EXHIBIT 10.1
***TEXT OMITTED AND FILED SEPARATELY
CONFIDENTIAL TREATMENT REQUESTED
UNDER 17 C.F.R. SECTIONS 200.80(b)(4),
200.83 AND 240.24b-2
SEPTEMBER 19, 2002
COLLABORATION AGREEMENT
BETWEEN
XXX XXXXX AND COMPANY
AND
AMYLIN PHARMACEUTICALS, INC.
COLLABORATION AGREEMENT
THIS COLLABORATION AGREEMENT (the "Agreement") is made and is effective
as of September 19, 2002 (the "Effective Date") between
Xxx Lilly and Company, a corporation organized and existing under the
laws of the State of Indiana, whose principal place of business is Lilly
Xxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx, 00000, Xxxxxx Xxxxxx of America
("Lilly"),
and
Amylin Pharmaceuticals, Inc., a corporation organized and existing
under the laws of Delaware, whose principal place of business is 0000 Xxxxx
Xxxxxx Xxxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxxxxxx 00000, Xxxxxx Xxxxxx of America
("Amylin").
RECITALS
A. Amylin is engaged in manufacturing, research and development
of pharmaceutical products and is currently engaged in the
development of the Compound for the Indication.
X. Xxxxx is engaged in the research, development, manufacture and
marketing of pharmaceutical products. Lilly and Amylin desire
to collaborate in the further clinical development and
marketing of Compound, upon the terms described in this
Agreement and the Related Agreements.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained, the parties hereby agree as follows:
ARTICLE 1
DEFINITIONS
When used and capitalized in this Agreement (other than the headings of
the Articles and Sections), including the foregoing recitals, the following
terms shall have the meanings assigned to them in this Article and include the
plural as well as the singular. All accounting terms not otherwise defined in
this Agreement, whether capitalized or not, shall have the meanings assigned to
them in accordance with generally accepted accounting principles as in effect in
the U.S. from time to time ("U.S. GAAP").
1.
1.1 "ADDITIONAL INDICATIONS" means all potential indications for
Compound other than the Indication.
1.2 "ADVERSE EVENT" (ALSO TERMED "ADVERSE DRUG EXPERIENCE") means any
adverse medical occurrence in a pre-clinical study, or in a patient or clinical
investigation subject administered a pharmaceutical product and that does not
necessarily have to have a causal relationship with any treatment, including as
designated under 21 C.F.R. 312.32 and any other Applicable Laws.
1.3 "ADVERSE EVENT REPORT" (also termed "Adverse Drug Experience
Report") means any oral, written or electronically transmitted report of any
Adverse Event or Adverse Drug Experience.
1.4 "AFFILIATE" means any Person that directly (or indirectly through
one or more intermediaries) controls, is controlled by, or is under common
control with a Party. For purposes of this definition only, the terms
"controls," "controlled," and "control" means (i) the direct or indirect ability
or power to direct or cause the direction of the management and policies of an
entity or otherwise direct the affairs of such entity, whether through ownership
of equity, voting securities, or beneficial interest, by contract, or otherwise,
or (ii) the ownership, directly or indirectly, of at least 50% of the voting
securities (or other comparable ownership interest for an entity other than a
corporation) of a Party.
1.5 "ALTERNATE DELIVERY" means a method for administration of Product
other than by means of intravenous, intramuscular or subcutaneous injection
(including injectable depot formulations), including but not limited to oral
administration, controlled or sustained release oral delivery, buccal delivery,
and pulmonary delivery.
1.6 "AMIGO TRIAL" means any of the three (3) Phase 3 Clinical Trials
under Amylin's protocols 2993-112, 2993-113 and 2993-115, respectively.
1.7 "AMYLIN CONFIDENTIAL INFORMATION" means all information
(scientific, clinical, regulatory, marketing, financial, commercial, or
otherwise) disclosed or provided by, or on behalf of, Amylin to Lilly or Lilly's
designees in connection with this Agreement, or the Related Agreements, whether
disclosed or provided prior to, or after, the Effective Date and whether
provided orally, visually, electronically, or in writing, except such
information that Lilly can show by its contemporaneous written records:
(a) was, prior to the date of Amylin's disclosure, known to it or
already in the public domain;
(b) became part of the public domain, after Amylin's disclosure
hereunder, through no breach of this Agreement by Lilly or by any person or
entity to whom Lilly disclosed such information;
(c) was subsequently disclosed to Lilly, without any restrictions,
by a person or entity having lawful possession of, and a legal right to
disclose, such information; or
2.
(d) was developed by Lilly without use, and independent, of Amylin
Confidential Information.
1.8 "AMYLIN KNOW-HOW" means all Information that Amylin Controls as of
the Effective Date or during the Term that is necessary or useful for the
Development, Manufacture, Commercialization, formulation, use, distribution or
sale of Compound or Product, including without limitation its formulation and
Manufacture and any Improvements. Amylin Know-How does not include Amylin
Patents or Neogenesis Patents, or know-how related to Neogenesis Patents.
1.9 "AMYLIN MARKS" has the meaning provided in Section 9.5(b).
1.10 "AMYLIN PATENTS" means all Patents Controlled by Amylin as of the
Effective Date or during the Term that are necessary or useful for the
Development, Manufacture, formulation, use, distribution or sale of Compound or
Product, including without limitation any such patents, claiming the composition
of matter or the use of Compound or Product or any Improvements, but excluding
the Neogenesis Patents.
1.11 "AMYLIN RIGHTS" means Amylin Patents and Amylin Know-How.
1.12 "APPLICABLE LAWS" mean all applicable statutes, ordinances,
regulations, rules, or orders of any kind whatsoever of any Governmental
Authority, including, without limitation, the Regulatory Laws, Prescription Drug
Marketing Act, Generic Drug Enforcement Act of 1992 (21 U.S.C. Section 335a et
seq.), and Anti-Kickback Statute (42 U.S.C. Section 1320a-7b et seq.), all as
amended from time to time.
1.13 "[...***...]" means a Development Budget or Commercialization
Budget that is intended to be binding upon the Parties. In the absence of a
downward adjustment approved by the JDC with respect to a Development Budget or
the JCC with respect to a Commercialization Budget, each Party agrees to use its
Commercially Reasonable Efforts to complete the activities contemplated by a
[...***...] and to do so within the amounts budgeted. The Parties acknowledge
that actual expenditures are likely to differ from budgeted amounts, and
accordingly agree that the aggregate amount actually spent by a Party may be up
to [...***...] than the amount specified in the [...***...]. In the event a
Party's expenditures in the aggregate exceed the amount budgeted in any
[...***...] by [...***...], the JDC or the JCC, as appropriate, shall determine
if such excess amount is reasonable under the circumstances. If the JDC or the
JCC, as appropriate, determines such excess amounts are reasonable, such amounts
shall be deemed Development Costs or Commercialization Costs, otherwise, the
excess shall be the responsibility of that Party.
1.14 "CALENDAR QUARTER" means the respective periods of three (3)
consecutive calendar months ending on March 31, June 30, September 30 and
December 31.
3. *CONFIDENTIAL TREATMENT REQUESTED
1.15 "CALENDAR YEAR" means each successive period of 12 months
commencing on January 1 and ending on December 31.
1.16 "CHANGE IN CONTROL" shall mean, with respect to either Party, any
of the following events: (i) the acquisition by any Major Pharmaceutical Company
of "beneficial ownership" (as defined in Rule 13d-3 under the United States
Securities and Exchange Act of 1934, as amended) directly or indirectly, of 50%
or more of the shares of such Party's capital stock, the holders of which have
general voting power under ordinary circumstances to elect at least a majority
of such Party's Board of Directors or equivalent body (the "Board of Directors")
(the "Voting Stock"); (ii) the approval by the shareholders of such Party of a
merger, share exchange, reorganization, consolidation or similar transaction of
such Party (a "Transaction"), if any party to the transaction is a Major
Pharmaceutical Company other than a Transaction which would result in the
beneficial owners of Voting Stock of such Party immediately prior thereto
continuing to beneficially own (either by such Voting Stock remaining
outstanding or being converted into voting securities of the surviving entity)
more than 50% of the Voting Stock of such Party or such surviving entity
immediately after such Transaction; or (iii) approval by the shareholders of
such Party of a complete liquidation of such Party or a sale or disposition of
all or substantially all of the assets of such Party.
1.17 "cGCP" shall mean the then current good clinical practices as
defined in U.S. Regulations 21 CFR Sections 50, 54, 56, 312 and 314, (or in the
case of foreign jurisdictions, comparable regulatory standards), and in any
successor regulation, including those procedures expressed or implied in the
Regulatory Materials with respect to the Product provided to Regulatory
Authorities.
1.18 "cGLP" means the then current good laboratory practice standards
promulgated or endorsed by the FDA (or in the case of foreign jurisdictions,
comparable regulatory standards), including those procedures expressed or
implied in the Regulatory Materials with respect to the Product provided to
Regulatory Authorities.
1.19 "cGMP" OR "GMP" means current good manufacturing practices for
pharmaceuticals as described in regulations promulgated by Regulatory
Authorities as applicable to the Manufacture of Product, as such regulations are
in effect at the time of Manufacturing Product.
1.20 "CLINICAL HOLD" means the FDA requires Amylin to stop, or Amylin
agrees to stop, dosing patients with Compound in all Amigo Trials, prior to
completion of the Amigo Trials in accordance with their protocols.
1.21 "COLLABORATION" shall have the meaning provided in Section 2.1.
1.22 "COMMERCIALIZATION" shall mean all activities undertaken before
and after Marketing Approval pursuant to an approved Commercialization Plan for
a Product or otherwise relating specifically to the marketing, sale and
distribution of Products including, without limitation, (i) sales force
detailing, advertising, education, planning, marketing, sales force training and
distribution, (ii) scientific and medical affairs; (iii)
4.
Phase 3B Clinical Trials and Phase 4 Clinical Trials; and (iv) the Manufacture
of Product intended for commercial sale, including, without limitation,
formulation, bulk production, fill/finish, manufacturing process development,
and manufacturing and quality assurance technical support.
1.23 "COMMERCIALIZATION BUDGET" means the budget for Commercialization
activities that is included within each Commercialization Plan, as such budget
may be amended or updated from time to time in accordance with Section 2.6. The
Commercialization Budget shall be updated on a yearly basis.
1.24 "COMMERCIALIZATION COSTS" means those costs and expenses incurred
by a Party or for its account in the Commercialization of Product consistent
with the Commercialization Plan, calculated in accordance with Section 4.4.
1.25 "COMMERCIALIZATION PLAN" means a written rolling three-year plan
for the Commercialization of Product, including a budget for such activities, as
such plan may be amended or updated from time to time in accordance with Section
2.6. The initial commercialization plan has been agreed upon by the parties in
writing concurrently herewith.
1.26 "COMMERCIALIZATION PROGRAM" means the activities undertaken by
Amylin and Lilly as set forth in the Commercialization Plan.
1.27 "COMMERCIALLY REASONABLE EFFORTS" shall mean efforts, expertise
and resources normally used by the Party for a product or compound owned by it
or to which it has rights, which is of similar market potential at a similar
stage in its development or product life, taking into account issues of safety,
and efficacy, product profile, difficulty in developing the product,
competitiveness of the marketplace for resulting products, the proprietary
position of the compound or product, the regulatory structure involved, the
potential total profitability of the applicable products marketed or to be
marketed, and other relevant factors affecting the cost, risk and timing of
development and the total potential reward to be obtained if a product is
commercialized. In determining whether Commercially Reasonable Efforts were
satisfied, the fact that a Party is required to share profits with the other
Party shall not be a factor weighed (i.e., a Party may not apply lesser
resources or effort to the Product because it must share the profits or revenues
from sales of the Product with the other Party). Further, if a Party is
[...***...], Commercially Reasonable Efforts shall mean that such Party shall
not unreasonably [...***...], and shall instead devote [...***...] effort in
support of the Product [...***...].
1.28 "COMPOUND" means exendin-4 having the molecular structure set
forth in ATTACHMENT 1.28 HERETO.
1.29 "CONFIDENTIAL INFORMATION" means the Amylin Confidential
Information or the Lilly Confidential Information, as applicable.
5. *CONFIDENTIAL TREATMENT REQUESTED
1.30 "CONTROL" or "CONTROLLED" means with respect to any intellectual
property right, that the Party owns or has a license to such intellectual
property right and has the ability to grant access, a license, or a sublicense
to such intellectual property right to the other Party as provided for in this
Agreement without violating an agreement with, or infringing any rights of, a
Third Person as of the time such person would be first required under this
Agreement to grant the other person such access, license or sublicense.
1.31 "CO-PROMOTE" OR "CO-PROMOTION" has the meaning provided in the
Co-Promotion Agreement included within the Related Agreements.
1.32 "CO-PROMOTION TERRITORY" has the meaning provided in the
Co-Promotion Agreement.
1.33 "COST OF PRODUCT SOLD" means, for so long as the Collaboration
utilizes primarily Third Parties for the Manufacture of Compound and Product,
those costs incurred for the acquisition of Compound or Product from Third Party
manufacturer(s) including all activities necessary for conversion into salable
Product. The Cost of Product Sold shall be evidenced by Third Party invoices for
Product supplied to the Parties and converted into salable Product. Also, the
reasonable internal or Third Party costs for distribution expenses including,
but not limited to, transportation costs, warehousing costs, and customer
service costs associated with the manufacturing and distribution of the Product
are included in the Cost of Product Sold. In addition, royalties paid to Third
Parties related to the sale of the Product shall be included in the Cost of
Product Sold. If one of the Parties desires to manufacture Compound or Product,
the Parties shall negotiate in good faith the terms of such arrangements,
including any necessary changes to this definition.
1.34 "DEVELOPMENT" means the conduct of all activities that are
reasonably required to obtain Marketing Approval of Product, including: (i)
toxicology, regulatory affairs, pre-clinical studies and clinical trials
(excluding Phase 3B Clinical Trials and Phase 4 Clinical Trials) in accordance
with the cGLPs, cGCPs and cGMPs or other designated quality standards and
Applicable Laws; and (ii) all activities relating to developing the ability to
Manufacture Compound and Product, including, without limitation, formulation,
delivery technologies and devices, bulk production, fill/finish, Manufacturing
process development, and Manufacturing and quality assurance technical support,
until such time as Manufacturing of Product intended for commercial sale
commences.
1.35 "DEVELOPMENT BUDGET" means the budget for Development activities
that is included within each Development Plan, as such budget may be amended or
updated from time to time in accordance with Section 2.2.
1.36 "DEVELOPMENT COSTS" means those costs and expenses incurred by a
Party or for its account in the Development of Product consistent with the
Development Plan, calculated in accordance with Section 4.3. Development Costs
include those costs incurred for FTEs and Product specific Third Party costs.
Product specific Third
6.
Party costs include, but are not limited to, [...***...]
1.37 "DEVELOPMENT PLAN" means a written rolling three-year plan for the
Development of Product, including a budget for such activities, as such plan may
be amended or updated from time to time in accordance with Section 2.2. The
initial Development Plan has been agreed upon by the Parties in writing
concurrently herewith.
1.38 "DEVELOPMENT PROGRAM" means the activities undertaken by Amylin
and Lilly as set forth in the Development Plan.
1.39 "DMF" shall mean a drug master file (as such term is defined in 21
C.F.R. Part 314.420) for Product, or the comparable file required by any
Regulatory Authority in a country or jurisdiction outside the U.S.
1.40 "EARLY TERMINATION DATE" means the date on which Lilly receives
the full statistical data on the results of the Amigo Trials in accordance with
the statistical plan agreed to by the Parties.
1.41 "EC APPROVAL" means approval of a Product for marketing in the
European Union by the European Commission ("EC") upon recommendation by the EMEA
or, if Lilly seeks approval through mutual recognition therein, by the Ministry
of Health of the United Kingdom, France, Germany, Italy or Spain (each a "Major
European Country"), without the requirement for price having been approved. If a
Product is sold in a Major European Country without EC or Ministry of Health
approval, EC Approval will be deemed to have been obtained on the date of
Product Launch in a Major European Country.
1.42 "EMEA" means the European Medicines Evaluation Agency for the
European Union, or a successor agency, which has jurisdiction over Marketing
Approval of a pharmaceutical product or device in the European Union.
1.43 "EXCEPTED COMMERCIALIZATION MATTERS" has the meaning provided in
Section 3.1(e).
1.44 "EXCEPTED DEVELOPMENT MATTERS" has the meaning provided in Section
3.1(e).
1.45 "FDA" means the U.S. Food and Drug Administration, or any
successor federal agency having responsibility over U.S. Marketing Approvals.
7. *CONFIDENTIAL TREATMENT REQUESTED
1.46 "FD&C ACT" means the U.S. Food, Drug and Cosmetic Act, as amended
from time to time (21 U.S.C. Section 301 et seq.), together with any rules and
regulations promulgated thereunder.
1.47 "FIELD" means prevention and treatment of all human and animal
diseases and disorders.
1.48 "FTE" means the equivalent of the scientific or technical work of
one (1) employee full time for one (1) year (consisting of at least a total of
1800 hours per year) of work on or directly related to the Development or
Commercialization of Products, or any other activities contemplated under this
Agreement, carried out by a qualified employee. A qualified employee is any
individual, regardless of level within the organization, that is directly
associated with the Development or Commercialization of the Product, including
Phase 3B Clinical Trials and Phase 4 Clinical Trials. Time incurred by these
qualified employees specifically related to the direct Development or
Commercialization of the Product is reimbursable. Scientific or technical work
can include, but is not limited to, experimental laboratory work, developing
manufacturing processes for Product, conducting other Development activities
relating to Product, recording and writing up results, reviewing literature and
references and holding scientific discussions, and attending conferences in the
field. Time incurred by employees not related to scientific or technical work
(e.g., Sales Force Efforts) and time not spent directly on the Product is not
eligible for reimbursement by this Agreement. No additional payment shall be
made with respect to any person who works more than 1800 hours per year, and any
person who devotes less than 1800 hours per year of reimbursable time shall be
treated on a pro-rata basis based upon the actual number of reimbursable hours
divided by 1800.
1.49 "FTE RATE" means the rate (which shall be the same U.S. dollar
amount for both Parties) for which each Party will charge for its eligible FTEs
devoted to Development and, in certain circumstances, Commercialization of the
Product under this Agreement. For the period ending December 31, 2003, the rate
shall be [...***...]. The FTE Rate shall be adjusted annually as of January 1
beginning with January 1, 2004, in accordance with the annual percentage change
in the [...***...], except as otherwise mutually agreed by the Parties. The
intent of the FTE Rate is to represent a fully loaded rate that includes, but is
not limited to the following general expense categories: salaries and wages
(including overtime compensation, all bonuses, moving expenses, and payroll
taxes), benefits provided to FTEs (including health benefits, defined
contribution, defined benefit plans, vacations, etc.), direct employee costs
(including recruitment costs, internal and external training costs, computer
charges, automobile leases, travel expenses, subscriptions and reference
materials, telephone, fax, cellular phone, and copy machines and related costs),
and allocation of costs for those additional activities that support the
Development or Commercialization of the Product (including rent, insurance, and
utilities). The Commercialization expenses to be reimbursed through the FTE Rate
shall include only
8. *CONFIDENTIAL TREATMENT REQUESTED
those services of employees that are primarily scientific or technical in
nature, such as medical and regulatory personnel involved in the conduct of
Phase 3B and Phase 4 Clinical Trials. The FTE Rate is not intended to include
any Sales Force Costs.
1.50 "GEO OPEX" means the amount spent by Amylin or Lilly with Third
Parties for Product samples (including performance or trial scripts),
promotional materials, and promotional activities to promote the Product in the
Territory.
1.51 "GOVERNMENTAL AUTHORITY" means any court tribunal, arbitrator,
agency, commission, official or other instrumentality of any federal, state, or
other political subdivision, or supranational body, domestic or foreign.
1.52 "GROUP" shall mean a group of related Persons deemed a "person"
for purposes of Section 13(d) of the Securities Exchange Act of 1934, as
amended.
1.53 "IMPROVEMENT" means any findings, developments, discoveries,
inventions, additions, modifications, enhancements, formulations, or changes to
the composition of matter, or method of use of, Compound or Product, or their
Manufacture made by, or coming under Control of a Party or any of its Affiliates
or Sublicensees during the Term which are necessary or useful in the
Development, Manufacture, or Commercialization of Compound or Product, including
without limitation, new or improved methods of synthesis, manufacture,
ingredients, preparation, presentation, means of delivery, dosage, formulation,
or analysis, whether or not patentable.
1.54 "IND" means an Investigational New Drug Application (together with
all additions, deletions, and supplements thereto) filed with the FDA.
1.55 "INDICATION" means the prevention and treatment of diabetes and/or
obesity through any dosage form of a pharmaceutical product for humans.
1.56 "INFORMATION" means any information (including technology to
reduce immunogenicity) Controlled by either Party during the Term that is
necessary or useful for the Development, Commercialization or Manufacture of
Compound or Product. Information may include, but is not limited to, (a) any and
all inventions, know-how, developments, Improvements, materials, data, analyses,
and the like, regardless of whether the information is stored or transmitted in
oral, documentary, or electronic form and (b) information relating to research
and development plans, experiments, results, compounds, therapeutic leads,
candidates and products, clinical and preclinical data, trade secrets and
Manufacturing, marketing, financial, regulatory, personnel and other business
information and plans, and all scientific, clinical, regulatory, marketing,
financial and commercial information or data; in each case, to the extent
necessary or useful for the Development, Commercialization or Manufacture of
Compound or Product.
1.57 "IP SUBCOMMITTEE" has the meaning provided in Section 3.1 hereof.
1.58 "JOINT COMMERCIALIZATION COMMITTEE" OR "JCC" has the meaning
provided in Section 3.3.
9.
1.59 "JOINT DEVELOPMENT COMMITTEE" OR "JDC" has the meaning provided in
Section 3.2.
1.60 "JOINT IMPROVEMENTS" has the meaning provided in Section 10.1(c).
1.61 "JOINT PATENTS" has the meaning provided in Section 10.2.
1.62 "JOINT QUALITY SUBCOMMITTEE" OR "JQS" has the meaning provided in
Section 3.2 hereof.
1.63 "LILLY CONFIDENTIAL INFORMATION" means all information
(scientific, clinical, regulatory, marketing, financial, commercial, or
otherwise) disclosed or provided by, or on behalf of, Lilly to Amylin or
Amylin's designees in connection with this Agreement, or the Related Agreements
whether disclosed or provided prior to, or after, the Effective Date and whether
provided orally, visually, electronically, or in writing, except such
information that Amylin can show by its contemporaneous written records:
(a) was, prior to the date of Lilly's disclosure, known to it or
already in the public domain;
(b) became part of the public domain, after Lilly's disclosure
hereunder, through no breach of this Agreement by Amylin or by any person or
entity to whom Amylin disclosed such information;
(c) was subsequently disclosed to Amylin, without any restrictions,
by a person or entity having lawful possession of, and a legal right to
disclose, such information; or
(d) was developed by Amylin without use, and independent, of Lilly
Confidential Information.
1.64 "LILLY KNOW-HOW" means all Information that Lilly Controls as of
the Effective Date or during the Term that is necessary or useful for the
Development, Manufacture, Commercialization, formulation, use, distribution or
sale of Compound or Product, including without limitation its formulation and
Manufacture and any Improvements. Lilly Know-How does not include Lilly Patents.
1.65 "XXXXX XXXXX" has the meaning provided in Section 9.5(b).
1.66 "LILLY PATENTS" means all Patents Controlled by Lilly as of the
Effective Date or during the Term that are necessary or useful for the
Development, Manufacture, formulation, use, distribution or sale of Compound or
Product, including without limitation any such Patents claiming the composition
of matter or the use of Compound or Product or any Improvements.
1.67 "LILLY POLICY COMMITTEE" means the most senior executive committee
at Lilly that sets overall business policy for Lilly or any successor committee.
10.
1.68 "LILLY RIGHTS" means Lilly Patents and Lilly Know-How.
1.69 "MAJOR MARKET" means any of the following jurisdictions: United
States, United Kingdom, France, Germany, Italy, Spain or Japan.
1.70 "MAJOR PHARMACEUTICAL COMPANY" means any Person who, during the
immediately preceding fiscal year, had [...***...], excluding Lilly and any of
its successors or assigns. Beginning with January 1, 2004, the [...***...]
threshold described above shall be increased or decreased by [...***...]
1.71 "MANUFACTURE" OR "MANUFACTURING" OR "MANUFACTURED" means all
operations involved in the manufacturing, quality control testing (including
in-process, release and stability testing, if applicable), releasing, packaging
and shipping the Product.
1.72 "MARKETING APPROVAL" means the act of a Regulatory Authority
necessary for the manufacture, marketing and sale of the Product for one or more
Indications or Additional Indications in a country or regulatory jurisdiction,
including, without limitation, the approval of the NDA by the FDA, and EC
Approval and satisfaction of all applicable regulatory and notification
requirements and the grant of Pricing Approval.
1.73 "MARKS" has the meaning provided in Section 9.5(b).
1.74 "MEDICAL INQUIRY" means an unsolicited request from a health care
professional for additional information concerning Product.
1.75 "NDA" means the single application or set of applications (and any
other required registrations, notifications, forms or supplements) for a Product
and/or pre-market approval to make and sell commercially a Product, filed with
the FDA or with a Regulatory Authority anywhere in the Territory.
1.76 "NEOGENESIS PATENTS" means, to the extent Controlled by Amylin,
those patents described in Attachment 1.76 and their related Patents.
1.77 "NET SALES" shall mean, with respect to a Product, the gross
amount invoiced for sales of Product by a Party, its Affiliates and Sublicensees
to Third Persons (excluding Sublicensees) in the Territory, less:
(a) trade, quantity and cash discounts and rebates and retroactive
price reductions or allowances actually allowed or granted from the billed
amount;
(b) credits or allowances actually granted upon claims, rejections
or returns of such sales of Products, including recalls;
11. *CONFIDENTIAL TREATMENT REQUESTED
(c) taxes imposed on the production, sale, delivery or use of the
Product (including, without limitation, sales, use, excise or value added taxes
but excluding income taxes), duties or other governmental charges levied on or
measured by the billing amount when included in billing, as adjusted for rebates
and refunds; and
(d) a provision for uncollectible accounts determined in accordance
with such Party's normal accounting procedures consistently applied within and
across its pharmaceutical operating units, provided that such provision for
uncollectible accounts shall not exceed [...***...] of the amount invoiced.
