EXHIBIT 10.18
CONFIDENTIAL
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[* * *]: CONFIDENTIAL TREATMENT REQUESTED FOR PORTIONS OF THIS EXHIBIT
LICENSE AGREEMENT
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This License Agreement ("Agreement"), is made and entered into this 14th day of
August, 1998 ("Effective Date") by and between BioMarin Pharmaceutical, Inc.,
having its principal office at 00 Xxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx 00000, XXX
("BioMarin") and Women and Children's Hospital, Adelaide, Australia having its
principal office at 00 Xxxx Xxxxxxx Xxxx, Xxxxx Xxxxxxxx, Xxxxx Xxxxxxxxx,
Xxxxxxxxx ("WCH").
RECITALS
A. WCH has been active in the field of research relating to the development of
therapeutic agents for the treatment of Lysosomal Storage Disorders (LSD)
and has, confidential information and know-how in respect to a group of LSD
known as Mucopolysaccharidosis ("MPS") type diseases.
B. BioMarin has agreed to work in the field of developing an enzyme
replacement therapy ("ERT") for the treatment of the disease MPS VI and
subsequent production, clinical trials, marketing and commercialization of
Licensed Products for the benefit of patients. BioMarin desires to develop
the Licensed Products and undertakes to commit significant resources to the
said development for a therapy for children suffering with MPS VI.
C. WCH possesses the Licensed Technology.
D. BioMarin is interested in taking an exclusive worldwide license to the
Licensed Technology for the commercialization of Licensed Products.
E. WCH is willing to grant to BioMarin a license for the Licensed Technology,
on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the premises and mutual covenants, WCH and
BioMarin hereby agree as follows:
ARTICLE I
DEFINITIONS
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1.1 "Inventions" shall have the meaning as set forth in Section 8.1.
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1.2 "Licensed Product" means any therapeutic product for ERT used in the
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treatment of MPS VI, which is developed from or utilizes any part of the
Licensed Technology.
1.3 "Licensed Technology" means the biological materials, clones, host cell
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lines, and any research and development information, inventions, know-how,
and all technical data applicable solely for MPS VI therapy which has been
developed as of the Effective Date and which shall include recombinant
human enzyme N-acetylgalactosamine-4-sulfatase, the cDNA clone encoding
this enzyme, and the host cell line which expresses this enzyme for the
treatment of MPS VI disease.
1.4 "Net Sales" means the aggregate gross sales price received by BioMarin on
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any Sale of the Licensed Product less any credits for returns and
allowances, cash and trade discounts, sales, use, excise or similar taxes,
duties, insurance and freight and other shipping expenses, to the extent
that such items are separately stated on BioMarin invoices to purchasers.
1.5 A "Sale" means a sale or lease of a Licensed Product. As used herein,
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"Sale" shall not include Licensed Product retained for quality assurance
purposes, any distribution for assessment by regulatory authorities for
which BioMarin does not receive financial gain.
ARTICLE II
TERMS OF LICENSE
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2.1 License. WCH grants to BioMarin a perpetual, nontransferable, exclusive,
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world-wide license, (i) to make use or sell the Licensed Technology or
Inventions to make, use, distribute, market, sell, lease and sub-license
Licensed Products and (ii) to make modifications to and to further develop
the Licensed Technology or Inventions to make, use, distribute, market,
sell, lease and sub-license the Licensed Products.
2.2 Access. WCH will provide to BioMarin, subject to the principles of
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confidentiality set forth in Article IX, access to all Licensed Technology
and all accompanying know-how and documentation necessary to use the
Licensed Technology.
ARTICLE III
DEVELOPMENT
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3.1 BioMarin will be responsible for the production of the Licensed Product,
including, enzyme material using on any aspect of the Licensed Technology
for clinical trials and, for world wide supply, based on real cost
calculations, in the case of successful clinical trials. WCH hereby grants
and BioMarin accepts the fight to sublicense the Licensed Product to ensure
BioMarin can enter into partnerships or business collaborations, which
involve the manufacture, marketing, sales, and distribution of the Licensed
Products.
3.2 During the term of this Agreement, WCH, under the direction of Xxxxxxxxx
Xxxx Xxxxxxx, will have substantial responsibility in the design of
BioMarin's MPS VI clinical studies, the terms and conditions of which are
to be agreed by WCH and BioMarin within six (6) months of the effective
date.
