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EXHIBIT 10.22
LICENSE AND SUPPLY AGREEMENT
THIS LICENSE AND SUPPLY AGREEMENT (the "Agreement") is made as
of December 1, 1996 (the "Effective Date") by and between PHARMACYCLICS, INC.,
a Delaware corporation ("Pharmacyclics") and E-Z-EM, LTD., an English company
organized and existing under the laws of England and Wales ("E-Z-EM").
RECITALS
WHEREAS Pharmacyclics is engaged in the development of and
owns or has a license to certain patent rights relating to an oral magnetic
resonance imaging ("MRI") contrast agent for the gastrointestinal tract based
upon its proprietary GADOLITE(R) Oral Suspension technology;
AND WHEREAS Pharmacyclics and E-Z-EM, Inc., a Delaware
corporation ("E-Z-EM US"), entered into a License and Supply Agreement dated as
of August 17, 1995 (the "North American Agreement") pursuant to which
Pharmacyclics granted certain rights to E-Z-EM US to import, market, sell,
offer for sale and distribute Licensed Products (as therein defined) in the
United States of America, including its territories and possessions, Canada and
Mexico (the "North American Territory");
AND WHEREAS Pharmacyclics and E-Z-EM now desire that
Pharmacyclics grant to E-Z-EM the exclusive right to import, market, sell,
offer for sale and distribute Licensed Products in the Territory on the terms
and conditions set forth herein;
AND WHEREAS Pharmacyclics has filed for the UK Marketing
Authorization and E-Z-EM intends to file for Marketing Authorizations with the
Competent Authorities within the Territory with respect to GADOLITE(R);
NOW THEREFORE, in consideration of the foregoing premises and
the covenants set forth below, the parties hereby agree as follows:
ARTICLE 1
DEFINITIONS
As used herein, the following terms shall have the following meanings:
1.1 "ADDITIONAL MRI PRODUCTS" shall mean any Pharmacyclics product for use
in the Field, other than a Licensed Product.
1.2 "ADEQUATE SUPPLY" shall mean supply of Licensed Product in ordered
quantity that is delivered on a timely basis according to written purchase
orders pursuant to Article 6 and that meets the MRI Product Specifications but
does not exceed the Maximum Quantities.
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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1.3 "APPLICABLE LAWS" shall mean all applicable laws, rules, regulations
and guidelines within or without the Territory that may apply to the
development, marketing or sales of the Licensed Products in the Territory or
the performance of either party's obligations under this Agreement including
laws, regulations and guidelines governing the import, export, development,
marketing, distribution and sale of the Licensed Products in the Territory and
the United States, to the extent applicable and relevant, and including all
Good Manufacturing Practices or Good Clinical Practices standards or guidelines
promulgated by the FDA or the Competent Authorities and including trade
association guidelines, where applicable, as well as U.S. export control laws
and the U.S. Foreign Corrupt Practices Act ("FCPA").
1.4 "AUDIT" shall mean the rights of both parties to examine or have
examined not more often than once each year by a certified public accountant
selected by the other party and acceptable to the party whose records are to be
examined, which acceptance will not be unreasonably withheld or delayed, the
Records for the sole purpose of verifying for the inspecting party the
correctness of calculations reflected in the Records.
1.5 "XXXXXXXXX WELLCOME" shall mean Xxxxxxxxx Wellcome Co., a North
Carolina corporation.
1.6 "CHANGE IN CONTROL" shall mean (i) a merger or consolidation in which
E-Z-EM US or E-Z-EM is not the surviving corporation or company; (ii) any
"person" (within the meaning of Section 13(d) and Section 14(d)(2) of the
Securities Exchange Act l934) (other than a Xxxxx/Xxxxxx Person) is or becomes
the beneficial owner, directly or indirectly, of securities of a party
representing 50% plus one vote or more of the combined voting power of such
party's then-outstanding securities.
1.7 "COMMISSION" shall mean the Commission of the European Union.
1.8 "CPMP" shall mean the Committee for Proprietary Medicinal Products of
the European Agency for the Evaluation of Medicinal Products.
1.9 "COMPETENT AUTHORITIES" shall mean the entities in the Territory
responsible for the regulation of medicinal products intended for human use.
1.10 "COMPETITIVE MRI PRODUCT" shall mean any product intended for use in
the Field other than (i) any Licensed Product, (ii) the oral contrast agents
which contain barium sulfate, bentonite, and other ingredients which have been
or are being developed by E-Z-EM or an E-Z-EM Affiliate as of the effective
date of the North American Agreement and (iii) any Additional MRI Product
licensed by E-Z-EM pursuant to Section 2.2.
1.11 "CONFIDENTIAL INFORMATION" shall mean, subject to the exceptions set
forth in Section 8.2, any information received by one party from the other
party after the
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effective date of the North American Agreement pertaining to the Pharmacyclics
Technology, all know-how, data, process, technique, or formula relating to
Licensed Products and any research project, work in process, future
development, scientific, engineering, manufacturing, marketing, business plan,
financial or personnel matter relating to either party, its present or future
products, sales, suppliers, customers, employees, investors or business,
whether in oral, written, graphic or electronic form.
1.12 "DECENTRALIZED APPLICATION" shall mean an application submitted by
E-Z-EM for mutual recognition of the UK Marketing Authorization by one or more
of the Competent Authorities using the Decentralized Procedures.
1.13 "DECENTRALIZED PROCEDURES" shall mean the decentralized procedures
established by Directive 93/39/EEC amending Directive 65/65/EEC, 75/3l8/EEC and
75/319/EEC in respect of Medicinal Products, l993 O.J. (L214) 22.
1.14 "DISTRIBUTOR RECEIPTS" shall mean all fees and other payments actually
received from distributors in respect of the granting of Licensed Product
rights in any country within the Territory, whether denominated as licensing
fees, marketing fees or otherwise, but shall not include amounts paid by
distributors for MRI Product Units.
1.15 "EU" shall mean the European Union.
1.16 "E-Z-EM US" shall have the meaning set forth in the Recitals.
1.17 "E-Z-EM AFFILIATE" shall mean any person or entity directly, or
indirectly through one or more intermediaries, controlling, controlled by or
under common control with E-Z-EM, where control means the direct or indirect
possession of greater than fifty percent (50%) of (i) the outstanding voting
securities of a corporation or (ii) a comparable equity interest in any other
type of entity.
1.18 "FDA" shall mean the United States Food and Drug Administration.
1.19 "FD&C ACT" shall mean the United States Federal Food, Drug and
Cosmetic Act and applicable regulations promulgated thereunder, as amended from
time to time.
1.20 "FIELD" shall mean positive and negative contrast agents which are
delivered to and which image the gastrointestinal tract using MRI.
1.21 "FIRST COMMERCIAL SALE" shall mean, (i) with respect to each country
in the Territory, the first sale of GADOLITE(R) for use, consumption or resale
to any third party customer by E-Z-EM or its sub-distributors in such country
subsequent to receipt of a Marketing Authorization and other approvals with
respect to such country obtained in order to comply with Applicable Laws and
(ii) with respect to the Territory, the First Commercial Sale in any country
within the Territory.
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1.22 "FIRST TIER MARKETING AUTHORIZATIONS" shall mean Marketing
Authorizations in Belgium, the Netherlands, France, Germany and Italy.
1.23 "FISCAL YEAR". The Fiscal Year shall mean E-Z-EM's fiscal year, which
is the year ending May 31st.
1.24 "GADOLITE(R)" shall mean that MRI contrast agent for use in the Field
known as GADOLITE(R) Oral Suspension.
1.25 "GADOLITE(R) LINE EXTENSION" shall mean any subsequent formulations or
dosages of, or indications for, GADOLITE(R), where the New Drug Application
("NDA") or the application for the new marketing authorization or abridged
application therefor is a supplement to the initial NDA for GADOLITE(R)
("Initial NDA") or the initial Marketing Authorization or where such NDA filing
package or application for a new marketing authorization or abridged
application incorporates or relies upon, to a material extent, data or
information contained in the Initial NDA or in the initial UK Marketing
Authorization submission package or the Decentralized Application submission
package for GADOLITE(R).
1.26 "GROSS PROFITS" shall mean Net Sales minus the sum of (a) amounts paid
to Pharmacyclics for MRI Product Units actually sold, as calculated in Section
6.3, plus (b) third party royalties paid to Pharmacyclics pursuant to Section
4.1(d).
1.27 "IMPROVEMENTS" shall mean any improved or modified element or feature
of Pharmacyclics Technology for use in the Field made during the term of this
Agreement which is applicable to a Licensed Product.
1.28 "LICENSED PRODUCT" shall mean any product for use in the Field which
is either (i) covered by one or more claims contained in the Pharmacyclics
Patents or (ii) incorporates or is based upon the Pharmacyclics Technology, and
includes GADOLITE(R), any GADOLITE(R) Line Extension and any Other Licensed
Products.
1.29 "MRI PACKAGING SPECIFICATIONS" shall mean the packaging and labeling
specifications for the MRI Product Unit as may be determined by E-Z-EM from
time to time, as such specifications may be amended from time to time as may be
required in accordance with Section 3.2(d), provided, however, that any such
specifications or amendments thereto shall be subject to the approval of
Pharmacyclics, which approval shall not be unreasonably withheld or delayed and
shall be in compliance with Applicable Laws.
1.30 "MRI PRODUCT SPECIFICATIONS" shall mean the specifications for the MRI
Product Unit which are attached hereto as Schedule 1.30 and made a part hereof,
as such specifications may be amended from time to time by mutual agreement of
the parties, including, without limitation, such amendments as may be necessary
to obtain any
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necessary or appropriate Marketing Authorizations or other approvals within the
Territory.
1.31 "MRI PRODUCT UNIT" shall mean one (1) bottle containing sixteen (16)
ounces of GADOLITE(R) or such other package size for GADOLITE(R) as may be
mutually agreed upon by the parties from time to time.
1.32 "MARKETING AUTHORIZATION" shall mean all necessary and appropriate
approvals, including Pricing and Reimbursement Approvals, where applicable, to
put GADOLITE(R) or a GADOLITE(R) Line Extension product on the market as
Licensed Product in a particular member state in the Territory.
1.33 "MAXIMUM QUANTITIES" shall mean the maximum quantities of MRI Product
Units which Pharmacyclics is entitled to purchase from Xxxxxxxxx Wellcome
annually pursuant to Subsection 2.1(a) of the Supply Agreement (or a comparable
section of a substantially similar supply agreement).
1.34 "NET SALES" shall mean the gross receipts actually received by E-Z-EM
from the sale of Licensed Product, whether sold directly to third parties or to
a distributor, less the following deductions, without duplication:
(1) Prompt payment or other trade or quantity
discounts actually allowed and taken in such
amounts as are customary in the trade;
(2) Commissions or rebates paid or allowed by
E-Z-EM to distributors and agents who are
independent third parties;
(3) Amounts repaid or credited by reason of
timely rejections or returns;
(4) Taxes (other than franchise or income taxes
on the income of E-Z-EM) actually paid or
withheld or which E-Z-EM is obligated to pay;
(5) Transportation and delivery charges, including
insurance premiums, invoiced to the customer;
and
(6) All costs incurred in transporting, packaging
and labeling the MRI Product Units,
including, without limitation, insurance,
freight and duties, that are incurred before
MRI Product Units reach the Initial Entry
Point, except to the extent such costs are
included in the amounts paid to Pharmacyclics
for MRI Product Units, as calculated in
Section 6.3.