Such amounts shall be determined from the books and records of the
applicable Party maintained in accordance with U.S. GAAP consistently applied.
Each Party further agrees that in determining such amounts, it will use such
Party's then current standard procedures and methodology, including such Party's
then current standard exchange rate methodology for the translation of foreign
currency sales into U.S. Dollars.
1.78 "OPERATING PROFITS OR LOSSES" has the meaning provided in Section
4.5.
1.79 "OPTION COMPOUND" means any Tier 1 Compound or any Tier 2
Compound.
1.80 "OPTION PERIOD" means, for any Option Compound:
(i) The period from the [...***...] until [...***...], with
respect to any Option Compound for which the first patient
has been enrolled in a [...***...] before [...***...], and
(ii) The period from the [...***...] until [...***...], with
respect to any Option Compound for which the Product Decision
Date had been reached before [...***...].
1.81 "PARTY" or "PARTIES" means Amylin and/or Lilly.
1.82 "PATENT" or "PATENTS" means (a) patents and patent applications
(including provisional applications and applications for certificates of
invention); (b) any patents issuing from such patent applications (including
certificates of invention); (c) all patents and patent applications based on,
corresponding to, or claiming the priority date(s) of any of the foregoing; (d)
any reissues, substitutions, confirmations, registrations, validations,
re-examinations, additions, continuations, continued prosecution applications,
continuations-in-part, or divisions of or to any of the foregoing; and (e) term
extensions, supplementary protection certificates and other governmental action
which provide exclusive rights to a Product beyond the original patent
expiration date.
12. *CONFIDENTIAL TREATMENT REQUESTED
1.83 "PATENT EXPENSE" means all costs and expenses incurred by a Party
for preparation, filing, prosecution and maintenance of an Amylin Patent, Lilly
Patent or Joint Patent, as applicable.
1.84 "PERSON" means a natural person, a corporation, a partnership, a
trust, a joint venture, a limited liability company, any governmental authority
or any other entity or organization.
1.85 "PHASE 1 CLINICAL TRIALS" means human clinical trials conducted
anywhere in the world in accordance with cGCP in a small number of healthy
volunteers or patients intended to establish an initial safety profile and the
pharmacokinetics and/or pharmacodynamics of a Product.
1.86 "PHASE 2 CLINICAL TRIALS" means human clinical trials conducted in
patients with a Product anywhere in the world in accordance with cGCP and
intended to demonstrate efficacy and a level of safety in the particular
indication tested, as well as to obtain a preliminary indication of the unit
and/or daily dosage regimen required.
1.87 "PHASE 3 CLINICAL TRIALS" means large scale human clinical trials
conducted in patients anywhere in the world in accordance with cGCP and intended
to demonstrate efficacy and a level of safety in the particular indication
tested sufficient to obtain Marketing Approval of Product. Phase 3 Clinical
Trials include "bridging studies" which allow submission in a target country of
clinical data generated from Phase 3 studies completed in other countries to be
submitted in lieu of repeating Phase 3 studies in the target country.
1.88 "PHASE 3B CLINICAL TRIALS" shall mean Phase 3 Clinical Trials
commenced before receipt of Marketing Approval in the jurisdiction where such
trials are being conducted, but which are not required for receipt of Marketing
Approval and are conducted primarily for the purpose of Product support (i.e.,
providing additional drug profile data).
1.89 "PHASE 4 CLINICAL TRIALS" means all clinical trials which are
conducted after Approval of Product has been obtained from an appropriate
Regulatory Authority comprising of trials conducted voluntarily by one or both
of the Parties for enhancing marketing or scientific knowledge of an approved
Indication and trials conducted due to request or requirement of a Regulatory
Authority.
1.90 "PRICING APPROVAL" means such approval or agreement or
determination or governmental decision establishing prices for Product that can
be charged to consumers and will be reimbursed by Governmental Authorities in
countries in the Territory where Governmental Authorities or Regulatory
Authorities of such country approve or determine pricing for pharmaceutical
products for reimbursement or otherwise.
1.91 "PRODUCT" means a pharmaceutical product that contains or
incorporates Compound, whether in development or approved by any Regulatory
Authority, including
13.
all formulations, line extensions and modes of administration (including,
without limitation, all delivery devices or other peripherals and consumables).
1.92 "PRODUCT COMPLAINT" means any written, verbal, or electronic
expression of dissatisfaction regarding Product including, but not limited to,
actual or suspected product tampering, contamination, mislabeling, or wrong
ingredients.
1.93 "PRODUCT DECISION DATE" means the date on which a Party makes the
determination, in accordance with its usual internal decision making processes
and [...***...] for a pharmaceutical product.
1.94 "PRODUCT LAUNCH" shall mean the date on which Product is first
shipped in commercial quantities by a Party, its Affiliate or Sublicensee for
commercial sale to Third Persons in the Territory (not Affiliates or
Sublicensees) following Marketing Approval of Product, including, if applicable,
any necessary Pricing Approval.
1.95 "PRODUCT TRADEMARKS" has the meaning provided in Section 9.5(a).
1.96 "PROMOTIONAL MATERIALS" means any printed or other materials
bearing a Product name (trade name or generic name) used to promote Product,
(examples include, but are not limited to, all promotional brochures, journal
ads, brochures, selling aids, posters, reprints, video or audio tapes, press
releases, service items, managed care pull through sheets, formulary
presentations, price lists, monographs, Internet pages and websites, and
telephone, radio or television advertisements) and materials produced by outside
sources (examples include, but are not limited to, medical reprints, textbooks
and CME materials) to the extent funded by, created in cooperation with,
reviewed by or distributed by a Party, and any other items defined as labeling
or advertising in Section 201(m) of the FD&C Act or 21 CFR Section 202.1(l)(1)
(as such sections may be amended from time to time). "Promotional Materials"
shall also be deemed to include any advertising and promotional labeling bearing
the Parties' names but not bearing a Product name (examples include "coming
soon" or "reminder" advertisements) that may be used prior to obtaining
Marketing Approval to market, sell and distribute the Product to promote only
the Indication(s) or Additional Indications of the Product.
1.97 "REGULATORY AUTHORITY" means, in a particular country or
jurisdiction, any applicable government regulatory authority involved in
granting Marketing Approval and/or, to the extent required in such country or
jurisdiction, Pricing Approval of Product in such country or jurisdiction,
including without limitation, (a) in the U.S., the FDA, and any other applicable
governmental or regulatory authority in the U.S. having jurisdiction over the
Product, and any successor government authority having substantially the same
function, and (b) any foreign equivalent thereof.
1.98 "REGULATORY LAW" means the FD&C Act, together with any rules and
regulations promulgated thereunder. "Regulatory Law" shall also mean any
applicable statutes, ordinances, regulations, rules or orders of any kind
whatsoever of any
14. *CONFIDENTIAL TREATMENT REQUESTED
Governmental Authority governing the import, export, manufacture or distribution
of Product (including, without limitation, Marketing Approval of Product) or
reporting obligations with respect to Product Complaints or Adverse Events
related to Product, together with any rules and regulations promulgated
thereunder.
1.99 "REGULATORY MATERIALS" means any regulatory submissions,
notifications, registrations, approvals and/or other filings made to or with
Regulatory Authority that may be necessary or reasonably desirable to develop,
manufacture, market, sell or otherwise commercialize Product in the Territory.
1.100 "REIMBURSABLE MARKETING EXPENSES" means all Sales Force Costs and
all other costs and expenses incurred by a Party that are consistent with the
Commercialization Plan and Commercialization Budget and specifically
attributable or related to the Commercialization of Product. Internal costs of
either Party in the U.S. shall not be Reimbursable Marketing Expenses. Should
one of the Parties be materially adversely impacted by not sharing these
internal costs, that Party shall have a right to present a proposal to the JCC
to share future internal marketing direct FTE and medical liaison costs in the
U.S. FTEs involved in conducting Phase 3B and Phase 4 studies are reimbursable
at the FTE Rate. Lilly's internal marketing costs outside the U.S., including
headcount, shall be reimbursed in accordance with Lilly's standard cost
accounting procedures. Lilly shall ensure that costs are not unfairly allocated
to the Product and that headcount shall be allocated based upon actual time
spent on the Product similar to the procedures specified in Section 1.48. Third
Party marketing expenses eligible for reimbursement by the Parties include,
without limitation, the following expenses: (i) medical support for marketing
and product team matters, including support for investigator initiated studies;
(ii) expenses associated with the Product launch meeting; (iii) Promotional
Materials, including but not limited to, those materials used for training of
sales representatives and for communication with thought leaders, targeted
professionals or other Persons including, without limitation, Geo Opex costs,
and external expenses associated with distribution of Promotional Materials to
the individual Parties' warehouses, (iv) advertising agency fees and media
production; (v) development and creation of scientific communications,
publications, journal and magazine advertisements and supplements; (vi) health
economics studies and activities; (vii) patient marketing activities; (viii)
market research and competitive intelligence projects; (ix) public relations and
community relations related to Product; (x) consultantships; (xi) "peer to peer"
activities such as continuing medical education, speaker training, consultants
and advisory boards; (xii) symposia, conferences, trade shows and conventions,
convention donations, convention exhibits, grants, educational materials,
compassionate use product, indigent programs and other Product donations; (xiii)
pricing research and pricing development; (xiv) thought leader, patient and/or
physician web-based communication activities and programs, along with internet
and website development -- both content and actual site administration and
updates; (xv) the risk management plan for Product, (xvi) customer service
initiatives including, but not limited to a customer call center; (xvii) drug
distribution data; and (xviii) other promotion-related activities. Expenses of
the type described above that are incurred internally and not through Third
Parties shall not be Reimbursable Marketing Expenses unless they constitute
Sales Force Costs. It is anticipated that over time the level of internal
15.
expenses incurred by each Party will be approximately equal. In the event such
internal expenses are not approximately equal over time, the Parties shall
negotiate in good faith appropriate charges to this Agreement in order to
equalize such expenses.
1.101 "RELATED AGREEMENTS" means the Co-Promotion Agreement, Stock
Purchase Agreement, Milestone Conversion Agreement, Registration Rights
Agreement, and Loan Agreement entered into by the Parties contemporaneously with
this Agreement.
1.102 "SALES FORCE COSTS" include costs associated with sales force
promotion, including, but are not limited to, direct costs such as (i) sales
representative compensation and benefits, (ii) incentives, (iii) training, (iv)
travel, (v) meetings, (vi) telecommunications, (vii) automobiles, (viii) office
rental and administrative support, (ix) sales force operations including, but
not limited to, sales force incentives and metrics, strategy and planning, and
analytics, and allocated costs such as (A) information technology including, but
not limited to, software associated sales force automation tools, related help
desk support, related software maintenance, field hardware, and samples cards,
(B) functional support such as human resources, legal, financial,
communications, compliance, (C) eBusiness initiatives, and (D) other
administrative costs such as moving expenses, nominal sales representative spend
for lunches, entertainment, etc.
1.103 "SALES FORCE EFFORTS" means the face-to-face contact by either a
Lilly or an Amylin sales representative with a targeted professional or other
medical professional with prescribing authority which involves a Product
presentation and is performed with a view to increase prescribing preferences
for the Products. The Parties will share in the costs of these Sales Force
Efforts in compliance with Section 4.6.
1.104 "SERIOUS ADVERSE EVENT REPORT means any Adverse Event Report that
involves an Adverse Event that is fatal or life-threatening, a persistent or
significant disability/incapacity, requires in-patient hospitalization or
prolongation of existing hospitalization, or is a congenital anomaly/birth
defect, or any other medically important event that can be regarded as serious,
even though it does not meet any of the above criteria.
1.105 "SR PRODUCT" means a sustained release injectable Product
formulation [...***...].
1.106 "STEERING COMMITTEE" OR "JSC" has the meaning provided in Section
3.1.
1.107 "SUBLICENSEE" means any Third Person (including, without
limitation, a distributor) to which a Party or any of its Affiliates grants any
right to make, use, market, or import and sell a Product in accordance with
Section 9.2. A Third Person who is granted only the right to distribute or
promote a Product (such as a contract sales organization) will not be considered
a Sublicensee.
16. *CONFIDENTIAL TREATMENT REQUESTED
1.108 "TERM" has the meaning provided in Section 12.1.
1.109 "TERRITORY" means all countries of the world.
1.110 "THIRD PARTY" OR "THIRD PERSON" means any Person other than
Amylin or Lilly and their respective Affiliates.
1.111 "TIER 1 COMPOUND" means any compound listed in ATTACHMENT 1.111.
1.112 "TIER 2 COMPOUND" means any compound listed in ATTACHMENT 1.112.
1.113 "TREATED SUBJECT" means a study patient participating in an Amigo
Trial or in a Phase 3 Clinical Trial of an SR Product who has been administered
Product.
1.114 "U.S." means the United States of America, including its
territories and possessions.
ARTICLE 2
COLLABORATION; DEVELOPMENT AND
COMMERCIALIZATION PROGRAMS
2.1 PURPOSE AND SCOPE OF COLLABORATION.
In accordance with the terms described herein, the Parties agree to collaborate
on an exclusive basis in the Development and Commercialization of Product in the
Field (the "COLLABORATION"). The Development obligations of each Party, and
budget for Development activities, will be set forth in the Development Plan.
The Co-Promotion obligations of the Parties and their respective rights as to
certain other matters will be set forth in the Related Agreements. The Parties
agree at all times to act in good faith and in a cooperative manner, to share
all information reasonably necessary to facilitate each Party's performance of
its obligations hereunder, and to use reasonable efforts to reach consensus on
decisions contemplated under this Agreement. The Commercialization obligations
of each Party, and budget for Commercialization activities, will be set forth in
the Commercialization Plan.
2.2 DEVELOPMENT PROGRAM.
(a) DEVELOPMENT EFFORTS. Each Party will use Commercially Reasonable
Efforts to conduct Development of the Product for the Indication in accordance
with the Development Plan and to bring Product to market as soon as practicable
on a worldwide basis. Amylin shall have primary responsibility for Development
of the Product in the U.S., and Lilly shall have primary responsibility for
Development of the Product outside the U.S. All Development activities shall be
conducted under the direction and oversight of the Steering Committee and the
Joint Development Committee with coordination with the JCC as appropriate. Lilly
and Amylin will provide financial and other support for Development of the
Product as provided in this
17.
Agreement and in the Development Plan. Each Party shall provide consultation and
advice to the other Party in furtherance of the Development Plan through its
participation on the Steering Committee and the Joint Development Committee as
described in Article 3.
(b) DEVELOPMENT PLAN.
(i) The Joint Development Committee shall prepare and oversee the
implementation of an overall clinical development plan for
the Product that will be set forth in the Development Plan.
The Development Plan shall describe fully the ongoing and
proposed preclinical studies, toxicology work, clinical
trials, regulatory plans, clinical trial material
requirements, specifications and other key elements of
obtaining Marketing Approval (i) in all Major Markets and
(ii) in each country in the Territory outside of the Major
Markets that is determined by the JCC to be feasible and
commercially attractive for marketing of the Product. The
Joint Development Committee will also prepare and oversee the
implementation of an overall clinical development plan for
any Additional Indications or Alternate Delivery of Product
that the JDC (or, if Section 3.1(e)(i) (B) is applicable, the
Parties) may agree to pursue. The Development Plan, including
updates and amendments, shall be reviewed and approved by the
JDC in accordance with Article 3. The JDC shall coordinate
with the JCC to ensure that Development Plans, particularly
efforts directed to countries outside the U.S., appropriately
support Commercialization efforts.
(ii) The Development Plan covering Development through
[...***...], including the Development Budget (that includes
"Low", "Medium" and "High" budget points), has been prepared
and agreed to concurrently herewith by the Parties. The
Development Budget for [...***...]. The Development Budget
for [...***...]. The Development Budget for [...***...]. The
Parties acknowledge that Development Plans and Development
Budgets do not necessarily include all activities or expenses
that may be necessary or desirable for the Development of
Products hereunder, nor will they necessarily contemplate
developments, either positive or negative, (for example,
unforeseen FDA requests, competitive opportunities,
enrollment delays, etc.) that should be taken into account as
determined by the JDC. Accordingly, the Parties expect to
update and amend Development Plans and Development Budgets
from time to time during the Term as appropriate to reflect
these
18. *CONFIDENTIAL TREATMENT REQUESTED
changes and accomplish the objectives of the Collaboration as
determined by the JDC.
(iii) On an annual basis, the Parties shall update and amend the
three year Development Plan and Development Budget no later
than [...***...] (except that the first annual update for
Calendar Years 2003 -- 2005 shall not be due until
[...***...]), which updates shall cover the ensuing three
Calendar Years including a quarterly plan for the first year
of the period. The [...***...] three year plan approved by
the Parties shall be [...***...]. The [...***...] three year
plan [...***...]. The [...***...] will be [...***...]. At
least [...***...] Lilly and Amylin will review the existing
three year plan in order to update at least the [...***...]
of the forecast to reflect significant changes to the
operating assumptions. This [...***...] rolling forecast will
serve as the basis for the construction of the [...***...] in
[...***...]. In the event the Parties cannot agree on a
[...***...] for [...***...], the Parties agree that
[...***...] the agreed upon amount of the Development Budget
[...***...] until a final Budget can be established. Each
Development Plan shall describe the proposed overall program
of Development of Products. In addition, the Development Plan
shall include a detailed Development Budget which shall
include estimated headcount and other resource allocations by
the Parties for all Development activities proposed for the
following three Calendar Years or for such longer period as
the JDC may determine.
(iv) If either Party fails to meet its financial obligations under
any Binding Development Budget, then the other Party shall be
entitled at its election either (a) to reduce the amount of
its spending proportionately, (b) elect to maintain its
spending at the budgeted level or (c) to increase its
spending by an amount necessary to compensate for the amount
not spent by the other Party. If the Party elects to maintain
or increase its level of expenditure, it shall be entitled to
reimbursement by the other Party of an amount equal to
[...***...] of its spending over the spending of the other
Party, plus a surcharge of [...***...] of such amount. If a
Product is then being marketed, and if the Party entitled to
compensation so requests, the JSC shall within thirty (30)
days of such request agree upon an appropriate adjustment to
the division of profits and losses between the Parties
sufficient to permit the Party to recover all amounts due it
within six (6) months.
19. *CONFIDENTIAL TREATMENT REQUESTED
(v) In the preparation of the Development Plan and Budget, the
Parties shall endeavor when reasonable to conform their
effort to the timing and methods used by Lilly in its
internal planning processes. With respect to issues related
to Product Development outside of the U.S. and without
limiting any rights of any Party or the JDC, it is the
Parties' intent that JDC review will generally be at a
strategic rather than operational level.
(vi) Within [...***...] of the Effective Date, Lilly shall provide
Amylin with a detailed written assessment of the feasibility
of Product Development and Commercialization [...***...],
including the Development activities and related estimated
budgets that would be applicable should the Parties decide to
proceed. Such plan shall contain information comparable to
that required in the Development Plan and the
Commercialization Plan. The JDC shall then make a
determination regarding the feasibility and timing of
activities [...***...]. If the JDC approves, the Development
plan [...***...] shall become part of the Development Plan,
and upon approval by the JCC, the Commercialization plan
[...***...] shall become part of the Commercialization Plan.
Lilly shall thereafter promptly use Commercially Reasonable
Efforts to conduct the Development and Commercialization of
the Product [...***...].
(c) DECISIONS. The parties will endeavor to reach a consensus with
respect to amendments to the Development Plan through the Joint Development
Committee and the Steering Committee, with disputes resolved in accordance with
the procedures set forth in Article 3.
2.3 SR PRODUCT DEVELOPMENT EFFORTS. The Development Plan prepared concurrently
with the execution of this Agreement contemplates significant Development
activities with respect to a SR Product. Unless otherwise agreed by the Parties,
[...***...], nor shall either Party [...***...]. No clinical trials with respect
to a SR Product [...***...] referenced in the preceding sentence, shall be
initiated as part of the Collaboration without the agreement of the Parties to
proceed, and development of agreed critical success factors for the clinical
trial.
2.4 ROLES AND RESPONSIBILITIES OF AMYLIN AND LILLY IN DEVELOPMENT.
(a) LILLY'S RESPONSIBILITIES.
(i) The activities to be undertaken by Lilly in the course of the
Development Program are set forth in the Development Plan, as amended from time
to time by the Joint Development Committee and approved by the Steering
Committee.
20. *CONFIDENTIAL TREATMENT REQUESTED
Lilly will use Commercially Reasonable Efforts, as provided in the Development
Plan, to develop and obtain Marketing Approval for the Product outside of the
U.S., and to maximize the commercial value of the Product. Lilly will not
initiate any activities with respect to Development of the Product not provided
for in the Development Plan, except with the approval of the JDC or Steering
Committee.
(ii) Lilly will conduct its portion of the Development Program
using Commercially Reasonable Efforts, in a good scientific manner and in
compliance in all material respects with all requirements of Applicable Laws,
including cGCPs, cGLPs and cGMPs, to achieve the objectives of the Collaboration
efficiently and expeditiously.
(iii) Lilly will use Commercially Reasonable Efforts to provide
Amylin with all reasonable assistance and take all actions reasonably requested
by Amylin, without changing the allocation of responsibilities assigned in the
Development Plan, that are necessary or desirable to enable Amylin to comply
with the terms and intent of this Agreement. Lilly further agrees to cooperate
with any inspection by the FDA or other Regulatory Authority, including, but not
limited to, any inspection prior to approval of the NDA for any Product. Lilly
will use Commercially Reasonable Efforts to assist Amylin, as provided in the
Development Plan, to conduct Development of and obtain Marketing Approval for
the Product in the U.S., and to maximize the commercial value of the Product.
(b) AMYLIN'S RESPONSIBILITIES.
(i) The activities to be undertaken by Amylin in the course of the
Development Program are set forth in the Development Plan, as amended from time
to time by the Joint Development Committee and approved by the Steering
Committee. Amylin will use Commercially Reasonable Efforts, as provided in the
Development Plan, to develop and obtain Marketing Approval for the Product in
the U.S., and to maximize the commercial value of the Product. Amylin will not
initiate any activities with respect to Development of the Product not provided
for in the Development Plan, except with the approval of the JDC or Steering
Committee.
(ii) Amylin will conduct its portion of the Development Program
using Commercially Reasonable Efforts, in a good scientific manner and in
compliance in all material respects with all requirements of Applicable Laws,
including cGCPs, cGLPs and cGMPs, to achieve the objectives of the Collaboration
efficiently and expeditiously.
(iii) Amylin will use Commercially Reasonable Efforts to provide
Lilly with all reasonable assistance and take all actions reasonably requested
by Lilly, without changing the allocation of responsibilities assigned in the
Development Plan, that are necessary or desirable to enable Lilly to comply with
the terms and intent of this Agreement. Amylin further agrees to cooperate with
any inspection by the FDA or other Regulatory Authority, including, but not
limited to, any inspection prior to approval of the NDA for any Product. Amylin
will use Commercially Reasonable Efforts to assist Lilly, as provided in the
Development Plan, to conduct Development of and obtain Marketing
21.
Approval for the Product outside the U.S., and to maximize the
commercial value of the Product.
2.5 ADDITIONAL DEVELOPMENT ACTIVITIES.
(a) COLLABORATIVE ACTIVITIES. Before any Party engages in development
activities with respect to Additional Indications or Alternate Delivery of any
Product, such Party shall submit a proposal to the JDC for the Parties to engage
jointly in Development activities with respect to such Additional Indications or
Alternate Delivery of Product. If the JDC elects to proceed, the activities
shall be incorporated into a Development Plan. Unless otherwise agreed by the
Parties, their respective rights and obligations with respect to Additional
Indications or Alternate Delivery shall be the same as for any Product under
this Agreement.
(b) INDEPENDENT ACTIVITIES.
(i) If any Party (the "Proposing Party") presents a proposal to the
JDC to engage in Development activities with respect to Additional Indications
or Alternate Delivery of Products, (a "New Project") and the JDC fails to
approve the proposal due to the objection of the other Party, then the Proposing
Party may request permission to conduct the New Project independently at its
expense. The Proposing Party shall submit a detailed description of the proposed
activities to the JDC. If the JDC agrees, the Proposing Party shall be free to
undertake the New Project consistent with the proposal, subject to the
provisions below. If the JDC fails to approve the proposal due to the objection
of the other Party, then the Proposing Party may appeal the matter to the JSC,
and if necessary, to a senior executive of the other Party in accordance with
the procedures for dispute resolution set forth in Article 3. If the other Party
still fails to consent to such activities, such consent not to be unreasonably
withheld, then neither Party shall be entitled to pursue the proposed activities
with respect to such Additional Indication or Alternate Delivery of Product.
(ii) If the Proposing Party receives permission to proceed (but
without receiving approval from the non-Proposing Party to include the New
Project in the Development Plan), then the following provisions shall apply:
(a) the Proposing Party shall conduct such activities solely
at its expense and substantially in accordance with the plans
presented to the JDC, and shall, at least quarterly, provide a
written report to the JDC of the results of such efforts, and
provide to the other Party such additional information as it may
reasonably request. The Proposing Party's activities shall be
deemed independent of this Agreement, except as expressly provided
hereto.
(b) Within [...***...] of the conclusion of the first
[...***...] resulting from activities on the New Project, the
Proposing Party shall furnish to the JDC and the other Party a
written report of the results of such trial, together with such
other information as the other Party may
22. *CONFIDENTIAL TREATMENT REQUESTED
reasonably request. The other Party shall then have a period of
[...***...] in which to advise the Proposing Party that it desires
to include the New Project within the Collaboration contemplated by
this Agreement. If the other Party so elects, then (i) it shall pay
to the Proposing Party an amount equal to [...***...] of the total
development costs incurred to that date by the Proposing Party on
the New Project and (ii) the New Project shall become part of the
Collaboration contemplated by this Agreement, with each Party
having the same rights and obligations with respect to the New
Project as for any Product under this Agreement.