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ARTICLE IV
DELIVERY
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4.1 WCH shall make its best effort to supply to BioMarin a copy of materials
and/or documentation in its possession that contains the Licensed
Technology within sixty (60) days from the Effective Date.
4.2 On the Effective Date, BioMarin shall designate one or more qualified
individual(s) to be responsible for receiving the Licensed Technology. On
or before the expiration of sixty (60) days from the Effective Date, WCH
shall provide up to seventy (70) hours of training to such designated
individual(s) who manufacture or use the Licensed Technology pursuant to
such schedules and locations as the parties may agree. BioMarin will pay
all travel, board, and lodging costs related to the supply of a copy of the
Licensed Technology and documentation from WCH to BioMarin in accordance
with Section 4.1.
ARTICLE V
PAYMENT
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5.1 In consideration of the license set forth in Article II above, BioMarin
must pay to WCH the following:
(a) License Fee: On the Effective Date, BioMarin must pay to WCH the
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sum of [* * *] as a licensing fee payment to WCH.
(b) Maintenance Fee: On each anniversary date of the Effective Date,
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BioMarin must pay to WCH an annual license maintenance fee of
[* * *]. If the annual royalty payments set forth in Section 5.1(c)
exceeds [* * *] BioMarin shall not be required to pay the annual
license maintenance fee and shall make only the royalty payment in
accordance with Section 5.1(c). Each annual license maintenance
payment must be made within eight (8) business days from the
anniversary date.
(c) Royalties: Commencing with the first commercial sale of the
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Licensed Products by BioMarin, BioMarin shall pay to WCH a royalty
rate of [* * *] of the Net Sales of Licensed Products. If a product
which can be used for the treatment of MPS IV enters the market
during the term of this Agreement and is competitive with the
Licensed Product, then the royalty rate to WCH shall be decreased to
[* * *] of annual Net Sales:
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[* CONFIDENTIAL TREATMENT REQUESTED]
(d) Payment: BioMarin shall make royalty payments to WCH within sixty (60)
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days after the end of each calendar quarter during the term of this Agreement,
for Net Sales within such calendar quarter. Each royalty payment shall be
accompanied by a report by BioMarin describing royalty calculations due
hereunder, for Net Sales of the Licensed Products within such calendar quarter.
(e) Sublicensee's Royalty: In the event that BioMarin sublicenses the
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Licensed Technology, then a condition of any sub-license must be that the sub-
licensee pays a royalty to WCH on its Net Sales in accordance with Sections
5.1(c) and (d) and BioMarin guarantees to WCH any required royalty payments by
the sub-licensee.
(f) Records: BioMarin shall keep at its principal offices, complete, true
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and accurate business books and records of account in sufficient detail to
enable the royalties due WCH under this Article 5 to be verified, which books
and records shall be maintained until at least six (6) years following the
relevant royalty period or termination of this Agreement. Not more than one
(1) time each calendar year during the term of this Agreement, WCH shall be
entitled to inspect and audit BioMarin's accounts to verify the accuracy of
(i) the reports provided to WCH under this Section 5.1 (c) and (d) and the
amounts of the accompanying payments. Such audit shall be conducted by an
independent accounting firm who is bound by strict confidentiality. Such audit
shall be preceded by three (3) days prior written notice to BioMarin and shall
be during BioMarin's normal business hours. If any such audit reveals an
underpayment by BioMarin of its royalty obligations hereunder, BioMarin shall
promptly remit to WCH the amount of such underpayment within thirty (30) days.
ARTICLE VI
REPRESENTATIONS BY WCH
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6.1 WCH represents and warrants that: (i) WCH has developed and owns all fight,
title and interest in and to the Licensed Technology existing as of the
Effective Date; (ii) WCH has the fight to enter into this Agreement, to
fully comply with the terms and conditions of this Agreement to the best of
WCH's knowledge, to grant to BioMarin the fights and licenses contemplated
in Section 2.1 above; and (iii) WCH has not executed any agreement or
contract that is inconsistent with the fights and licenses granted
hereunder. Except for the warranties made in this Section 6.1, WCH has made
no other warrantees and expressly excludes all warranties to the extent
possible by law.