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Notwithstanding the foregoing, amounts received by E-Z-EM or its
permitted sub-licensees (which, for greater clarity, shall not include a
distributor, subdistributor or dealer that is not a sub-licensee) for the sale
of Licensed Product among E-Z-EM and its permitted sub-licensees (which, for
greater clarity, shall not include a distributor, subdistributor or dealer that
is not a sub-licensee) whether for their internal use or for resale or other
disposition will not be included in the computation of Net Sales hereunder.
1.35 "NORTH AMERICAN AGREEMENT" shall have the meaning set forth in the
Recitals.
1.36 "OBJECTIONS" shall mean any objections submitted by any member state
to mutual recognition of the UK Marketing Authorization during the
Decentralized Procedures.
1.37 "OTHER LICENSED PRODUCT" shall mean any product in the Field other
than GADOLITE(R) or a GADOLITE(R) Line Extension which is covered by or
incorporates Pharmacyclics Technology.
1.38 "PATENT LICENSE AGREEMENTS" shall mean (i) that certain Patent License
Agreement by and between Pharmacyclics and the Board of Regents of the
University of Texas System dated July 1, 1992, and (ii) that certain Patent
License Agreement by and between Pharmacyclics and Xxxxxx Xxxxx dated October
15, 1992.
1.39 "PHARMACYCLICS PATENTS" shall mean U.S. Patents No. 5,122,363 and No.
5,429,814 and European Patent No. 0560910 and "Pharmacyclics EU Patent" shall
mean European Patent No. 0560910.
1.40 "PHARMACYCLICS TECHNOLOGY" shall mean (i) the Pharmacyclics Patents
and (ii) all know how, technology, trade secrets, processes, data, methods and
any physical, chemical or biological material or other information which
Pharmacyclics owns, controls or acquires or has or acquires a license to (with
the right to sub-license) relating to the use, marketing, sale, offer for sale,
importation and distribution of products in the Field.
1.41 "PRE-MARKETING EXPENSES" shall mean all expenses (other than U.K.
Registration Costs) incurred prior to the First Commercial Sale in each country
in the Territory.
1.42 "PRICING AND REIMBURSEMENT APPROVALS" shall mean any pricing and
reimbursement approvals which must be obtained before placing GADOLITE(R) on
the market in any country in the Territory.
1.43 "RECORDS" shall mean complete and accurate records showing clearly all
transactions which are relevant to any sales, costs, expenses and payments
under this Agreement kept in a manner to facilitate an Audit.
1.44 "REFERENCE MEMBER STATE" shall mean the UK.
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1.45 "REGULATORY STRATEGY" shall mean a reasonably detailed written plan
prepared by E-Z-EM outlining its strategy for achieving Marketing
Authorizations in all member states in the Territory mutually agreed by the
parties, as amended from time to time by E-Z-EM, including lists of tasks to be
accomplished, time lines for completion of various tasks necessary to obtain
the Marketing Authorizations, including details of plans to obtain the national
licenses.
1.46 "RIGHTS" means the rights to import, market, sell and distribute any
Additional MRI Product.
1.47 "SOP" shall mean E-Z-EM's standard operating procedure for identifying
and reporting adverse drug experiences, as agreed to by the UK Department of
Health in connection with E-Z-EM's Wholesale Dealers License, in compliance
with Applicable Laws.
1.48 "XXXXX/XXXXXX PERSON" means Xxxxxx Xxxxx and Xxxxx Xxxxxx, and their
spouses, children (and their spouses), and grandchildren (and their spouses),
and any trust, corporation, partnership, limited liability company or other
entity established for the benefit of any such person or persons, or control of
which is held by any such person or persons.
1.49 "SUPPLY AGREEMENT" shall mean that Supply Agreement, dated March 1,
1995, between Pharmacyclics and Xxxxxxxxx Wellcome, as may be amended from time
to time, a copy of which is attached hereto as Appendix 1.
1.50 "TERRITORY" means the following countries: Belgium, Italy, Denmark,
Luxembourg, France, the Netherlands, Germany, Portugal, Greece, Spain, Ireland,
United Kingdom, Sweden, Finland, Austria, Norway, Switzerland, Iceland,
Liechtenstein, South Africa, Albania, Armenia, Azerbaijan, Belarus,
Bosnia-Hercegovina, Bulgaria, Croatia, Czech Republic, Estonia, Georgia,
Hungary, Kazakhstan, Kirghistan, Latvia, Lithuania, Macedonia, Moldova,
Montenegro, Poland, Romania, Russia, Serbia, Slovak Republik, Slovenia,
Tajikistan, Turkey, Turkmenistan, Ukraine, Uzbekistan and such other countries
as may in the future become members of the EU or the European Economic Area.
1.53 "UK" means the United Kingdom of Great Britain and Northern Ireland,
the Isle of Man and the Channel Islands.
1.54 "UK MARKETING AUTHORIZATION" means a marketing authorization from the
Competent Authority in the United Kingdom to place GADOLITE(R) on the market as
Licensed Product in the United Kingdom.
1.55 "UK REGISTRATION COSTS" means all costs incurred by Pharmacyclics in
seeking the UK Marketing Authorization.
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1.56 "INITIAL ENTRY POINT" means a place of delivery specified by E-Z-EM in
each order for MRI Product Units as permitted by Applicable Laws.
ARTICLE 2
GRANT OF RIGHTS
2.1 LICENSE GRANT.
(a) PRODUCT. Subject to the terms and conditions of this
Agreement, Pharmacyclics hereby grants to E-Z-EM, and E-Z-EM hereby accepts,
(i) an exclusive (even as to Pharmacyclics) sub-license under the Pharmacyclics
Patents pursuant to the Patent License Agreements and (ii) an exclusive (even
as to Pharmacyclics) license under the other Pharmacyclics Technology and
Improvements, to import, market, sell, offer for sale and distribute Licensed
Products in the Territory and (iii) a non-exclusive license (and sub-license)
to use the Pharmacyclics Technology and Improvements solely in connection
therewith in the Territory for the term of this Agreement. E-Z-EM shall have
the right to sub-license the rights granted in this Section 2.1 only to (a) one
or more E-Z-EM Affiliates and (b) distributors, sub-distributors or dealers in
the Territory. E-Z-EM shall have the right to sell Licensed Product through
(a) one or more E-Z-EM Affiliates and (b) distributors, sub-distributors or
dealers in the Territory without in any such case sub-licensing the rights
granted in this Section 2.1.
(b) DEVELOPMENT OF IMPROVEMENTS. Subject to the terms
and conditions of this Agreement, Pharmacyclics hereby grants to E-Z-EM, and
E-Z-EM hereby accepts, a non-exclusive license under the Pharmacyclics
Technology to conduct, or to have conducted on its behalf, research and
development solely for the purpose of making Improvements. With respect to
each such Improvement and all inventions (whether or not patentable), know how,
technology, trade secrets, processes, data, methods and any physical, chemical
or biological material or other information pertaining thereto which are
developed or invented by E-Z-EM or which have been licensed by E-Z-EM, to the
extent E-Z-EM has the right to sub-license, E-Z-EM hereby agrees to grant and
grants to Pharmacyclics during the term of this Agreement a royalty-free,
non-exclusive license, to use the same in connection with Licensed Products in
the Field and within the Territory. With respect to any license hereunder
outside the Territory, the parties will meet and negotiate in good faith the
terms of such license.
(c) COOPERATION CONCERNING IMPROVEMENTS. Each party
agrees to keep the other party fully informed of Improvements which it
develops. E-Z-EM agrees to make no Improvements without Pharmacyclics' prior
written consent, which shall not be unreasonably withheld or delayed.
2.2 ADDITIONAL MRI PRODUCTS. If Pharmacyclics determines to grant the
Rights to any Additional MRI Product to one or more third parties in the
Territory, E-Z-EM shall have a first right of negotiation to obtain the Rights
in accordance with this Section 2.2.
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Upon such a determination, Pharmacyclics shall notify E-Z-EM in writing of its
intent to grant the Rights to such Additional MRI Product. Such notice shall
identify the Additional MRI Product . Upon receipt of such notice, E-Z-EM shall
have 30 days to notify Pharmacyclics in writing of its interest. Upon receipt
by Pharmacyclics of such statement of interest, the parties shall negotiate in
good faith for an additional 180 days to reach agreement upon the principal
business and legal terms with respect to the Rights. If E-Z-EM expresses no
interest in pursuing the Rights within the 30 day period or the parties are
unable to agree on such principal terms within such 180 day period,
Pharmacyclics shall have the right to grant the Rights to any third party and
shall have no obligation or liability to E-Z-EM therefore.
2.3 COVENANT NOT TO LAUNCH COMPETITIVE MRI PRODUCT. E-Z-EM hereby
covenants not to develop, in-license, market, sell, distribute or have
marketed, have sold or have distributed any Competitive MRI Product in the
Territory during the term of this Agreement. Notwithstanding the foregoing, if
E-Z-EM or any E-Z-EM Affiliate acquires an entity or all or substantially all
of the assets of an entity and such entity distributes or such assets include a
Competitive MRI Product, E-Z-EM or such E-Z-EM Affiliate shall have one (1)
year in which to divest itself of such Competitive MRI Product or to otherwise
cease distribution of such Competitive MRI Product, and E-Z-EM shall not be in
breach of this Section 2.3 if it or the E-Z-EM Affiliate, as the case may be,
so divests or ceases distribution within such one (1) year period.
2.4 WARRANTY CONCERNING GRANT. Pharmacyclics warrants that, as of the
Effective Date, (i) it has no product, developed or in development, in the
Field that has not heretofore been disclosed to E-Z-EM, and (ii) it has no
product, developed or in development, in the Field other than GADOLITE(R).
Pharmacyclics further warrants that the Patent License Agreements are the only
license agreements pursuant to which the Pharmacyclics Patents has been
licensed to Pharmacyclics and the Patent License Agreements permit
Pharmacyclics to enter into this License and Supply Agreement with E-Z-EM.
Pharmacyclics further warrants that it has the right to license (or
sub-license, as the case may be) to E-Z-EM the Pharmacyclics Technology.
Pharmacyclics further warrants that it will undertake whatever payments and
other actions are required for it to maintain the Patent License Agreements in
good standing, provided that E-Z-EM complies with its obligations pursuant to
Section 5.1.
2.5 DEVELOPMENT OF GADOLITE(R) LINE EXTENSIONS AND OTHER LICENSED PRODUCTS.
(a) GADOLITE(R) LINE EXTENSIONS. If either party desires
to seek and obtain Marketing Authorization for a GADOLITE(R) Line Extension in
the Territory, the parties will consult. If both parties agree to seek such
Marketing Authorization for such GADOLITE(R) Line Extension, * * *. In
such event, such GADOLITE(R) Line Extension shall be subject to all other terms
and conditions of this Agreement, as though it were GADOLITE(R), unless
otherwise explicitly
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT HAS
BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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stated. Any regulatory filing with respect to any GADOLITE(R) Line Extension
will be made only if agreed to by both parties in writing.