(c) If the other Party has not elected to include the New
Project in the Collaboration pursuant to subparagraph (b), then
within [...***...] of the conclusion of [...***...] resulting from
activities on the New Project, the Proposing Party shall furnish to
the other Party a written report of the results of such trial,
together with such other information as the other Party may
reasonably request. The other Party shall then have a period of
[...***...] in which to advise the Proposing Party that it desires
to include the New Project within the Collaboration contemplated by
this Agreement. If the other Party so elects, then (i) it shall pay
to the Proposing Party an amount equal to [...***...] of the total
development costs incurred to date by the Proposing Party on the
New Project, (ii) the New Project shall become part of the
Collaboration contemplated by this Agreement, with each party
having the same rights and obligations with respect to the New
Product as for any Product under this Agreement, and (iii) if, and
only if, the New Project results in a differentiated Product so
that it is possible to accurately quantify Net Sales of Product
resulting from the New Project (such as would be the case with
Alternate Delivery of the Product) the other Party shall pay to the
Proposing Party [...***...] resulting from the New Project.
(c) INDEPENDENT SR PRODUCT DEVELOPMENT. If, [...***...] the [...***...]
or the [...***...] referenced under Section 2.3, either Party wishes to pursue
additional development activities with respect to a SR Product that do not
relate to Additional Indications or Alternate Delivery of Products (such Party,
the "SR Proposing Party"), and the other Party objects to including such
activities in the Collaboration, then the SR Proposing Party may proceed with
independent development activities. At the conclusion of [...***...] with
respect to such SR Product, the other Party shall have the right to include the
SR Product in the Collaboration upon the same terms as for Product. If the other
Party elects to include the SR Product in the Collaboration, then it shall pay
to the SR Proposing Party [...***...] of the total development costs incurred
(excluding any costs incurred during any previous Development activities
undertaken as part of the Collaboration) and, in the event the SR Proposing
Party is Amylin, Lilly shall [...***...] with respect to a SR Product. The
[...***...] applicable to New Projects
23. *CONFIDENTIAL TREATMENT REQUESTED
pursuant to Section 2.5 (b) (ii) (c) above shall not apply or be payable with
respect to SR Product included in the Collaboration pursuant to this Section 2.5
(c).
(d) PARTIES' RIGHTS AND RESPONSIBILITIES. The Parties' rights to, and
responsibilities for, the Development and Commercialization, including Operating
Profits or Losses, of Products for any Additional Indication and Alternate
Delivery will be the same as their respective rights to, and responsibilities
for, Compound for Indication by geography.
2.6 COMMERCIALIZATION PROGRAM.
(a) COMMERCIALIZATION EFFORTS. Each Party will use Commercially
Reasonable Efforts to Commercialize the Product on a worldwide basis in
accordance with the Commercialization Plan. The Commercialization Plan shall
contemplate the Marketing of Product in each Major Market and in each country in
the Territory outside the Major Markets that is determined by the JCC to be
feasible and commercially attractive for marketing of the Product. Subject to
the terms and conditions of the Co-Promotion Agreement, Lilly shall have primary
responsibility for preparing and proposing changes and modifications to the
Commercialization Plan during the Term. However, the Parties acknowledge and
agree that Amylin will actively participate in Commercialization activities both
during the Development time frame and following Product Launch. In addition,
Lilly shall consult with, and consider in good faith the suggestions of, Amylin
with respect to such Commercialization strategies and activities, through the
Parties' interaction on the JCC. Without limiting any rights of Amylin, the
Parties anticipate that Amylin's most active participation will be in the U.S.
and that with respect to countries in the Territory outside the U.S., Amylin's
participation in Commercialization activities will be primarily through its
review of proposed activities in meetings of the JCC. Lilly and Amylin will
provide financial and other support for Commercialization of the Product as
provided in this Agreement, the Co-Promotion Agreement and in the
Commercialization Plan. Each Party shall provide consultation and advice to the
other Party in furtherance of the Commercialization Plan through its
participation on the Steering Committee and the Joint Commercialization
Committee as described in Article 3.
(b) COMMERCIALIZATION PLAN.
(i) The Joint Commercialization Committee shall prepare and oversee
the implementation of an overall plan for Commercialization of the Product that
will be set forth in the Commercialization Plan. The Commercialization Plan,
including updates and amendments to any of the foregoing, shall be reviewed and
approved by the JCC in accordance with Article 3.
(ii) The Commercialization Plan covering Commercialization through
[...***...], including the Commercialization Budget (that includes "Low",
"Medium" and "High" budget points), has been prepared and agreed to concurrently
herewith by the Parties. The Commercialization Budget for [...***...] is a
[...***...]. The
24. *CONFIDENTIAL TREATMENT REQUESTED
Commercialization Budget for [...***...] shall be a [...***...] at [...***...].
The Commercialization Budget for [...***...]. The Parties acknowledge that such
initial Commercialization Plan and Commercialization Budget do not necessarily
include all activities or expenses that may be necessary or desirable for the
Commercialization of Products hereunder, nor will they necessarily contemplate
developments, either positive or negative, (for example, unforeseen competitive
activity or opportunities for the Product, launch delays, etc.) that should be
taken into account as determined by the JCC. Accordingly, the Parties expect to
update and amend such Commercialization Plan and Commercialization Budget from
time to time during the Term as appropriate to reflect these changes and
accomplish the objectives of the Collaboration as determined by the JCC.
(iii) On an annual basis, the Parties shall update and amend the
three year Commercialization Plan and Commercialization Budget no later than
[...***...] (except that the first annual update for Calendar Years 2003-2005
shall not be due until [...***...]), which updates shall cover the ensuing three
Calendar Years, including a quarterly plan for the first year of the period. The
[...***...] three year plan approved by the Parties [...***...]. The [...***...]
three year plan [...***...]. The [...***...] will be [...***...]. At least
[...***...] Lilly and Amylin will review the existing three year plan in order
to update at least the [...***...] of the forecast to reflect significant
changes to the operating assumptions. This [...***...] rolling forecast will
serve as the basis for the construction of the [...***...] in [...***...]. In
the event the Parties cannot agree on a Commercialization Budget for
[...***...], the Parties agree that [...***...] the agreed upon amount of the
Commercialization Budget [...***...] until a final Budget can be established.
The Commercialization Plan shall describe the proposed overall program of
worldwide Commercialization of Products, including, without limitation: (a)
demographics and market dynamics, market strategies, estimated launch date, a
sales and marketing expense forecast (including at least three (3) years of
estimated sales and expenses), (b) specifications for and Manufacture of Product
for commercial sale (c) Product inventory plans and expected product profile
based on the Development Plan; (d) a market plan (including pricing strategies,
discounts and samples); (e) strategy for Phase 3B and Phase 4 trials; and (f) a
detailed Commercialization Budget that includes a budget of the expenses
expected to be incurred in connection with performing the Commercialization
Plan, which shall include estimated headcount and other resource allocations by
the Parties for all Commercialization activities proposed for the following
three (3) years or for such longer period as the JCC may determine. In so far as
possible the JCC shall conform its planning and budgeting processes to those
internal processes used by Lilly.
(iv) If either Party fails to meet its financial obligations under
any Binding Commercialization Budget, then the other Party shall be entitled at
its election either (a) to reduce the amount of its spending proportionately,
(b) elect to maintain its
25. *CONFIDENTIAL TREATMENT REQUESTED
spending at the budgeted level or (c) to increase its spending by an amount
necessary to compensate for the amount not spent by the other Party. If the
Party elects to maintain or increase its level of expenditure, it shall be
entitled to reimbursement by the other Party of an amount equal to [...***...]
of its spending over the spending of the other Party, plus a surcharge of
[...***...] of such amount. If a Product is then being marketed, and if the
Party entitled to compensation so requests, the JSC shall within thirty (30)
days of such request agree upon an appropriate adjustment to the division of
profits and losses between the Parties sufficient to permit the Party to recover
all amounts due it within six (6) months.
(v) In the preparation of the Commercialization Plan and Budget,
the Parties shall endeavor when reasonable to conform their efforts to the
reasonable timing and methods used by Lilly in its internal planning processes.
With respect to issues related to Product Commercialization outside of the U.S.
and without limiting any rights of any Party or of the JCC, it is the Parties'
intent that JCC review will generally be at a strategic rather than operational
level, except when considering [...***...] (in the case where Amylin elects to
co-promote Product in [...***...] pursuant to Section 2.7 (d)) that shall be
subject to a more detailed Commercialization review.
(c) DECISIONS. The parties will endeavor to reach a consensus with
respect to amendments to the Commercialization Plan through the Joint
Commercialization Committee and the Steering Committee, with disputes resolved
in accordance with the procedures set forth in Article 3.
2.7 ROLES AND RESPONSIBILITIES OF AMYLIN AND LILLY IN COMMERCIALIZATION.
(a) LILLY'S RESPONSIBILITIES.
(i) The activities to be undertaken by Lilly in the course of the
Commercialization Program are set forth in the Commercialization Plan, as
amended from time to time by the Joint Commercialization Committee and approved
by the Steering Committee, and in the Co-Promotion Agreement. Without limiting
the generality of the foregoing, Lilly will use Commercially Reasonable Efforts
to Commercialize the Product (i) in each Major Market outside the U.S. and (ii)
in each country in the Territory outside of the Major Markets that is determined
by the JCC to be feasible and commercially attractive for marketing of the
Product.
(ii) Lilly will conduct its portion of the Commercialization
Program using Commercially Reasonable Efforts and in compliance in all material
respects with all requirements of Applicable Laws to achieve the objectives of
the Collaboration efficiently and expeditiously.
26. *CONFIDENTIAL TREATMENT REQUESTED
(b) AMYLIN'S RESPONSIBILITIES.
(i) The activities to be undertaken by Amylin in the course of the
Commercialization Program are set forth in the Commercialization Plan, as
amended from time to time by the Joint Commercialization Committee and approved
by the Steering Committee, and in the Co-Promotion Agreement. Without limiting
the generality of the foregoing, Amylin will use Commercially Reasonable Efforts
to Commercialize the Product in the U.S. and, if Amylin co-promotes Product in
[...***...] pursuant to subparagraph (d) below, in [...***...].
(ii) Amylin will conduct its portion of the Commercialization
Program using Commercially Reasonable Efforts and in compliance in all material
respects with all requirements of Applicable Laws to achieve the objectives of
the Collaboration efficiently and expeditiously.
(c) PRICING DECISIONS. Subject to Section 4.8, Amylin shall have sole
responsibility for making pricing decisions regarding Compound or Product sold
in the U.S., and Lilly shall have sole responsibility for making pricing
decisions regarding Compound or Product sold in the Territory outside the U.S.
(d) [...***...]. Notwithstanding the fact that Lilly has the exclusive
right to promote and sell Product outside the U.S., Amylin shall have the right
to co-promote Product in [...***...] under certain circumstances. In the event
Amylin desires to co-promote Product within [...***...], it shall so notify
Lilly not later than [...***...] prior to the expected date of Product Launch in
[...***...]. If Amylin provides notice of its desire to co-promote, the JCC
shall prepare a joint marketing plan and forecast for [...***...] based upon
Lilly's customary planning processes. Amylin shall have the right to co-promote
Product in [...***...] utilizing not more than [...***...] sales representatives
unless Lilly reasonably concludes that the marketing plan and forecast do not
support the need for promotional efforts beyond those to be provided by Lilly.
If the Parties do not agree, the dispute shall be submitted to the JSC for
resolution. If the JSC is not able to resolve the issue, it shall be submitted
to the Chief Executive Officer of Amylin and a member of the Lilly Policy
Committee. If they are unable to resolve the issue, then Amylin shall have no
right to co-promote. If Amylin co-promotes Product in [...***...], the Parties
shall negotiate in good faith the terms of such an arrangement, which shall be
similar to arrangements with contract sales organizations, and include
compensation to Amylin of [...***...] and [...***...]. If Amylin elects not to
co-promote Product at Product Launch, it shall be entitled to co-promote Product
at a later date only with the agreement of Lilly.
2.8 INFORMATION MANAGEMENT.
The Parties agree that maintaining effective and open communication on
all ongoing matters, including Development and Commercialization of Products,
between each other is of paramount importance in the relationship created by
this Agreement. The Parties agree to work together to identify and support
hardware, software, and
27. *CONFIDENTIAL TREATMENT REQUESTED
services appropriate for the sharing of Information. Any costs incurred by a
Party associated with this hardware, software and services will be borne by it.
Upon reasonable advance notice, each Party agrees: (a) to make its employees and
non-employee consultants reasonably available at their respective places of
employment to consult with the other Party on all aspects of the relationship,
including issues arising during the Term and in connection with any request from
any Regulatory Authority, including, without limitation, regulatory, scientific,
technical and clinical testing issues; and (b) to allow a reasonable number of
appropriately qualified representatives of the other Party to have access to and
review such Party's written records, accounts, notes, reports and data relating
to the Development or Commercialization of Products. The Steering Committee
shall be responsible for implementing information audits or other procedures, as
it deems appropriate from time to time to ensure that the Parties are
maintaining effective and open communication.
2.9 MANUFACTURING.
(a) The Development Plan shall include plans for Manufacture of Product
for use in clinical trials, while the Commercialization Plan shall address
Manufacture of Product for commercial sales. Amylin has previously disclosed to
Lilly its arrangements with outside suppliers for manufacture of Product
("Existing Suppliers"), [...***...] initial Product Launch in the U.S. The JCC
shall be responsible for overseeing negotiations for additional supply contracts
[...***...]. Manufacture of Product for sale following initial Product Launch in
the U.S. and for Product Launch and commercial sale outside the U.S. shall be
determined by the JCC. If Lilly determines that it desires to Manufacture
Product (either bulk Compound or finished Product), it shall submit a proposal
to Amylin, and the Parties shall negotiate in good faith the terms upon which
Lilly shall Manufacture Product. Amylin shall use its Commercially Reasonable
Efforts to cause Existing Suppliers to fulfill their obligations under their
agreements with Amylin and to make available Compound or Product to the
Collaboration as contemplated by this Agreement. The Parties agree that Amylin
will not be liable to Lilly, its Affiliates or their respective directors,
officers, shareholder, employees or agents for any failure of Compound or
Product Manufactured by an Existing Supplier or any other Third Party
manufacturing Product to comply with applicable specifications, any
representations or warranties of such Existing Supplier or Third Party
manufacturer or Applicable Laws, except to the extent such failure to comply is
the result of Amylin's gross negligence or willful misconduct. In the event
Amylin receives any indemnification payments or other recovery from the Existing
Suppliers relating to the above, such amounts shall be shared equally by the
Parties.
(b) The parties presently intend that Product will be presented in a
disposable injection pen device. The Development Plan and the Commercialization
Plans shall specify the pen to be used. [...***...]. If the Parties elect to
[...***...] for use in the Product.
28. *CONFIDENTIAL TREATMENT REQUESTED
ARTICLE 3
GOVERNANCE
3.1 STEERING COMMITTEE.
The Parties will establish a Steering Committee ("Steering Committee"
or "JSC") to oversee all activities under the Agreement and the Co-Promotion
Agreement.
(a) COMPOSITION. The Steering Committee will be comprised of an equal
number of members appointed by Lilly and by Amylin. Each Party will notify the
other Party of its initial Steering Committee members within sixty (60) days of
the Effective Date. The Parties, through the Steering Committee, may establish
and later change the number of Steering Committee members as long as an equal
number of members from Lilly and Amylin is maintained. Each Party may change its
Steering Committee members at any time by written notice to the other. Such
notice may be delivered at a scheduled meeting of the Steering Committee. The
Steering Committee will be chaired by Amylin until December 31, 2003 and by
Lilly during Calendar Year 2004, and the chairmanship of the Steering Committee
shall alternate between the Parties annually thereafter. The role of the
Chairman shall be to convene and preside at meetings of the Steering Committee,
but the Chairman shall not be entitled to prevent items from being discussed or
to cast any tie-breaking vote. Each Party will designate a senior member of
management who will be the primary contact for that Party. Not later than thirty
(30) days after the Steering Committee is named, the Parties shall hold an
organizational meeting. The primary contacts of the Parties shall be responsible
for scheduling the meeting of the Steering Committee for that purpose.
(b) RESPONSIBILITIES. The Steering Committee shall be responsible for
the overall strategic direction of the Collaboration and for the following:
(i) Establishing such joint teams and subcommittees as it deems
necessary to fulfill this Agreement;
(ii) Resolving any disputes among such joint teams or
subcommittees, the JDC or the JCC, or between the Parties, subject to the terms
of this Agreement;
(iii) Reviewing, approving, and amending the Development Plan,
Development Budget, Commercialization Plan and Commercialization Budget;
(iv) Determining whether to develop Product for Additional
Indications and Alternate Delivery and reviewing, approving and amending
Development Plans;
(v) Developing and implementing accountability mechanisms for the
JDC and JCC.
The Steering Committee shall make such changes, or have such changes made, to
the Development Plan, and budgets, as it deems necessary to accomplish the
purpose of the Collaboration. The Steering Committee shall periodically review
the results of the
29.
Development Plan to ensure, to the extent reasonably practical, that the Parties
are meeting their commitments for both human and financial support and are each
fulfilling all of their respective contractual obligations. The Steering
Committee shall resolve any disputes referred to it in accordance with Section
3.1(e) below.
(c) MEETINGS. The Steering Committee will hold an in-person
organizational meeting at Amylin's offices in San Diego, California to establish
the Committee's operating procedures. After such initial meeting, the Steering
Committee will meet at such other times as are agreeable to a majority of the
Steering Committee members, but no less than once each Calendar Quarter. Such
meetings may be in-person, via videoconference, or via teleconference. After the
initial meeting above, the location of in-person Steering Committee meetings
will alternate between San Diego, California and Indianapolis, Indiana, unless
the Parties otherwise agree. Each Party will bear the expense of its respective
Steering Committee members' participation in Steering Committee meetings. At
least five (5) business days prior to each Steering Committee meeting, each
Party shall provide written notice to the other Party of agenda items proposed
by such Party for discussion or decision at such meeting, together with
appropriate information related thereto. Material decisions reached at a meeting
will be documented and signed by both Parties before the meeting ends.
Reasonably detailed written minutes will be kept of all Steering Committee
meetings and will reflect, without limitation, material decisions made at such
meetings. Responsibility for keeping minutes will alternate between the Parties,
beginning with Lilly. Meeting minutes will be sent to each member of the
Steering Committee for review and approval within five (5) business days after a
meeting. Minutes will be deemed approved unless a member of the Steering
Committee objects to the accuracy of such minutes within ten (10) business days
of receipt. At least monthly, the primary contacts of the Parties shall discuss
the status of the Collaboration, either in person or by telephone or
videoconference. The primary contacts of the Parties will jointly prepare and
provide to each Party on at least a quarterly basis a report, via e-mail,
regarding the status of the Collaboration.
(d) DECISIONS. All Steering Committee decisions will be made by
unanimous vote of the Steering Committee, and each Party will have one vote,
provided that any deadlock shall be resolved in accordance with Section 3.1(e)
below.
(e) DISPUTE RESOLUTION. If the Steering Committee is unable to decide
or resolve unanimously any matter properly presented to it for action, at the
written request of either Party, the issue shall be referred to a member of the
Lilly Policy Committee and the Chief Executive Officer of Amylin who shall
promptly meet and attempt in good faith to resolve such issue within thirty (30)
days. These individuals may obtain the advice of other employees or consultants
as they deem necessary or advisable in order to make the decision. If such
executives cannot resolve such matter within thirty (30) days of the date such
matter is first referred to them:
(i) in the case of a matter primarily involving Development of
Compound or Product (whether or not such matter also involves or affects
30.
Commercialization), the decision of Amylin will be final and determinative,
except that resolution of disputes regarding any of the following matters
("Excepted Development Matters") shall require the mutual agreement of the
Parties:
(A) altering the Development Plan in a manner that would
exclude Development of Product in any Major Market (subject, however, to the
provisions of Section 9.6);
(B) approving Development of Product for Additional
Indications, or Alternate Delivery;
(C) [...***...]
(D) terminating a Phase 3 Clinical Trial of Product prior to
completion in accordance with its protocol;
(E) [...***...]
(ii) in the case of a matter primarily involving Commercialization
of Compound or Product (whether or not such matter also involves Development of
Compound or Product), the decision of Lilly will be final and determinative
except as provided in Section 2.7(c), except that resolution of disputes
regarding any of the following matters ("Excepted Commercialization Matters")
shall require the mutual agreement of the Parties:
(A) A decision to recall a Product;
OR
(B) a dispute related to Manufacture of Product;
provided, however, that in no event shall either Party or the Steering Committee
have the right or power to resolve any such matter in a manner that conflicts
with the provisions of this Agreement or to unilaterally amend or modify this
Agreement; and provided, further, that if the disputed matter referred to such
officers relates to an expenditure of funds, then the Party entitled to make
such decision shall not have the right to increase the Parties' aggregate
spending under the applicable Development Plan or Commercialization Plan by more
than the greater of:
(1) [...***...] above the Parties' previously agreed upon
[...***...] for such Development or Commercialization Plan; or
(2) The percent the other Party is then willing to increase
spending on such Development or Commercialization Plan;
* CONFIDENTIAL TREATMENT REQUESTED
31.
nor reduce the Parties' aggregate spending under the applicable Development or
Commercialization Plan by more than the greater of:
(1) [...***...] below the Parties' previously agreed upon
[...***...] for such Development or Commercialization Plan; or
(2) The percent the other Party is then willing to decrease
spending on such Development or Commercialization Plan.
Finally, this dispute resolution procedure is not applicable with regard to any
disputes regarding the interpretation, or alleged breaches, of this Agreement or
any of the Related Agreements, or the validity, enforceability or scope of any
Patent, nor shall it in any way limit either Party's right to exercise any right
of termination it may have under this Agreement.
(f) OTHER COMMITTEES. The Steering Committee may create such other
committees or subcommittees as it may deem desirable for the conduct of the
Collaboration. All such committees or subcommittees shall have equal
representation from each of the Parties unless the Steering Committee expressly
directs otherwise.
(g) IP SUBCOMMITTEE. The Steering Committee shall establish an IP
Subcommittee (the "IP Subcommittee") which shall have four members (or such
other even number as the Parties may mutually agree from time to time), with
each Party selecting fifty percent of the members. Members of the IP
Subcommittee shall be patent attorneys or others experienced in intellectual
property law. The IP Subcommittee shall be responsible for overseeing activities
described in Article 10.
3.2 JOINT DEVELOPMENT COMMITTEE.
(a) COMPOSITION. For so long as Lilly and Amylin are performing work
pursuant to a Development Plan, the day to day Development work will be
conducted under the direction of the Joint Development Committee ("JOINT
DEVELOPMENT COMMITTEE" or "JDC") comprised of an equal number of representatives
from Lilly and Amylin. Each Party shall designate one of its representatives on
the JDC as a co-chair of the JDC.
(b) RESPONSIBILITIES. The Joint Development Committee will be
responsible for any amendments to the Development Plan, for overseeing the
Parties' performance of the Development Program, and for making operational
decisions related to that program. If so requested by the JCC, the JDC may also
undertake supervision of certain Commercialization activities, such as the
management of Phase 3B Clinical Trials; provided, however, that such activities
shall remain within the jurisdiction of the JCC for purposes of the resolution
of any disputes pursuant to this Article 3 and the costs of such activities
shall be Commercialization Costs. The Joint Development Committee may propose
Development of Product for Additional Indications and
* CONFIDENTIAL TREATMENT REQUESTED
32.
Alternate Delivery and shall prepare appropriate development plans for
consideration by the Steering Committee. Each Party shall instruct each of its
representatives on the JDC that (i) performance of his or her responsibilities
as a JDC member is an important component of such representative's
responsibilities as an employee of such Party; and (ii) he or she will be
evaluated in part based on such representative's diligent and efficient
performance of his or her responsibilities on the JDC. The Joint Development
Committee shall at all times coordinate the efforts of the Parties with respect
to the conduct of the Development Plan. The Joint Development Committee will be
responsible for approving or disapproving any amendments to the Development Plan
proposed by either Party and submitting such amendments to the Steering
Committee for final approval. The Joint Development Committee will provide to
the Parties copies of an amended Development Plan promptly after approval by the
Joint Development Committee and before submission to the Steering Committee. If
neither Party has any objection to the proposed amendment, the Joint Development
Committee may implement the amended Development Plan without Steering Committee
approval, provided that members of the Steering Committee are provided with a
copy of the amended plan. The JDC shall establish a Joint Quality Subcommittee
(the "JQS") which shall have four members (or such other even number as the
Parties may mutually agree from time to time), with each Party selecting fifty
percent of the members. Members of the JQS shall have substantial experience in
quality assurance and/or regulatory matters. The JQS shall be responsible for
all quality assurance and regulatory matters in the Collaboration. At such time
as responsibility for manufacturing matters is transferred from the JDC to the
JCC, the JQS shall become a subcommittee of the JCC.
(c) OPERATION. At least monthly, a member of the JDC for each Party
shall provide to the other Party a reasonably detailed summary of the
Development activities conducted by such Party, and the co-chairs of the JDC
shall discuss the results of such activities, either in person or by telephone
or videoconference. The co-chairs of the Joint Development Committee will
jointly prepare and provide to each Party on at least a quarterly basis a
report, via e-mail, regarding the status of Development activities hereunder.
The Joint Development Committee will review the progress of the activities
carried out under the Development Program and will consider proposed
modifications to the objectives and goals of that program.
(d) MEETINGS. During the term of Lilly and Amylin's collaborative
participation in the Development Program, the Joint Development Committee will
meet on a regular basis, but at least once per quarter. Such meetings may be
in-person, via videoconference, or via teleconference. The location of in-person
JDC meetings will alternate between San Diego, California and Indianapolis,
Indiana, unless the Parties otherwise agree. Each Party will bear the expense of
its respective JDC members' participation in JDC meetings. At least five (5)
business days prior to each JDC meeting, each Party shall provide written notice
to the other Party of agenda items proposed by such Party for discussion or
decision at such meeting, together with appropriate information related thereto.