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ARTICLE VII
REPRESENTATIONS BY BIOMARIN
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7.1 BioMarin will commit best commercially reasonable efforts towards the said
development. For the purposes of this Agreement, commercially reasonable
efforts shall be interpreted as:
Submission of Investigational New Drug Application ("IND") for MPS VI
enzyme replacement therapy (i.e., Licensed Product) to the United States
Food and Drug Administration ("FDA") or equivalent application to be made
to the appropriate regulatory authority of another country at least nine
(9) months from the Execution Date, or twelve (12) months if additional
pre-clinical toxicology studies are required for the submission. Clinical
trials should begin within three (3) months of the filing of an IND
provided that the initiation of clinical trials has been approved by the
FDA.
7.2 BioMarin represents and warrants that (i) BioMarin has the fight to enter
into this Agreement; (ii) BioMarin will fully comply with the terms and
conditions of this Agreement; and (iii) BioMarin will be responsible for
all liability to third parties arising form any use of the Licensed
Technology and its manufacture, distribution and sale of the Licensed
Product.
ARTICLE VIII
PATENTS
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8.1 Ownership of Inventions. WCH shall have and retain sole and exclusive title
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to all inventions, discoveries and know how ("Inventions") which are made
by either party, its employees, agents, or other third parties acting under
authority from either party relating to Licensed Product.
8.2 Maintenance of Patents.
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(a) Filings. As between WCH and BioMarin, BioMarin shall, at its expense,
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have responsibility for filing, prosecution and maintenance of all
patents in the name of WCH. WCH shall have the fight to review pending
patent applications and make recommendations to BioMarin concerning
them. BioMarin will consider in good faith all reasonable suggestions
of WCH with respect thereto. BioMarin agrees to keep WCH informed of
the course of patent prosecution or other proceedings with respect to
the patents. WCH shall provide such patent consultation to BioMarin at
no cost to BioMarin. WCH shall hold all information disclosed to it
under this Section 8.2(a) as confidential.
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(b) Extensions. BioMarin shall have the right but not the obligation to
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seek extensions of the terms of patents. At BioMarin's request, WCH
shall either authorize BioMarin to act as WCH's agent for the purpose
of making any application for any extensions of the term of patents
and provide reasonable assistance therefor to BioMarin or shall
diligently seek to obtain such extensions, in either event, at
BioMarin's expense.
8.3 Infringement by Licensed Product. In the event of the institution of any
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suit by a third party against WCH for patent infringement involving the
manufacture, use, sale, distribution or marketing of Licensed Product, WCH
shall promptly notify BioMarin in writing. BioMarin shall have the right
but not the obligation to defend such suit against it at its own expense.
BioMarin and WCH shall assist one another and cooperate in any such
litigation at the other's reasonable request without expense to the
requesting party, and in any event WCH may participate in any such suit
with counsel of its choice at its own expense.
8.4 Third Party Infringement. In the event that BioMarin or WCH becomes aware
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of actual or threatened infringement of a patent by the manufacture or sale
or use of an ERT product for treatment of MPS VI (the "Field"), that party
shall promptly notify the other party in writing. BioMarin shall have the
first right but not the obligation to bring, at its own expense, an
infringement action against any third party. If BioMarin does not commence
a particular infringement suit within the Field within one hundred twenty
(120) days of receipt of a request by WCH to do so, then WCH, after
notifying BioMarin in writing and obtaining BioMarin's consent, which shall
not be unreasonably withheld, shall be entitled to bring such infringement
action at its own expense. WCH shall keep BioMarin reasonably informed of
its activities during the 120-day period. The party conducting such action
shall have full control over its conduct, including settlement thereof
subject to Section 8.6. In any event, BioMarin and WCH shall assist one
another and cooperate in any such litigation at the other's reasonable
request without expense to the requesting party.
8.5 Recovery. BioMarin and WCH shall recover their respective actual out-of-
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pocket expenses, or equitable proportions thereof, associated with any
litigation against infringers undertaken pursuant to Section 8.4 above or
settlement thereof from any resulting recovery made by any party. Any
excess amount of such a recovery shall belong to BioMarin to the extent
such recovery represents damages relative to sales.
8.6 Status of Activities. The parties shall keep one another informed of the
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status of their respective activities regarding any litigation or
settlement thereof concerning Licensed Product, provided however that no
settlement or consent judgment or other voluntary final disposition of any
suit defended or action brought by a party pursuant to this Section 8 may
be entered into without the consent of the other party if such settlement
would require the other party to be subject to an injunction or to make a
monetary payment or would otherwise adversely affect the other party's
rights under this Agreement.
