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EXHIBIT 10.24
ARIAD PHARMACEUTICALS, INC. HAS OMITTED FROM THIS EXHIBIT 10.24 PORTIONS OF THE
AGREEMENT FOR WHICH ARIAD PHARMACEUTICALS, INC. HAS REQUESTED CONFIDENTIAL
TREATMENT FROM THE SECURITIES AND EXCHANGE COMMISSION. THE PORTIONS OF THE
AGREEMENT FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED ARE MARKED WITH AN
ASTERISK AND SUCH CONFIDENTIAL PORTIONS HAVE BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
L I C E N S E A G R E E M E N T
THIS AGREEMENT is made and entered into as of September 12, 1996 by and between
Mochida Pharmaceutical Co., Ltd. of 0, Xxxxxxx x-xxxxx, Xxxxxxxxxx, Xxxxx 000,
Xxxxx ("Mochida") and ARIAD Pharmaceuticals, Inc. of 00 Xxxxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx 00000, X.X.X. ("ARIAD").
WITNESSETH:
WHEREAS, under the Confidential Disclosure Agreement dated February 5, 1996
concluded between the parties hereto ("Confidentiality Agreement"), ARIAD
evaluated certain confidential information disclosed by Mochida regarding the
Patents (as hereinafter defined);
WHEREAS, as the result of such evaluation, ARIAD is now desirous of acquiring a
worldwide non-exclusive license from Mochida to use the Patents for the purpose
of development, manufacture, use and sale of the Products (as hereinafter
defined); and
WHEREAS, as the worldwide exclusive licensee of the Patents appointed by OBI (as
hereinafter defined), Mochida is willing to grant such license to ARIAD under
the terms and conditions provided herein;
NOW, THEREFORE, in consideration of the premises and mutual covenants provided
herein, the parties hereby agree as follows:
Article 1. Definitions
For the purpose of this Agreement:
A. "ARIAD-Information" shall mean any and all information, data,
techniques, know-how and formulas disclosed by ARIAD to Mochida under
this Agreement and provided in written form clearly specifying as
"Confidential" at the time of the disclosure thereof;
B. "Confidential Information" shall mean both M-Information (as
hereinafter defined) and ARIAD-Information;
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C. "Field" shall mean the use of Mochida's intellectual property rights to
the DNA sequence encoding portions of the Fas [*] for use in the
genetic engineering of cells using ARIAD's gene cassettes and for use
of such ARIAD's gene cassettes and/or cells for gene and cell therapy
in human and non-human animals.
D. "First Year" shall mean such calendar year in which the first Products
is (are) launched by ARIAD or its sublicensee(s) in any country in the
Territory (as hereinafter defined);
E. "M-Information" shall mean any and all information, data, techniques,
know-how and formulas disclosed by Mochida to ARIAD under this
Agreement and/or the Confidentiality Agreement provided in written form
clearly specifying as "Confidential" at the time of the disclosure
thereof, including, without limitation, those that relate to the
Patents and results of study or development conducted by Mochida and/or
OBI under the OBI Agreements (as hereinafter defined).
F. "Net Sales" shall mean the gross sales amount of the Products sold by
ARIAD and/or its sublicensees to any third party less actually allowed
rebates, normal trade discounts, credits and refunds for returned goods
granted to customers, transportation and insurance costs incidental to
the sale of the Products as well as sales taxes and excise taxes which
ARIAD and its sublicensees has/have to pay or absorb on such sales;
G. "OBI" shall mean Osaka Bioscience Institute of 0-0, Xxxxxxxx 0-xxxxx,
Xxxxxxxx, Xxxxx, Xxxxx;
H. "OBI Agreements" shall mean any and all agreements concluded between
OBI and Mochida relating to the Patents;
I. "Patents" shall mean all patents and patent applications listed in
Schedule 1 attached hereto as an integral part hereof, and such patents
and patent applications issuing thereon or derived from them,
including, without limitation, divisions, extensions, continuations,
continuation-in-parts, or substitute or reissue applications of the
same, specifically excluding those which are clearly unrelated to the
manufacture, use or sale of the Products;
J. "Payment Computation Period" shall mean each calendar half-year, that
is, six (6) month period ending the last day of June and December of
each year;
K. "Products" shall mean ARIAD's gene cassettes carrying portions of Fas
DNA or variants thereof or cells incorporating such gene cassettes to
be used in the Field, including improvements and modifications thereof,
the manufacture, use or sale of which, in the absence of the rights
granted hereunder, would infringe the Patents;