(b) OTHER LICENSED PRODUCTS. If either party desires to
seek and obtain Marketing Authorization for any Other Licensed Product in the
Territory, the parties will consult. If both parties agree to seek Marketing
Authorizations for such Other Licensed Product, * * *. The parties agree
that the terms of this Agreement shall apply to such jointly developed Other
Licensed Product except the parties will meet and negotiate in good faith to
amend those sections of this Agreement which the parties deem appropriate, in
order to establish the relationship between the parties with respect to such
Other Licensed Product development and commercialization. Any regulatory
filings on such Other Licensed Products will be made only if agreed to by both
parties in writing.
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
ARTICLE 3
COMMERCIALIZATION
3.1 PRODUCT LAUNCH. E-Z-EM shall initiate distribution or marketing of
GADOLITE(R) in each country in the Territory promptly upon receipt of all
Marketing Authorizations but in no event later than 120 days following receipt
of all Marketing Authorizations required by that country. E-Z-EM's obligation
under this Subsection 3.1 is subject to the availability of Adequate Supply.
If E-Z-EM does not initiate such distribution or marketing in any such country
within such period and there was Adequate Supply during all of such period,
Pharmacyclics shall have the right to invoke Section 10.2, provided, however,
that if E-Z-EM fails to cure such breach, Pharmacyclics' sole and exclusive
remedy shall be to remove such country from the Territory. The 120 days
provided for in this Section 3.1 shall be in lieu of the time periods provided
for in Section 10.2 for cure of any material breach. In the event
Pharmacyclics invokes 10.2, the removal of such country shall be carried out in
accordance with the provisions of Section 10.6 which are relevant to this
Agreement; provided, however, that E-Z-EM shall not have the option to sell off
existing inventory intended for sale in such country pursuant to Section
10.6(a)(iii) and the provisions of Section 10.6(a)(iv) shall be mandatory.
3.2 PROMOTION AND MARKETING OBLIGATIONS.
(a) MARKETING EFFORTS. E-Z-EM agrees to promote the
sale, marketing and distribution of the Licensed Product in the Territory,
consistent with accepted business practices devoting the same level of efforts
as it devotes to its own products of comparable market potential. "Comparable
market potential" shall be fairly determined by E-Z-EM in good faith and shall
be based upon market size, price, competition and general marketing parameters.
It is understood and agreed that E-Z-EM may market the Licensed Product in
certain countries in the Territory through third party distributors
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and agents. E-Z-EM shall promptly advise Pharmacyclics of any material issues
that materially and adversely affects E-Z-EM's ability to market the Licensed
Product in the Territory. In such event, senior executives of E-Z-EM and
Pharmacyclics shall meet and in good faith discuss what actions should be taken
in light of such issues.
(b) GENERAL CONDUCT. E-Z-EM hereby covenants that it
will not, without the prior written authorization of Pharmacyclics, actively
solicit sale of Licensed Product or advertise Licensed Product, outside of the
Territory. E-Z-EM shall not, directly or indirectly, without the prior written
authorization of Pharmacyclics, (i) contact any of Pharmacyclics' suppliers or
vendors of Licensed Product components relating to the Licensed Product, or
(ii) contact any Competent Authority or other entity about the Licensed
Product, except as required to do so by Applicable Laws or as may be necessary
or appropriate to carry out its obligations hereunder, or as provided in
Sections 6.9 and 6.11 and Article 7. However, if a problem arises with regard
to Adequate Supply, then E-Z-EM may, with notice to Pharmacyclics which may
join in the process, take whatever steps are necessary, including directly
contacting suppliers or vendors, to obtain Licensed Product. Pharmacyclics
will grant a right to make Licensed Product under the Pharmacyclics Patents to
any new supplier or vendor reasonably acceptable to Pharmacyclics selected
under this Section 3.2(b).
(c) TRADEMARKS. Pharmacyclics shall have the right to
select one or more trademarks for use in connection with the promotion,
marketing and sale of Licensed Product, which trademark shall be owned by
Pharmacyclics, and E-Z-EM is hereby granted an exclusive license to use such
trademark(s) solely for such purposes in the Territory. If a trademark other
than GADOLITE(R) is selected, E-Z-EM shall review such trademark for legal and
marketing suitability and may disapprove use of any such trademark. Approval
will not be unreasonably withheld or delayed. If either E-Z-EM or
Pharmacyclics desires that GADOLITE(R) be sold under a different name or if any
Competent Authority requires that GADOLITE(R) be sold under a different name,
the following provisions shall apply: (i) the different name (the "New
Trademark") must be acceptable to E-Z-EM, acting reasonably, (ii) the New
Trademark must be legally obtainable by Pharmacyclics or E-Z-EM, as the case
may be, in each jurisdiction where the New Trademark is sought, (iii) the New
Trademark must be acceptable to the Competent Authority in each jurisdiction
where a variation making the change to the applicable Marketing Authorization
is sought, (iv) all costs (including reasonable attorneys' fees) for obtaining
any change to a Marketing Authorization and for obtaining the right to use the
New Trademark in each jurisdiction are paid by (A) E-Z-EM if E-Z-EM requested
the New Trademark, (B) Pharmacyclics if Pharmacyclics requested the New
Trademark, (C) one-half by E-Z-EM and one-half by Pharmacyclics if a Competent
Authority required the New Trademark, and (D) one-half by E-Z-EM and one-half
by Pharmacyclics if the New Trademark is the same as the trademark used in the
United States for the Licensed Product, subject to Pharmacyclics being credited
with its documented out-of-pocket costs incurred in registering and maintaining
the name GADOLITE(R) in the Territory, and (v) any New Trademarks obtained or
authorized
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shall be the sole property of Pharmacyclics, other than New Trademarks
incorporating a variation of the E-Z-EM trademark, in which case the New
Trademarks shall be the sole property of E-Z-EM.
(d) PACKAGING. Packaging and labeling of the Licensed
Product shall comply with the MRI Packaging Specifications and Applicable Laws.
Pharmacyclics shall be responsible for assuring that such packaging and
labeling conform with all Applicable Laws, if any, of the FDA for export of the
Licensed Product to the countries in the Territory and that the MRI Product
Units comply with the MRI Product Specifications. E-Z-EM shall be responsible
for assuring that packaging and labeling comply with all Applicable Laws where
such Licensed Product is to be distributed for sale. Pharmacyclics shall have
the right to approve in writing any such labeling and packaging to monitor the
proper use of its trade name, trademark, and patent references, such approval
not to be unreasonably withheld or delayed. All additional incremental costs
resulting from changes to the MRI Packaging Specifications made at the request
of E-Z-EM that are not required to export the Licensed Product to the Initial
Entry Point under Applicable Laws shall be borne by E-Z-EM; provided, however,
that if it is reasonable for the supplier of the Licensed Product to do such
packaging and labeling, Pharmacyclics shall reasonably assist E-Z-EM in
obtaining, at E-Z-EM's cost, such packaging and labeling at the lowest possible
cost. The E-Z-EM name and trademark may be used and may be more prominent than
the GADOLITE(R) or other trademark selected by Pharmacyclics if permissible
according to Applicable Laws. In the event that a third party (such as
Xxxxxxxxx Wellcome) is to package and label the Licensed Product, then E-Z-EM
shall provide Pharmacyclics or the third party with camera ready art work for
the packaging and labeling within the time periods necessary for Pharmacyclics
to comply with the timing requirements in the Supply Agreement.
(e) CONSULTATION REGARDING PRICING OF MRI PRODUCT UNITS.
Prior to the expected date of First Commercial Sale in any country within the
Territory, E-Z-EM shall provide Pharmacyclics notice of the expected selling
price schedule of the MRI Product Unit in such country (including any (i)
prompt payment or other trade or quantity discounts which E-Z-EM expects to
offer and (ii) commission rates or rebates which E-Z-EM expects to offer to
distributors and agents). If, at any time E-Z-EM intends to increase or
decrease the selling price of the MRI Product Unit by more then * or
substantially alter the discounts, commission rates or rebates referenced in
the previous sentence, E-Z-EM shall consult with Pharmacyclics prior to
implementing such change. The final decision on selling price, discounts,
commission rates and rebates shall be that of E-Z-EM.
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
(f) MARKETING PLANS AND REPORTS. Prior to the expected
date of First Commercial Sale in any country in the Territory and at the
beginning of each Fiscal Year thereafter, E-Z-EM shall submit to Pharmacyclics
in writing, for Pharmacyclics' review and comment, the annual marketing, sales
and distribution plan for such country detailing E-Z-EM's proposed marketing,
sales and distribution strategy and tactics for
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Licensed Product during such Fiscal Year that has been developed by E-Z-EM for
Licensed Product. In addition, E-Z-EM shall submit to Pharmacyclics copies of
any market research reports relating to Licensed Product sales and Licensed
Product competition which E-Z-EM commissions or otherwise obtains to the extent
permissible by the agency preparing the report. To the extent the foregoing
information is contained in plans or reports which contain information about
other products or markets, E-Z-EM may submit to Pharmacyclics only those
excerpts from such plans or reports which relate to the Licensed Product and
Licensed Product competition.
(g) SALES FORECAST. No later than 90 days prior to the
expected date of First Commercial Sale and no later than 90 days prior to the
start of each Fiscal Year thereafter, E-Z-EM shall deliver to Pharmacyclics,
for review by Pharmacyclics, a forecast of the number of Licensed Products
which E-Z-EM expects it and its permitted sub-licensees to sell during each
quarter of such year.
(h) PHASE IV SURVEILLANCE; MARKETING TRIALS. E-Z-EM
shall be responsible for any Phase IV surveillance programs of Licensed
Product, which shall be conducted in accordance with Applicable Laws and which
may only be undertaken upon the prior written approval of E-Z-EM and
Pharmacyclics, which approval shall not be unreasonably withheld or delayed.
E-Z-EM shall be responsible for the conduct of any marketing trials that it
determines are necessary. All expenses incurred pursuant to this Section
3.2(h) shall be borne by E-Z-EM. Any interim data and results in written form
of such surveillance programs and marketing trials shall be promptly provided
to Pharmacyclics in writing, who shall have the right to incorporate, refer to
and cross-reference such results and underlying data in any regulatory filing
with respect to any Licensed Product. Further, E-Z-EM agrees that should
Applicable Laws require that any such interim data and results from such
programs and trials be prepared in written form, E-Z-EM shall comply with such
requirements and provide all such information in writing to Pharmacyclics or
the FDA or the Competent Authorities in accordance with Applicable Laws.
3.3 PRE-MARKETING EXPENSES. E-Z-EM shall bear all * Expenses. To the
extent that Pre-Marketing expenses are incurred by Pharmacyclics, E-Z-EM shall
reimburse Pharmacyclics on an as-invoiced basis at Pharmacyclics' cost;
provided that any such Pre-Marketing expenses incurred by Pharmacyclics
hereunder must be agreed to by E-Z-EM in writing in advance.
ARTICLE 4
PAYMENTS TO PHARMACYCLICS
4.1 PAYMENTS TO PHARMACYCLICS. E-Z-EM shall pay Pharmacyclics the
following amounts:
(a) * upon execution of this Agreement; plus
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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(b) * upon issuance of the UK Marketing Authorization; plus
(c) An amount equal to * of Net Sales until the such time
as Pharmacyclics has been paid an aggregate of * pursuant to this Section
4.1(c); plus
(d) Payments due to third parties pursuant to the Patent
License Agreements; plus
(e) In the case of sales through third party
distributors, * * * of the excess of Gross Profits with respect to such
sales over the amounts paid pursuant to Section 4.1(c), if any; plus
(f) In the case of direct sales by E-Z-EM or by E-Z-EM's
Affiliates, * of the excess of Gross Profits with respect to such sales over
the sum of (i) the amounts paid pursuant to Section 4.1(c), if any, plus (ii)
* * * of Net Sales with respect to such sales.