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ARTICLE IX
CONFIDENTIALITY
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9.1 BioMarin and WCH shall use their best efforts to protect the
confidentiality of proprietary information provided to it by the other
party and identified in writing or orally as confidential and proprietary
and not to use such information except for the purposes of this Agreement.
This obligation of confidentiality shall not apply to information which (a)
is or becomes known publicly through no fault of the other party; (b) is
obtained or learned by the receiving party from a third party entitled to
disclose it; (c) is already known to the receiving party at the time of
disclosure, as shown by the receiving party's prior written records; (d) is
developed by the receiving party independent of any disclosure made
hereunder, which can be demonstrated by written or other documentary
evidence; or is required by law to be disclosed.
9.2 The foregoing restrictions shall not apply to any confidential information
of either party ("Disclosing Party") that (i) is in the possession of the
other party ("Receiving Party") at the time of disclosure, (ii) prior to or
after the time of disclosure becomes part of the public domain, not as a
result of any breach by the Receiving Party, (iii) is developed
independently by the Receiving Party without use of or reference to the
confidential Information of the Disclosing Party, (iv) is acquired from a
third party having the fight to disclose such information, or (v) is
approved in writing for release by the Disclosing Party.
ARTICLE X
TERM AND TERMINATION
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10.1 This Agreement shall commence on the Effective Date for a period of ten
years. BioMarin shall have the option to renew this Agreement for two (2)
periods of one (1) year upon terms to be agreed upon between the parties.
10.2 In the event that BioMarin fails to demonstrate to the WCH that best
commercially reasonable efforts to develop and commercialize any of the
Licensed Technology and Licensed Product then the WCH will inform BioMarin
of this in writing. In case of a dispute, the parties shall have cause to
negotiate in good faith to resolve any such dispute. If a dispute is not
resolved within 30 days then the parties shall have the matter resolved by
binding arbitration.
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ARTICLE XI
INDEMNITY BY BIOMARIN
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11.l BioMarin shall indemnify and hold harmless WCH and its employees, from and
against any and all costs, losses, liabilities and expenses (including WCH
attorneys' fees) arising out of the manufacture, use or sale of Licensed
Products by BioMarin and from any use of the Licensed Technology, except
for any gross negligence or willful acts by WCH employees, that serve to
prohibit BioMarin from carrying out its fights under this Agreement.
11.2 BioMarin confirms that BioMarin has adequate insurance to cover all the
risks referred to in Section 11.1. BioMarin agrees that on request by
WCH,will provide WCH with evidence of the insurance on a certificate of
currency.
ARTICLE XII
GENERAL PROVISIONS
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12.1 Transfer Costs. Costs associated with the manufacture of the Licensed
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Technology or travel costs directly related to the requirement of
attendance by Xxxxxxxxx Xxxxxxx or members of his staff, are to be paid
for by BioMarin.
12.2 Return of Licensed Technology. In the event that
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BioMarin terminates their participation in the MPS VI project, all
Licensed Technology including, without limitation, confidential
information, cell lines etc. shall be returned to WCH.
12.3 Governing Law. This Agreement shall be construed and interpreted, and the
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fights and obligations of the parties hereto shall be determined, in
accordance with the laws of the State of California, without regard to the
conflicts of law principles thereof.
12.4 Alteration. No alteration or amendment of this Agreement shall be
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effective unless embodied in writing and executed by an authorized
representative of each party.
12.5 Assignment. This Agreement, and the rights and obligations hereunder,
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shall not be assigned by WCH without the prior written consent of
BioMarin.
12.6 Addresses The addresses of the parties for purposes of notices, payments
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and other communications shall be as follows:
BioMarin Pharmaceutical, Inc.
00 Xxxxxxxx Xxxxx
Xxxxxx XX 00000
Attn.: Xx. Xxxxxxxxxxx X. Xxxxx, Vice President of Research
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Women and Children's Hospital
00 Xxxx Xxxxxxx Xxxx
Xxxxx Xxxxxxxx
Xxxxx Xxxxxxxxx, Xxxxxxxxx
Attn: Mr Xxxxxx Xxxx, Intellectual Property Manager
Either party, by notice to the other, may change its address for the
purpose of this Section 12.6.