L. "Territory I" shall mean [*];
M. "Territory II" shall mean [*];
N. "Territory" shall mean both Territory I and Territory II; and
O. "Year" shall mean a calendar year.
Article 2. Grant of License
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2.1 Mochida hereby grants to ARIAD, and ARIAD hereby accepts, a nonexclusive
license, with the right to sublicense, to use the Patents and the M-Information
for the purpose of development, manufacture, import, use and/or sale of the
Products in the Field.
2.2 ARIAD assures to Mochida that it shall render its commercially reasonable
efforts in the development and commercialization of the Products.
2.3 This Agreement contains no other grant of rights or licenses by Mochida,
except to the extent of the rights and licenses expressly granted to ARIAD under
Paragraph 2.1. Without limiting the generality of the foregoing, ARIAD and its
sublicensees shall have no right or license to use the Patents and the
M-Information for any purpose other than the development, manufacture, import,
use and/or sale of the Products in the Field.
Article 3. Consideration
3.1 In consideration of the right and license granted hereunder, ARIAD shall pay
to Mochida as follows:
(a) Initial Payment - [*]. Payable within thirty (30) days from the
date first above written.
(b) Annual Fee - [*]. Payable by the end of each Year for the following
Year. The Annual Fee shall be payable from the end of Year 1996
(covering Year 1997) until the end of the Year immediately preceding
the First Year (covering the First Year).
(c) Minimum Royalty - [*]. Payable by the end of each Year for the
following Year. The Minimum Royalty shall be payable from the end of
the First Year (covering the Year immediately following the First Year)
until the end of the Year immediately preceding the Year of termination
or expiration of this Agreement (covering the last Year).
(d) Running Royalty - [*] the Net Sales in Territory I, [*] for the Net
Sales in Territory II. Payable semi-annually [*] days from the end of
each Payment Computation Period. If or when the Products are
manufactured in the Territory but exported to the customers located
outside the Territory for the use or sale therein, the Running Royalty
shall be imposed on the export price of the Products at the rates
provided in this Item (d).
3.2 The Initial Payment and the Annual Fee (except such Annual Fee that covers
the First Year) shall not be refundable or creditable for any reason. The
Minimum Royalty and such Annual Fee that covers the First Year shall not be
refundable for any reason but creditable against such Running Royalty that has
accrued in the Year for which the Minimum Royalty or the Annual Fee is related.
3.3 The Running Royalty shall be payable by ARIAD on the Net Sales of the
Products manufactured and/or sold by ARIAD or its sublicensees in the Territory
on a country-by-country basis until and unless any and all Patents cease to
exist in such country. Provided, however, that
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as to the Products manufactured and/or sold in any of the constituent countries
[*], the Running Royalty shall be payable until and unless any and all Patents
cease to exist in all of the countries constituting the European Union.
Article 4. Payment Procedures, Records and Auditing
4.1 Unless otherwise instructed by Mochida in writing, payment by ARIAD to
Mochida hereunder shall be made in Dollars and by remittance to a bank account
designated by Mochida in writing. All payments to be made by ARIAD to Mochida
hereunder shall be subject to any income tax, withholding tax or other taxes
which are imposed under the relevant law and/or relevant tax conventions
concluded for the avoidance of double taxation. ARIAD shall withhold any such
taxes and send to Mochida official receipts of such tax payments as promptly as
practicably possible.
4.2 Within [*] days from the end of each Payment Computation Period, ARIAD shall
submit a written report to Mochida in a form to be agreed between the parties
separately, identifying, inter alia, the amount of the gross sales and the Net
Sales on a country-by-country and a Product-by-Product basis and the computation
of the Running Royalty payable to Mochida.