4.2 EXAMPLE. Schedule 4.2 illustrates how Section 4.1(a)-(f) is intended
to operate.
4.3 ALLOCATION OF DISTRIBUTOR RECEIPTS. E-Z-EM shall pay Pharmacyclics
* * * of Distributor Receipts received by E-Z-EM or by E-Z-EM's
Affiliates.
ARTICLE 5
PROCEDURE FOR PAYMENTS; RECORDS; AUDIT
5.1 MANNER AND PLACE OF PAYMENT. Within 45 days after the end of each
calendar quarter, E-Z-EM shall pay to Pharmacyclics the total amount due under
Sections 4.1 and 4.3, such payment to be accompanied by a written report by
E-Z-EM concerning Gross Profits and Distributor Receipts detailed
country-by-country in the Territory, including quantities of the Licensed
Product sold, and other such details as required to be provided pursuant to the
Patent License Agreements. All payments to Pharmacyclics shall be made by
check at such bank as Pharmacyclics shall specify from time to time and shall
be made in U.S. Dollars.
5.2 RECORDS AND AUDIT. Each party will maintain the Records. Such
Records shall be open during reasonable business hours for a period of five (5)
years from creation of any such Record for the purpose of permitting either
party to conduct any Audit. In the absence of material discrepancies
* * * in any request for reimbursement resulting from the Audit, the
accounting expense shall be paid by the party requesting the Audit. If material
discrepancies do result, the party which was the subject of the Audit shall bear
the accounting expense. Any Records received from the other party shall be
Confidential Information for purposes of Article 8. The terms of this Section
5.2 shall survive any termination or expiration of this Agreement for a period
of five (5) years. All Records not disputed as to correctness by the other
party within one (1) year
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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after receipt or Audit thereof shall thereafter conclusively be deemed correct
for all purposes.
5.3 WITHHOLDING TAXES. Payments to Pharmacyclics hereunder shall be made
without deduction other than such amount (if any) as E-Z-EM is required by law
to deduct or withhold. E-Z-EM shall obtain a receipt from the relevant taxing
authorities for all withholding taxes paid and forward such receipts to
Pharmacyclics to enable Pharmacyclics to claim any and all tax credits for
which it may be eligible. E-Z-EM shall use reasonable commercial efforts to
enable or assist Pharmacyclics to claim exemption from such deductions or
withholdings under any double taxation or similar agreement or treaty from time
to time in force.
5.4 EXCHANGE RATES. For purposes of determining amounts to be paid to
Pharmacyclics pursuant to Sections 4.1 and 4.3, the UK interbank rate for
buying dollars on the date that the payment is being made, shall be used.
5.5 PRODUCT BUNDLING. In the event E-Z-EM or any permitted sub-licensee
sells the MRI Product Unit in conjunction with any other E-Z-EM product and in
so doing sells the MRI Product Unit for an amount less than the lowest selling
price for the MRI Product Unit, for the purposes of determining Net Sales from
such sale, Net Sales shall be based upon the Net Sales price to a similar size
customer ordering a similar volume of MRI Product Unit under similar but
unbundled terms and conditions.
ARTICLE 6
MANUFACTURE AND SUPPLY OF GADOLITE(R)
6.1 SUPPLY OF MRI PRODUCT UNITS. Subject to the terms of the Agreement,
Pharmacyclics shall supply or cause to be supplied to E-Z-EM, and E-Z-EM shall
purchase from Pharmacyclics, E-Z-EM's requirements of MRI Product Units.
However, if a problem arises with regard to Adequate Supply, then E-Z-EM may,
with notice to Pharmacyclics, who may join in the process, take whatever steps
are necessary, including directly contacting suppliers or vendors, to obtain
MRI Product Units. Pharmacyclics shall grant a right to make under the
Pharmacyclics Patents to any new supplier or vendor reasonably acceptable to
Pharmacyclics selected under this Section 6.1. Pharmacyclics agrees to take
whatever action is appropriate, including allowing E-Z-EM or any supplier to
E-Z-EM the right to make reference to Competent Authorities any relevant and
applicable Pharmacyclics' regulatory filings, to allow E-Z-EM or any supplier
to E-Z-EM to obtain approval to manufacture GADOLITE(R). Approval to
manufacture GADOLITE(R) by a third party supplier shall be subject to execution
of a binding contract between Pharmacyclics and the third party supplier to
manufacture GADOLITE(R) on terms reasonably acceptable to Pharmacyclics.
6.2 DELIVERY. All MRI Product Units shall be shipped by Pharmacyclics as
directed by E-Z-EM to the Initial Entry Point. Subject to Section 3.2(d),
after the MRI Product
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Units have been delivered to the Initial Entry Point, E-Z-EM shall be
responsible for all labeling and packaging of MRI Product Units and for
shipping MRI Product Units within the Territory.
6.3 PRICE. E-Z-EM shall pay to Pharmacyclics such price, including the
cost of active ingredients at Pharmacyclics cost if supplied by Pharmacyclics,
shipping, duties and insurance costs, as Pharmacyclics pays for any MRI Product
Unit purchased from a third-party supplier for sale and use in the Territory,
plus * * * of the direct costs (net of insurance and freight) of the
MRI Product Units; provided, however, that (i) the * * * of the direct
costs (net of insurance and freight) shall in no case exceed * * * per
MRI Product Unit and (ii) the amount paid by Pharmacyclics to a third-party
supplier shall in no case include amounts paid due to the failure of
Pharmacyclics to meet minimum purchase requirements or due to any other breach
of such third-party supply agreement by Pharmacyclics unless such breach is
caused by E-Z-EM. The initial price to be paid by Pharmacyclics for the MRI
Product Units is based on Sections 8.1 and 8.2 of the Supply Agreement. The
"minimum purchase requirements" mentioned in paragraph 8.1 of the Supply
Agreement are not applicable to this Agreement. Pharmacyclics agrees that
Pharmacyclics will continue to supply or cause to be supplied the active
ingredient of MRI Product Units to any third-party supplier, including to
E-Z-EM, if E-Z-EM becomes the supplier. Concurrently with each shipment of MRI
Product Units, Pharmacyclics shall invoice E-Z-EM, which invoice shall specify
the amount payable by Pharmacyclics to the third-party supplier with respect to
such MRI Product Units. The portion of the invoice representing amounts owed
to the third-party supplier shall be due and payable upon receipt by E-Z-EM of
the MRI Product Units at the Initial Entry Point, or at such time as
Pharmacyclics is required to pay the third-party supplier for such MRI Product
Units, and the balance of the invoice shall be due and payable thirty days
after receipt by E-Z-EM of the MRI Product Units at the Initial Entry Point.
6.4 MRI PRODUCT UNIT MAXIMUMS. During each Contract Year (as such term is
defined in the Supply Agreement), under this Agreement and the North American
Agreement, E-Z-EM shall be entitled to purchase no more than the Maximum
Quantities.
6.5 SUPPLY FORECASTS.
(a) LONG-TERM FORECAST SCHEDULE. E-Z-EM shall deliver to
Pharmacyclics such information as will allow Pharmacyclics to meet its
obligations under Section 6.1 (a) of the Supply Agreement (or a comparable
section of a substantially similar supply agreement) with respect to the
Territory. All such information shall be delivered to Pharmacyclics promptly,
but in any event no later than 30 days prior to the date Pharmacyclics is
obligated to deliver corresponding information to Xxxxxxxxx Wellcome (or a
comparable supplier).
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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(b) DETAILED FORECAST SCHEDULE. E-Z-EM shall deliver to
Pharmacyclics such information as will allow Pharmacyclics to meet its
obligations under Section 6.1(b) of the Supply Agreement (or a comparable
section of a substantially similar supply agreement) with respect to the
Territory and all such information shall be delivered to Pharmacyclics
promptly, but in any event no later than 30 days prior to the date
Pharmacyclics is obligated to deliver corresponding information to Xxxxxxxxx
Wellcome (or a comparable supplier).
(c) FORECAST VARIANCES. The forecasts provided under
this Section 6.5 shall be non-binding; provided, however, that the total number
of MRI Product Units ordered during any Calendar Quarter (as such term is
defined in the Supply Agreement) shall be in conformance with the provisions of
Section 6.2 of the Supply Agreement (or a comparable section of a substantially
similar supply agreement) as if E-Z-EM had submitted its detailed forecasts
directly to Xxxxxxxxx Wellcome (or a comparable supplier).
6.6 ORDERS. MRI Product Units shall be ordered by E-Z-EM pursuant to
written purchase orders which shall be received by Xxxxxxxxx Wellcome or other
supplier or Pharmacyclics between 90 and 120 days prior to the delivery date
specified in such purchase order. All orders shall be in accordance with the
terms of Article 7 and Section 8.4 of the Supply Agreement (or comparable
sections of a substantially similar supply agreement), other than minimum
purchase requirements. Copies of all orders and payments from E-Z-EM to
Xxxxxxxxx Wellcome shall be sent to Pharmacyclics by FAX.
6.7 PRODUCT SPECIFICATIONS. All MRI Product Units manufactured and
supplied by or on behalf of Pharmacyclics under this Agreement shall conform to
the MRI Product Specifications.
6.8 PACKAGING SPECIFICATIONS. Packaging and labeling of all MRI Product
Units manufactured and supplied by or on behalf of Pharmacyclics under this
Agreement shall conform to the MRI Packaging Specifications and to Applicable
Laws.
6.9 DIRECT COMMUNICATIONS AND PAYMENTS BETWEEN E-Z-EM AND THIRD PARTY
SUPPLIER. After signing this Agreement, E-Z-EM may communicate directly with
or make payment directly to Xxxxxxxxx Wellcome or such other third party
supplier with respect to orders, forecasts and reports under this Article 6.
In the event of such direct communication or payment, Pharmacyclics shall
receive copies of all such communication and receipts for such payment at the
same time that the receiving party receives such communication or receipt.
6.10 MODIFICATIONS OF SUPPLY AGREEMENT. [Intentionally Deleted]
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6.11 GOVERNMENTAL REGULATION.
6.11.1 Pharmacyclics shall produce or have produced all GADOLITE(R)
materials provided under this Agreement according to Applicable Laws.
6.11.2 Pharmacyclics will permit E-Z-EM or its designated
representative, to perform vendor audits of Pharmacyclics' facilities and
procedures on reasonable advance notice to Pharmacyclics during normal business
hours.
6.11.3 The parties agree to notify each other immediately upon
receipt of any communication indicating a possible inspection or visit
requested by FDA or a Competent Authority related to the Licensed Product and
will provide each other with copies of any communications made between the
other party and FDA or the Competent Authority relating to the Licensed Product
to the extent relevant to this Agreement.
6.11.4 Pharmacyclics will provide E-Z-EM a Certificate of Compliance
for each batch lot of any materials sold hereunder.