Material decisions reached at a meeting will be documented before the meeting
ends. Reasonably detailed written minutes will be kept
33.
of all JDC meetings and will reflect, without limitation, material decisions
made at such meeting. Responsibility for keeping minutes will alternate between
the Parties, beginning with Lilly. Meeting minutes will be sent to each member
of the JDC for review and approval within five (5) business days after a
meeting. Minutes will be deemed approved unless a member of the JDC objects to
the accuracy of such minutes within ten (10) business days of receipt.
(e) DECISIONS. All Joint Development Committee decisions will be made
by unanimous vote of both Parties, and each Party will have one vote. In the
event of a dispute on any matter within the responsibilities of the Joint
Development Committee, then the matter shall be referred to the Steering
Committee for resolution in accordance with the procedures set forth in Section
3.1(e). In no event shall the JDC have the right or power to amend, modify or
waive compliance with this Agreement.
(f) SUBCOMMITTEES. The JDC may establish such subcommittees as it may
deem desirable. All such subcommittees shall have equal representation from each
Party unless the Parties expressly agree otherwise.
3.3 JOINT COMMERCIALIZATION COMMITTEE.
(a) COMPOSITION. During the Term, the day-to-day Commercialization work
will be conducted under the direction of the Joint Commercialization Committee
("JOINT COMMERCIALIZATION COMMITTEE" or "JCC") comprised of an equal number of
representatives from Lilly and Amylin. Each Party shall designate one of its
representatives on the JCC as a co-chair of the JCC.
(b) RESPONSIBILITIES. The Joint Commercialization Committee will be
responsible for any amendments to the Commercialization Plan, for overseeing the
Parties' performance of the Commercialization Program, and for making
operational decisions related to that program. Each Party shall instruct each of
its representatives on the JCC that (i) performance of his or her
responsibilities as a JCC member is an important component of such
representative's responsibilities as an employee of such Party; and (ii) he or
she will be evaluated based in part on such representative's diligent and
efficient performance of his or her responsibilities on the JCC. The Joint
Commercialization Committee shall at all times coordinate the efforts of the
Parties with respect to the conduct of the Commercialization Plan. The Joint
Commercialization Committee will be responsible for approving or disapproving
any amendments to the Commercialization Plan proposed by either Party and
submitting such amendments to the Steering Committee for final approval. The
Joint Commercialization Committee will provide to the Parties copies of an
amended Commercialization Plan promptly after approval by the Joint
Commercialization Committee and before submission to the Steering Committee. If
neither Party has any objection to the proposed amendment, the Joint
Commercialization Committee may implement the amended Commercialization Plan
without Steering Committee approval, provided that members of the Steering
Committee are provided with a copy of the amended plan. The JCC shall oversee
the JQS at such time as the JQS's manufacturing responsibilities become subject
to oversight by the JCC.
34.
(c) OPERATION. At least monthly, each co-chair of the JCC shall provide
to the other co-chair a reasonably detailed summary of the Commercialization
activities conducted by such Party, and the co-chairs of the JCC shall discuss
the results of such activities, either in person or by telephone or
videoconference. The co-chairs of the Joint Commercialization Committee will
jointly prepare and provide to each Party on at least a quarterly basis a
report, via e-mail, regarding the status of Commercialization activities
hereunder. The Joint Commercialization Committee will review the progress of the
activities carried out under the Commercialization Program and will consider
proposed modifications to the objectives and goals of that program.
(d) MEETINGS. During the term of Lilly and Amylin's collaborative
participation in the Commercialization Program, the Joint Commercialization
Committee will meet on a regular basis, but at least once per quarter. Such
meetings may be in-person, via videoconference, or via teleconference. The
location of in-person JCC meetings will alternate between San Diego, California
and Indianapolis, Indiana, unless the Parties otherwise agree. Each Party will
bear the expense of its respective JCC members' participation in JCC meetings.
At least five (5) business days prior to each JCC meeting, each Party shall
provide written notice to the other Party of agenda items proposed by such Party
for discussion or decision at such meeting, together with appropriate
information related thereto. Material decisions reached at a meeting will be
documented before the meeting ends. Reasonably detailed written minutes will be
kept of all JCC meetings and will reflect, without limitation, material
decisions made at such meeting. Responsibility for keeping minutes will
alternate between the Parties, beginning with Lilly. Meeting minutes will be
sent to each member of the JCC for review and approval within five (5) business
days after a meeting. Minutes will be deemed approved unless a member of the JCC
objects to the accuracy of such minutes within ten (10) business days of
receipt.
(e) DECISIONS. All Joint Commercialization Committee decisions will be
made by unanimous vote of both Parties, and each Party will have one vote. In
the event of a dispute on any matter within the responsibilities of the Joint
Commercialization Committee, then the matter shall be referred to the Steering
Committee for resolution in accordance with the procedures set forth in Section
3.1(e). In no event shall the JCC have the right or power to amend, modify or
waive compliance with this Agreement.
(f) SUBCOMMITTEES. The JCC may establish such committees as it deems
desirable. All such subcommittees shall have equal representation from each
Party, unless the Parties specifically agree otherwise.
35.
ARTICLE 4
PAYMENTS AND REPORTS
4.1 UPFRONT PAYMENTS.
(a) PAYMENT. In partial consideration for the opportunities described
in this Agreement and the Related Agreements, Lilly will pay to Amylin a
non-refundable, non-creditable upfront payment of $80 Million Dollars
(U.S.$80,000,000) within [...***...] business days following the Effective Date
of this Agreement. Such payment will be made in immediately available funds via
a Federal Reserve electronic wire transfer to a bank account designated by
Amylin.
(b) EQUITY INVESTMENT. Pursuant to the Stock Purchase Agreement of even
date hereof, Lilly shall purchase and Amylin shall sell to Lilly Thirty Million
Dollars (U.S. $30,000,000.00) of Amylin Common Stock pursuant to the Stock
Purchase Agreement.
(c) DEVELOPMENT CREDIT FACILITY. Lilly shall make available to Amylin a
credit facility in the aggregate principal amount of Sixty Million Dollars
(U.S.$60,000,000.00) to assist Amylin in meeting its obligations with respect to
Development of Products hereunder under the terms and conditions set forth in
the Loan Agreement between the Parties of even date herewith.
(d) COMMERCIALIZATION CREDIT FACILITY. Lilly shall make available to
Amylin a credit facility in the aggregate principal amount of Fifty Million
Dollars (U.S.$50,000,000.00) to assist Amylin in meeting its obligations with
respect to Commercialization of Products hereunder under the terms and
conditions set forth in the Loan Agreement between the Parties of even date
herewith.
4.2 MILESTONE PAYMENTS.
(a) Lilly shall be obligated to pay the milestones listed below upon
occurrence of the applicable milestone event and receipt from Amylin of notice
that such milestone is due. Lilly shall have [...***...] days following receipt
of each notification of the achievement of a milestone listed below in which to
pay the corresponding amount to Amylin in immediately available funds via a
Federal Reserve electronic wire transfer to an account designated by Amylin.
Each Party will inform the other Party within five (5) days of the achievement
of any such milestone by such Party, its Affiliate or Sublicensee, and shall
provide the other Party with substantiation of the achievement of the milestone.
MILESTONE MILESTONE EVENTS MILESTONE PAYMENT DUE
NUMBER
---------- -------------------------------------------------------------------- ---------------------------
1 Sixty (60) days shall have elapsed from the Early Termination Date [...***...]
and Lilly shall not have terminated this Agreement
36. *CONFIDENTIAL TREATMENT REQUESTED
MILESTONE
NUMBER MILESTONE EVENTS MILESTONE PAYMENT DUE
---------- -------------------------------------------------------------------- ---------------------------
pursuant to Section 12.3(a) or (b).
2 The following (1) through (3) have been completed: [...***...]
(1) In the three (3) Amigo Trials --
[...***...]
(A) [...***...]
(B) [...***...]
AND
[...***...]
(Y) [...***...]
(Z) [...***...]
AND
(2) [...***...]
AND
(3) [...***...]
3 [...***...]; AND [...***...]
37. *CONFIDENTIAL TREATMENT REQUESTED
MILESTONE
NUMBER MILESTONE EVENTS MILESTONE PAYMENT DUE
---------- -------------------------------------------------------------------- ---------------------------
[...***...]
4 [...***...] [...***...]
5 Date the first site enrolls the first study patient in the first [...***...]
Phase 3 Clinical Trial for an SR Product.
6 Either (1) or (2) below is completed: [...***...]
(1) Milestone Numbers 2 and 5 are achieved; OR
(2) If Milestone Number 2 is not achieved, but the
following (A) through (C) have been completed:
(A) In the [...***...] --
(i) Either (a) or b) below is completed
[...***...]:
(a) [...***...]; OR
(b) [...***...]
38. *CONFIDENTIAL TREATMENT REQUESTED
MILESTONE
NUMBER MILESTONE EVENTS MILESTONE PAYMENT DUE
---------- -------------------------------------------------------------------- ---------------------------
[...***...]
AND
(ii) If more than [...***...], either (y) or (z)
below is completed [...***...]
(y) [...***...]
(z) [...***...]
AND
(B) [...***...]
AND
(C) [...***...]
7 Product Launch of first Product (resulting from the Product [...***...]
formulation studied in an Amigo Trial) in the U.S.
8 Product Launch of first Product (resulting from the Product [...***...]
formulation studied in an Amigo Trial) in the first Major Market
country in the European Union.
9 Product Launch of first Product (resulting from the Product [...***...]
formulation studied in an Amigo Trial) in Japan.
10 Achievement of Milestone Numbers 2 and 7. [...***...]
11 Product Launch of first SR Product in the U.S. [...***...]
12 Product Launch of first SR Product in the first Major Market country [...***...]
in the European Union.
39. *CONFIDENTIAL TREATMENT REQUESTED
MILESTONE
NUMBER MILESTONE EVENTS MILESTONE PAYMENT DUE
---------- -------------------------------------------------------------------- ---------------------------
13 Product Launch of first SR Product in Japan. [...***...]
(b) If any of the Milestone Events achieved for Milestone Numbers 2, 3,
and 6, respectively, are not allowed to be included by the FDA within the final
approved Product label (for the Product achieving such Milestone Event) at the
time of U.S. Regulatory Authority approval for such Product, then Lilly may
credit the amount of the applicable Milestone Payment paid for achievement of
Milestone Number 2, 3, or 6, as applicable, towards any future Milestone
Payments due. If Milestone 4 is met, the milestone shall be payable [...***...]
within thirty (30) days following Lilly's receipt of the results of the study of
the trial and [...***...] upon the results of the trial appearing in the U.S.
label for the Product within [...***...] of Product Launch. If the results of
the trial do not appear in the label within [...***...] of Product Launch, then
the [...***...] installment of the milestone shall be deemed cancelled.
(c) At Lilly's option --
(i) Lilly may convert any payments made for Milestone Xxxxxxx 0, 0,
0, xxx 0 xxxx Xxxxxx equity pursuant to the Milestone Conversion Agreement, if
the U.S. NDA submission for the Product studied in the Amigo Trial is not
accepted for filing by the FDA by December 31, 2005; and
(ii) Lilly may convert any payments made for Milestone Numbers 5
and 6 into Amylin equity pursuant to the Milestone Conversion Agreement, if the
U.S. NDA submission for the SR Product subject to Milestone Numbers 5 and 6, is
not accepted for filing by the FDA by December 31, 2007.
Notwithstanding any other provision of this Agreement to the contrary, (a) in no
event may any Milestone Payment be subject to both a credit under Section 4.2(b)
and conversion into Amylin equity under Section 4.2(c), and (b) each Milestone
Payment shall only be paid one time for the first Product to achieve the
applicable Milestone Event.
4.3 FUNDING OF DEVELOPMENT PROGRAM.
(a) RESPONSIBILITY FOR DEVELOPMENT COSTS.
(i) UNITED STATES. Development Costs for Development of Products in
the U.S. (i.e., the costs of those Development activities required to be
undertaken to obtain Marketing Approval in the U.S.) shall be shared by the
Parties in the same proportion as the Parties shall share Operating Profits or
Losses in the U.S. pursuant to Section 4.5. Each Party shall be responsible for
expenses incurred by it in excess of the Development Budget pertaining thereto,
unless otherwise approved by Steering Committee.
40. *CONFIDENTIAL TREATMENT REQUESTED
(ii) REST OF THE WORLD. Lilly shall bear eighty percent (80%) of
the Development Costs for Development of Products in all countries in the
Territory outside the U.S. and Amylin shall pay twenty percent (20%) of such
Development Costs.
(iii) REGULATORY APPROVAL. Development Costs required for
Regulatory Approval in the U.S. shall be U.S. Development Costs. Development
Costs required for Regulatory Approval outside of the U.S. shall be OUS
Development Costs. The costs of each of the Amigo Trials and the [...***...]
protocol study shall be regarded as U.S. Development Costs. Other Development
Costs shall be determined by the JDC at the time plans applicable thereto are
made, and if the Parties cannot agree, shall be deemed [...***...] U.S.
Development Costs and [...***...] OUS Development Costs.
(b) COST PROCEDURE. Each Party will be compensated for its Development
services performed under the Development Plans based upon the number of each
Party's FTE's performing such services and the FTE Rate. In addition, the actual
out-of-pocket expenses incurred in connection with Third Person contractors
utilized to perform activities under the Development Plan (i.e., no xxxx-up with
respect to Third Person out-of-pocket expenses incurred) will be reimbursable.
Within [...***...], beginning with the Effective Date, each Party will prepare
and deliver to the other Party a monthly report of its own Development Costs, in
both the U.S. and outside the U.S.
Amylin shall be responsible for the first $101.2 Million Dollars
(US$101,200,000) of Development Costs for the Product, beginning on the
Effective Date. After Amylin and Lilly incur expenses above the first $101.2
Million Dollars (US$101,200,000) in Development Costs related to the Product,
Amylin and Lilly will share costs as further described in this article. Any
reimbursable costs incurred by Lilly of the first $101.2 Million Dollars
(US$101,200,000) of Development Costs will be reimbursed by Amylin to Lilly in
accordance with the same procedure in this Article.
Each Party's [...***...] report of the Development Costs will detail Third
Person costs incurred by such Party together with the actual time spent by each
Party's personnel (including a breakdown of the name of the individual, the
hours worked, and a brief description of the activities(s) performed) for
activities related to the Development Plan.
Each Party has ten (10) days to inquire of the other Party of any items included
in the monthly report provided by the other Party requesting additional
information related to Development Costs contained in the other Party's
[...***...] report.
Within the later of ten (10) days of Lilly providing its [...***...] report to
Amylin or forty (40) days in total [...***...], Amylin will prepare a composite
report setting forth the expenses incurred by each Party for such [...***...],
apply the percentage of such costs for which each Party is responsible pursuant
to Article 4.3 (a) to the total expenses for that month and prepare a statement
of the amount for which each Party is responsible.
41. *CONFIDENTIAL TREATMENT REQUESTED
The composite report will separately itemize Development Costs incurred related
to the Product in the U.S. with those incurred outside the U.S.
The composite report will compute a net amount of Development Costs due to Lilly
or to Amylin.
For example, if Amylin incurs $80,000 and Lilly incurs $20,000 in FTE
and out-of-pocket expenses for Development Costs provided for the
Product in the U.S., Lilly would be responsible for $30,000 payable to
Amylin ($100,000x50%=$50,000; $80,000 - $50,000=$30,000).
Either Party shall have the right to audit (with financial and scientific
representatives) the records of the other Party with respect to any expenses
included in such reports, in accordance with Section 4.9(e) of this Agreement.
Except as the Parties otherwise agree specifically in writing, the Parties
acknowledge that each Party shall be solely responsible for equipment and other
capital expenditures that such Party may make in connection with conducting
research and Development activities.
(c) DEVELOPMENT COST REPORTING. The Parties shall use reasonable
efforts to provide such reports in sufficient time to permit the Parties to
comply with their reporting obligations under U.S. federal securities laws,
rules and regulations.
4.4 FUNDING OF COMMERCIAL PROGRAMS
(a) RESPONSIBILITY FOR COMMERCIALIZATION COSTS
(i) UNITED STATES. Commercialization Costs for Commercialization of
Products in the U.S. (i.e., the costs of those Commercial activities required to
be undertaken to effectively market the Product in the U.S.) shall be shared by
the Parties in the same proportion as the Parties shall share U.S. Operating
Profits or Losses pursuant to Section 4.5.
(ii) REST OF WORLD. Lilly shall pay one hundred percent (100%) of
the Commercialization Costs for Commercialization of Products in all countries
in the Territory outside the U.S. and Amylin shall pay 0% of such
Commercialization Costs.
(b) COST PROCEDURE. Each Party will be reimbursed for Reimbursable
Marketing Expenses.
Within thirty (30) days [...***...], beginning with the Effective Date, Amylin
and Lilly will prepare and deliver to the other Party a monthly report of its
Reimbursable Marketing Expenses in the U.S.
Each Party's [...***...] report of the Reimbursable Marketing Expenses will
detail Sales Force Efforts, FTEs for Phase 3B and Phase 4 studies and Third
Person costs incurred
42. *CONFIDENTIAL TREATMENT REQUESTED
by each Party including a brief description of the activities(s) performed for
activities related to the Commercialization Plan.
Each Party has ten (10) days to inquire of the other Party of any items included
in the monthly report provided by the other Party requesting additional
information related to Reimbursable Marketing Expenses related to the Product
contained in the other Party's [...***...] report.
Within the later of ten (10) days of Lilly providing its [...***...] report to
Amylin or forty (40) days in total after the end of [...***...], Amylin will
prepare a composite report setting forth the Reimbursable Marketing Expenses
incurred by each Party for such [...***...], apply the percentage of such costs
for which each Party is responsible pursuant to Section 4.4(a) to the total
expenses for that [...***...] and prepare a statement of the amount for which
each Party is responsible.
The composite report will compute a net amount of Commercialization Costs in the
U.S. due to Lilly or to Amylin.
For example, if Lilly incurs $80,000 and Amylin incurs $20,000 in Reimbursable
Marketing Expenses in the U.S., Amylin would be responsible for $30,000 payable
to Lilly ($100,000x50%=$50,000; $80,000 - $50,000=$30,000).
Either Party shall have the right to audit (with financial and commercial
representatives) the records of the other Party with respect to any expenses
included in such reports, in accordance with Section 4.9(e) of this Agreement.
Except as the Parties otherwise agree specifically in writing, the Parties
acknowledge that each Party shall be solely responsible for equipment and other
capital expenditures that such Party may make in connection with conducting
Commercialization activities.
4.5 SHARING OF OPERATING PROFITS OR LOSSES.
Operating Profits or Losses shall be calculated and reported in accordance with
ATTACHMENT 4.5 hereto. Lilly and Amylin shall share Operating Profits and Losses
as follows.
(a) PROFIT/(LOSS) SHARE IN THE U.S. [...***...], Amylin will prepare an
Operating Profit/(Loss) report related to the U.S. Operating Profit/(Loss) which
will equal Net Sales less Cost of Product Sold less Reimbursable Marketing
Expenses and Development Costs. The Development Costs and Reimbursable Marketing
Expenses the Parties are sharing as calculated in Sections 4.3 and 4.4,
respectively, shall be added back to the Operating Profit or Loss to arrive at
the Adjusted U.S. Operating Profit/(Loss) ("Adjusted U.S. Operating Profit").
The Adjusted U.S. Operating Profit report shall be completed within [...***...].
43. *CONFIDENTIAL TREATMENT REQUESTED
The Adjusted U.S. Operating Profits or Losses in the U.S. shall be allocated
fifty percent (50%) to Lilly and fifty percent (50%) to Amylin.
(b) PROFIT/(LOSS) SHARE OUTSIDE THE U.S. [...***...], Lilly will
prepare an "Operating Profit (Loss)" report related to the Territory outside the
United States. "Operating Profit (Loss) will equal Net Sales less Cost of
Product Sold less Reimbursable Marketing Expenses and Development Costs. The
Development Costs the Parties are sharing as calculated in Section 4.3 shall be
added back to the Operating Profit or Loss to arrive at the adjusted operating
profit outside of the U.S. ("Adjusted OUS Operating Profit"). The Adjusted OUS
Operating Profit report shall be completed with [...***...].
The Adjusted OUS Operating Profit and Losses shall be allocated 80% to Lilly and
20% to Amylin for all months in a Calendar Year from the beginning of such year
to and including the month in which cumulative Net Sales in countries outside
the U.S. exceed [...***...] in cumulative Net Sales for that Calendar Year.
Beginning in the month after Net Sales in the Calendar Year for the Territory
outside the U.S. exceed [...***...], the Adjusted OUS Operating Profit
[...***...] Amylin for all [...***...] Calendar Year.
[...***...] within fifteen (15) days.
The obligation of the Parties to share Operating Profits or Losses as set forth
above shall continue on a Product and country-by-country basis until such
Product is permanently withdrawn from and is no longer being sold anywhere in
such country by either Party or its Affiliates or Sublicensees. The Parties may
at any time convert from a system of sharing Operating Profits or Losses outside
the U.S. to a royalty-based system on terms mutually agreed upon by the Parties.
4.6 SALES FORCE EFFORTS.
Pursuant to the Co-Promotion Agreement, the Parties will define the
expected percent effort that each of the Parties sales forces will exert in
support of the Product. It is currently anticipated that the JCC will develop a
methodology whereby Sales Force Costs will be calculated on a per sales force
basis. The intention of the Parties is that neither Party will be advantaged or
disadvantaged by the methodology developed by the JCC and neither Party will
profit from the cost allocation and methodology employed. The Parties shall
discuss these efforts on a good faith basis and each Party
44. *CONFIDENTIAL TREATMENT REQUESTED
will use Commercially Reasonable Efforts to contribute the expected effort
agreed to through the JCC.
4.7 INVENTORY MANAGEMENT.
Amylin, with respect to Product inventory for the U.S., and Lilly, with respect
to Product inventory for the Territory outside the U.S., shall use its
Commercially Reasonable Efforts to manage Product inventory on hand at
wholesalers and other distributors so as to maintain levels of inventory
appropriate to expected demand and to avoid taking action that would result in
unusual levels of inventory fluctuation. Each Party shall provide to the other a
quarterly forecast of inventory levels in the format to be agreed by the
Parties.
4.8 PROHIBITION ON BUNDLING.
Notwithstanding any other provision of this Agreement to the contrary, each
Party hereby covenants that it will not include or bundle any Product as part of
a multiple product offering with any other products or services if it would
result in the price of the Product being discounted from the then-applicable
sale price in such jurisdiction, nor shall either Party permit its Affiliates or
sublicensees to do so, except with the prior written consent of the other Party.
4.9 PAYMENT; LATE PAYMENT CHARGES.
(a) EXCHANGE RATE FOR ROYALTY CALCULATION; MANNER AND PLACE OF PAYMENT.
Within 45 days [...***...], the composite report in Section 4.3 (b), the
composite report in Section 4.4 (b), the Adjusted US Operating Profit/(Loss)
report in Section 4.5 (a); and the Adjusted OUS Operating Profit/(Loss) report
in Section 4.5 (b) shall be aggregated and the Party owing funds shall pay the
other Party ("Owed Party") in immediately available funds via a Federal Reserve
electronic wire transfer to a bank account designated by the Owed Party. All
payments to be made by one Party to the other Party under this Agreement will be
made in U.S. dollars and may be paid by bank wire transfer in immediately
available funds to a bank account designated in writing from time to time by the
Party entitled to receive such payment. When conversion of payments from any
foreign currency is required with respect to calculation of Net Sales of
Products outside the U.S., Lilly shall make such conversion at the exchange rate
broadly applied by Lilly to all foreign currency conversions into U.S. dollars
on the last business day of the applicable quarter. If the payment is made from
outside the U.S., the Party will make the payment in a manner that will not
result in a tax liability for the other Party larger than it would be if the
payment were made from inside the U.S. with no additional delays in payment when
compared to the timing of payment made in the U.S.
(b) TAX CONSIDERATIONS. Unless otherwise agreed by the Parties, either
Party may take advantage of tax considerations which benefit it and not the
other Party. In the event that a Party takes advantage of a tax consideration
which benefits it and
45. *CONFIDENTIAL TREATMENT REQUESTED
not the other Party, no compensation to the other Party is required unless it
affects the other Party's Operating Profits or Losses negatively, in which case
compensation shall be provided to the other Party to make it whole.
(c) INCOME TAX WITHHOLDING. Amylin will pay any and all taxes levied on
account of any license fee, royalty or milestone payments made to it under this
Agreement. If any taxes are required to be withheld by Xxxxx, Xxxxx will (i)
deduct such taxes from the payment made to Amylin, (ii) timely pay the taxes to
the proper taxing authority, and (iii) send proof of payment to Amylin and
certify its receipt by the taxing authority within thirty (30) days following
such payment.
(d) LATE FEE. All past due amounts owed by one Party to the other Party
under this Agreement shall bear interest at the average one-month London
Interbank Offered Rate (LIBOR) for the US Dollar, as reported by the British
Bank Association (BBA or a successor organization) from time to time, plus
[...***...] points, calculated on the number of days between the actual date the
payment is made and the date the payment was due; provided, however, that in no
event shall such rate exceed the maximum legal annual interest rate. The payment
of such interest shall not limit a Party from exercising any other rights it may
have as a consequence of the lateness of any payment.
(e) AUDITS. Upon written notice to the other Party, each Party shall
have the right, at its own expense, using the [...***...] Party's independent
certified public accounting firm as elected by the [...***...] Party (to the
extent such firm is a nationally recognized independent accounting firm) and
appropriate scientific representatives during normal business hours and not more
than once in or in respect of any Calendar Year, to audit the other Party's
books and records as may be reasonably necessary to verify the accuracy of the
financial reports furnished by the audited Party pursuant to this Agreement or
of any payments made by one Party to the other pursuant to this Agreement, in
respect of any Calendar Year ending not more than three (3) years prior to the
date of such notice. The Parties recognize that such accounting firm may perform
accounting services for the audited Party, and each Party hereby waives any
conflict of interest relating to the use of such accounting firm. In the event
the auditing Party's independent accounting firm of choice is not a nationally
recognized firm, the Parties shall mutually agree on an independent auditor.