12.7 Entire Agreement. This Agreement sets forth the entire understanding of
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the parties hereto with respect to the subject matter hereof and
supersedes any previous understandings and agreements, written or oral,
which the parties hereto may have reached with respect to the subject
matter hereof.
12.8 Arbitration. Any dispute or claim arising out of this Agreement shall be
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finally settled by binding arbitration in San Francisco, California under
the rules of arbitration of the American Arbitration Association by one
arbitrator appointed in accordance with said rules. Judgment on the award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof. Notwithstanding the foregoing, the parties may apply to any court
of competent jurisdiction for injunctive relief without breach of this
arbitration provision. Both parties agree to attempt to resolve disputes
within thirty (30) days prior to initiating arbitration.
12.9 Waiver. The failure or delay of either party to exercise any fight under
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this Agreement may not be construed as a waiver of that fight, and no
waiver of any term or condition of this Agreement shall be valid or
binding on either party unless set forth in a writing signed by such
party.
12.10 Independent Contractors. The relationship of BioMarin and WCH established
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by this Agreement is that of independent contractors, and nothing
contained in this Agreement shall be construed to (i) give either party
the power to direct and control the day-to-day activities of the other,
(ii)constitute the parties as partners, joint venturers, co-owners or
otherwise as participants in a joint or common undertaking, or (iii)allow
either party to create or assume any obligation on behalf of the other
party for any purpose whatsoever. All financial obligations associated
with each party's business are the sole responsibility of that party.
12.11 Public Announcement. Neither party shall have the right to disclose to
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third parties the terms of or the existence of this Agreement, unless
approved in writing by the other party; provided that either party shall
have the right to disclose the terms and existence of this Agreement to
third parties as required by law, to prospective investors and to such
party's accountants, attorneys and other professional advisors.
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12.12 Notices. All notices under this Agreement shall be in writing and shall
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be deemed to have been given if personally delivered, sent by certified
or registered mail (return receipt) to the persons names in Section 12.6,
or such other address as is provided by notice as set forth herein.
Notices shall be deemed effective upon receipt or, if delivery is not
effected by reason of some fault of the addressee, when tendered.
12.13 Severability. In the event any provision of this Agreement is held to be
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unenforceable in any respect, such unenforceability shall not affect any
other provision of this Agreement, provided that the expected economic
benefits of this Agreement are not denied to either party.
12.14 Limitation of Liability. EXCEPT 1N RELATION TO AN INDEMNITY PROVIDED BY
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BIOMARIN PURSUANT TO CLAUSE 11.1, THE PARTY'S LIABILITY (IF ANY) 1N ALL
CASES SHALL BE EXCLUDED TO THE EXTENT POSSIBLE BY LAW, AND WHERE IT
CANNOT BE EXCLUDED, IT WILL BE LIMITED TO THE AMOUNTS PAID BY BIOMARIN
HEREUNDER. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY
SPECIAL, INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES ARISING IN ANY WAY
OUT OF THIS AGREEMENT, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY.
THIS LIMITATION SHALL APPLY EVEN IF EITHER PARTY KNOWS OR HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING ANY
FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY PROVIDED FOR HEREIN.
12.15 Counterparts. This Agreement may be executed in any number of
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counterparts and when so executed and delivered shall have the same force
and effect as though all signatures appeared on one document.
12.16 Compliance with Laws. BioMarin shall be responsible, at its own expense,
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for obtaining any and all governmental authorizations required (and
comply with all applicable laws) in connection with the manufacture sale
or use of any of the Licensed Technology and the Licensed Products.
12.17 Force Majeure. Nonperformance of either party shall be excused to the
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extent that performance is rendered impossible by strike, fire, flood,
earthquake, governmental acts or orders or restrictions, failure of
suppliers, or any other reason when failure to perform is beyond the
control and not caused by the negligence of the non-performing party.
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IN WITNESS WHEREOF, the parties hereto have caused this License Agreement
to be executed as of the day and year first above written.
/s/ [SIGNATURE]
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("WCH")
By: /s/ X. Xxxxxxxxxx
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ASST CHIEF EXECUTIVE OFFICER
/s/ [SIGNATURE]
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("BioMarin")
By: /s/ Xxxxxxxxxxx X. Xxxxx
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VP Research
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