6.11.5 Pharmacyclics will notify E-Z-EM of any proposed material
changes in raw materials, components, processes, or labeling, at least ninety
(90) days prior to such actions.
6.11.6 Pharmacyclics guarantees that no materials manufactured by or
on behalf of Pharmacyclics pursuant to this Agreement will be adulterated or
misbranded within the meaning of the FD&C Act or any other Applicable Law and
further guarantees that no materials supplied by or on behalf of Pharmacyclics
pursuant to this Agreement will be barred from introduction into inter-state
commerce under the provisions of Section 404, 505 or 512 of the FD&C Act or any
other Applicable Law. Pharmacyclics agrees to take whatever action is
necessary to assure that any Pharmacyclics contractor for the supply of
GADOLITE(R) or, to the extent Pharmacyclics can reasonably do so, any component
thereof, will comply with the requirement of this Section 6.11.6.
6.11.7 E-Z-EM will permit Pharmacyclics or its designated
representative to perform vendor audits or other audits required by Applicable
Laws on the facilities, procedures and records which are relevant to such
audits of E-Z-EM and E-Z-EM's Affiliates and, to the extent reasonably
obtainable by E-Z-EM, on facilities, procedures and records which are relevant
to such audits of unaffiliated parties with responsibility for distribution,
testing, analyzing, labeling or packaging the Licensed Product on reasonable
advance notice to E-Z-EM during normal business hours.
6.11.8 E-Z-EM agrees to assume all responsibility for importing,
selling and distributing the Licensed Product, including obtaining all
necessary permits and licenses therewith, and including performance of all
testing necessary for batch release, analytical testing, and/or labeling
(except to the extent necessary to export the Licensed Product to
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the Initial Entry Point) required to place the Licensed Product on the market
in the Territory and any other requirement relating to the import, sale and
distribution of the Licensed Product imposed by Applicable Laws, at E-Z-EM's
sole cost.
ARTICLE 7
MARKETING AUTHORIZATIONS; OTHER REGULATORY COMPLIANCE ISSUES
7.1 U.K. MARKETING AUTHORIZATION. Pharmacyclics made an application for a
UK Marketing Authorization for the Licensed Product on June 26, l996. In its
application, Pharmacyclics indicated that, when the UK Marketing Authorization
is received, Pharmacyclics intends to use the UK Marketing Authorization to
follow the Decentralized Procedures to obtain the First Tier Marketing
Authorizations. Pharmacyclics has turned the dossier and related documentation
for the U.K. Marketing Authorization over to E-Z-EM. All costs and expenses in
connection with obtaining the UK Marketing Authorization and any other
Marketing Authorizations are to be borne according to the provisions of Section
7.11.
7.2 REGULATORY STRATEGY. Within thirty (30) days after the Effective
Date, E-Z-EM shall submit its Regulatory Strategy to Pharmacyclics for its
review and comment.
7.3 USE OF DECENTRALIZED PROCEDURES. The parties have agreed that, unless
advised to the contrary by the Reference Member State, within sixty (60) days
of receipt of the UK Marketing Authorization, E-Z-EM will file Decentralized
Applications for the First Tier Marketing Authorizations. E-Z-EM will provide
Pharmacyclics with any Objections promptly after receipt and shall afford
Pharmacyclics the opportunity to consult with E-Z-EM concerning such matters.
In no event will Pharmacyclics communicate directly with the Reference Member
State, members of the CPMP, the Commission and/or the Competent Authority
during the Decentralized Procedures relating to GADOLITE(R). In the event that
one or more member states indicates that it will not grant mutual recognition
to the Decentralized Application, the parties agree to consult to decide
whether to withdraw the Decentralized Application or proceed to binding
arbitration. The parties agree that, should a decision be made to withdraw the
Decentralized Application from one or more member states, or a positive opinion
of the CPMP not be obtained, or the Commission not ratify the opinion of the
CPMP so as to make the CPMP opinion into a binding Commission decision, the
parties agree to consult.
7.4 OBTAINING MARKETING AUTHORIZATIONS. Promptly after receipt of notice
from MCA that MCA intends to issue the UK Marketing Authorization within a
thirty day period, E-Z-EM shall promptly begin taking all acts and activities
necessary to obtain the national licenses from each member state that will be
required as a condition to receipt of a Marketing Authorization. E-Z-EM agrees
to notify Pharmacyclics within fifteen (15) days of receipt of each Marketing
Authorization. In the event that E-Z-EM has not received a Marketing
Authorization (including any applicable Pricing and Reimbursement Approvals
necessary for placing the Licensed Product on the market in a
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member state) in each member state which has mutually recognized the
Decentralized Application, within one year of that member state mutually
recognizing the Decentralized Application, then the Chief Executive Officers of
the parties or their representatives or designees agree to meet within ten days
to discuss further options for the Decentralized Applications, including having
Pharmacyclics take over the responsibilities for designing and implementing the
Regulatory Strategy at the reasonable expense of E-Z-EM. E-Z-EM shall follow
such procedures as it deems appropriate and shall comply with Applicable Laws
with respect to obtaining Marketing Authorizations for states in the Territory
that are not subject to the Decentralized Procedures.
7.5 ONGOING CONSULTATIONS. The parties shall consult on the U.K.
Marketing Authorization and the First Tier Marketing Authorizations on a
regular basis and also about authorizing E-Z-EM to obtain additional Marketing
Authorizations in addition to the First Tier Marketing Authorizations and the
U.K. Marketing Authorization using the procedures specified in this Article 7.
7.6 MARKETING AUTHORIZATION HOLDER. Unless otherwise required by
Applicable Laws, Pharmacyclics shall be the holder of the UK Marketing
Authorization and all other Marketing Authorizations and E-Z-EM shall be named
as Pharmacyclics' distributor in the Territory with respect to the Marketing
Authorizations. In the event that the parties determine that it is desirable,
for legal or administrative reasons, for E-Z-EM to hold the Marketing
Authorizations, E-Z-EM understands and agrees that E-Z-EM will hold the
Marketing Authorizations in trust for the benefit of Pharmacyclics and that,
therefore, E-Z-EM will not transfer, assign, mortgage, charge or sub-contract
any of the Marketing Authorizations other than to Pharmacyclics or to a
third-party distributor appointed by E-Z-EM to distribute the Licensed Product,
and that E-Z-EM will not do anything intentionally to adversely affect a
Marketing Authorization. E-Z-EM agrees that Pharmacyclics shall be free from
time to time to inform the Competent Authorities that the Marketing
Authorizations are held in trust for Pharmacyclics. Any transfer of the
Marketing Authorization by E-Z-EM to a third party distributor shall be
contingent upon the execution by the third party distributor of a written
agreement pursuant to which the third party distributor agrees to hold the
Marketing Authorization on the same terms and conditions as set forth in this
Section 7.6. E-Z-EM agrees to provide Pharmacyclics with copies of any
agreements with third parties entered into by E-Z-EM and such third party in
order to comply with this Section 7.6 within 30 days of the effective date of
any transfer of any Marketing Authorization, along with appropriate evidence
from the Competent Authorities documenting the transfer of the Marketing
Authorization. Any transfers of any Marketing Authorizations made in violation
of this Section 7.6 shall be null, void and unenforceable. For the avoidance
of doubt, the term "transfer" shall include, but not be limited to, transfers
from E-Z-EM to a third party distributor of an existing Marketing Authorization
as well as cases in which the third party distributor rather than E-Z-EM makes
an application for a Marketing Authorization.
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7.7 MAINTENANCE OF MARKETING AUTHORIZATIONS E-Z-EM agrees to maintain
the Marketing Authorizations including obtaining any variations or renewals
thereof, at E-Z-EM's sole cost.
7.8 PRICING AND REIMBURSEMENT APPROVALS. E-Z-EM shall be responsible for
obtaining any Pricing and Reimbursement Approvals that are required to obtain
Marketing Authorizations.
7.9 PROVISION OF REGULATORY FILINGS. E-Z-EM will provide Pharmacyclics
with copies of all filings made to the FDA or the Competent Authorities
relating to GADOLITE(R), any GADOLITE(R) Line Extension or to any Other
Licensed Product filed in accordance with this Article.
7.10 ASSISTANCE. Each party shall provide reasonable assistance to the
other at the other's request, in connection with their obligations pursuant to
this Section 7, subject to reimbursement of its out-of-pocket costs.
7.11 COSTS. * * *
7.12 COMPLIANCE. E-Z-EM and Pharmacyclics shall comply with all Applicable
Laws within the Territory including the provision of information by E-Z-EM and
Pharmacyclics to each other necessary for Pharmacyclics and E-Z-EM to comply
with any applicable reporting requirements.
7.13 ADVERSE REACTION REPORTING. Each party shall advise the other party,
by telephone or facsimile, within such time as is required to comply with
Applicable Laws after it becomes aware of any adverse reaction involving the
Licensed Product. Such advising party shall provide the other party with a
written report delivered by confirmed facsimile of any adverse reaction,
stating the full facts known to it, including but not limited to customer name,
address, telephone number, batch, lot and serial numbers, as required by
Applicable Laws. To the extent permitted by Applicable Laws, E-Z-EM shall have
full responsibility for monitoring such adverse reactions and making any
reports to the Competent Authorities, with a complete copy provided to
Pharmacyclics at the same time the report is made to the Competent Authorities.
Within thirty (30) days before the First Commercial Sale or any test or trial
conducted on GADOLITE(R) by E-Z-EM or its designee, the parties agree to agree
upon and finalize the SOP, provided that such SOP shall be E-Z-EM's current
SOP, modified only to the extent necessary to provide a mechanism for E-Z-EM to
provide information to Pharmacyclics that is necessary under Applicable Laws
for Pharmacyclics to provide to the FDA. The parties agree to follow the SOP.
In the event responsibilities exist with respect to compliance with Applicable
Laws pursuant to this section which cannot be delegated to E-Z-EM by
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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Pharmacyclics and some or all of the information needed to fulfill the
responsibility is not within Pharmacyclics' control, E-Z-EM agrees to provide
such information to Pharmacyclics to the extent such information can be
reasonably obtained by E-Z-EM, with such information to provided within such
time limits as is required for Pharmacyclics to comply with Applicable Laws.
7.14 POST - FIRST COMMERCIAL SALE TESTING AND REPORTING. If, after the
date of First Commercial Sale in any country in the Territory, adverse events
or other issues arise with respect to the safety or efficacy of GADOLITE(R)
which jeopardize GADOLITE(R)'s performance or are deemed by the parties to
potentially limit its approved indications, the parties shall consult with each
other with respect to such events or other issues. If the parties determine
that the situation requires clinical testing after First Commercial Sale in any
country in the Territory, modifications to any Marketing Authorization or other
communication with any Competent Authority or entity, Pharmacyclics shall
design and the parties shall implement any such testing, modifications or
communication as shall be agreed upon by the parties; provided, however, that
E-Z-EM may communicate with any Competent Authority to the extent it deems
necessary or appropriate to fulfill its obligations hereunder. * * *
7.15 PRODUCT RECALL. E-Z-EM and Pharmacyclics each shall notify the other
promptly if any MRI Product Unit is the subject of a recall, market withdrawal
or correction, and the parties shall cooperate in the handling and disposition
of such recall, market withdrawal or correction; provided, however, in the
event of a disagreement as to any matters related to such recall, market
withdrawal or correction, other than the determination of who shall bear the
costs as set forth in the immediately following sentence, each party shall have
the right to cause a recall, market withdrawal or correction to be made.