Upon the expiration of three (3) years following the end of any Calendar Year,
the calculation of amounts payable with respect to such fiscal year shall be
binding and conclusive upon the Parties, and each Party shall be released from
any liability or accountability with respect to payments for such year. The
report prepared by the independent certified public accounting firm, a copy of
which shall be sent or otherwise provided to the other Party by such independent
public accountant at the same time it is sent or otherwise provided to the Party
requesting the audit, shall contain the conclusions of such accounting firm
regarding the audit and will specify that the amounts paid pursuant thereto were
correct or, if incorrect, the amount of any underpayment or overpayment. If such
report shows any underpayment by the audited Party, the audited Party shall
remit to the auditing Party within thirty (30) days after receipt of such
report, (i) the amount of such underpayment and (ii) if such underpayment
exceeds five percent (5%) of the total
46. *CONFIDENTIAL TREATMENT REQUESTED
amount owed for the Calendar Year then being audited, the reasonable and
necessary fees and expenses of such accounting firm to perform the audit,
subject to reasonable substantiation thereof. If such report shows any
overpayment by the audited Party, then at the audited Party's option, such
overpayment shall either be refunded to the audited Party by the auditing Party
within thirty (30) days of receipt of the audit report, or creditable against
amounts payable by the audited Party in subsequent payment periods. The Parties
agree that all information subject to review under this Section is Confidential
Information and that each Party shall retain and cause the accountant to retain
all such information in confidence.
ARTICLE 5
REGULATORY
5.1 REGULATORY STRATEGY.
The Parties will work together through the Joint Development Committee
and the Steering Committee to determine regulatory strategy in the Territory,
including strategy for filings and label content other than as provided in this
Agreement. All regulatory strategies shall be proposed by the Joint Development
Committee and referred to the Steering Committee for final approval.
5.2 REGULATORY RESPONSIBILITY IN GENERAL.
(a) REGULATORY MATERIALS. Subject to the Development Plan, and the
terms of this Agreement, Amylin shall assume sole right and principal
responsibility for the preparation, submission, and maintenance of Regulatory
Materials (including, without limitation, NDAs) and for seeking Marketing
Approval in connection with Products in the U.S., and Lilly shall assume sole
right and principal responsibility for the preparation, submission and
maintenance of Regulatory Materials (including, without limitation, NDAs) and
for seeking Marketing Approval in connection with Products (i) in each Major
Market outside the U.S. and (ii) in each country in the Territory outside of the
Major Markets that is determined by the JCC to be feasible and commercially
attractive for marketing of the Product. Such responsibilities shall be pursued
using Commercially Reasonable Efforts and in compliance with other regulatory
obligations related to the conduct of Development of the Product in the
applicable jurisdiction(s) and shall include responsibility for seeking any
necessary approvals of Regulatory Authorities for any label, labeling, package
inserts and packaging, samples and Promotional Materials to be used in the
applicable jurisdiction(s) in connection with the Product. The Party with the
lead regulatory responsibility in a country in the Territory shall be referred
to as the "Regulatory Lead" and the country(ies) in which such Party is the
Regulatory Lead shall be referred to as such Party's "REGULATORY JURISDICTION."
All INDs (and equivalent regulatory filings), Marketing Approvals and Regulatory
Materials for Products in the U.S. shall be held in Amylin's name and shall be
owned solely by Amylin, subject to Lilly's rights under this Agreement and the
Related Agreements. Lilly shall consult and
47.
cooperate with Amylin in Amylin's preparation of such NDAs and in obtaining
Marketing Approvals in the U.S. Amylin agrees to consult with Lilly regarding,
and keep Lilly regularly and fully informed of, the preparation, Regulatory
Authority review and approval of NDA filings for which Amylin is responsible.
Additionally, Amylin shall provide Lilly with the then most current copy of any
proposed NDA filing for such jurisdiction reasonably (and in any event at least
ninety (90) days) prior to its anticipated submission to the applicable
Regulatory Authority, and Lilly shall have the right to review such proposed NDA
and provide its comments to Amylin within sixty (60) days of the delivery of
such proposed NDA to Lilly. (it being understood that Lilly will review such
proposed NDA and provide such comments as expeditiously as practicable) All INDs
(and equivalent regulatory filings), Marketing Approvals and Regulatory
Materials for Products outside the U.S. shall be held in Lilly's name and be
owned solely by Lilly, subject to Amylin's rights under this Agreement and the
Related Agreements. Amylin shall consult and cooperate with Lilly in Lilly's
preparation of such NDAs and in obtaining Marketing Approvals outside the U.S.
Lilly agrees to consult with Amylin regarding, and keep Amylin regularly and
fully informed of, the preparation, Regulatory Authority review and approval of
NDA filings for which Lilly is responsible. Additionally, Lilly shall provide
Amylin with the then most current copy of any proposed NDA filing for such
jurisdiction reasonably (and in any event at least ninety (90) days) prior to
its anticipated submission to the applicable Regulatory Authority, and Amylin
shall have the right to review such proposed NDA and provide its comments to
Lilly within sixty (60) days of the delivery of such proposed NDA to Amylin (it
being understood that Amylin will review such proposed NDA and provide such
comments as expeditiously as practicable). Each Party agrees to consider in good
faith any comments or suggested made by the other.
In order for each Party to meet the foregoing responsibilities, the Regulatory
Lead will have the right to: (i) integrate data into such Regulatory Material in
its Regulatory Jurisdiction; (ii) have full access to Manufacturing data within
the Party's possession or Control and have the right to require the Party
responsible for Manufacturing to generate additional Manufacturing data to the
extent necessary to obtain and maintain Marketing Approvals in its Regulatory
Jurisdiction; (iii) seek and/or obtain any necessary approvals of Regulatory
Authorities for any label, labeling, package inserts and packaging, samples and
Promotional Materials to be used in its Regulatory Jurisdiction in connection
with the Product; (iv) make all final decisions regarding the appropriate label
language in connection with such Regulatory Material and the content of such
label, labeling, package inserts and packaging, samples, Promotional Materials
and Regulatory Material in its Regulatory Jurisdiction; and (v) review and
approve all Regulatory Material utilized to apply for Marketing Approval in its
Regulatory Jurisdiction in advance of submission to a Regulatory Authority and
determine, with the input and advice of the other Party, whether the Regulatory
Material meets the regulatory standards, and is consistent with the regulatory
strategy of the Parties. No Product label, labeling, and packaging, samples or
Promotional Materials shall be used or distributed by either Party without prior
written approval of the Joint Commercialization Committee or Steering Committee,
or its designee(s), unless in accordance with the Commercialization Plan.
48.
(b) PERIODIC UPDATES. The Regulatory Lead shall be exclusively
responsible (with reasonable cooperation from the other Party as may be
requested by the Regulatory Lead from time to time) for all post-approval
updates to Regulatory Materials in its Regulatory Jurisdiction, such as annual
updates, supplements and amendments and routine maintenance of the submissions
of the Regulatory Materials that must be provided on the Product at periodic
intervals to the Regulatory Authorities in its Regulatory Jurisdiction. In
addition, the Regulatory Lead shall be the sponsor of all filings in its
Regulatory Jurisdiction for Additional Indications, formulations and Alternate
Delivery.
Specific details regarding the management of Adverse Event information for the
Product will be delineated in a separate document, to be agreed to by the
Parties within ninety (90) days after the Effective Date of this Agreement. The
pharmacovigilance and labeling representatives of each Party will work in good
faith together to develop a document that identifies: (i) which safety
information, if any, will be exchanged; (ii) when such information will be
exchanged; (iii) which Party will have regulatory reporting responsibilities;
(iv) which Party will manage the global safety data base; (v) which Party will
be obligated to obtain follow-up information on incomplete safety reports; (vi)
which Party will review the literature for safety report information; (vii)
roles and responsibilities of the Parties related to review and approval of
safety information for inclusion in the Product label in the Territory; (viii)
which Party will prepare required periodic safety updates; and (ix) the
identification of any other details required to appropriately manage safety
information for the Product.
(c) REVIEW OF REGULATORY MATERIALS. The Regulatory Lead shall prepare
and submit to the other Party for its review all Regulatory Materials proposed
to be used in its Regulatory Jurisdiction. The Regulatory Lead will consider
comments of the other Party on such Regulatory Materials but the Regulatory Lead
shall have the final authority to determine the content of the Regulatory
Materials for use in its Regulatory Jurisdiction.
(d) COSTS. The costs of preparing, maintaining, formatting and filing
such Regulatory Materials and otherwise handling regulatory responsibilities
within the Territory shall be Development Costs subject to sharing in accordance
with Section 4.3.
49.
5.3 RELATIONSHIP WITH REGULATORY AUTHORITIES.
As sponsor of the Regulatory Materials for Product in its Regulatory
Jurisdiction, the Regulatory Lead shall have primary responsibility for
interacting with Regulatory Authorities in its Regulatory Jurisdiction, chairing
meetings with such Regulatory Authorities, responding to inquiries of such
Regulatory Authorities, and other communications with such Regulatory
Authorities, with regard to such Regulatory Materials or the Product, including
but not limited to, Regulatory Materials related to Additional Indications and
Alternate Delivery. The Regulatory Lead shall have sole authority and
responsibility regarding all regulatory obligations regarding Product in its
Regulatory Jurisdiction, including, but not limited to, the Regulatory
Materials, Promotional Materials, samples, package inserts, indications,
labeling, expedited and periodic Adverse Event reporting (as provided above),
Medical Inquiries, and Product Complaints. The Regulatory Lead shall provide the
other Party with reasonable advance notice of and any preparatory material for
any hearing before, or meeting with, any Regulatory Authority in the Regulatory
Lead's Regulatory Jurisdiction, and a reasonable number of representatives of
the other Party shall have the right to attend such hearing or meeting.
5.4 REGULATORY AUTHORITY COMMUNICATIONS RECEIVED BY A PARTY.
(a) GENERAL. Except as otherwise provided in the Development Plan or as
directed by the Steering Committee, the other Party shall not, without the prior
consultation with, and agreement of, the Regulatory Lead or unless so required
by law, correspond or communicate with Regulatory Authorities in the Regulatory
Lead's Regulatory Jurisdiction concerning the Product or any Regulatory Material
related thereto. Each Party shall keep the other Party informed of notification
of any action by, or notification or other information which it receives
(directly or indirectly) from any Regulatory Authority which: (i) raises any
material concerns regarding the safety or efficacy of the Product; (ii)
indicates or suggests a potential material liability for either Party to third
parties arising in connection with the Product; (iii) is reasonably likely to
lead to a recall or market withdrawal of the Product; (iv) relates to Product,
Regulatory Materials, Promotional Materials, samples, package inserts,
indications, labeling, expedited and periodic Adverse Event Reports, Medical
Inquiries, Product Complaints, this Agreement or the Related Agreements, or (v)
is otherwise important to the Development, Manufacturing and/or
Commercialization of the Product including, without limitation, the following
information:
(1) REGULATORY ACTIONS. Any information pertaining to actions taken
by Regulatory Authorities in connection with Product (and/or its Manufacture,
distribution and/or facilities connected thereto) including, without limitation,
any notice, audit notice, notice of initiation by Regulatory Authorities of
investigations, inspections, detentions, seizures or injunctions concerning the
Product (and/or its Manufacture or distribution and/or facilities connected
thereto), notice of violation letter (i.e., an untitled letter), warning letter,
service of process or other inquiry;
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(2) REGULATORY NON-COMPLIANCE. Any information pertaining to
notices from Regulatory Authorities of non-compliance with laws, regulations,
rules or guidance in connection with the Product including, without limitation,
receipt of a warning letter or other notice of alleged non-compliance from any
Regulatory Authority relating to the Product; and
(3) OTHER REGULATORY COMMUNICATION. Any information pertaining to
or involving inquiries or communications by or from Regulatory Authorities
concerning: (i) the clinical investigation activities of Product (including
inquiries by Regulatory Authorities pertaining to investigators, clinical
monitoring organizations and other related parties involved with the Product);
(ii) the Manufacture, sale, promotion or distribution of Product; or (iii) any
other material inquiries or communications by Regulatory Authorities involving
the Product.
In the event that a Party receives any communication or questions from
any Regulatory Authority in the other Party's Regulatory Jurisdiction relating
to such matters such Party will notify the Regulatory Lead immediately (but in
no event later than one business day after receipt of such notice or inquiry)
and provide to the Regulatory Lead copies of all documents it received from the
Regulatory Authorities. The Regulatory Lead will then prepare the response to
the communication (except for responses to FDA communications regarding a loss,
theft, of significant loss of the other Party's Product samples). Before
submitting a response to a Regulatory Authority regarding correspondence
received by a Party, the Regulatory Lead will give the other Party an
opportunity to comment on the response to the extent such response may affect
the other Party's rights or obligations under this Agreement.
(b) COOPERATION. In the event the Parties disagree concerning the form
or content of a response to a Regulatory Authority, the Regulatory Lead in the
applicable Regulatory Jurisdiction will decide the appropriate form and content
of it. The other Party will fully cooperate with, and assist, the Regulatory
Lead in complying with such regulatory obligations and communications, including
by providing to the Regulatory Lead, within forty-eight (48) hours (or sooner as
specified elsewhere in the Agreement) after a request by the Regulatory Lead,
such information and documentation in the other Party's possession as may be
necessary or helpful for the Regulatory Lead to prepare a response to an inquiry
from a Regulatory Authority. If it is necessary for a Party to respond to FDA or
any other Regulatory Authority in the other Party's Regulatory Jurisdiction,
such Party shall seek the input and approval of the Regulatory Lead before
responding. Each Party will also provide the other Party with a copy of all
correspondence received from a Regulatory Authority specifically regarding the
matters referred to above.
(c) COMMITMENTS. Each Party shall conform its respective activities
under this Agreement to any commitments made in the response, except to the
extent a Party believes in good faith that such commitments violate Applicable
Laws.
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5.5 EFFORTS.
The Parties shall use their respective Commercially Reasonable Efforts
consistent with their respective responsibilities hereunder to file for and
obtain all necessary Marketing Approvals in the Territory in accordance with the
regulatory strategy for the Territory. All regulatory strategies shall be
proposed and approved by the Joint Development Committee and referred to the
Steering Committee for final approval.
5.6 COMMUNICATIONS CONCERNING PRODUCT.
The Parties shall mutually agree upon procedures for communication and handling
of Product Complaints and Medical Inquiries concerning the Product. All Product
Complaints concerning suspected or actual Product tampering, contamination or
mix-up (e.g. wrong ingredients) shall be notified to the Regulatory Lead by
telephone immediately and delivered in writing within twenty-four (24) hours of
receipt of the same. Except as mutually agreed, the other Party shall not take
any other action in connection with any such Product Complaint without the
consent of the Regulatory Lead. Additional specifics regarding roles and
responsibilities for responding to Medical Inquiries from health care
professionals are to be agreed to in the document developed pursuant to Section
5.2(b) of this Agreement.
5.7 GENERAL REGULATORY ASSISTANCE AND ACCESS TO REGULATORY INFORMATION.
Each Party will cooperate and provide the other Party with all Information and
assistance reasonably necessary or desirable for such other Party to carry out
and comply with any regulatory obligations or requirements of Regulatory
Authorities in connection with the Development, Manufacture and/or
Commercialization of Product in such other Party's Regulatory Jurisdiction to
the extent contemplated under the terms and intent of this Agreement, including,
without limitation, providing such information and assistance to such other
Party as is necessary or desirable to: (i) submit, obtain, maintain and update
Regulatory Material for the Product with Regulatory Authorities in such other
Party's Regulatory Jurisdiction (including, without limitation, sharing clinical
data, pre-clinical data, Development data, manufacturing data, and notes and
documents related to discussions with Regulatory Authorities in connection with
such Regulatory Material); (ii) report Adverse Drug Experience Reports and
Serious Adverse Drug Experience Reports to applicable Regulatory Authorities in
connection with the Product in such other Party's Regulatory Jurisdiction; (iii)
submit or file Promotional Materials with Regulatory Authorities in connection
with the Product in such other Party's Regulatory Jurisdiction; and (iv) comply
with any other requirements of Regulatory Authorities in connection with the
Product in such other Party's Regulatory Jurisdiction.
5.8 REGULATORY INSPECTION OR AUDIT.
If a Regulatory Authority desires to conduct an inspection or audit of Lilly or
Amylin with regard to Product or this Agreement, Lilly and Amylin each agrees to
cooperate with the
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Regulatory Authority and the other Party during such inspection or audit,
including by allowing, to the extent practicable, a representative of the other
Party to be present during the applicable portions of such inspection or audit.
Following receipt of the inspection or audit observations of the Regulatory
Authority (a copy of which the Party will immediately provide to the other
Party), the Regulatory Lead in the applicable Regulatory Jurisdiction will
prepare the response to any observation that concerned this Agreement. The other
Party agrees to fully cooperate with the Regulatory Lead when it prepares such a
response, including by providing to the Regulatory Lead, within seventy-two (72)
hours after its request, such information and documentation in the Party's
possession as may be necessary for the Regulatory Lead to prepare such response.
Before submitting the response to the Regulatory Authority, the Regulatory Lead
agrees to give the other Party an opportunity to comment on it. In the event the
Parties disagree concerning the form or content of a response, the Regulatory
Lead will decide the appropriate form and content of it. Each Party agrees to
conform its respective activities under this Agreement to any commitments made
in such a response, except to the extent a Party believes in good faith that
such commitments violate Applicable Laws.
Each Party (and its Third Person subcontractors) shall notify the other Party
within twenty-four (24) hours of receipt of notification from a Regulatory
Authority of the intention of such Regulatory Authority to audit or inspect
facilities being used for Manufacture of Products. Each Party (and its Third
Person subcontractors) shall also provide the other Party with copies of any
written communications received from Regulatory Authorities with respect to such
facilities within thirty-six (36) hours of receipt. Such Party shall provide the
other Party with an opportunity to review and provide input on any proposed
response by such Party (or Third Person subcontractor) to such communications.
5.9 AUDITS.
Each Party shall have the right, at its own cost and expense, at reasonable
times and upon reasonable prior written notice to conduct quality assurance
audits on the other Party's Development, Manufacture, storage, shipping or
distribution facilities (including computer systems such as those that capture,
analyze or store study information or results), as well as the facilities of any
subcontractors, where work on the Development, Manufacture, storage, shipping or
distribution of Product is conducted, as reasonably deemed necessary by the
other Party in order to ensure that such facilities meet the other Party's and
Regulatory Authority standards, including GCP, GLP and GMP. If such services are
being performed by a Third Person for either Party, such Party shall first
obtain permission on behalf of the other Party. Each Party hereby agrees to
cooperate with the other Party and take such other acts as may be reasonably
necessary or appropriate to carry out the purpose and intent of this Section,
including, without limitation, use of its Commercially Reasonable Efforts to
comply with the other Party's recommendations for action.
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5.10 RECORDS.
Each Party will maintain records, in sufficient detail and in good scientific
manner, that will fully and properly reflect all work done and results achieved
in the performance of its responsibilities under this Agreement, the Development
Plan, and the Commercialization Plan. Each Party will have the right, during
normal business hours and upon reasonable prior notice, to inspect and copy
those records of the other Party referred to herein that are necessary or useful
to the inspecting Party for the purposes of making any required filings with
Regulatory Authorities in order to obtain Manufacturing Approvals and/or
Marketing Approvals. Each Party will maintain such records and the information
disclosed therein in confidence in accordance with Article 6.
5.11 RECALLS.
In the event that a Regulatory Authority issues a request, directive, or order,
or the Parties determine to recall or remove the Product from the market, the
recall shall be the responsibility of the Marketing Approval holder. Both
parties will cooperate fully with one another in conducting the recall.
ARTICLE 6
CONFIDENTIALITY AND PUBLICATION
6.1 OBLIGATIONS.
Except upon obtaining the other Party's prior written consent to the contrary,
each Party agrees that it will:
(a) maintain in confidence, and not disclose to any person or entity
(except as provided in Section 6.2), the other Party's Confidential Information
for the term of this Agreement and five (5) years thereafter; and
(b) not use such Confidential Information for any purpose except as
contemplated in this Agreement.
6.2 AUTHORIZED DISCLOSURES OF CONFIDENTIAL INFORMATION.
(a) PERMITTED PERSONS. Each Party may disclose Confidential Information
of the other Party, without such other Party's prior written consent, to its and
its Affiliates' (or the other Party's and its Affiliates') directors, employees,
agents, consultants, permitted Sublicensees, suppliers, and other person or
entities who:
(i) need to know such Confidential Information to assist the Party
in fulfilling its obligations or exploiting its rights hereunder (or to
determine their interest in providing such assistance); and
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(ii) are bound by written confidentiality and non-use obligations
no less stringent than those contained herein.
(b) LEGALLY REQUIRED OR NECESSARY. Each Party may also disclose the
Confidential Information of the other Party, without such other Party's prior
written consent, to any person, entity, or government or regulatory authority to
the extent that the law requires such disclosure. In addition, the Regulatory
Lead may also disclose the other Party's Confidential Information, without the
other Party's prior written consent, to any person, entity, or government or
Regulatory Authority to the extent that such disclosure is necessary for
obtaining, maintaining, or amending any Regulatory Materials regarding Product
in the Regulatory Lead's Regulatory Jurisdiction or satisfying any other
regulatory obligation regarding Product in the Regulatory Lead's Regulatory
Jurisdiction.
Prior to disclosing the other Party's Confidential Information under
this Subsection, the disclosing Party, to the extent practicable, will give the
other Party a copy of the Confidential Information to be disclosed and provide
such Party a reasonable opportunity to comment on the necessity and the text of
the proposed disclosure. The disclosing Party agrees to consider such comments
in good faith and to reasonably avail itself of available means under the
applicable law to minimize the disclosure of such Confidential Information.
(c) COURT ORDERS. Each Party may also disclose the Confidential
Information of the other Party, without such other Party's prior written
consent, pursuant to an order of a Regulatory Authority or court of competent
jurisdiction, provided that it promptly notifies the other Party of the required
disclosure in order to provide such Party an opportunity to take legal action to
prevent or limit such disclosure and, if asked, reasonably assists the other
Party in pursuing such action.
(d) LEGAL ACTIONS. Each Party may also disclose the Confidential
Information of the other Party, without such other Party's prior written
consent, as is necessary to pursue or defend against a legal or regulatory
action by one Party against the other with respect to this Agreement. A Party
disclosing the other Party's Confidential Information, pursuant to this
Subsection, will use reasonable efforts to minimize the disclosure of the other
Party's Confidential Information, including, without limitation, by seeking to
file pleadings under seal.
6.3 DISCLOSURE OF THE TERMS OF THE AGREEMENT.
Each Party agrees that it will maintain in confidence, and not disclose, the
terms of this Agreement without the prior written consent of the other Party,
except as authorized under Subsections (a), (b), (c), or (d) of Section 6.2. In
addition, if a Party receives a request from an authorized representative of a
U.S. or foreign tax authority for a copy of the Agreement, that Party may
provide a copy of the Agreement to such tax authority representative without
advance notice to, or the consent or cooperation of, the other
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Party, but the disclosing Party must notify the other Party of the disclosure as
soon as practical.
(a) DISCLOSURE TO AUTHORIZED PERSONS. Either Party may disclose such
information to its agents, consultants, permitted Sublicensees and suppliers,
who need to know such information to perform their contractual obligations to
such Party, and who agree to be bound by terms of confidentiality and non-use at
least as strict as those set forth in this Agreement.
(b) USE OF NAME. Neither Party shall use the name of the other Party,
without the prior written approval of the other Party, for any purpose other
than informing employees who need to know about this Agreement. Without
limitation, these prohibitions apply to press releases, annual reports,
prospectuses, public statements, educational and scientific conferences,
Promotional Materials, governmental filings and discussions with public
officials, securities analysts, investors and the media. However, subject to the
requirements for review and approval that follow, these prohibitions shall not
apply to a disclosure of the other Party's name, which counsel to a Party has
advised is required by law or regulation or in response to requests for a copy
of this Agreement or related information by tax authorities.
(c) DISCLOSURE ON ADVICE OF COUNSEL. If any Party to this Agreement,
based on the advice of counsel, determines that a release of information
regarding the existence or terms of this Agreement is required by law or
regulation, then prior to any release of such information, that Party will
notify the other Party as soon as practical and provide as much detail as
possible in relation to the proposed disclosure and will endeavor in good faith
to provide the other Party with a minimum of five (5) business days to review
and provide comments on the proposed release. The disclosing Party will use its
best efforts to incorporate comments of the other Party to the extent consistent
with fulfilling its legal obligations.
(d) REDACTION OF AGREEMENT. Lilly shall have the right to review and
comment on any redaction of this Agreement for purposes of filing the Agreement
by Amylin as required by the SEC or other agencies.
(e) PUBLICITY. It is understood that the Parties intend to issue a
joint press release announcing the execution of this Agreement and agree that
each Party may desire or be required to issue subsequent press releases relating
to the Agreement or activities hereunder. The Parties agree to consult with each
other reasonably and in good faith with respect to the text and timing of such
press releases prior to the issuance thereof, provided that a Party may not
unreasonably withhold consent to such releases, and that either Party may issue
such press releases as it determines, based on advice of counsel, are reasonably
necessary to comply with laws or regulations or for appropriate market
disclosure. In addition, following the initial joint press release announcing
this Agreement, each Party shall be free to disclose, without the other Party's
prior written consent, the existence of this Agreement, the identity of the
other
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Party and those terms of the Agreement which have already been publicly
disclosed in accordance herewith.
(f) PUBLICITY REFERRAL. Unless, otherwise directed in writing by Lilly,
all matters that require Lilly's review or consent under this Section must be
referred to Lilly's Corporate Communications (Public Relations) department for
review and approval at the address set forth in Section 14.6. Unless otherwise
directed in writing by Amylin, all matters that require Amylin's review or
consent under this Section must be referred to Amylin's Vice President of
Finance and Chief Financial Officer, at the address set forth in Section 14.6.
6.4 PUBLICATIONS.
The JDC shall develop procedures for review and approval of publications related
to Compound or other activities of the Collaboration, and neither Party shall
permit any publication in violation of such procedures.
