EXHIBIT 10.2
CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
LICENSE AGREEMENT
THIS LICENSE AGREEMENT, dated as of December 18, 2002 (this
"Agreement"), between NEUROCRINE BIOSCIENCES, INC. ("Neurocrine"), a corporation
organized under the laws of the State of Delaware, 00000 Xxxxxxx Xxxxxx Xxxxx,
Xxx Xxxxx, Xxxxxxxxxx 00000-0000, and PFIZER INC., a corporation organized under
the laws of the State of Delaware, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 ("Pfizer").
WHEREAS, Neurocrine owns or may acquire certain patents and patent
applications, licenses to patents and patent applications, know-how, trade
secrets and scientific and technical information relating to a compound referred
to as NBI-34060 (indiplon); and
WHEREAS, Pfizer desires to acquire from Neurocrine exclusive licenses
and sublicenses under said patents and licenses and related know-how, trade
secrets and scientific and technical information, and Neurocrine is agreeable to
granting such licenses and sublicenses pursuant to the terms of this Agreement.
NOW, THEREFORE, Pfizer and Neurocrine hereby agree as follows:
ARTICLE 1
1. DEFINITIONS. Any capitalized terms used herein which are not expressly
defined in this Agreement shall have the meaning set forth in the
Collaboration Agreement. For purposes of this Agreement, the following
definitions shall also be applicable:
1.01 "Acceptable Safety Profile" means data with respect to a Product that
demonstrates that such Product is safe and well-tolerated for use in
humans.
[***]
1.03 "Affiliate" means any entity directly or indirectly controlled by,
controlling, able to control, or under common control with, a party to
this Agreement, but only for so long as such control shall continue.
For purposes of this definition, "control" (including, with
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correlative meanings, "controlled by", "controlling" and "under common control
with") means possession, direct or indirect, of (a) the power to direct or cause
direction of the management and policies of an entity (whether through ownership
of securities or partnership or other ownership interests, by contract or
otherwise), or (b) at least 50% of the voting securities (whether directly or
pursuant to any option, warrant or other similar arrangement) or other
comparable equity interests. For the avoidance of doubt, neither of the parties
to this Agreement shall be deemed to be an "Affiliate" of the other solely as a
result of their entering into this Agreement.
1.04 "Approval" means receipt of a final Approval Letter from FDA
authorizing marketing and sale of Products.
1.05 "Bankruptcy Code" means 11 U.S.C Sections 101-1330, as amended.
1.06 "Code" or "Codes" means the Code on Interactions with Healthcare
Professionals promulgated by the Pharmaceutical Research and
Manufacturers of America (PhRMA), and the American Medical Association
Guidelines on Gifts to Physicians, as either of the foregoing may be
amended from time to time.
1.07 "Collaboration Agreement" means the Collaboration Agreement, dated the
date hereof, between Neurocrine and Pfizer, as the same shall be
amended from time to time in accordance with the terms thereof.
1.08 "Combination Product" means any Product which contains, in addition to
the Product, one or more other therapeutically active ingredients.
1.09 "Commercially Reasonable Efforts" means those efforts and resources
that Pfizer would use were it promoting and detailing its own
pharmaceutical products which are of similar market potential as the
Products, taking into account product labeling, market potential, past
performance, economic return, the regulatory environment and
competitive market conditions in the therapeutic area, all as measured
by the facts and circumstances at the time such efforts are due. In
evaluating economic return, Pfizer shall not consider payments under
this Agreement and the Collaboration Agreement to Neurocrine.
1.10 "Compound" means indiplon (NBI-34060), as more specifically described
as Acetamide, N-Methyl-N-[3-[3-(2-thienylcarbonyl)-pyrazol- [1,5-a]
pyrimidin-7-yl] phenyl] in any chemical form, including without
limitation, salts, solvates, metabolites and prodrugs.
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1.11 [***]
1.12 "DOV Sublicense" means the Sub-License and Development Agreement, dated
June 30, 1998, between DOV and Neurocrine, as amended from time to
time.
1.13 "DOV Technical Information" means all scientific or technical
information relating to the Compound or the Products licensed to
Neurocrine under the DOV Sublicense, including but not limited to: (a)
medical, clinical, toxicological or other scientific data, and (b)
processes and analytical methodology useful in the development,
testing, analysis, manufacture or packaging of the Compound or
Products.
1.14 "Effective Date" means the date upon which the applicable waiting
period under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended ("HSR Act") shall have expired or been terminated, with
respect to this Agreement and the Collaboration Agreement, as
applicable.
1.15 "FDA" means the United States Food and Drug Administration and any
successor agency thereto.
1.16 "Generic Competition" shall exist during a given calendar quarter with
respect to a Product in any country in the Territory if, during such
calendar quarter, one or more Generic Products shall be commercially
available in such country and shall have, in the aggregate, [***] or
more share of total sales of the aggregate of Products and Generic
Products (based on data provided by IMS International, or if such data
is not available, such other reliable data source as reasonably
determined by Pfizer and agreed by Neurocrine (such agreement not to be
unreasonably withheld) as measured by unit sales. In the event IMS
International data (or such other agreed data source) is not sufficient
to determine the percentage market share for each country in the EU,
the
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average percent market share of the EU countries for which data is not
available will be deemed to be the percent market share for those
countries in which the data is available.
1.17 "Generic Products" means any pharmaceutical products (other than
Products developed and commercialized by Pfizer pursuant to this
Agreement) that contain principally the same active chemical
entity(ies) as a Product and can reasonably be or are reasonably used
for the same indication as a Product.