* * * E-Z-EM shall in all events be responsible for conducting any
recalls, market withdrawals or corrections with respect to the MRI Product Units
in consultation with Pharmacyclics. E-Z-EM shall maintain Records of all sales
and distribution of MRI Product Units and customers sufficient to adequately
administer a recall, market withdrawal or correction for a period of five (5)
years after the date the Record is created.
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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7.16 REPORTS. On a quarterly basis, E-Z-EM shall provide Pharmacyclics
with an updated version of the Regulatory Strategy, including changes in time
lines and a written report on the status of all efforts by E-Z-EM to obtain
Pricing and Reimbursement Approvals. Each party shall keep the other fully
informed of all governmental activities and plans which potentially or actually
affect the sale of the Licensed Product in the Territory to the extent that
each such party has knowledge of such activities and plans.
7.17 BLOCK EXEMPTION. Immediately prior to the expiration of Regulation
l983/83 of the Commission of the EU (the "Block Exemption"), the parties agree
to examine the Agreement to determine whether the Agreement will fall within
the new Block Exemption. Should any of the provisions of the Agreement not
fall within the Block Exemption or the new Block Exemption, during the term of
this Agreement, the parties agree either to amend the Agreement to fall within
the Block Exemption or the new Block Exemption or to notify the Agreement to
the Commission, with each party to bear one-half of the reasonable costs of
making the notification.
ARTICLE 8
CONFIDENTIALITY
8.1 NONDISCLOSURE OBLIGATIONS. During the term of this Agreement, and for
a period of 5 years after termination hereof, each party will maintain all
Confidential Information in trust and confidence and will not disclose any
Confidential Information to any third party or use any Confidential Information
for any unauthorized purpose. Each party may use such Confidential Information
only to the extent required to accomplish the purposes of this Agreement.
Confidential Information shall not be used for any purpose or in any manner
that would constitute a violation of any Applicable Laws. Confidential
Information shall not be reproduced in any form except as required to
accomplish the intent of this Agreement. Each party will use at least the same
standard of care as it uses to protect proprietary or confidential information
of its own confidential information. Each party will promptly notify the other
upon discovery of any unauthorized use or disclosure of the Confidential
Information. All information that is to be held confidential shall be given
only to individuals who are made aware of the confidential nature of the
information and who have signed a confidentiality agreement or who have a
fiduciary responsibility to E-Z-EM and who have a need to know.
8.2 EXCEPTIONS. Confidential Information shall not include any
information which:
(a) is now, or hereafter becomes, through no act or
failure to act on the part of the receiving party,
generally known or available;
(b) is known by the receiving party at the time of
receiving such information, as evidenced by its
written records;
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(c) is hereafter furnished to the receiving party by a
third party, as a matter of right and without
restriction on disclosure;
(d) is independently developed by the receiving party
without any breach of Section 8.1;
(e) is the subject of a written permission to disclose
provided by the disclosing party; or
(f) is of such inconsequential nature as to render it
valueless.
The parties agree that the material financial terms of this Agreement
will be considered Confidential Information of both parties. However, each
party shall have the right to disclose the material financial terms of this
Agreement to any potential acquiror, merger partner, or other bona fide
potential financial partner, subject to a requirement to secure confidential
treatment of such information or if it is prudent or proper to make such
disclosure to comply with Applicable Laws or to meet Generally Accepted
Accounting Principles. Notwithstanding the foregoing, the parties agree that
the initial press releases regarding this Agreement shall be mutually agreed
upon by the parties.
8.3 AUTHORIZED DISCLOSURE. Notwithstanding any other provision of this
Agreement, each party may disclose Confidential Information if such disclosure:
(a) is in response to a valid order of a court or other
governmental body of the United States or the EU or
any state of the Territory or of any political
subdivision thereof; provided, however, that the
responding party shall first have given notice to the
other party hereto and shall have made a reasonable
effort to obtain a protective or other appropriate
forms of order requiring that the Confidential
Information so disclosed be used only for the
purposes for which the order was issued;
(b) is otherwise required by Applicable Laws; or
(c) is otherwise necessary to file or prosecute patent
applications, prosecute or defend litigation or
comply with Applicable Laws or otherwise establish
rights or enforce obligations under this Agreement,
but only to the extent that any such disclosure is
necessary.
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ARTICLE 9
INTELLECTUAL PROPERTY
9.1 OWNERSHIP OF INTELLECTUAL PROPERTY. Pharmacyclics shall retain all of
its rights, title and interest in and to all Pharmacyclics Technology,
copyrights, trade marks, trade name, and all other industrial and intellectual
property embodied in or appurtenant to the Licensed Product. Except as
otherwise expressly provided in this Agreement, E-Z-EM shall have no right,
title or interest in any industrial or intellectual property relating to the
Licensed Product, except to marketing and promotional materials and reports and
all marketing data and all intellectual property relating thereto.
9.2 VALIDITY AND INFRINGEMENT OF PHARMACYCLICS PATENTS.
(a) In the event E-Z-EM or Pharmacyclics becomes aware of
any actual or threatened infringement of any Pharmacyclics Patents in the
Territory, that party shall promptly notify the other.
(b) To validate the proprietary rights licensed herein,
Pharmacyclics shall have the first right, but not the obligation, to bring and
control any infringement action against any person or entity materially
infringing the Pharmacyclics Patents directly or contributorily in the
Territory and shall have the first right, but not the obligation, to defend the
Pharmacyclics Patents against any challenge to the validity and enforceability
of those patents in the Courts of the United States or in the United States
Patent and Trademark Office and the and/or the appropriate agencies or Courts
in the Territory, as the case may be. If Pharmacyclics does not take steps
within 120 days of the date of Pharmacyclics becoming aware of such material
infringement to xxxxx the infringement or does not bring litigation within six
months of said 120 days, then E-Z-EM may, but shall not be required, to
prosecute and control the infringement or threatened infringement and to defend
the Pharmacyclics Patents. If, within 120 days of the date on which E-Z-EM may
first prosecute and control the infringement or threatened infringement or
defend the Pharmacyclics Patents, E-Z-EM has not commenced such prosecution,
control or defense, E-Z-EM's right to do so shall expire and the right to
prosecute and control the infringement or threatened infringement and to defend
the Pharmacyclics Patents shall revert to Pharmacyclics.
(c) Pharmacyclics shall bear the full cost of any action
brought by Pharmacyclics to validate the proprietary rights licensed herein.
During the course of such litigation, all payments due to Pharmacyclics under
this Agreement shall continue to be made. Pharmacyclics will receive all
damages that may be awarded to Pharmacyclics under such litigation.
(d) E-Z-EM shall bear the full cost of any action brought
by E-Z-EM to validate the proprietary rights licensed herein and shall receive
all damages that may be awarded to E-Z-EM under such litigation; provided,
however, that if E-Z-EM, acting
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reasonably, determines that there is a reasonable expectation that the results
of such litigation (including both damages and the value of injunctive relief)
are greater than the anticipated costs of such litigation, E-Z-EM may, by
notice to Pharmacyclics, require Pharmacyclics to pay * of the costs incurred
by E-Z-EM in connection therewith and in such case Pharmacyclics shall be
entitled to receive * of the damages recovered. During the course of such
litigation, all payments due to Pharmacyclics under this Agreement shall
continue to be made.
(e) In the event either party brings an infringement
action, the other party shall cooperate as reasonably requested, including, if
requested, furnishing a power of attorney. No settlement or consent judgment
or other voluntary final disposition of a suit under this Section 9.2 may be
entered into without the joint consent of Pharmacyclics and E-Z-EM, such
consent not to be unreasonably withheld or delayed.
(f) If the Pharmacyclics EU Patent shall be held invalid
in a Court or Patent Office or other action and such holding is upheld on
appeal or the appeal period has passed without an appeal being taken, and if
the above occurs prior to the tenth anniversary of First Commercial Sale in the
Territory, the following shall occur:
(i) Pharmacyclics shall continue to provide MRI
Product Units in accordance with Article 6
until the termination of the North American
Agreement;
(ii) Article 4 payments shall be made to
Pharmacyclics until the termination of the
North American Agreement;
(iii) This Agreement shall terminate in accordance
with Section 10.1.
9.3 INFRINGEMENT OF THIRD PARTY PATENTS. Pharmacyclics represents that to
the best of its knowledge, the manufacture, use or sale of GADOLITE(R), as
configured as of the Effective Date, does not infringe any United States or EU
patent or other proprietary rights held by any third party. If a third party
asserts that a patent or other proprietary right owned by it is infringed by
the manufacture, use or sale of the Licensed Product, the party against whom
such a claim was asserted shall immediately provide the other party notice of
such claim and the related facts in reasonable detail. The party against whom
a claim is asserted shall control the defense of such claim and if a claim is
asserted against both parties they shall jointly cooperate in controlling the
defense of such claim. The party (whether Pharmacyclics or E-Z-EM) that
controls the defense of a given claim with respect to the Licensed Product
shall also have the right to control settlement of such claim; provided,
however, that (i) no settlement shall be entered into without the consent of
the other party if such settlement would adversely affect the interests of such
other party in a manner different from the interests of the party controlling
the defense and (ii) if a claim is asserted against both parties, both parties.
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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must consent to such settlement. Each party shall pay * of the expenses
incurred in defending the litigation, regardless of against which party the
claim is asserted; provided, however, that if the representation and warranty
made by Pharmacyclics in the first sentence of this Section 9.3 is determined
by a court of competent jurisdiction to be untrue with respect to the claim
that is the subject of the infringement action (or a claim related thereto),
Pharmacyclics shall pay all of such expenses.
9.4 RESPONSIBILITY FOR PATENTS AND TRADEMARKS.
(A) PROSECUTION. Pharmacyclics shall be responsible for
the filing of and all prosecution and maintenance of the Pharmacyclics Patents
and all trademarks, including GADOLITE(R), in the Territory, other than
trademarks incorporating a variation of the name E-Z-EM, with respect to which
E-Z-EM shall have such responsibility.
(B) COSTS. Subject to Section 3.2(c), the out-of-pocket
costs incurred pursuant to Section 9.4(a) shall be paid by Pharmacyclics, other
than trademarks incorporating a variation of the name E-Z-EM, with respect to
which E-Z-EM shall pay such costs.
ARTICLE 10
TERM AND TERMINATION OF AGREEMENT
10.1 TERM. The Agreement shall expire on the date the North American
Agreement terminates, unless such termination is pursuant to Section 11.3 of
the North American Agreement, in which case this Agreement shall extend for the
period provided in Section 11.1 of the North American Agreement.
10.2 TERMINATION FOR MATERIAL BREACH. If either party is in material
breach of any obligation hereunder, the party contending there is a breach (the
charging party) may give a first written notice to the accused party of the
nature of the breach and shall provide sixty (60) days after the giving of such
first notice for the breach to be cured to the reasonable satisfaction of the
charging party or for the accused party to commence action which is calculated
to result in the cure of the default to the reasonable satisfaction of the
charging party. If, however during the sixty (60) day period, the accused
party requests an additional sixty (60) days to cure, such additional time
shall be granted. If the charging party believes that adequate action has not
been taken to cure the default or that the default has not been cured, then at
the end of the initial sixty (60) day time period, or at the end of the
additional sixty (60) day time period if such has been requested, the charging
party may give a second written notice that the Agreement is to be terminated
within sixty (60) days after the second notice, if the default is not cured
within such extended time.