ARTICLE 7
REPRESENTATIONS, WARRANTIES AND DISCLAIMERS
7.1 CORPORATE EXISTENCE AND AUTHORITY.
Each Party hereby represents and warrants to the other Party that, as of the
Effective Date, it:
(a) is a corporation duly organized, validly existing and in good
standing under the laws of the state or country in which it is incorporated;
(b) has full corporate power and authority and the legal right to own
and operate its property and assets and to carry on its business as it is now
being conducted and is contemplated in this Agreement and the Related Agreements
(without making any representation as to the intellectual property rights); and
(c) has the corporate power and full authority and the legal right to
enter into this Agreement and perform the obligations and duties contemplated
under this Agreement and the Related Agreements.
7.2. AUTHORIZED EXECUTION; BINDING OBLIGATION.
Each Party represents and warrants to the other Party that, as of the
Effective Date (i) the execution, delivery, and performance of the Agreement and
the Related Agreements and the consummation of the transactions contemplated
thereby have been duly authorized and approved by all necessary corporate action
on its part; and (ii) this Agreement and the Related Agreements have been duly
executed and delivered by it and constitute a legal, valid, and binding
obligation enforceable against it in
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accordance with such Agreement's terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or affecting creditors' rights generally and by general equity
principles, including judicial principles affecting the availability of
injunction and specific performance.
7.3 NO CONFLICTS.
Each Party represents and warrants to the other Party that its execution,
delivery, and performance of this Agreement and the Related Agreements:
(a) does not, except as otherwise described in this Agreement, require
the approval or consent of any person or entity, which has not already been
obtained;
(b) does not, to the best of its knowledge, contravene any Applicable
Laws; and
(c) does not contravene the provisions of, nor constitute a default
under, its articles of incorporation or bylaws or any indenture, mortgage,
contract or other agreement or instrument to which it is a signatory, or any
permit, or governmental authorization or grant.
7.4 ALL CONSENTS AND APPROVALS OBTAINED.
Except as otherwise described in this Agreement, each Party represents and
warrants to the other that (i) all necessary consents, approvals and
authorizations of, and (ii) all notices to, and filings by such Party with, all
governmental authorities and other persons or entities required to be obtained
or provided by such Party in connection with the execution, delivery and
performance of this Agreement and the Related Agreements have been obtained and
provided, except for those government approvals, if any, not required at the
time of execution of this Agreement.
7.5 REGULATORY MATTERS REGARDING PRODUCT IN THE TERRITORY.
Amylin is the named holder of the IND for Product and has complied, to the best
of its knowledge, in all material respects with all Applicable Laws in
connection with the IND.
7.6 EXISTING PATENTS IN THE TERRITORY.
Amylin represents and warrants that
(a) ATTACHMENT 7.6 lists all Amylin Patents existing as of the
Effective Date; and
(b) to the best of its knowledge, as of the Effective Date, (i) there
is no litigation or arbitration, either pending or threatened in writing,
alleging that any Amylin Patent is invalid or unenforceable anywhere in the
Territory and (ii) Amylin is the sole
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owner of or is the holder of a valid license to the Amylin Patents and has the
right to grant to Lilly the sublicenses granted hereunder.
7.7 DISCLAIMER OF IMPLIED WARRANTIES.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT OR THE RELATED AGREEMENTS,
NEITHER PARTY MAKES ANY OTHER REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED,
EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND EACH PARTY
SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING
WARRANTIES OF MERCHANTABILITY, OF FITNESS FOR A PARTICULAR PURPOSE, AND OF
NON-INFRINGEMENT.
7.8 LIMITATION OF LIABILITY.
NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY FOR INDIRECT, INCIDENTAL,
CONSEQUENTIAL, OR SPECIAL DAMAGES INCLUDING, BUT NOT LIMITED TO, LOST PROFITS
ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY
NOTICE OF THE POSSIBILITY OF SUCH DAMAGES. HOWEVER, NOTHING IN THIS SECTION IS
INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF
EITHER PARTY UNDER ARTICLE 8.
7.9 GUARANTEE OF PERFORMANCE OF AFFILIATES.
Each Party absolutely, unconditionally and irrevocably guarantees to the other
Party: prompt performance when due and at all times thereafter of the
liabilities (including, without limitation, indemnity obligations and
liabilities), obligations, covenants, warranties, representations and
undertakings (collectively, the "LIABILITIES") of its Affiliates pursuant to
this Agreement and the Related Agreements, and any and all modifications and
amendments thereof.
ARTICLE 8
MUTUAL INDEMNIFICATION
8.1 INDEMNIFICATION OBLIGATIONS.
(a) LILLY'S OBLIGATION. Lilly will defend, indemnify, and hold harmless
Amylin, Amylin's Affiliates, and the respective directors, officers,
shareholders, employees, and agents of Amylin and Amylin's Affiliates ("Amylin
Indemnitees"), from and against any and all liabilities, damages, losses,
penalties, fines, costs, interest, and expenses, including, without limitation,
reasonable attorneys' fees, ("Damages") arising from or occurring as a result of
a Third Person's claim, action, suit, judgment, or settlement against an Amylin
Indemnitee that is due to or based upon:
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(i) any breach by Lilly of an obligation, agreement, condition,
covenant, representation, or warranty of Lilly under this Agreement or any of
the Related Agreements, or
(ii) any negligent or more culpable act or omission of Lilly or a
Lilly Affiliate, sublicensee, or contractor or their respective directors,
officers, shareholders, employees, and agents related to this Agreement or any
of the Related Agreements ((i) and (ii) each, an "AMYLIN THIRD PERSON CLAIM");
provided, however, that Lilly will not be obligated to indemnify or hold
harmless Amylin Indemnitees from Damages from an Amylin Third Person Claim to
the extent that such Damages are finally determined to have resulted from the
negligent (or more culpable) act or omission of an Amylin Indemnitee or any
breach by Amylin of an obligation, agreement, condition, covenant,
representation, or warranty of Amylin under this Agreement or any of the Related
Agreements.
(b) AMYLIN'S OBLIGATION. Amylin will defend, indemnify, and hold
harmless Lilly, Lilly's Affiliates, and the respective directors, officers,
shareholders, employees, and agents of Lilly and Lilly's Affiliates ("Lilly
Indemnitees"), from and against any and all Damages arising from or occurring as
a result of a Third Person's claim, action, suit, judgment, or settlement
against a Lilly Indemnitee that is due to or based upon:
(i) any breach by Amylin of an obligation, agreement, condition,
covenant, representation, or warranty of Amylin under this Agreement or any of
the Related Agreements, or
(ii) any negligent or more culpable act or omission of Amylin or an
Amylin Affiliate, sublicensee, or contractor (excluding Existing Suppliers or
any other Third Parties manufacturing Product) or their respective directors,
officers, shareholders, employees, and agents related to this Agreement or any
of the Related Agreements ((i) and (ii) each, a "LILLY THIRD PERSON CLAIM");
provided, however, that Amylin will not be obligated to indemnify or hold
harmless Lilly Indemnitees from Damages from a Lilly Third Person Claim to the
extent that such Damages are finally determined to have resulted from the
negligent (or more culpable) act or omission of a Lilly Indemnitee or any breach
by Lilly of an obligation, agreement, condition, covenant, representation, or
warranty of Lilly under this Agreement or any of the Related Agreements.
(c) JOINT OBLIGATIONS. In the event of any product liability or other
Third Party claim in which both Parties are asserted to be liable and neither is
entitled to indemnification hereunder, the Parties shall treat such Damages as
Commercialization Costs.
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8.2 INDEMNIFICATION PROCEDURES.
(a) NOTICE. Promptly after an Amylin Indemnitee or a Lilly Indemnitee
(each, an "Indemnitee") receives notice of a pending or threatened Amylin Third
Person Claim or Lilly Third Person Claim, as the case may be (an "Action"), such
Indemnitee shall give written notice of the Action to the Party to whom the
Indemnitee is entitled to look for indemnification pursuant to this Article 8
(the "Indemnifying Party"). However, an Indemnitee's delay in providing or
failure to provide such notice will not relieve the Indemnifying Party of its
indemnification obligations, except to the extent it can demonstrate prejudice
due to the delay or lack of notice.
(b) DEFENSE. Upon receipt of notice under Subsection (a) from the
Indemnitee, the Indemnifying Party will have the duty to either compromise or
defend, at its own expense and by counsel (reasonably satisfactory to
Indemnitee), such Action. The Indemnifying Party will promptly (and in any event
not more than twenty (20) days after receipt of the Indemnitee's original
notice) notify the Indemnitee in writing that it acknowledges its obligation to
indemnify the Indemnitee with respect to the Action pursuant to this Article 8
and of its intention to either compromise or defend such Action. Once the
Indemnifying Party gives such notice to the Indemnitee, the Indemnifying Party
is not liable to the Indemnitee for the fees of other counsel or any other
expenses subsequently incurred by the Indemnitee in connection with such
defense, other than the Indemnitee's reasonable costs of investigation and
cooperation. However, the Indemnitee will have the right to employ separate
counsel and to control the defense of an Action (and the Indemnifying Party
shall bear the reasonable fees, costs, and expenses of such counsel) if:
(i) the use of the counsel chosen by the Indemnifying Party would
present such counsel with a conflict of interest;
(ii) the actual or potential defendants in, or targets of, such
Action include both the Indemnifying Party and the Indemnitee, and the
Indemnitee reasonably concludes that there may be legal defenses available to it
that are different from or additional to those available to the Indemnifying
Party (in which case the Indemnifying Party will not have the right to assume
the defense of such Action on the Indemnitee's behalf);
(iii) the Indemnifying Party does not employ counsel satisfactory
to the Indemnitee to represent the Indemnitee within a reasonable time after the
Indemnitee's notice of such Action;
(iv) the Indemnifying Party denies or fails to timely admit its
obligation to defend and indemnify the Action; or
(v) in the reasonable opinion of counsel to the Indemnitee, the
claim could result in the Indemnitee becoming subject to injunctive relief or
relief other than
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the payment of Damages that could have a materially adverse effect on the
ongoing business of the Indemnitee;
provided, however, that in no event shall the Indemnifying Party be obligated to
bear the fees, costs and expenses of more than one (1) separate counsel for all
of the other Party's Indemnitees in such Action.
(c) COOPERATION. The Indemnitee will cooperate fully with the
Indemnifying Party and its legal representatives in the investigation and
defense of an Action. The Indemnifying Party will keep the Indemnitee informed
on a reasonable and timely basis as to the status of such Action (to the extent
the Indemnitee is not participating in the defense of such Action) and conduct
the defense of such Action in a prudent manner.
(d) SETTLEMENT. If an Indemnifying Party assumes the defense of an
Action, no compromise or settlement of such Action may be effected by the
Indemnifying Party without the Indemnitee's written consent (which consent will
not be unreasonably withheld or delayed), unless (i) there is no finding or
admission of any violation of law or any violation of the rights of any person
and no effect on any other claims that may be made against the Indemnitee, (ii)
the sole relief provided is monetary damages that are paid in full by the
Indemnifying Party, and (iii) the Indemnitee's rights under this Agreement are
not adversely affected. If the Indemnifying Party fails to assume defense of an
Action within a reasonable time, the Indemnitee may settle such Action on such
terms as it deems appropriate with the consent of the Indemnifying Party (which
consent shall not be unreasonably withheld), and Indemnifying Party will be
obligated to indemnify the Indemnitee for such settlement as provided in this
Article 8.
8.3 INDEMNIFICATION PAYMENT ADJUSTMENTS.
(a) INSURANCE PROCEEDS OR OTHER RECOVERY. The amount of any Damages for
which indemnification is provided under this Article 8 will be reduced by the
insurance proceeds received and any other amount recovered, if any, by the
Indemnitee with respect to any Damages. However, an Indemnitee does not have an
obligation to pursue an insurance claim relating to any Damages for which
indemnification is sought hereunder.
(b) REFUND. If an Indemnitee receives a payment pursuant to this
Article 8 and subsequently receives insurance proceeds or other amounts with
respect to the same Damages, the Indemnitee will pay to the Indemnifying Party
an amount equal to the difference (if any) between: (i) the sum of the insurance
proceeds received, other amounts received, and the indemnification amount
received from the Indemnifying Party pursuant to this Article 8 and (ii) the
amount necessary to fully and completely indemnify and hold harmless the
Indemnitee from and against such Damages. However, in no event will such refund
ever exceed the Indemnifying Party's payment to the Indemnitee under this
Article 8.
62.
8.4 INDEMNIFICATION PAYMENT. Any amount owed by an Indemnitee to a Third Person,
for which the Indemnifying Party has an obligation under this Article 8 to
indemnify, will be due from the Indemnifying Party when such amount is owed by
the Indemnitee to the Third Person, whether upon entry of judgment, upon
settlement, or otherwise.
8.5 SURVIVAL. The provisions of this Article 8 will survive any termination or
expiration of this Agreement. Each Indemnitee's rights under this Article 8 will
not be deemed to have been waived or otherwise affected by such Indemnitee's
waiver of the breach of any obligation, agreement, condition, covenant,
representation, or warranty contained in, or made pursuant to, this Agreement,
unless such waiver expressly (and in writing) also waives any or all of the
Indemnitee's rights under this Article 8.
ARTICLE 9
LICENSE GRANTS; OPTION
9.1 LICENSE GRANTS.
(a) BY AMYLIN. Subject to the terms and conditions of this Agreement,
Amylin hereby grants to Lilly and its Affiliates an exclusive license (except as
set forth below) in the Territory except for the U.S. with the right to
sublicense in accordance with Section 9.2, under the Amylin Rights existing as
of the Effective Date ("Existing Amylin Rights"), solely to develop, make, have
made, use, sell, offer for sale, have sold and import Compound and Product in
the Field in the Territory except for the U. S. as contemplated by this
Agreement, and otherwise to perform its obligations expressly set forth in this
Agreement or the Related Agreements in the Territory.
Amylin shall retain the right to practice under the inventions claimed
in, and, subject to Section 9.2, to grant licenses under, the Existing Amylin
Rights (i) to the extent necessary to perform its obligations expressly set
forth in this Agreement and the Related Agreements, and (ii) for any and all
purposes other than to develop, make, have made, use, sell, offer for sale, have
sold and import Compound and Product in the Field in the Territory.
(b) BY LILLY. Subject to the terms and conditions of this Agreement,
Lilly hereby grants to Amylin and its Affiliates an exclusive license (except as
set forth below) in the Territory, with the right to sublicense in accordance
with Section 9.2, under the Lilly Rights existing as of the Effective Date
("Existing Lilly Rights"), solely to develop, make, have made, use, sell, offer
for sale, have sold and import Compound and Product in the Field in the
Territory as contemplated by this Agreement and otherwise to perform its
obligations expressly set forth in this Agreement or the Related Agreements in
the Territory.
Lilly shall retain the right to practice under the inventions claimed
in, and, subject to Section 9.2, to grant licenses under, the Existing Lilly
Rights (i) to the extent
63.
necessary to perform its obligations expressly set forth in this Agreement and
the Related Agreements, and (ii) for any and all purposes other than to develop,
make, have made, use, sell, offer for sale, have sold and import Compound and
Product in the Field in the Territory.
9.2 PERMITTED SUBLICENSES; RIGHT TO ENGAGE THIRD PERSONS. Each Party shall have
the right to grant sublicenses under the licenses granted to it pursuant to
Sections 9.1, 9.5 and 10.1 solely to (a) distributors for the purpose of
distributing Product in accordance with the terms of this Agreement and the
Related Agreements and (b) to the extent required for any manufacturing and
supply agreement between the parties, contract manufacturers for the purpose of
Manufacturing Compound or Product in accordance with the terms of this Agreement
and the Related Agreements. In addition, Lilly shall have the right to grant
sublicenses or obtain promotional support in Territories other than Major
Markets, and Lilly shall remain responsible and liable for all actions of
Sublicensees and other Third Person providers involved in such activities. If
Lilly determines that it requires Product promotion support in a Major Market,
then Lilly may contract for additional Product promotion support from a Third
Person, provided that Lilly shall consult with Amylin regarding the identity of
such Third Person and the scope of the Product promotion activities that Lilly
proposes to have such Third Person perform. If Amylin has the interest and
believes that it has the ability to provide such support, it may so indicate,
and Lilly will consider Amylin's offer of assistance in good faith. The
sublicensing of rights to a Third Person with respect to co-marketing and/or
co-promotion of Products in any Major Market will require Amylin's prior written
consent, not to be unreasonably withheld. Amylin's consent shall not be required
for markets other than a Major Market. Subject to the terms of the Co-Promotion
Agreement, neither Party shall engage a contract sales organization or other
Third Person to fulfill any of its obligations under the Commercialization Plan
with respect to a Major Market, except with the prior written consent of the
other Party, not to be unreasonably withheld. Finally, each Party shall have the
right to contract with one or more Third Persons to perform certain of its
obligations under the Development Plan or the Commercialization Plan, provided
such Party shall remain responsible and liable for activities of such Third
Persons. However, each Party's right to contract with any Third Persons as
permitted by this Section 9.2 is subject to the following requirements: (i) none
of the other Party's rights hereunder shall be diminished or otherwise adversely
affected as a result of such contracting, (ii) each such Third Person shall
undertake in writing obligations of confidentiality, publication and non-use
regarding Confidential Information which are substantially the same as those
undertaken by the Parties under this Agreement, and (iii) such Third Person
expenses shall be consistent with the Development Budget, or the
Commercialization Budget, as the case may be.
9.3 OPTION COMPOUNDS.
(a) Each Party hereby grants the other Party an exclusive option to
enter into an agreement for the Development of Option Compound(s) Controlled by
the granting Party upon the terms set forth in this Section 9.3 (the "Compound
Option"). If either Party desires to proceed with Development for the Indication
of an Option Compound Controlled by it ("Optionor") during the Option Period,
then Optionor shall provide the
64.
other Party ("Optionee") with written notice of its intent ("Option Notice") not
later than the earlier of :
(i) sixty (60) days prior to Optionor's [...***...] for the Option
Compound; and
(ii) [...***...] for the Option Compound.
Optionor shall include with the Option Notice, Option Compound information
reasonably necessary to enable Optionee to evaluate the Option Compound.
Optionee shall have the sole and exclusive option to participate in the
Development and Commercialization of the Option Compound by providing Optionor
with written notice of its intent to exercise the option within sixty (60) days
after receipt of the Option Notice. If the Option Notice is given at the time
contemplated by (a)(i) above, and the Optionee elects not to exercise the option
at that time, the Optionor shall provide a new Option Notice at the time
contemplated by (a)(ii) above, and the Optionee shall again have a sixty (60)
day period in which to exercise the Compound Option.
(b) The following terms shall apply to exercise of any Compound Option.
TIER I TIER I TIER II TIER II
COMPOUNDS COMPOUNDS COMPOUNDS COMPOUNDS
CONTROLLED BY CONTROLLED BY CONTROLLED BY CONTROLLED BY
Terms AMYLIN LILLY AMYLIN LILLY
----------------------------------------------- ----------------- ---------------- ---------------- -----------------
If the Compound Option is exercised pursuant [...***...]% [...***...]% [...***...]% [...***...]%
to Section 9.3 (a) (i), Optionee shall
reimburse Optionor the following respective
percentages of the total development costs
that have been incurred by Optionor up to
the date of Optionee's notice exercising the
option.*
If the Compound Option is exercised pursuant [...***...]% [...***...]% [...***...]% [...***...]%
to Section 9.3 (a) (ii), Optionee shall
reimburse Optionor the following respective
percentages of the total development costs
that have been incurred by Optionor up to the
date of Optionee's notice exercising the
option.*
Development Costs incurred on and after the [...***...]%/ [...***...]% [...***...]%/ [...***...]%/
date of Optionee's notice exercising a [...***...]% /[...***...]% [...***...]% [...***...]%
Compound Option for Development of Products
containing Tier I Compounds or Tier II
Compounds in the U.S., shall be shared by
the parties based on the following respective
percentages.
Development costs incurred on and after the [...***...] [...***...] [...***...] [...***...]
date of Optionee's notice
65. *CONFIDENTIAL TREATMENT REQUESTED
TIER I TIER I TIER II TIER II
COMPOUNDS COMPOUNDS COMPOUNDS COMPOUNDS
CONTROLLED BY CONTROLLED BY CONTROLLED BY CONTROLLED BY
Terms AMYLIN LILLY AMYLIN LILLY
----------------------------------------------- ----------------- ---------------- ---------------- -----------------
exercising a Compound Option, for Development [...***...] [...***...] [...***...] [...***...]
of Products containing Tier I Compounds or
Tier II Compounds outside of the U.S. shall
be shared by the parties based on the
following respective percentages.
Royalty rate to be paid to the inventing [...***...]% [...***...]% [...***...]% [...***...]%
Party by the other Party based on Net Sales
of product containing Option Compound
--------------
* All reimbursable development costs shall be paid within thirty (30) days of
the date of Optionee's notice exercising the option and shall also include
research costs directly attributable to the Option Compound.
(c) Unless otherwise agreed by the Parties, and subject to Section 9.4,
no milestone payments shall be made with respect to any Option Compounds, nor
shall there be any obligation to make up-front payments, stock purchases or
loans related thereto.
If Optionee elects to exercise its Compound Option, then the Parties shall
within sixty (60) days thereafter negotiate in good faith a collaboration
agreement with respect to the Option Compound, which agreement shall:
(i) be consistent with the provisions of this Section 9.3,
(ii) be substantially similar to this Agreement, with such changes as
are necessary to reflect the identity and role of the Party Controlling the
Option Compound (e.g., for an Option Compound Controlled by Xxxxx, Xxxxx would
book sales of the Option Compound and Amylin would co-promote the Option
Compound in the U.S.), and
(iii) provide that the Parties will share Operating Profits or Losses
[...***...]%/[...***...]% in the U.S. and [...***...]% Lilly [...***...]% Amylin
in the Territory outside the U.S.
(iv) contain such other provisions as the Parties may agree.
9.4 BACK-UP COMPOUND. If Development of the Product used in the Amigo
Trials is discontinued anytime before forty-five (45) days after the Early
Termination Date, Lilly shall have the right to bring into the Collaboration
provided for in this Agreement an Option Compound Controlled by Amylin that is a
Tier 1 Compound ("Amylin Controlled Compound"). If Lilly advises Amylin that it
desires to consider exercising this option, Amylin shall identify to Lilly
[...***...] Amylin Controlled Compounds that Amylin in good faith believes
represent the best candidates for further development among the Amylin
Controlled Compounds. Amylin shall provide all information regarding such
compounds as Lilly may reasonably request in order to evaluate the opportunity.
Lilly shall have a period of sixty (60) days after receipt of such information
in which to advise Amylin whether it desires to exercise this option. If Lilly
elects to include an Amylin Controlled Compound in the Collaboration,
[...***...] shall apply thereto. Accordingly, all [...***...]
66. *CONFIDENTIAL TREATMENT REQUESTED
the Product shall be paid by Lilly with respect to the Amylin Controlled
Compound, except that [...***...] the selected Amylin Controlled Compound.
[...***...] shall also apply in the case of Product containing an Amylin
Controlled Compound unless previously [...***...].
9.5 TRADEMARKS.
(a) PRODUCT TRADEMARKS. The JCC shall have the responsibility for
identifying appropriate trademarks for use in the Commercialization of Products
(excluding any Amylin or Lilly corporate trademarks or trade names, the "PRODUCT
TRADEMARKS"), using an approach similar to and no less rigorous than that used
by each Party in identifying trademarks for its own pharmaceutical products,
which Product Trademarks must be approved by both Parties, such approval to not
be unreasonably withheld. Amylin shall be responsible for registration,
maintenance and enforcement of, and shall solely own, the Product Trademarks.
Subject to the terms of this Agreement (including the last sentence in this
Section 9.5 (a)), Amylin hereby grants to Lilly an exclusive, worldwide,
royalty-free license, including the right to sublicense in conjunction with a
sublicense permitted by this Article 9, to use Product Trademarks on Product
packaging, labeling, advertising and Promotional Material during the Term.
Amylin shall retain the right to use the Product Trademarks on Product
packaging, labeling, advertising and Promotional Material, including the right
to sublicense such use in conjunction with a sublicense permitted by this
Article 9, solely for purposes of fulfilling its obligations under this
Agreement.
(b) COMPANY TRADEMARKS AND TRADE NAMES. To the extent permitted by
Applicable Laws, all packaging, labeling, advertising and Promotional Material
used by a Party, its Affiliates and Sublicensees in connection with any Product
in any country, shall feature both Amylin's corporate trade name(s) and logo(s)
(collectively, the "AMYLIN MARKS") and Lilly's corporate trade name(s) and
logo(s) (collectively, the "XXXXX XXXXX" and, together with Amylin Marks, the
"MARKS") with equal prominence. Each Party shall retain the ownership of the
entire right, title and interest in and to its Marks, and all goodwill
associated with or attached to its Marks arising out of the use thereof under
this Agreement. Each Party agrees that it will not contest, oppose or challenge,
or do any act that otherwise impairs or misrepresents, the other Party's rights
in such other Party's Marks. Each Party will obtain the prior written approval
of the other Party of the form and manner in which such other Party's Marks will
be used upon, in connection with, or in relation to, the Products, or any
packaging, labels, containers, advertisements and other materials related
thereto.
(c) AMYLIN MARKS LICENSE. Subject to the terms of this Agreement,
Amylin hereby grants to Lilly a non-exclusive, worldwide, royalty-free license,
including the right to sublicense in conjunction with a sublicense permitted by
this Article 9, to use the Amylin Marks on Product packaging, labeling,
advertising and Promotional Material.
67. *CONFIDENTIAL TREATMENT REQUESTED
(d) XXXXX XXXXX LICENSE. Subject to the terms of this Agreement, Lilly
hereby grants to Amylin a non-exclusive, worldwide, royalty-free license,
including the right to sublicense in conjunction with a sublicense permitted by
this Article 9, to use the Xxxxx Xxxxx on Product packaging, labeling,
advertising and Promotional Material.
9.6 FAILURE TO USE DILIGENCE. Any failure by Lilly to satisfy its obligations to
use Commercially Reasonable Efforts hereunder with respect to Development or
Commercialization of Products in any Major Market shall entitle Amylin to give
Lilly notice of such alleged failure to meet its diligence obligations,
requiring Lilly to begin using its Commercially Reasonable Efforts with respect
thereto in accordance with this Section 9.6, and stating Amylin's intention to
terminate Lilly's licenses under Sections 9.1(a), 9.5, and 10.1(a) in such Major
Market if Lilly does not begin using such Commercially Reasonable Efforts.