4.3 ARIAD shall, and cause its sublicensees to, keep accurate records in
sufficient detail to enable Mochida to confirm the accuracy of the amounts of
the royalties paid by ARIAD. Upon Mochida's request, but not more frequently
than once a year, and only during ordinary business hours, ARIAD shall permit,
[*] investigation of relevant records, necessary to verify the accuracy of the
royalty payments made hereunder. Such investigation and verification shall be
conducted by an independent public accountant selected by Mochida and
satisfactory to the party being inspected at Mochida'ssole expense.
Notwithstanding the foregoing, in the event that any such investigation and
verification reveals that the payment made by ARIAD to Mochida are incorrect by
more than [*] in any Payment Computation Period, ARIAD shall reimburse Mochida
for the costs of such audit in addition to promptly remitting the amount of any
underpayment.
4.4 Within [*] days after the end of each Year, ARIAD agrees to provide Mochida
with a written report on the status and a forecast of its [*] development
activities relating to the Products. Further, within [*] from the date of launch
of any of the Products in any country in the Territory, ARIAD shall notify, on a
Product-by-Product basis the details thereof in writing to Mochida.
Article 5. Confidentiality
5.1 During the term of this Agreement and for a period of [*] after the
expiration or termination hereof, ARIAD shall:
(a) keep the M-Information in strict confidence and not disclose it to
any third parties (except relevant sublicensees to whom ARIAD may
disclose the M-Information under the confidentiality obligations
substantially similar to those provided herein);
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(b) not use the M-Information for applications of any intellectual
property rights or for any purpose other than as authorized herein; and
(c) prevent its directors, officers, employees and sublicensees from
unauthorized use or disclosure of the M-Information.
5.2 Any and all Confidential Patent Documents (as defined in the Confidentiality
Agreement) shall be deemed to have been disclosed hereunder as of the date first
above written and hereafter be protected pursuant to the provisions hereof.
5.3 Notwithstanding the provisions of Paragraphs 5.1 and 5.2 hereof, with
respect to such M-Information (including Confidential Patent Documents) that is
included or covered by, or directly related to, the Patents, ARIAD's
confidentiality obligations provided herein shall continue until and unless such
M-Information becomes publicly known through no breach of this Agreement by
ARIAD (or its directors, officers, employees or sublicensees). ARIAD hereby
specifically agrees that it will not use M-Information, including without
limitation, information to be provided by Mochida under Paragraph 5.2 hereof,
to, inter alia, deny or contest the validity or scope of the Patents.
5.4 During the term of this Agreement and for a period of [*] after the
expiration or termination hereof, Mochida shall keep the ARIAD-Information in
strict confidence and not disclose it to any third parties (except OBI to whom
Mochida may disclose the ARIAD-Information under the confidentiality obligations
substantially similar to those provided herein) or use for any purpose other
than as authorized herein or otherwise in writing, and shall prevent its
directors, officers and employees from unauthorized use or disclosure of the
ARIAD-Information.
5.5 The obligations of confidentiality provided in Paragraphs 5.1 and 5.4 shall
not apply to the extent that the receiving party of the Confidential Information
(hereinafter referred to as the "Receiving Party") can establish that the
Confidential Information:
(a) was available to the public at the time of disclosure or thereafter
becomes publicly known through no breach of this Agreement by the
Receiving Party (or its directors, officers, employees or
sublicensees);
(b) was known to the Receiving Party at the time of disclosure becomes
known to the Receiving Party through disclosure by sources other than
the disclosing party of the Confidential Information (hereinafter
referred to as the "Disclosing Party"), which was lawfully in
possession of the same and had the right to disclose the same;
(c) is required to be disclosed by law, government agency, court order
or valid discovery request in connection with a legal proceeding,
provided that the Receiving Party provides the Disclosing Party with
prior written notice of any such disclosure so that it can seek an
appropriate protective order; or (d) is approved for release by written
authorization of the Disclosing Party.