* INDICATES THAT MATERIAL HAS BEEN OMITTED AND CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED THEREFOR. ALL SUCH OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2.
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10.3 TERMINATION BY E-Z-EM. At any time upon six months prior written
notice to Pharmacyclics, E-Z-EM may terminate this Agreement for any or no
reason; provided, however, that such termination shall be subject to the
following terms and conditions: E-Z-EM shall cooperate, at its own expense and
as reasonably requested by Pharmacyclics, with any one or more third parties
selected by Pharmacyclics to distribute, market or sell Licensed Product in the
Territory following such early termination. Such cooperation shall include,
but not be limited to, to promptly transferring the Marketing Authorizations,
inventory, providing customer lists and delivering any promotional materials to
such third parties.
10.4 TERMINATION BY PHARMACYCLICS.
10.4.1 If the UK Marketing Authorization is not received by
Pharmacyclics on or before eighteen months from the date Pharmacyclics files
for the UK Marketing Authorizations or if Pharmacyclics determines to abandon
seeking the UK Marketing Authorization (which it may do for good cause,
including, without limitation, UK Registration Costs materially in excess of
those estimated by its regulatory consultants), Pharmacyclics may terminate
this Agreement. Notwithstanding anything herein to the contrary, if
Pharmacyclics terminates this Agreement pursuant to this Section 10.4.1,
Section 2.2 of the North American Agreement shall remain in full force and
effect.
10.4.2 The parties agree that E-Z-EM's violation of Section 7.6 will
cause irreparable injury to Pharmacyclics and, that in the event of any
violation or threatened violation of Section 7.6 by E-Z-EM, Pharmacyclics will
be entitled to seek temporary and permanent injunctive relief, and other
equitable remedies against E-Z-EM. This section shall not limit any other
legal or equitable remedies that Pharmacyclics may have against E-Z-EM for
violation of the restrictions herein. The parties agree that, notwithstanding
Section 14.8, Pharmacyclics shall have the right to seek relief for any
violation or threatened violation of Section 7.6 from any court of competent
jurisdiction in any jurisdiction authorized to grant the relief necessary to
prohibit the violation or threatened violation of Section 7.6. This Section
shall apply with equal force to E-Z-EM's Affiliates and to any third party
distributors used by E-Z-EM to distribute the Licensed Product, if any of them
is the holder of the Marketing Authorization at the time the violation or
threatened violation of Section 7.6 takes place.
10.5 ACCRUED RIGHTS. Termination or expiration of this Agreement shall not
affect any accrued rights of either party.
10.6 EFFECT OF TERMINATION.
(a) Upon early termination by E-Z-EM under Section 10.3
or upon termination by Pharmacyclics because of material breach by E-Z-EM under
Section 10.2, the following shall occur:
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(i) All licenses granted to E-Z-EM shall
terminate immediately, including the
trademark license granted to E-Z-EM
pursuant to Section 3.2(c) and
E-Z-EM shall have no further rights
in the trademarks or the
Pharmacyclics Patents or the
Pharmacyclics Technology (other than
a non-exclusive license to any
Improvements made by E-Z-EM and
subject to E-Z-EM's option to sell
off existing inventory for six (6)
months after the termination date
under (iii)), and E-Z-EM shall not,
either directly or indirectly, use
or permit the use of the same or of
the promotional procedures, methods
or documentation relating to the
Licensed Products, except to sell
off existing inventory under (iii).
(ii) E-Z-EM will immediately transfer to
Pharmacyclics, to the extent
permitted by Applicable Laws,
without further consideration, any
Marketing Authorizations held in the
name of E-Z-EM. E-Z-EM will also
use its reasonable efforts to cause
any Marketing Authorizations held by
its Affiliates or distributors to be
immediately transferred to
Pharmacyclics, to the extent
permitted by Applicable Laws.
Because E-Z-EM agrees that the
Marketing Authorizations held by
E-Z-EM and by its Affiliates and its
distributors are held in trust for
Pharmacyclics, at the cost of
E-Z-EM, E-Z-EM will fully cooperate
with Pharmacyclics and all Competent
Authorities and do all things and
acts necessary to cause both the
legal and equitable ownership of the
Marketing Authorizations to vest in
Pharmacyclics or its designee as
soon as possible after termination
of the Agreement.
(iii) E-Z-EM may sell off any existing
inventory during a period not to
exceed six (6) months following such
termination. If E-Z-EM chooses this
option, E-Z-EM shall:
(a) within thirty days of issuance
of a notice of termination by any
party, notify Pharmacyclics that it
intends to sell off existing
inventory;
(b) continue to comply with its
payment obligations;
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(c) continue to sell off existing
inventory for six (6) months after
the notice of termination but at the
expiration of the six (6) months, at
Pharmacyclics' election, either (A)
sell all existing inventory to
Pharmacyclics or (B) destroy all
remaining inventory in accordance
with Applicable Law, providing
Pharmacyclics with proof of
destruction in writing sufficient to
comply with Applicable Laws;
provided that in either case,
Pharmacyclics shall pay to E-Z-EM
the actual landed cost paid by
E-Z-EM for such remaining inventory.
If E-Z-XX xxxxx any inventory to
Pharmacyclics pursuant to this
subsection, it shall warrant that
such inventory has been stored in
compliance with all Applicable Laws,
has not been adulterated and has
otherwise been maintained according
to the MRI Product Specifications.
(iv) In the event that E-Z-EM notifies
Pharmacyclics that E-Z-EM does not
intend to sell off any existing
inventory, E-Z-EM shall, at
Pharmacyclics' election, either (A)
sell all existing inventory to
Pharmacyclics or (B) destroy all
remaining inventory in accordance
with Applicable Law, providing
Pharmacyclics with proof of
destruction in writing sufficient to
comply with Applicable Laws;
provided that in either case,
Pharmacyclics shall pay to E-Z-EM
the actual landed cost paid by
E-Z-EM for such remaining inventory.
If E-Z-XX xxxxx any inventory to
Pharmacyclics pursuant to this
subsection, it shall warrant that
such inventory has been stored in
compliance with all Applicable Laws,
has not been adulterated and has
otherwise been maintained according
to the MRI Product Specifications.
(v) Any sales of Licensed Product made
by E-Z-EM to Pharmacyclics pursuant
to this Article 10 shall be made by
E-Z-EM within thirty (30) days of
the end of the time period specified
by Section 10.6(a)(iii)(c)(A) or
upon the occurrence of Section
10.6.(a)(iv)(B), and shall be
shipped to Pharmacyclics
appropriately packaged and stored.
All transportation costs in
connection with such sale, including
without limitation, insurance,
freight and duties, shall be paid by
Pharmacyclics. Amounts owed by
Pharmacyclics
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pursuant to this Section 10.6(a) for
the Licensed Products and the
transportation costs shall be paid
by Pharmacyclics within sixty (60)
days of receipt of an appropriately
detailed invoice.
(b) Upon termination by E-Z-EM because of material breach
by Pharmacyclics under Section 10.2 other than failure of supply under Article
6 not caused by Pharmacyclics, E-Z-EM shall be granted a royalty free
non-exclusive license under the Pharmacyclics Patents to make, use, have made
and sell Licensed Product. In such event, Pharmacyclics may sub-license one
other third party in each country within the Territory, who shall have no right
to further sub-license, to make, use, have made and sell Licensed Product.
10.7 SURVIVING OBLIGATION. Termination or expiration of this Agreement
shall not relieve either party of its obligations under Sections 5.2, 7.6,
7.13, 7.15, 14.1, 14.2 and Articles 8, 9 (other than Section 9.2(a)), 10 and
11.
ARTICLE 11
INDEMNITY
11.1 INDEMNIFICATION BY PHARMACYCLICS. Pharmacyclics agrees to indemnify
and hold E-Z-EM harmless from and against all claims, damages, losses, costs
and expenses, including reasonable attorney's fees, which E-Z-EM may incur by
reason of (i) any Licensed Product furnished by Pharmacyclics which result in
injury, illness or death of any person, to the extent that such claims arise
out of or result from the negligence, recklessness or wilful misconduct of
Pharmacyclics or its officers, employees or agents, (ii) violation by
Pharmacyclics of the provisions of this Agreement, (iii) violation by
Pharmacyclics of any Applicable Laws, or (iv) any representation made or
warranty given by Pharmacyclics. In addition, Pharmacyclics agrees to and
hereby does indemnify and hold E-Z-EM harmless from and against all claims,
damages, losses, costs and expenses, including reasonable attorney's fees, for
which Pharmacyclics is indemnified and held harmless pursuant to the Supply
Agreement or any third party supply agreement.
11.2 INDEMNIFICATION BY E-Z-EM. E-Z-EM agrees to indemnify and hold
Pharmacyclics harmless from and against all claims, damages, losses, costs and
expenses, including attorney's fees, which Pharmacyclics may incur to the
extent that such claims arise out of or result from (i) violation by E-Z-EM of
the provisions of this Agreement; (ii) violation by E-Z-EM or any third party
distributor licensed by E-Z-EM to distribute the Licensed Product of any
Applicable Laws; (iii) any representation made or warranty given by E-Z-EM or
any third party distributor licensed by E-Z-EM to distribute the Licensed
Product with respect to Licensed Product (other than the labeling for Licensed
Product as approved by a Competent Authority or, (iv) the manufacture, sale or
use of any product which is not supplied by Pharmacyclics and which is sold or
combined by E-Z-EM or any third party distributor licensed by E-Z-EM to
distribute the Licensed
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Product with a Licensed Product, (v) repairs or services rendered by E-Z-EM or
(vi) injury, illness or death of any person, to the extent such injury, illness
or death arises out of or results from the negligence, recklessness or wilful
misconduct of E-Z-EM or E-Z-EM's officers, employees or agents.
11.3 INDEMNIFICATION PROCEDURE. Subject to Section 9.3, the party seeking
indemnification under this Article 11 (the "Indemnified Party") shall (i) give
the other party (the "Indemnifying Party") notice of the relevant claim, (ii)
cooperate with the Indemnifying Party, at the Indemnifying Party's expense, in
the defense of such claim, and (iii) give the Indemnifying Party the right to
control the defense and settlement of any such claim, except that the
Indemnifying Party shall not enter into any settlement that affects the
Indemnified Party's rights or interest without the Indemnified Party's prior
written approval. The Indemnified Party shall have no authority to settle any
claim on behalf of the Indemnifying Party.
11.4 INSURANCE. Each party shall carry product liability insurance of five
million dollars ($5,000000) during the term of the Agreement and for three
years after the expiration of the term of the Agreement or its earlier
termination.
ARTICLE 12
REPRESENTATIONS AND WARRANTIES
12.1 REPRESENTATION AND WARRANTIES OF PHARMACYCLICS. Pharmacyclics hereby
represents and warrants as follows:
(A) CORPORATE POWER. Pharmacyclics is duly organized and
validly existing under the laws of the state of
Delaware and has full corporate power and authority
to enter into this Agreement and to carry out the
provisions hereof.
(B) DUE AUTHORIZATION. Pharmacyclics is duly authorized
to execute and deliver this Agreement and to perform
its obligations hereunder.