Within thirty (30) days following Lilly's receipt of any such notice from
Amylin, Lilly shall provide Amylin with a written response specifying, in
reasonable detail, how it has begun to use Commercially Reasonable Efforts in
such Major Market. If Lilly does not provide such written response and begin
using its Commercially Reasonable Efforts in accordance therewith within thirty
(30) days after the receipt of such notice, then, effective upon the expiration
of such thirty (30) day period, Amylin shall have the right to terminate the
licenses granted to Lilly under Sections 9.1(a), 9.5 and 10.1(a) in such Major
Market upon written notice to Lilly; provided, however, that in the event of a
dispute between the Parties with respect to whether Lilly is using its
Commercially Reasonable Efforts, such dispute shall be resolved in accordance
with Article 13. In addition, in the event that Lilly determines not to pursue
further Development or Commercialization of Products in any Major Market, then
Lilly shall provide the JSC with a detailed statement of the reason therefore.
If the JSC fails to agree upon the appropriate course of action, the matter may
be submitted to Chief Executive Officer of Amylin and a member of the Lilly
Policy Committee. If they are unable to agree, Lilly shall be entitled to make
the final decision, unless Amylin can demonstrate that Lilly's actions
constitute a failure to use Commercially Reasonable Efforts with respect to such
Major Market. If Lilly is determined not to have used its Commercially
Reasonable Efforts either before or after Product Launch, then Amylin shall have
the right to terminate, the licenses granted to Lilly under Sections 9.1(a), 9.5
and 10.1(a) with respect to such Major Market upon written notice to Lilly. Upon
any such termination, Lilly shall, and it hereby does, grant to Amylin an
exclusive (even as to Lilly), irrevocable, perpetual, fully-paid license, with
the right to sublicense, under the Lilly Rights (including, without limitation,
Lilly Improvements) and Lilly's interest in the Joint Improvements, to develop,
make, have made, use, sell, have sold, offer for sale and import Products in the
Field in the applicable Major Market, and Lilly shall transfer to Amylin as soon
as reasonably practicable following such termination all Information relating to
any Products as may be necessary to enable Amylin to practice the license
granted under this Section 9.6, including, without limitation, rights to all
Regulatory Materials, including INDs and NDAs, with respect to such Products in
such Major Market and all drug dossiers and DMFs (to the extent Controlled by
Lilly) with respect thereto.
9.7 NO IMPLIED LICENSES. Except as expressly provided otherwise herein, neither
Party hereto will be deemed by this Agreement to have been granted any license
or
68.
other rights to the other Party's intellectual property rights, including but
not limited to, trademarks, Amylin Rights, Lilly Rights, Improvements or
Information.
ARTICLE 10
INTELLECTUAL PROPERTY
10.1 IMPROVEMENTS.
(a) AMYLIN IMPROVEMENTS. The entire right, title, and interest in and
to all Amylin Rights and Improvements developed solely by employees, consultants
or agents of Amylin during the Term will be the sole and exclusive property of
Amylin. Amylin hereby grants Lilly a worldwide, royalty-free, paid-up,
nonexclusive license in the Territory to practice under the rights of Amylin to
any such Amylin Rights and Improvements to develop, make, have made, use, sell,
offer for sale, have sold and import Compound and Product in the Territory as
contemplated by this Agreement, and otherwise to perform its obligations
expressly set forth in this Agreement or the Related Agreements in the
Territory.
(b) LILLY IMPROVEMENTS. The entire right, title, and interest in and to
all Lilly Rights and Improvements developed solely by employees, consultants or
agents of Lilly during the Term will be the sole and exclusive property of
Lilly. Lilly hereby grants Amylin a worldwide, royalty-free, paid-up,
nonexclusive license in the Territory to practice under the rights of Lilly to
any such Lilly Rights and Improvements to develop, make, have made, use, sell,
offer for sale, have sold and import Compound and Product in the Territory as
contemplated by this Agreement and otherwise to perform its obligations
expressly set forth in this Agreement or the Related Agreements in the
Territory.
(c) JOINT IMPROVEMENTS. The entire right, title, and interest in and to
all Improvements developed or invented jointly by employees, consultants or
agents of Amylin and employees, consultants or agents of Lilly during the Term
("Joint Improvements") will be the joint property of Amylin and Lilly. Each
Party will have an undivided ownership interest in such Joint Improvements, and
shall not license or sublicense its rights under such Joint Improvements for its
own account without the consent of the other Party, which shall not be
unreasonably withheld.
10.2 FILING, PROSECUTION AND MAINTENANCE OF PATENTS
(a) It is the intention of the Parties to secure broad patent
protection for Improvements. Amylin shall be responsible for the preparation,
filing, prosecution and maintenance of all Amylin Patents and Patents arising
from Joint Improvements ("Joint Patents"). Lilly shall be responsible for the
preparation, filing, prosecution and maintenance of all Lilly Patents. The
Parties shall mutually agree upon the countries
69.
outside of the U.S. in which to file Joint Patents; provided, however, that if
there is a dispute between the Parties as to where to file, the more
comprehensive filing will be made. Each Party shall consider in good faith the
requests and suggestions of the other Party with respect to strategies for
filing and prosecuting Patents claiming any Product, or the manufacture, use or
sale of any Product. The Party responsible for the filing, prosecution,
maintenance, enforcement and defense of any such Patents shall keep the other
Party informed of progress with regard thereto and afford the other Party a
reasonable opportunity to comment prior to filing of patents. All Patent
Expenses incurred on and after the Effective Date with respect to (i) Amylin
Patents shall be paid by Amylin, and (ii) Lilly Patents shall be paid by Lilly.
(b) In the event that Amylin desires to abandon any Amylin Patent
claiming a manufacture, use or composition of Compound or Product, Amylin shall
provide reasonable prior written notice to Lilly of such intention to abandon
(which notice shall, in any event, be given no later than thirty (30) days prior
to the next deadline for any action that may be taken with respect to such
Amylin Patent with the applicable patent office) and Lilly shall have the right,
but not the obligation, to assume responsibility for the prosecution and
maintenance thereof in Amylin's name (and at Lilly's expense). In the event that
Amylin desires to abandon any Joint Patent, Amylin shall provide reasonable
prior written notice to Lilly of such intention to abandon (which notice shall,
in any event, be given no later than thirty (30) days prior to the next deadline
for any action that may be taken with respect to such Joint Patent with the
applicable patent office) and Lilly shall have the right, but not the
obligation, to assume responsibility for the prosecution and maintenance thereof
in the names of both the Parties (and at Lilly's expense). In the event that
Lilly desires to abandon any Lilly Patent claiming a manufacture, use or
composition of Compound or Product, Lilly shall provide reasonable prior written
notice to Amylin of such intention to abandon (which notice shall, in any event,
be given no later than thirty (30) days prior to the next deadline for any
action that may be taken with respect to such Lilly Patent with the applicable
patent office) and Amylin shall have the right, but not the obligation, to
assume responsibility for the prosecution and maintenance thereof in Lilly's
name and at Amylin's expense
(c) The Parties agree that the Patent Expenses (including prosecution
costs) incurred in connection with Joint Patents shall be equally shared by the
Parties (i.e., 50% paid by Amylin and 50% paid by Lilly).
10.3 INTERFERENCE, OPPOSITION, REEXAMINATION AND REISSUE.
(a) INFORMATION. Either Party will, within ten (10) days of learning of
such event, inform the other Party of any request for, or filing or declaration
of, any interference, opposition, or reexamination relating to Amylin Patents,
Lilly Patents or Joint Patents. Lilly and Amylin will thereafter consult and
cooperate fully to determine a course of action with respect to any such
proceeding subject to the provisions of this Section set forth below.
(b) EXPENSE AND COOPERATION. The Parties shall share equally the
expenses of any interference, opposition, reissue, or reexamination proceedings
relating to the
70.
Amylin Patents, Lilly Patents or Joint Patents covering a Compound or a Product.
Lilly and Amylin will cooperate fully and will provide each other with any
information or assistance that either Party may reasonably request. Each Party
will keep the other Party informed of developments in any such action or
proceeding. Decisions on whether to initiate such a proceeding and the course of
action in such proceeding, including settlement negotiations and terms, will be
made (i) with respect to Amylin Patents, by Amylin with the consultation of
Lilly, (ii) with respect to Lilly Patents, by Lilly with the consultation of
Amylin, and (iii) with respect to Joint Patents, jointly by the Parties;
provided, however, that neither Party shall have the right to settle any
proceeding under this Section 10.3 without the prior written consent of the
other Party, which shall not be unreasonably withheld.
10.4 ENFORCEMENT AND DEFENSE.
(a) INFRINGEMENT BY THIRD PERSON. Each Party will, within ten (10) days
of learning of such event, inform the other Party of any infringement of any
Amylin Patent, Lilly Patent or Joint Patent. Lilly and Amylin will thereafter
consult and cooperate fully to determine a course of action including, without
limitation, the commencement of legal action by either or both Lilly and Amylin,
to terminate any infringement, subject to the provisions of this Section 10.4
set forth below.
(b) AMYLIN PATENTS AND JOINT PATENTS. Amylin shall have the first right
to bring and control any action or proceeding with respect to infringement of
any Amylin Patent or Joint Patent by counsel of its own choice, and, except with
respect to Amylin Patents existing in countries where Lilly does not have a
license to Develop or Commercialize Product under this Agreement, Lilly shall
have the right, at its own expense, to be represented in any such action by
counsel of its own choice. If Amylin fails to bring any such action or
proceeding with respect to infringement of any Amylin Patent or Joint Patent
(other than an Amylin Patent existing in a country where Lilly does not have a
license to Develop or Commercialize Product under this Agreement) within (i)
sixty (60) days following the notice of alleged infringement or (ii) ten (10)
days before the time limit, if any, set forth in the appropriate laws and
regulations for the filing of such actions, whatever comes first, Lilly shall
have the right to bring and control any such action at its own expense and by
counsel of its own choice, and Amylin shall have the right, at its own expense,
to be represented in any such action by counsel of its own choice.
(c) LILLY PATENTS. Lilly shall have the first right to bring and
control any action or proceeding with respect to infringement of any Lilly
Patent by counsel of its own choice, and Amylin shall have the right, at its own
expense, to be represented in any such action by counsel of its own choice. If
Lilly fails to bring any such action or proceeding with respect to infringement
of any Lilly Patent within (i) sixty (60) days following the notice of alleged
infringement or (ii) ten (10) days before the time limit, if any, set forth in
the appropriate laws and regulations for the filing of such actions, whatever
comes first, Amylin shall have the right to bring and control any such action at
71.
its own expense and by counsel of its own choice, and Lilly shall have the
right, at its own expense, to be represented in any such action by counsel of
its own choice.
(d) JOINDER. For any action by a Party pursuant to subsection (b) or
(c) above, in the event that such Party is unable to initiate or prosecute such
action solely in its own name, the other Party will join such action voluntarily
and will execute and cause its Affiliates to execute all documents necessary for
such Party to initiate, prosecute and maintain such action. In connection with
any action, Lilly and Amylin will cooperate fully and will provide each other
with any information or assistance that either may reasonably request. Each
Party will keep the other informed of developments in any action or proceeding,
including, to the extent permissible by law, the status of any settlement
negotiations and the terms of any offer related thereto. Neither Party shall
have the right to settle any patent infringement litigation under this Section
10.4 without the prior written consent of the other Party, which shall not be
unreasonably withheld.
(e) SHARING OF EXPENSES AND RECOVERY. Each Party shall pay 50% of any
expenses (except for the expenses of the non-controlling Party's counsel, if
any) and shall receive 50% of any recovery realized as a result of any
litigation pursuant to this Section 10.4 until each Party's reimbursable
expenses have been recovered and thereafter share recovery in accordance with
each Party's proportionate interest in Operating Profits and Losses for the
relevant geography.
(f) SELECTION OF COUNSEL. In any case where a Party has the right to
select counsel of its choice, it shall first consult with the other Party
regarding the selection of counsel and consider in good faith the
recommendations of the other Party.
10.5 THIRD PERSON PATENTS.
If a Party becomes aware of a potential infringement of a Third Person's Patent
or other rights, or a Third Person asserts infringement of its Patent or other
rights, based on the manufacture, import, use, sale or offer for sale of any
Product, the Party first obtaining knowledge of such a potential infringement or
claim shall immediately provide the other Party notice of such potential
infringement or claim and the related facts in reasonable detail. In such event,
the IP Subcommittee shall determine how best to mitigate or control the defense
of any such potential infringement or claim that may include opposing the grant
of any patent upon that a later claim of infringement may be based. In the event
the Parties cannot agree on the mitigation or defense of any such potential
infringement or claim, such defense shall be controlled by Amylin; provided that
Lilly shall have the right to participate in such defense and to be represented
in any such action by counsel of its selection at its sole discretion. The
entity that controls the defense of a given claim with respect to a Product
shall also have the right to control settlement of such claim; provided,
however, that no settlement shall be entered into without the written consent of
the other Party, which consent shall not be unreasonably withheld. Each Party
shall pay 50% of any expenses (except for the expenses of the non-controlling
Party's counsel, if any) and shall receive 50% of any recovery realized as a
result of any litigation pursuant to this Section 10.5.
72.
10.6 CERTIFICATION UNDER DRUG PRICE COMPETITION AND PATENT RESTORATION ACT.
Amylin and Lilly each will immediately give notice to the other of any
certification of which they become aware filed under the U.S. "Drug Price
Competition and Patent Term Restoration Act of 1984" claiming that Patents
covering Product are invalid or that infringement will not arise from the
Manufacture, use or sale of Product by a Third Person. If Amylin or Lilly
(depending on which Party is defending the relevant Patents) decides not to
bring infringement proceedings against the entity making such a certification,
such Party will give notice to the other Party of its decision not to bring suit
within twenty (20) days after receipt of notice of such certification. The Party
receiving such notice may then, but is not required to, bring suit against the
entity that filed the certification. Any suit by Lilly or Amylin will be in the
name of Lilly if it involves a Lilly Patent, in the name of Amylin if it
involves an Amylin Patent, or in the names of both Parties if it involves a
Joint Patent or, collectively, an Amylin Patent and a Lilly Patent. For this
purpose, the Party not bringing suit will execute such legal papers necessary
for the prosecution of such suit as may be reasonably requested by the Party
bringing suit. Each Party shall pay 50% of any expenses (except for the expenses
of the non-controlling Party's counsel, if any) and shall receive 50% of any
recovery realized as a result of any litigation pursuant to this Section 10.6.
10.7 PATENT TERM RESTORATION.
At the request of the Party owning any Patents subject to this Agreement, the
Parties hereto will cooperate with each other in obtaining patent term
restoration or supplemental protection certificates or their equivalents in any
country worldwide where applicable to the Amylin Patents, Lilly Patents and
Joint Patents. In the event that elections with respect to obtaining such patent
term restoration are to be made, the IP Subcommittee shall determine the matter.
10.8 PATENT MARKING.
Each Party shall xxxx all Products made, used or sold under the terms of this
Agreement, or their containers, in accordance with all applicable patent-marking
laws.
10.9 COORDINATION.
The IP Subcommittee shall be responsible for coordinating all activities
described in this Article 10.
73.
ARTICLE 11
MANUFACTURE AND CO-PROMOTION
11.1 MANUFACTURING AND SUPPLY.
The Parties shall agree upon responsibility for Manufacture of Compound and
Product for Development and Commercialization activities hereunder. The Parties
intend to determine whether they will use Lilly's pen technology by [...***...],
and to finalize appropriate manufacturing and supply agreements for all aspects
of manufacturing by [...***...].
11.2 CO-PROMOTION IN THE U.S.
Concurrently with the execution of this Agreement, the Parties have entered into
a Co-Promotion Agreement providing for the Parties' co-promotion of Product in
the U.S.
11.3 HUMATROPE CO-PROMOTION
The Parties agree to enter into an agreement providing for the co-promotion of
HUMATROPE with terms in accordance with those terms in the term sheet attached
as ATTACHMENT 11.3 hereto.
ARTICLE 12
TERM AND TERMINATION
12.1 TERM.
The term of this Agreement shall begin on the Effective Date and end at such
time as neither Party, nor either Party's Affiliates or Sublicensees, is selling
Product in the Territory, unless earlier terminated as provided hereafter (the
"TERM").
12.2 TERMINATION FOR CAUSE.
Each Party shall have the right to terminate this Agreement upon ninety (90)
days' written notice to the other upon the occurrence of any of the following:
(a) In the event that the other Party makes a general assignment
for the benefit of creditors, files an insolvency petition in bankruptcy,
petitions for or acquiesces in the appointment of any receiver, trustee or
similar officer to liquidate or conserve its business or any substantial part of
its assets, commences under the laws of any jurisdiction any proceeding
involving its insolvency, bankruptcy, reorganization,
74. *CONFIDENTIAL TREATMENT REQUESTED
adjustment of debt, dissolution, liquidation or any other similar proceeding for
the release of financially distressed debtors or becomes a party to any
proceeding or action of the type described above and such proceeding or action
remains undismissed or unstayed for a period of more than sixty (60) days; or
(b) Upon or after the breach of any material provision of this
Agreement or the Co-Promotion Agreement by the other Party if the breaching
Party has not cured such breach within the ninety (90) day period following
written notice of termination by the non-breaching Party. Notwithstanding the
foregoing, in the event of a non-monetary default, if the default is not
reasonably capable of being cured within the ninety (90) day cure period by the
defaulting Party and such defaulting Party is making a good faith effort to cure
such default, the notifying Party may not terminate this Agreement; provided,
however, that the notifying Party may terminate this Agreement if such default
is not cured within one hundred eighty (180) days of such original notice of
default. The right of either Party to terminate this Agreement as hereinabove
provided shall not be affected in any way by its waiver of, or failure to take
action with respect to, any previous default.
12.3 TERMINATION AT WILL.
Lilly shall have the right to terminate this agreement as follows:
(a) Lilly may terminate this Agreement in the event of a Clinical Hold
at any time within six (6) months following the imposition of the Clinical Hold,
effective upon Amylin's receipt of written notice from Lilly. If Lilly exercises
its right to terminate pursuant to this subsection, it shall pay to Amylin (i)
an amount equal to the lesser of (x) [...***...] of the Development and
Commercialization expenses actually incurred by Amylin during the [...***...]
period immediately following the date of Amylin's receipt of Lilly's notice of
termination and (y) [...***...] of the amount set forth in the Development
Budget and Commercialization Budget for the same period (that would have been
reimbursable by Lilly had Lilly not terminated the Agreement), plus (ii)
[...***...] of any non-cancelable expenses that cannot be reasonably avoided, to
the extent such expenses are not included in the expenses incurred during such
[...***...] period, that would have been reimbursable by Lilly had Lilly not
terminated the Agreement. Only expenses related to the formulation studied in
the Amigo Trials shall be reimbursable. If Amylin elects to continue development
of Compound following Amylin's receipt of Lilly's notice of termination, Amylin
shall inform Lilly of that fact and provide such information to Lilly as Lilly
may reasonably request from time to time (for a period no longer [...***...]
from the effective termination date) to keep Lilly appraised of the progress of
Amylin's Development efforts with respect to the Compound. Lilly shall have the
option for a period [...***...] following the date of Amylin's receipt of its
notice of termination to advise Amylin that it desires to reinstate the
Agreement, in which case (i) Lilly shall reimburse Amylin for [...***...] of all
Development or Commercialization Costs incurred by it following the date of
Amylin's receipt of Lilly's notice of termination until the date of Lilly's
request to reinstate this Agreement, (ii) Lilly shall pay to Amylin [...***...]
that would have been paid by Lilly had Lilly not terminated this Agreement, and
(iii) this
75. *CONFIDENTIAL TREATMENT REQUESTED
Agreement shall be reinstated in full force and effect and govern the
relationship of the parties thereafter.
(b) Beginning on the Early Termination Date, Lilly shall have the right
for a period of sixty (60) days to terminate this Agreement upon written notice
to Amylin. If Lilly exercises its right to terminate pursuant to this
subsection, it shall pay to Amylin (i) an amount equal to the lesser of (x)
[...***...] of the Development expenses actually incurred by Amylin during the
[...***...] period immediately following the date of Amylin's receipt of Lilly's
notice of termination that would have been reimbursable by Lilly had Lilly not
terminated the Agreement and (y) [...***...] of the amount set forth in the
Development Budget for the same period (in all cases only expenses related to
the formulation studied in the Amigo Trials shall be reimbursable), and (ii) an
amount equal to [...***...] if (y) the primary end points for two of the three
Amigo Trials have been met and the results of the third Amigo Trial do not
suggest the presence of a safety issue that would preclude marketing of the
Product or suggest the likelihood of a "black box" safety warning and (z) Amylin
certifies that it intends to continue development efforts with respect to the
formulation studied in the Amigo Trials. The [...***...] referred to above may
be used by Amylin solely to fund development and commercialization activities
with respect to the Product studied in the Amigo Trials. Amylin shall advise
Lilly monthly of its expenditures related to these activities. If Amylin
subsequently terminates development of the Product, any of the [...***...] not
previously spent shall be immediately refunded. Following Product Launch, Amylin
shall pay to Lilly a royalty equal to [...***...] of Net Sales until such time
as Lilly has received an aggregate royalty equal to [...***...] (or such lesser
amount as was actually paid by Lilly to Amylin), increased by an amount equal to
interest at the rate of [...***...] compounded annually.
(c) Lilly may terminate this Agreement at any time following sixty (60)
days after the Early Termination Date by providing written notice to Amylin. In
the event such termination occurs prior to Product Launch, the termination shall
be effective immediately upon Amylin's receipt of written notice from Lilly and
Lilly shall be liable to continue to pay [...***...] of all Development and
Commercialization expenses incurred by Amylin during the [...***...] period
following Amylin's receipt of Lilly's notice of termination, up to the maximum
amount provided in the Development and Commercialization Budget for such period.
If such termination occurs after Product Launch, such termination shall be
effective [...***...] months after the date of Amylin's receipt of written
notice from Lilly.
12.4 EFFECT OF TERMINATION; SURVIVING OBLIGATIONS.
(a) Upon termination of this Agreement by Lilly pursuant to Section
12.2:
(i) the licenses granted by Lilly to Amylin under Sections 9.1(b),
9.5 and 10.1(b) shall automatically terminate and revert to Lilly;
76. *CONFIDENTIAL TREATMENT REQUESTED
(ii) any permitted sublicenses granted under Section 9.2 by Amylin
shall remain in effect, but shall be assigned to Lilly;
(iii) the licenses granted by Amylin to Lilly under Section 9.5
shall remain in effect in accordance with their terms, and Amylin shall, and it
hereby does, grant to Lilly an exclusive (even as to Amylin), royalty-bearing
license, with the right to sublicense, under the Amylin Rights (including,
without limitation, Amylin Improvements) and Amylin's interest in the Joint
Improvements, to develop, make, have made, use, sell, have sold, offer for sale
and import Products in the Field in the Territory, subject in each case to
compliance by Lilly with all applicable provisions of this Agreement.
Thereafter, instead of the payments set forth in Section 4.5, Lilly shall pay to
Amylin a royalty of [...***...] of worldwide Net Sales of Products by Lilly, its
Affiliates and Sublicensees, on a Product-by-Product and country-by-country
basis, from the effective date of such termination until the later of (A) ten
(10) years from Product Launch of such Product in such country and (B)
expiration of the last-to-expire of the Amylin Patents, Lilly Patents and Joint
Patents claiming such Product in such country. For purposes of clarification, in
the event of termination of this Agreement by Lilly pursuant to Section 12.2,
the Steering Committee, JDC and JCC shall cease to exist, and, for so long as
Lilly retains a license under this Section 12.4(a)(iii), Amylin shall not have
the right or obligation to participate in Development and Commercialization
activities with respect to Products; and
(iv) Amylin shall (A) transfer to Lilly as soon as reasonably
practicable all Information relating to any Products as may be necessary to
enable Lilly to practice the license granted under Section 12.4(a)(iii), (B)
transfer and assign to Lilly all of its right, title and interest in and to the
all INDs with respect to the Products (including all foreign equivalents
thereof), all Regulatory Approvals with respect to any Products, the DMF(s) (to
the extent Controlled by Amylin) and all drug dossiers and master files with
respect to any Products, and (C) take such other actions and execute such other
instruments, assignments and documents as may be necessary to effect the
transfer of rights hereunder to Lilly.
(b) Upon termination of this Agreement by Lilly pursuant to Section
12.3:
(i) the licenses granted by Amylin to Lilly under Sections 9.1(a),
9.5, and 10.1(a) shall automatically terminate and revert to Amylin;
(ii) any permitted sublicenses granted under Section 9.2 by Lilly
shall remain in effect, but shall be assigned to Amylin;
(iii) Lilly shall, and it hereby does, grant to Amylin an exclusive
(even as to Lilly), irrevocable, perpetual, fully-paid license, with the right
to sublicense, under the Lilly Rights (including, without limitation, Lilly
Improvements) and Lilly's interest in the Joint Improvements, to develop, make,
have made, use, sell, have sold, offer for sale and import Products in the Field
in the Territory;
77.
(iv) Lilly shall (A) transfer to Amylin as soon as reasonably
practicable all Information relating to any Products as may be necessary to
enable Amylin to practice the license granted under Section 12.4(b)(iii), (B)
transfer and assign to Amylin all of its right, title and interest in and to all
INDs with respect to the Products (including all foreign equivalents thereof),
all Regulatory Approvals with respect to any Products, the DMF(s) (to the extent
Controlled by Lilly) and all drug dossiers and master files with respect to any
Products, and (C) take such other actions and execute such other instruments,
assignments and documents as may be necessary to effect the transfer of rights
hereunder to Amylin; and
(v) To the extent Lilly is engaged in the manufacture of Product as
of the date notice of termination is given, Lilly shall manufacture and supply
Product to Amylin from the effective date of such termination until such time as
Amylin is able to secure an equivalent alternative commercial manufacturing
source, as requested by Amylin or until thirty-six (36) months from the
effective date of termination, whatever is earlier. To this end, as of the
effective date of such termination at Amylin's option, all Third Person
manufacturing contracts to which Lilly or any of its Affiliates is a party shall
be assigned to Amylin. Further, upon Amylin's request, Lilly shall provide such
technical assistance as Amylin may reasonably request to facilitate the transfer
of Product manufacturing responsibility to Amylin or its designee. All Product
supplied to Amylin by Lilly pursuant to this Section 12.4(b)(v) shall be
supplied at the same price at which Lilly supplied Product to the Parties, their
Affiliates or Sublicensees for resale immediately prior to such termination,
subject to annual adjustment in accordance with the annual percentage change in
the Pharmaceutical Producer Price Index (U.S. Bureau of Labor Statistics) on
each anniversary of the effective date of such termination.