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Article 6. Representations
6.1 Mochida agrees to make its commercially reasonable efforts to cause OBI to
(a) register the patent applications included in the Patents as promptly as
practically possible and (b) maintain the Patents pursuant to the relevant
patent laws in the Territory. If OBI and Mochida determines not to maintain any
of the Patents, it shall promptly notify thereof to ARIAD. In such a case, the
parties hereto (as well as OBI and any Mochida's licensees to such Patent(s)
other than ARIAD, if necessary) shall discuss the solution thereof in good
faith, provided, however, that in no event Mochida shall be liable for any
losses or damages incurred by ARIAD and/or ARIAD's sublicensees due to
cancellation, nullification or withdrawal of the Patent(s) in whole or part for
any reason. Notwithstanding the first provision of Paragraph 3.3, but without
affecting the generality of the proviso thereof, unless Mochida retains other
Patent(s) in the same country, on and after such abandonment, cancellation,
nullification or withdrawal of the Patents in whole, ARIAD shall be relieved
from the obligation to pay to Mochida the Running Royalty for the Products
manufactured, used and/or sold in the country where the Patent(s) cease to
exist.
6.2 Mochida shall provide ARIAD in a timely manner with copies of all
substantial communications between the patent attorney(s) representing OBI
and/or Mochida and the U. S. Patent Office so as to enable ARIAD to be kept
informed of the progress of the prosecution of such Patents in the U. S. A.
covering Products produced, or to be produced, by ARIAD. Each party agrees to
promptly notify the other party in writing of any infringement of the Patents by
a third party which shall come to its attention.
6.3 If or when ARIAD or its patent attorney submits to Mochida any comment or
advice to provide greater strength to the Patents, Mochida agrees to, and cause
OBI to, consider it carefully. Provided, however, that it shall be OBI/Mochida's
sole discretion to determine the [*].
6.4 Except as specifically set forth in this Article 6, Mochida makes no
representations or warranties, either express or implied, arising by law or
otherwise, including, without limitation, implied warranties of merchantability
or fitness for a particular purpose. In no event will Mochida have any
obligation or liability for loss of revenue or profit, or for incidental or
consequential damages. In particular, with no limitation, nothing in this
Agreement will be construed as:
(a) a warranty or representation by Mochida as to the validity or scope
of any Patents;
(b) a warranty or representation that anything made, used, sold or
otherwise disposed of under the license granted in this Agreement is or
will be free from infringement of patents of third parties;
(c) conferring the right to use in advertising, publicity, or otherwise
any trademark, trade name, or any contraction, abbreviation,
simulation, or adaptation thereof, of Mochida or of OBI. If or when
reference to Mochida and/or OBI is required by applicable law or
regulation, ARIAD shall notify the details thereof to Mochida and
acquire prior written consent therefor from Mochida, which consent
shall not be unreasonably withheld;
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(d) conferring by implication, estoppel, or otherwise any license or
rights under any patents of Mochida or of OBI other than the Patents;
or
(e) conferring any license or right as to which Mochida has not been
granted by OBI the right to sublicense.
6.5 If, during the term of this Agreement, any third party infringes the
Patents, Mochida shall have the right, but not the obligation, to bring a suit
in its name to restrain and enjoin such infringement and to recover profits and
damages. Without affecting the generality of the foregoing provision, if or when
Mochida desires to discuss the solution of any patent infringement or other
disputes occurred in the Territory involving the Patents and/or the Products,
and seek ARIAD's cooperation for the settlement thereof, ARIAD shall comply with
any request made by Mochida, to the extent reasonable.
6.6 Mochida represents that it is the worldwide exclusive licensee of the
Patents pursuant to an agreement with OBI and has the right to grant the license
set forth herein.
Article 7. Indemnification
7.1 It shall be ARIAD's sole responsibility to investigate its market carefully
at its expense to avoid any dispute, including without limitation, infringement
disputes involving industrial property rights owned by third parties.
7.2 If any action, including, without limitation, patent infringement or product
liability action is brought against Mochida (or OBI) because of actual or
anticipated development, manufacture, use or sale of the Products by ARIAD or
its sublicensees in any country, ARIAD shall, without delay, defend, indemnify
and hold harmless Mochida (and OBI) against such action. ARIAD shall assume
control of the defense of such action. If or when such action is related to the
validity or scope of any of the Patents, ARIAD shall notify Mochida in advance
of the strategy of such action, and if Mochida considers that such strategy is
not suitable to protect the Patents or disadvantageous to Mochida's (or its
licensees') business activities, Mochida may suggest alternative solution or
strategy to ARIAD, and ARIAD shall comply with such suggestion to the extent
practical and reasonable.