(C) BINDING AGREEMENT. This Agreement is a legal and
valid obligation binding upon Pharmacyclics and is
enforceable in accordance with its terms. The
execution, delivery and performance of this Agreement
by Pharmacyclics does not conflict with any
agreement, instrument or understanding, oral or
written, to which it is a party or by which it may be
bound, nor violate any Applicable Laws of any court,
governmental body or administrative or other agency
having authority over it.
12.2 REPRESENTATIONS AND WARRANTIES OF E-Z-EM. E-Z-EM hereby represents
and warrants as follows:
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(A) CORPORATE POWER. E-Z-EM is duly organized and
validly existing under the laws of England and Wales
and has full corporate power and authority under
Applicable Laws to enter into this Agreement and to
carry out the provisions hereof.
(B) DUE AUTHORIZATION. E-Z-EM is duly authorized to
execute and deliver this Agreement and to perform its
obligations hereunder.
(C) BINDING AGREEMENT. This Agreement is a legal and
valid obligation binding upon E-Z-EM and is
enforceable in accordance with its terms. The
execution, delivery and performance of this Agreement
by E-Z-EM does not conflict with any agreement,
instrument or understanding, oral or written, to
which it is a party or by which it may be bound, nor
violate any Applicable Laws of any court,
governmental body or administrative or other agency
having authority over it.
(D) E-Z-EM will not transfer, assign, mortgage nor charge
any of the rights under the Marketing Authorizations
other than to Pharmacyclics or to a person designated
by Pharmacyclics or to a third-party distributor
appointed by E-Z-EM to distribute the Licensed
Product that has entered into a written agreement as
provided in Section 7.6.
(E) E-Z-EM will not intentionally do anything to
adversely affect the Marketing Authorizations.
(F) E-Z-EM will not knowingly do anything to prejudice
the ability of Pharmacyclics or any entity designated
by Pharmacyclics to act as holder of any Marketing
Authorization.
ARTICLE 13
ASSIGNMENT
13.1 NON-ASSIGNMENT. Except as set forth in Section 13.2 or 13.3, neither
party shall assign its rights or delegate its duties under the Agreement
without the prior written consent of the other.
13.2 PHARMACYCLICS EXCEPTION. Notwithstanding Section 13.1, Pharmacyclics
may assign this Agreement to any successor by merger or sale of substantially
all of its business units to which the Agreement relates.
13.3 E-Z-EM EXCEPTION. Subject to compliance with Section 12.2(d),
notwithstanding Section 13.1, E-Z-EM may assign this Agreement to any E-Z-EM
Affiliate or to any
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successor by merger or sale of substantially all of its business unit to which
the Agreement relates, provided, however, E-Z-EM may not make such assignment
to any then-competitor in Licensed Product of Pharmacyclics, without the prior
written consent of Pharmacyclics, such consent not to be unreasonably withheld
or delayed. If Pharmacyclics refuses to give any consent pursuant to this
Section 13.3, Pharmacyclics and its affiliates shall not, directly or
indirectly, enter into any agreement or understanding, written or oral,
concerning the Licensed Product with such competitor or its affiliates for a
period of three years from the date Pharmacyclics notifies E-Z-EM that it will
not consent to such assignment. E-Z-EM shall cause Pharmacyclics to be
notified about any Change in Control within 15 days after such Change in
Control. In the event the Change in Control means that E-Z-EM has been
acquired by a company with a Competitive MRI Product, upon thirty (30) days
notice to the entity controlling E-Z-EM given not later than sixty (60) days
after Pharmacyclics is given notice of such Change in Control, Pharmacyclics
may terminate this Agreement, with such termination to have the effect of a
material breach by E-Z-EM under Section 10.6 of this Agreement.
13.4 ASSIGNMENT OR DELEGATION NULL AND VOID. Any attempted assignment or
delegation in contravention of this Article shall be void and of no effect.
ARTICLE 14
MISCELLANEOUS
14.1 EXPORT LAW COMPLIANCE. E-Z-EM understands and recognizes that the
Licensed Product and other materials made available to it hereunder may be
subject to the export administration regulations of the United States
Department of Commerce and other United States government regulations related
to the export of drugs. E-Z-EM represents that it is familiar with and agrees
to comply with all such regulations, including any future modifications
thereof, in connection with the distribution of Licensed Product. E-Z-EM
agrees that it will not export or reexport outside the Territory, directly or
indirectly, any Licensed Product or clinical data relating to License Product
without the prior written consent of Pharmacyclics and without complying with
all Applicable Laws. E-Z-EM agrees to obtain the same agreement from each of
its subsidiaries and sub-licensees. E-Z-EM hereby agrees to indemnify and hold
Pharmacyclics harmless from any breach of this Section.
14.2 FOREIGN CORRUPT PRACTICES ACT. E-Z-EM hereby agrees that it shall
comply with the requirements of the FCPA and shall refrain from any payments to
third parties which would cause Pharmacyclics or E-Z-EM to violate the Act.
E-Z-EM hereby agrees to indemnify and hold harmless Pharmacyclics from any
breach of this Section.
14.3 BENEFITS AND BINDING NATURE OF AGREEMENT. In the case of any
permitted assignment of this Agreement, this Agreement or the relevant
provisions shall be binding upon, and inure to the benefit of, the successors,
executors, heirs, representatives, administrators and assigns of the parties
hereto.
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14.4 ENTIRE AGREEMENT. This Agreement, together with any exhibits and
schedules attached and referenced herein, embodies the final, complete and
exclusive understanding between the parties, and replaces and supersedes all
previous agreements, understandings or arrangements between the parties with
respect to its subject matter. No modification or waiver of any terms or
conditions hereof, nor any representations or warranties shall be of any force
or effect unless such modification or waiver is in writing and signed by an
authorized officer of each party hereto.
14.5 NO OTHER TERMS AND CONDITIONS. The parties intend that this Agreement
expresses all of the terms and conditions applicable to the sale of Licensed
Product and accordingly agree that all provisions, terms and conditions of any
purchase order, sales or order acknowledgment, invoice or other business form
or document (a "Form"), unless an amendment to this Agreement in accordance
with Section 14.4 hereof, shall be superseded hereby and therefore shall be
disregarded and have no force and effect. If a Form purports to be conditioned
in any manner on agreement to and/or acceptance of any provisions, terms and
conditions other than those set forth herein, then such condition is hereby
waived. In no event shall either party be bound by any provisions, terms or
conditions relating to the subject matter of this Agreement not set out herein.
14.6 FORCE MAJEURE. Neither party shall be liable to the other for its
failure to perform any of its obligations under this Agreement, except for
payment obligations, during any period in which such performance is delayed
because of, or rendered impracticable or impossible due to, circumstances
beyond its reasonable control (including any force majeure failure of a
third-party supplier to supply Licensed Product under the terms of a supply
agreement entered into between Pharmacyclics and such third-party supplier),
provided that the party experiencing the delay promptly notifies the other of
the delay.
14.7 NOTICE. All notices concerning this Agreement shall be written in the
English language and shall be deemed to have been received (a) two (2) days
after being properly sent by commercial overnight courier, or (b) one (1) day
after being transmitted by confirmed facsimile, in each case addressed to the
address below:
If to Pharmacyclics:
Pharmacyclics, Inc.
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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If To E-Z-EM:
E-Z-EM, Ltd.
0000 Xxxx Xxxx
Xxxxxx X00 OLH
Attention: Managing Director
Telephone: 00 000 000 0000
Facsimile: 44 181 446 9810
with a copy to
E-Z-EM, Inc.
000 Xxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx
Attention: President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
14.8 ENGLISH LANGUAGE; GOVERNING LAW; JURISDICTION; VENUE. This Agreement
has been prepared in the English language and the English language shall
control its interpretation. This Agreement shall be governed by the laws of
the State of New York as applied to agreements executed and performed entirely
in New York by New York residents. Any claim or controversy arising out of or
related to this Agreement or any breach hereof shall be submitted to a court of
applicable jurisdiction in the State of New York, and each party hereby
consents to and submits to the jurisdiction and venue of such court.
14.9 ALLOCATIONS. E-Z-EM and Pharmacyclics agree that in determining Net
Sales and Gross Profits, E-Z-EM shall be entitled to in good faith use
reasonable allocation methods.
14.10 WAIVER. Any waiver (express or implied) by either party of any
default or breach of this Agreement shall not constitute a waiver of any other
or subsequent default or breach.
14.11 SEVERABILITY. In the event that any provision of this Agreement shall
be unenforceable or invalid under any applicable law or be so held by
applicable court decision, such enforceability or invalidity shall not render
this Agreement unenforceable or invalid as a whole, and, in such event, such
provision shall be changed and interpreted
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so as to best accomplish the objectives of such unenforceable or invalid
provision within the limits of applicable law or applicable court decisions.
14.12 RIGHTS AND REMEDIES CUMULATIVE. Except as expressly provided herein,
the rights and remedies provided in this Agreement shall be cumulative and not
exclusive of any other rights and remedies provided by law or otherwise.
14.13 INDEPENDENT CONTRACTORS. Each party shall act as an independent
contractor under the terms of this Agreement. Neither party is, nor shall it
be deemed to be, an employee, agent, co-venturer, partner or legal
representative of the other for any purpose. Neither party shall be entitled
to enter into any contracts in the name of, or on behalf of the other, nor
shall either party be entitled to pledge the credit of the other in any way or
hold itself out as having authority to do so.
14.14 CAPTIONS AND SECTION REFERENCES. The section headings appearing in
this Agreement are inserted only as a matter of convenience and in no way
define, limit, construe or describe the scope or extent of such section or in
any way affect such section.
14.15 COUNTERPARTS. This Agreement may be executed in counterparts with the
same force and effect as if each of the signatories had executed the same
instrument.
14.16 PRESS RELEASES. The parties agree that the material terms of this
Agreement will be considered Confidential Information of both parties.
However, each party shall have the right to disclose the material terms of this
Agreement to any potential acquiror, merger partner or other bona fide
potential financial partner, subject to a requirement to secure confidential
treatment of such information or if it is prudent or proper to make such
disclosure to comply with SEC rules and regulations or meet Generally Accepted
Accounting Principles. Notwithstanding the foregoing, the parties agree that
the initial press releases regarding this Agreement shall be mutually agreed by
the parties.
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IN WITNESS WHEREOF, the parties have each caused this Agreement to be
signed and delivered by their duly authorized representatives as of the date
first written above.
PHARMACYCLICS, INC.
By: /s/ XXXX X. XXXXXX
---------------------------------
Title: VP/CFO
-----------------------------
E-Z-EM, LTD.
By: /s/ XXXX XXXXXX
---------------------------------
Title: Managing Director
-----------------------------
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SCHEDULE 1.30
PRODUCT SPECIFICATIONS
(see attached pages)
Pages 1 through 36
***
*Indicates that material has been omitted and
confidential treatment has been requested
therefor. All such omitted material has been
filed separately with the Commission pursuant
to Rule 24b-2.
40
SCHEDULE 4.2
SALES THROUGH THIRD PARTY DISTRIBUTOR FOR TWO BOTTLE UNITS
***
*Indicates that material has been omitted and
confidential treatment has been requested
therefor. All such omitted material has been
filed separately with the Commission pursuant
to Rule 24b-2.