(c) Upon termination of this Agreement by Amylin pursuant to Section
12.2, all of the provisions in Section 12.4 (b) (i) through (v) above shall
apply, and in addition Amylin shall pay to Lilly a royalty of [...***...] of
worldwide Net Sales of Products by Amylin, its Affiliates and Sublicensees, on a
Product by Product and country-by-country basis, from the effective date of such
termination until the later of (A) ten (10) years from Product Launch of such
Product in such country and (B) expiration of the last to expire of the Amylin
Patents, Lilly Patents and Joint Patents claiming such Product in such country.
(d) Expiration or termination of this Agreement shall not relieve the
Parties of any obligation accruing prior to such expiration or termination.
Except as set forth below or elsewhere in this Agreement, the obligations and
rights of the Parties under the following provisions of this Agreement shall
survive expiration or termination of this Agreement: 4.8, 4.9, Article 5,
Article 6, Article 8, Article 10 only to the extent contemplated by 12.4, 12.4,
12.5, 12.6, Articles 13 and 14.
(e) Within thirty (30) days following the expiration or termination of
this Agreement, except to the extent and for so long as a Party retains license
rights under Sections 12.4(a), (b) or (c), each Party shall deliver to the other
Party any and all Confidential Information of the other Party in its possession.
78. *CONFIDENTIAL TREATMENT REQUESTED
12.5 NON-EXCLUSIVE RIGHTS.
The foregoing rights and remedies of the Parties set forth in Sections 12.2,
12.3 and 12.4 are non-exclusive and without prejudice to any rights that either
Party may have arising under applicable law or equity.
12.6 RIGHTS IN BANKRUPTCY.
All rights and licenses granted under or pursuant to this Agreement by Amylin
and Lilly are, and will otherwise be deemed to be, for purposes of Section
365(n) of the U.S. Bankruptcy Code, licenses of rights to "INTELLECTUAL
PROPERTY" as defined under Section 101 of the U.S. Bankruptcy Code. The parties
agree that the parties, as licensees of such rights under this Agreement, will
retain and may fully exercise all of their rights and elections under the U.S.
Bankruptcy Code. The parties further agree that, in the event of the
commencement of a bankruptcy proceeding by or against a Party under the U.S.
Bankruptcy Code, the Party hereto that is not a Party to such proceeding will be
entitled to a complete duplicate of (or complete access to, as appropriate) any
such intellectual property and all embodiments of such intellectual property,
which, if not already in the non-subject Party's possession, will be promptly
delivered to it (a) upon any such commencement of a bankruptcy proceeding upon
the non-subject Party's written request therefor, unless the Party subject to
such proceeding continues to perform all of its obligations under this Agreement
or (b) if not delivered under clause (a) above, following the rejection of this
Agreement by or on behalf of the Party subject to such proceeding upon written
request therefor by the non-subject Party.
12.7 BUY-OUT OPTION
(a) For a period of ninety (90) days following [...***...] following
the first Product Launch in the first Major Market, if global Net Sales of
Product for such year are less than [...***...] U.S. Dollars ([...***...]
Dollars), each Party shall have the option to request that the budgets
contemplated by this Agreement be revised if such Party believes in good faith
that the market performance of the Product has been below expectations and that
an adjustment of the budget is required. If any such request is made, the
members of the JSC shall discuss in good faith what adjustments, if any, should
be made. If the JSC is unable to reach a decision within thirty (30) days of the
request, either Party may request that the matter be discussed by the Chief
Executive Officer of Amylin and a member of the Lilly Policy Committee. If these
persons are unable to reach a decision within thirty (30) days of the matter
being referred to them, then the Parties agree that the Agreement shall remain
in force without modification until ninety (90) days following the end of
[...***...] following the first Product Launch in the first Major Market. If
after such time either Party continues to believe that an adjustment is required
or that any budget adjustment would be inadequate to permit the party to meet
its expectation, it shall notify the other in writing (which notification shall
be no later than 120 days after
79. *CONFIDENTIAL TREATMENT REQUESTED
[...***...]), and the executives referred to above shall again discuss
the matter in good faith. If such executives are unable to reach a decision
within thirty (30) days of the written notice, then either Party has an
additional thirty (30) days to request that a buy-out option be exercised
pursuant to subparagraph (b) below.
(b) If either Party requests a buy-out option, then the following
shall apply:
(i) The Parties shall select a nationally recognized investment banking
firm with experience in the pharmaceutical industry to prepare a valuation of
each of the Party's interest in the Agreement. If the Parties cannot agree upon
the investment banking firm to perform the valuation, then each Party shall
select a nationally recognized investment banking firm with experience in the
pharmaceutical industry, and the two so selected shall agree upon a third. The
two firms selected by the Parties shall prepare a valuation of each Party's
interest. The third firm shall review the valuation of the two firms selected by
the Parties, and then render its own opinion as to the value, which shall be
binding on the Parties.
(ii) Upon receipt of the valuation, the Party requesting the buy-out
shall have the option within thirty (30) days of receipt of the valuation to (i)
withdraw its notice requesting a buy-out option or (ii) confirm its desire to
proceed, in which case the Party not requesting the buy-out option shall then
have a period of thirty (30) days following receipt of the binding valuation
report to elect either to (i) purchase the other Party's interest at the
appraised value for such interest or (ii) sell its own interest to the other
Party at the appraised value for the selling Party's interest. The Parties shall
negotiate in good faith such other terms and conditions as shall be necessary to
effect the sale or purchase contemplated hereby within the shortest possible
time.
12.8 CHANGE IN CONTROL. In the event there shall be a Change in Control with
respect to either Party, the Party not involved in the Change in Control shall
have a period of ninety (90) days following the Change in Control to give notice
to the other Party that it desires to terminate this Agreement. If such notice
is given, then the Parties shall arrange for a valuation of the value of their
respective interests in this Agreement using the procedures set forth in Section
12.7(b)(i). Upon receipt of the valuation, the Party not involved in the Change
in Control shall have the option within thirty (30) days of receipt of the
valuation either to (i) withdraw its notice terminating this Agreement or (ii)
confirm its desire to terminate, in that case the Party experiencing the Change
in Control shall elect either to (a) purchase the other Party's interest at the
established value or (b) sell its own interest to the other Party at the
appraised value of its interest. The Parties shall negotiate in good faith such
other terms and conditions and take such other actions as shall be necessary to
effect the sale or purchase contemplated hereby within the shortest possible
time.
80. *CONFIDENTIAL TREATMENT REQUESTED
ARTICLE 13
DISPUTE RESOLUTION
13.1 DISPUTES.
The Parties recognize that disputes as to certain matters may from time to time
arise which relate to either Party's rights and obligations hereunder. It is the
objective of the Parties to establish procedures to facilitate the resolution of
such disputes in an expedient manner by mutual cooperation and without resort to
litigation. To accomplish this objective, the Parties agree to follow the
procedures set forth in Section 13.2 if and when such a dispute arises between
the Parties (other than a dispute specifically governed by Section 3.1(e),
3.2(e) or 3.3(e)).
13.2 MEDIATION PROCEDURES.
(a) DISCUSSIONS BETWEEN THE PARTIES. Except as otherwise provided in
Section 3.1(e), 3.2(e) or 3.3(e), if any claim, dispute, or controversy of any
nature arising out of or relating to this Agreement, including, without
limitation, any action or claim based on tort, contract or statute, or
concerning the interpretation, effect, termination, validity, performance and/or
breach of this Agreement (each, a "CLAIM"), arises between the Parties and the
Parties cannot resolve the dispute within thirty (30) days of a written request
by either Party to the other Party, the Parties agree to refer the Claim to a
member of the Lilly Policy Committee and the Chief Executive Officer of Amylin
for resolution. If, after an additional sixty (60) days, such officers have not
succeeded in negotiating a resolution of the dispute, then, upon the written
request of either Party, such dispute shall be submitted to non-binding
mediation to be facilitated by a mutually agreeable mediator with prior
experience as an executive in the pharmaceutical industry.
(b) Unless otherwise agreed by the Parties, the mediation shall be held
in Dallas, Texas and shall be attended by the Chief Executive Officer of Amylin
and a member of the Lilly Policy Committee. The mediation shall be held on a
mutually agreeable date which shall not be later than thirty (30) days following
any Party's request for mediation. In the event the Parties are unable to agree
to a resolution of the dispute at the mediation session, either Party shall be
entitled to institute legal proceedings to pursue its claims. The fees of the
mediator shall be shared equally by the Parties.
(c) Nothing in this Section 13.2 shall prohibit any Party from seeking
immediate injunctive or other relief if such Party reasonably believes that it
will suffer irreparable harm from the actions of the other.
81.
ARTICLE 14
MISCELLANEOUS
14.1 STANDSTILL AGREEMENT. During the Term and for a period of three (3) years
thereafter (the "Standstill Period"), neither Lilly nor any of Lilly's
Representatives (as defined below) will, in any manner, directly or indirectly:
(a) make, effect, initiate, directly participate in or cause (i) any
acquisition of beneficial ownership of any securities of Amylin or any
securities of any subsidiary or other affiliate of Amylin, if, after such
acquisition, Lilly would beneficially own more than ten percent (10%) of the
outstanding common stock of Amylin, (ii) any acquisition of any assets of Amylin
or any assets of any subsidiary or other affiliate of Amylin, other than
purchases of Product as contemplated in this Agreement in non-material
acquisitions in the ordinary course of business, (iii) any tender offer,
exchange offer, merger, business combination, recapitalization, restructuring,
liquidation, dissolution or extraordinary transaction involving Amylin or any
subsidiary or other affiliate of Amylin, or involving any securities or assets
of Amylin or any securities or assets of any subsidiary or other affiliate of
Amylin, or (iv) any "solicitation" of "proxies" (as those terms are used in the
proxy rules of the Securities and Exchange Commission) or consents with respect
to any securities of Amylin;
(b) form, join or participate in a Group with respect to the beneficial
ownership of any securities of Amylin;
(c) act, alone or in concert with others, to seek to control the
management, board of directors or policies of Amylin;
(d) take any action that might require Amylin to make a public
announcement regarding any of the types of matters set forth in clause "(a)" of
this sentence;
(e) agree or offer to take, or encourage or propose (publicly or
otherwise) the taking of, any action referred to in clause "(a)", "(b)", "(c)"
or "(d)" of this sentence;
(f) assist, induce or encourage any other Person to take any action of
the type referred to in clause "(a)", "(b)", "(c)", "(d)" or "(e)" of this
sentence;
(g) enter into any discussions, negotiations, arrangement or agreement
with any other Person relating to any of the foregoing; or
(h) request or propose that Amylin or any of Amylin's Representatives
amend, waive or consider the amendment or waiver of any provision set forth in
this Section 14.1.
Notwithstanding the foregoing, the provisions of this Section 14.1 shall not
apply to (i) the exercise by Lilly of any of its rights pursuant to this
Agreement or any of the Related Agreements, (ii) the exercise by Lilly of any
rights available to shareholders generally
82.
pursuant to any transaction described in subparagraph (a) (ii) above provided
that Lilly has not then either directly or as a member of a Group made,
effected, initiated or caused such transaction to occur or (iii) any activity by
Lilly after Amylin or any Third Party unrelated to Lilly has made any public
announcement of its intent to solicit or engage in any transaction of the type
referred to in this clause (a) above, provided however, with respect to this
subpart (iii), if Amylin or such third Person terminates or announces its intent
to terminate such transaction and Lilly (A) has not previously made any public
announcement of its intent to solicit or engage in any transaction of the type
referred to in this clause (a) above, or (B) in the event that such public
announcement has been made by Xxxxx, Xxxxx has terminated or announced its
intent to terminate such transaction, then the provisions of this Section 14.1
shall again be applicable.
The expiration of the Standstill Period will not terminate or otherwise affect
any of the other provisions of this Agreement. For purposes of this Agreement,
Lilly's "Representatives" will be deemed to include each Person that is or
becomes (i) a subsidiary or other affiliate of Lilly, or (ii) an officer,
director, employee, partner, attorney, advisor, accountant, agent or
representative of Lilly or of any of Lilly's subsidiaries or other affiliates,
providing such person is acting on behalf of Lilly.
14.2 FORCE MAJEURE.
Neither Party will be held liable or responsible to the other Party nor be
deemed to have defaulted under or breached the Agreement for failure or delay in
fulfilling or performing any term of the Agreement when such failure or delay is
caused by or results from causes beyond the reasonable control of the affected
Party including, without limitation, embargoes, acts of war (whether war be
declared or not), insurrections, riots, civil commotions, or acts of God. Such
excuse from liability and responsibility shall be effective only to the extent
and duration of the event(s) causing the failure or delay in performance and
provided that the affected Party has not caused such event(s) to occur. The
affected Party will notify the other Party of such force majeure circumstances
as soon as reasonably practical and will make every reasonable effort to
mitigate the effects of such force majeure circumstances.
14.3 ASSIGNMENT.
This Agreement will inure to the benefit and be binding upon each Party, its
successors and assigns. The Agreement may not be assigned or otherwise
transferred, nor, except as expressly provided hereunder, may any right or
obligation hereunder be assigned or transferred by either Party without the
prior written consent of the other Party; provided, however, that either Party
may, without such consent, assign the Agreement and its rights and obligations
hereunder to an Affiliate or in connection with the transfer or sale of all or
substantially all of its assets or business to which this Agreement relates, or
in the event of its merger or consolidation or change in control or similar
transaction. In the event of such transaction, however, intellectual property
rights of the acquiring party to such transaction (if other than one of the
Parties to this Agreement) shall not be included in the technology licensed
hereunder. The rights and obligations of the Parties under this Agreement shall
be binding upon and inure to the benefit of the successors
83.
and permitted assigns of the Parties. Any attempted assignment not in accordance
with this Section 14.3 will be void.
14.4 FURTHER ASSURANCES.
The Parties intend that this Agreement contain all consents, licenses and
authorizations from one Party to the other necessary to enable each Party to
perform its obligations hereunder. In the event any further such consents,
licenses or authorizations are necessary, each Party agrees to take such further
actions and execute such further agreements as may be reasonably necessary to
carry out the intent and purposes of this Agreement.
14.5 SEVERABILITY.
In the event any one or more of the provisions contained in this Agreement
should be held invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein will
not in any way be affected or impaired thereby, unless the absence of the
invalidated provision(s) adversely affect the substantive rights of the parties.
The parties will in such an instance use their best efforts to replace the
invalid, illegal or unenforceable provision(s) with valid, legal and enforceable
provision(s) which, insofar as practical, maintains the balance of the rights
and obligations of the parties under this Agreement.
14.6 NOTICES.
All notices which are required or permitted hereunder will be in writing and
sufficient if delivered personally, sent by facsimile or email to current a fax
number or e-mail address for the recipient (and promptly confirmed by personal
delivery, registered or certified mail or overnight courier), sent by
nationally-recognized overnight courier or sent by registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:
if to Amylin, to: Amylin Pharmaceuticals, Inc.
0000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Chairman and Chief Executive Officer
Fax No.: (000) 000-0000
with a copy to: Attention: General Counsel
Fax No.: (000) 000-0000
if to Lilly, to: Xxx Xxxxx and Company
Lilly Xxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: General Counsel
84.
or to such other address as the Party to whom notice is to be given may have
furnished to the other Party in writing in accordance herewith. Any such notice
will be deemed to have been given when delivered if personally delivered or sent
by facsimile on a business day, on the business day after dispatch if sent by
nationally-recognized overnight courier and on the third business day following
the date of mailing if sent by mail.
14.7 APPLICABLE LAW.
The Agreement will be governed by and construed in accordance with the laws of
the State of New York, without reference to any rules of conflict of laws.
14.8 ENTIRE AGREEMENT.
This Agreement (including the initial Development Plan and Commercialization
Plan) and the Related Agreements contain the entire understanding of the Parties
with respect to the license, Development, Manufacture and Commercialization of
Product. All express or implied agreements and understandings, either oral or
written, heretofore made by the parties on the same subject matter are expressly
superseded by this Agreement. The Agreement may be amended, or any term hereof
modified, only by a written instrument duly executed by both Parties hereto.
14.9 HEADINGS.
The captions to the several Articles and Sections hereof are not a part of the
Agreement nor affect the interpretation of any of its provisions, but are merely
a convenience to assist in locating and reading the several Articles and
Sections hereof.
14.10 INDEPENDENT CONTRACTORS.
It is expressly agreed that Amylin and Lilly will be independent contractors and
that the relationship between the two parties will not constitute a partnership,
joint venture or agency. Neither Amylin nor Lilly will have the authority to
make any statements, representations or commitments of any kind, or to take any
action, which will be binding on the other, without the prior consent of the
other Party.
14.11 WAIVER.
The waiver by either Party hereto of any right hereunder, or the failure to
perform, or a breach by the other Party will not be deemed a waiver of any other
right hereunder or of any other breach or failure by said other Party whether of
a similar nature or otherwise.
14.12 NO THIRD PARTY BENEFICIARIES.
This Agreement is neither expressly nor impliedly made for the benefit
of any Person other than the Parties.
85.
14.13 COUNTERPARTS.
The Agreement may be executed in two or more counterparts, each of which will be
deemed an original, but all of which together will constitute one and the same
instrument.
14.14 WAIVER OF RULE OF CONSTRUCTION.
Each Party has had the opportunity to consult with counsel in connection with
the review, drafting and negotiation of this Agreement. Accordingly, the rule of
construction that any ambiguity in this Agreement will be construed against the
drafting Party will not apply.
14.15 NON-SOLICITATION OF EMPLOYEES.
During the term of this Agreement, neither Party shall solicit for employment
any person employed by the other, provided, however, that this provision shall
not apply to any employee who seeks employment on an unsolicited basis or who
responds to general forms of solicitation such as newspaper advertisements or
inquiries from employment recruitment agencies where such agencies have not been
directed to target employees of the other Party.
86.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective
Date.
XXX XXXXX AND COMPANY AMYLIN PHARMACEUTICALS, INC.
By: /s/ AUGUST X. XXXXXXXX By: /s/ XXXXXX X. XXXX, XX.
---------------------------- ----------------------------
Name: August X. Xxxxxxxx Name: Xxxxxx X. Xxxx, Xx.
Title: Executive Vice President Title: Chairman and Chief
Science/Technology Executive Officer
[Signature Page -- Collaboration Agreement]
87.
ATTACHMENT 1.28 COMPOUND: THE AMINO ACID SEQUENCE OF EXENDIN-4
AS AN AMIDE OR FREE ACID
Chemical Formula: C(184)H(282)N(50)O(60)S
Molecular Weight: Approximately 4186 Daltons
Structural Formula (amino acid sequence):
His-Gly-Glu-Gly-Thr-Phe-Thr-Ser-Asp-Leu-Ser-Lys-Gln-Met-Glu-Glu-Glu-Ala-Val-
Arg-Leu-Phe-Ile-Glu-Trp-Leu-Lys-Asn-Gly-Gly-Pro-Ser-Ser-Gly-Ala-Pro-Pro-Pro-
Ser-NH(2) (or --OH)
88.
ATTACHMENT 1.76 -- NEOGENESIS PATENTS
"Neogenesis Patents" include the following Patents claiming [...***...] pending
as of the Effective Date
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
89. *CONFIDENTIAL TREATMENT REQUESTED
ATTACHMENT 1.111 DEFINITION OF TIER 1 COMPOUND
Tier I Compounds subject to the Option provision [...***...].
Amylin Lilly
--------------------------------------- ----------------------------------------
[...***...] [...***...]
[...***...] [...***...]
[...***...] [...***...]
[...***...]
[...***...] [...***...]
[...***...]
[...***...]
[...***...]
------------
[...***...] are excluded from the definition of a Tier I Compound.
90. *CONFIDENTIAL TREATMENT REQUESTED
ATTACHMENT 1.112 DEFINITION OF TIER 2 COMPOUND
Tier II Compounds subject to the Option provision are [...***...].
[...***...]
[...***...] are excluded from the definition of an Option Compound.
91.
ATTACHMENT 4.5 OPERATING PROFITS OR LOSSES
SCHEDULE 4.5
Example of operations and 'Adjusted U.S. Operating Profit' sharing
MONTHLY FINANCIAL RESULTS FOR THE UNITED STATES
[...***...] [...***...] [...***...]
[...***...] [...***...] [...***...] [...***...]
92. *CONFIDENTIAL TREATMENT REQUESTED
SCHEDULE 4.5
Example of operations and 'Adjusted OUS Operating Profit' sharing
MONTHLY FINANCIAL RESULTS FOR TERRITORIES OUTSIDE THE UNITED STATES
[...***...] [...***...] [...***...]
[...***...] [...***...] [...***...] [...***...]
93. *CONFIDENTIAL TREATMENT REQUESTED
ATTACHMENT 7.6 AMYLIN PATENTS
Amylin Patents include but are not limited to the following Patents pending or
issued as of the Effective Date.
[...***...]
[...***...] [...***...]
[...***...]
[...***...] [...***...]
[...***...] [...***...]
[...***...] [...***...]
[...***...] [...***...]
[...***...] [...***...]
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[...***...] [...***...]
94. *CONFIDENTIAL TREATMENT REQUESTED
[...***...]
[...***...] [...***...]
[...***...] [...***...]
[...***...] [...***...]
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95. *CONFIDENTIAL TREATMENT REQUESTED
[...***...]
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96. *CONFIDENTIAL TREATMENT REQUESTED
ATTACHMENT 11.3 AMYLIN AND LILLY CO-PROMOTION QUID TERMS
SEPTEMBER 19, 2002
PARTIES: Xxx Xxxxx and Company ("Lilly") and Amylin Pharmaceuticals, Inc.
("Amylin")
CONCEPT: Amylin to promote Humatrope to Tier III/IV targets for
[...***...] beginning January 1, 2003.
TERRITORY: United States of America
TERM: Period of [...***...] beginning [...***...].
TERRITORY
ALIGNMENT: Thirty territories with each Amylin territory overlapping a
unique pair of Humatrope assignments. This configuration is
[...***...]. Amylin may use [...***...] sales representatives to
cover this territory. Amylin shall advise Lilly of the exact
number of representatives it intends to field by [...***...].
DETAIL
POSITION: First position, which means: a sales representative is expected
to present the uses, benefits and risks of Humatrope in 100% of
his or her face-to-face meetings with healthcare professionals.
No restriction for second detail position.
DETAIL FEE: [...***...]/Detail up to [...***...] details for the [...***...]
period beginning on [...***...]. In addition, if Amylin is able
to start more than [...***...] full year patient equivalents,
Amylin would receive [...***...] of the incremental revenue above
this base line for the year of promotion and then [...***...] of
incremental residual revenue for the incremental patient starts
it created for the [...***...] following its promotional activity
on Humatrope based upon the forecasted degradation curve for the
[...***...] following its Humatrope promotion. Such degradation
curve is the following. In the [...***...] following the
promotional period [...***...] of the incremental full patient
equivalents started during the promotional period would remain on
Humatrope. In the [...***...] following the promotional period
[...***...] of the incremental full year patient equivalents
started in the promotional year would remain on Humatrope.
CALL
FREQUENCY/
TARGETS: To [...***...]. The parties will agree on additional metrics and
aligned incentive schemes.
97. *CONFIDENTIAL TREATMENT REQUESTED
REGULATORY
REQUIREMENTS: Amylin will comply with all the applicable provisions and
obligations resulting from Humatrope's regulatory, patient
privacy and marketing requirements. Lilly will advise Amylin of
all regulatory requirements unique to the product.
HIRING: Amylin will be solely responsible for recruiting and hiring of
its sales force. However, Lilly will be allowed to provide input
to establish the minimum qualifications for sales
representatives, which Amylin will take in good faith.
TRAINING: Amylin will deliver the detail message determined by Lilly. Lilly
will design and administer all training as it pertains to
Humatrope and the obligations of Humatrope's regulatory, patient
privacy and marketing requirements. In addition, Lilly will
provide marketing support.
GOVERNANCE: PRIMARY CONTACT PERSONS: Within ten (10) days after the Effective
Date, Lilly will appoint an individual to serve as its primary
contact person with regard to this agreement and Amylin will also
appoint an individual to serve as its primary contact person with
regard to this agreement. The Lilly and Amylin representatives
will meet, by phone or in person, as necessary (but not less than
three (3) times each month) to monitor and manage the day-to-day
activities of this co-promotion.
MARKETING TEAM'S PERIODIC REVIEWS OF CO-PROMOTION EFFORTS AND
PLANS: Within thirty (30) days after the Effective Date and then
once each month thereafter, the Amylin contact person and
selected other individuals from Amylin will meet with the
Humatrope marketing team to review and discuss the Parties'
efforts, strategies and plans for promoting Humatrope in the
Territory. During such meetings, Lilly agrees to consider
Amylin's comments in good faith, but Lilly, retains exclusive
decision making authority regarding Humatrope's marketing,
development strategies and promotional plans.
JOINT EXECUTIVE ADVISORY COMMITTEE: Within thirty (30) days after
the Effective Date, the Parties will establish a Joint Executive
Advisory Committee composed of an equal number of members
appointed by Lilly and Amylin from their respective
organizations. The Joint Executive Advisory committee will meet,
by phone, or in person, once each Calendar Quarter to monitor the
co-promotion's success, opportunities and potential problems.
TERMINATION: Agreement will last for twelve months from the effective date and
terminate thereafter.
DEFINITIVE
AGREEMENT: The parties shall use their commercially reasonable efforts to
negotiate and execute a definitive co-promotion agreement
consistent with this Term Sheet and containing such other terms
as are customary in "rent-a-sales force" arrangements by not
later than [...***...].
98. *CONFIDENTIAL TREATMENT REQUESTED