7.3 Any reasonable costs and expenses incurred by Mochida (or OBI) as a result
of the action prescribed in Paragraph 7.2, including settlement costs, damages
assessed against Mochida (or OBI) and reasonable outside attorney fees, shall be
reimbursed by ARIAD to Mochida (or OBI). Upon Mochida's reasonable request,
ARIAD shall advise Mochida of the progress status and prospect of any action
involving Mochida, OBI and/or the Patents from time to time.
Article 8. Term and Termination
8.1 This Agreement shall become effective as of the date first above written and
continues to be in full force and effect until the last of the Patents expires
or otherwise cease to exist.
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8.2 Should ARIAD determine to terminate all of the manufacture, use and sale of
the Products in the Territory entirely or if there is any other justifiable
reason, ARIAD shall have the right to terminate this Agreement forthwith by
giving [*] prior notice to Mochida in writing.
8.3 Failure by either party to comply with any of the respective obligations or
conditions contained in this Agreement shall entitle the other party to give to
the party in default notice requiring it to cure such default. If such default
be not cured within [*] after receipt of such notice, the notifying party shall
be entitled (without prejudice to any of its other rights conferred on it by law
or this Agreement) to terminate this Agreement by giving written notice to take
effect immediately. The right of either party to terminate this Agreement as
provided hereinabove shall not be affected in any way by its waiver of, or
failure to take, action with respect to any previous default.
8.4 In case of the bankruptcy or insolvency of either party, or in the event
that one of the parties hereto shall go into liquidation, that a receiver or a
trustee is appointed for all or substantially all of the property or estate of
that party, or that party makes an assignment for the benefit of creditor, and
whether any of the aforementioned events be the outcome of the voluntary act of
that party or otherwise, the other party shall be entitled to terminate this
Agreement forthwith by giving written notice to the first party, provided that
if any of such events is the outcome of an action by a third party without the
agreement of the party to this Agreement, such party shall have a period of [*]
to overturn such action.
8.5 Upon termination of this Agreement for any reason, except expiration hereof
pursuant to Paragraph 8.1, ARIAD shall, and cause its sublicensees to,
immediately terminate the manufacture, use, sale or distribution of the Products
in the Territory, and simultaneously cease to use, directly or indirectly, any
M-Information for any purpose in any country.
8.6 Upon expiration or termination of this Agreement, the Receiving Party shall
destroy, or at the request of the Disclosing Party, shall return to the
Disclosing Party any and all Confidential Information of the latter party in
tangible form, including, without limitation, all copies and reproductions
thereof, except that one (1) copy thereof may be retained by the Receiving Party
solely for the purpose of determining the extent of its confidentiality
obligations hereunder.
8.7 The following provisions shall survive any termination or expiration of this
Agreement:
Articles 5, 7 & 9
Paragraphs 3.2, 4.3, 6.4, 8.5 & 8.6
Article 9. Miscellaneous
9.1 Assignability
9.1.1 Neither this Agreement nor any rights or obligations hereunder
shall be assignable by either party without the prior written consent
of the other party. Each party agrees not
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to withhold the consent unreasonably. The major factors which Mochida
will take into consideration will be, without limitation, [*].
9.1.2 Notwithstanding the provisions of the preceding Item 9.1.1, ARIAD
may assign this Agreement and rights and obligations hereunder, without
additional obligation to Mochida, to:
(a) an entity with which ARIAD merges or consolidates or to
which it sells or transfers all or substantially all of its business
and assets pursuant to a legitimate vote of its stockholders with
thirty (30) days prior written notice to Mochida; or
(b) a corporation, partnership or other business entity which
during the term of this Agreement, directly or indirectly, is
controlled by, controls, or is under common control with ARIAD or to
which substantially all of its business and assets relating to the
Products are sold or otherwise transferred or to a partnership of which
ARIAD is a partner, with sixty (60) days prior written consent from
Mochida, subject to the condition that ARIAD continues to be liable as
to the due performance of this Agreement by the proposed assignee.
9.1.3 In no event the terms and conditions of this Agreement shall be
changed in any sense as the result of the assignment permitted
hereunder. Without affecting the generality of the provisions of this
Paragraph 9.1, this Agreement and any rights and obligations hereunder
shall be binding upon and inure to the benefit of the successors and
assigns of the respective parties.
9.2 In the exercise of the rights and obligations under this Agreement, the
parties hereto shall at all times comply with such requirements imposed on it by
all applicable laws and governmental regulations and shall cause such
requirements to be observed by its officers, employees and sublicensees. In the
event that any provision of this Agreement is held by a court, or a Fair Trade
Commission, of competent jurisdiction to be unenforceable because it is invalid
or in conflict with any law or governmental regulations of any relevant
jurisdiction, the validity of the remaining provisions shall not be affected,
and the offending provision shall be construed in such a manner as to effectuate
the original intent and purpose thereof to the maximum extent possible without
being invalid or unenforceable.
9.3 No waiver by either party of a term or condition of this Agreement in any
one instance shall be deemed or construed to be a waiver of such term or
condition for any similar instance in the past or future or of any preceding or
subsequent breach hereof. All rights, remedies, undertakings, obligations and
agreements contained in this Agreement shall be cumulative and none of them
shall be a limitation of any other right, remedy, undertaking, obligation or
agreement.
9.4 The captions used in this Agreement are for convenience of reference only
and are not to be used for interpreting the obligations of the parties under
this Agreement.
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9.5 This Agreement sets forth the entire agreement and understanding between the
parties and supersedes and merges all prior oral and written agreements and
understandings between Mochida and ARIAD, relating to the subject matter hereof.
Without affecting any rights and obligations already accrued, the
Confidentiality Agreement shall be replaced by this Agreement in its entirety.
This Agreement may not be modified or discharged, in whole or part, except by an
agreement in writing signed by the parties.
9.6 This Agreement shall be construed as to all matters including validity,
construction and performance by and under the laws of Japan.
9.7 All disputes, controversies, or differences which may arise between the
parties out of, or in relation to, or in connection with this Agreement shall be
settled amicably between the parties. In case this fails, such dispute shall be
exclusively and finally settled by arbitration. Such arbitration shall be held
at the place of the proposed respondent, i.e., in Tokyo, Japan under the rules
of the Japan Commercial Arbitration Association, if the proposed respondent is
Mochida, and in Boston, Massachusetts U.S.A. under the rules of American
Arbitration Association, if the proposed respondent is ARIAD.
9.8 Any notice required under this Agreement shall be in writing sent by
registered or certified airmail, postage pre-paid, or by overnight courier or by
facsimile confirmed by airmail and addressed as follows:
If to Mochida:
Attn: Xx. Xxxxxxxx Xxxxxxx
Director
International Business Development Division
Facsimile No.: 00-0000-0000
Telephone No.: 00-0000-0000
If to ARIAD:
Attn: Xxxxxx X. Xxxxxx, M.D.
President and Chief Executive Officer
Facsimile No.: 000-000-0000
Telephone No.: 000-000-0000
All notices shall be deemed to be effective on the date of the actual receipt
thereof or, if such date is not verified, shall be deemed to have been duly
given seven (7) days after being dispatched by registered or certified airmail,
three (3) days after being sent by overnight courier, or one (1) day after being
sent by facsimile confirmed by airmail.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized representatives as of the date first above written.
For and on behalf of Mochida Pharmaceutical Co, Ltd.
/s/ X. Xxxxxxxx
Name: Xxxxxx Xxxxxxxx
Title: President
Date: September 12, 1996
For and on behalf of ARIAD Pharmaceuticals, Inc.
/s/ Xxxxxx Xxxxxx, M.D.
Name: Xxxxxx X. Xxxxxx, M.D.
Title: President and Chief Executive Officer
Date: September 4, 1996
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Schedule 1
Details of the Patents
Country Application No. Date of Application Title
(Publication No.) (Date of Publication)
[*]