1.18 "Governmental Authority" means any court, agency, department or other
instrumentality of any foreign, federal, state, county, city or other
political subdivision.
1.19 "IR" means the immediate release formulation of the Compound as more
specifically described on Exhibit A or any formulation with equivalent
release characteristics.
1.20 "IR Product" means a Product with the IR formulation.
1.21 "Joint Technology" means any Technology developed or invented jointly
by Pfizer and Neurocrine relating to the Compound or the Products
arising out of the Development Program (as defined in the Collaboration
Agreement).
1.22 "Key EU Country" means any of the United Kingdom, France, Germany,
Spain or Italy.
1.23 "Launch" means, on a country by country basis, the shipping of
commercial quantities of a Product for commercial sale to unaffiliated
third parties.
1.24 "Law" or "Laws" means all laws, statutes, rules, Codes, regulations,
orders, judgments and/or ordinances of any Governmental Authority.
1.25 "MR" means the modified release formulation of the Compound as more
specifically described on Exhibit A or any formulation with an
equivalent kinetic profile.
1.26 "MR Product" means a Product with the MR formulation.
1.27 "NDA" means a New Drug Application filed with the FDA with respect to a
pharmaceutical product.
1.28 "Net Sales" means (a) gross sales of Pfizer, its Affiliates and
sublicensees of Product to unaffiliated third parties in the applicable
country, less (i) bad debts related to the Product
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and (ii) sales returns and allowances, including, without limitation,
trade, quantity and cash discounts and any other adjustments,
including, but not limited to, those granted on account of price
adjustments, billing errors; rejected goods, damaged or defective
goods, recalls, returns, rebates, chargeback rebates, fees,
reimbursements or similar payments granted or given to wholesalers or
other distributors, buying groups, health care insurance carriers or
other institutions, adjustments arising from consumer discount
programs, [***], customs or excise duties, sales tax, consumption tax,
and other taxes (except income taxes) or duties relating to sales, and
any payment in respect of sales to any governmental or regulatory
authority in respect of any government-subsidized program; and (b) in
the case of Combination Products, (aa) If Pfizer and/or its Affiliates
separately sells in such country during such Year when it sells such
Combination Product both (x) one or more Products as a single chemical
entity and (y) other products containing active ingredient(s) as a
single entity that are also contained in such Combination Product, the
Net Sales attributable to such Combination Product during such Year
shall be calculated [***]; (bb) if Pfizer and/or its Affiliates
separately sells, in such country during such Year when it sells such
Combination Product, one or more Products as a single chemical entity
but do not separately sell, in such country, other products containing
active ingredient(s) that are also contained in such Combination
Product, the Net Sales attributable to such Combination Product during
such Year shall be calculated [***];
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(cc) if Pfizer and/or its Affiliates do not separately sell each
Products contained in the Combination Product, the Net Sales
attributable to such Combination Product shall be calculated by [***].
With respect to the determination of Net Sales of Combination Products
above and in considering the financial feasibility of Launching a
Combination Product, if one or both of the parties determines that the
formula in (aa), (bb) or (cc), as the case may be, will result in
commercialization of the Combination Product not being economically
feasible or equitable, the parties will meet and discuss in good faith
adjustments or alterations to the applicable formulas above to address
the concerns of such party(ies).
1.29 "Neurocrine Patent Rights" means all Patent Rights, now or hereafter
during the term of this Agreement, owned, licensed or controlled by
Neurocrine or its Affiliates that claim Compound or the Products, or
uses, formulations, indications, compositions or methods of
manufacturing thereof including, without limitation, the patents and
patent applications set forth on Exhibit B. For the purpose of this
Section 1.29, Neurocrine Patent Rights will also include [***].
1.30 "Neurocrine Technical Information" means all scientific or technical
information and related know-how and trade secrets, now or hereafter
during the term of this Agreement, owned or controlled by Neurocrine or
its Affiliates relating directly to the Compound or the Products,
including but not limited to: (a) medical, clinical, toxicological or
other
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scientific data, (b) processes and analytical methodology used in the
development, formulation, testing, analysis, manufacture or packaging
of the Compound or Products, (c) uses or indications of Products and
Product compositions, and (d) Neurocrine's interest in any Joint
Technology.
1.31 "Patents Rights" means the rights and interest in and to all issued
patents and pending patent applications in any country, including,
without limitation, all divisionals, continuations, renewals,
continuations-in-part, patents of addition, supplementary protection
certificates, extensions, registration or confirmation patents and
reissues thereof.
1.32 "Payment Computation Period" means each of the periods ending on each
of the four (4) thirteen (13) week periods as used by Pfizer in filings
with the Securities and Exchange Commission (a "Pfizer Quarter")
commencing on January 1 of any year. For sake of clarification, outside
the United States, Net Sales are computed for a three month period,
which ends one month prior to the end of the relevant Pfizer Quarter.
1.33 "Pfizer Technical Information" means all scientific or technical
information and related know-how and trade secrets owned or controlled
during the term of this Agreement by Pfizer or its Affiliates arising
in the course of the development of Products by Pfizer and development
of Products by Neurocrine and Pfizer under the Collaboration Agreement,
in each case relating directly to Compounds or Products, including but
not limited to: (a) medical, clinical, toxicological or other
scientific data, (b) processes and analytical methodology used in the
development, formulation, testing, analysis, manufacture or packaging
of the Compound or Products, (c) uses or indications of Products and
Product compositions, and (d) Pfizer's interest in any Joint
Technology.
1.34 "Price Approval" means, in countries where governmental or regulatory
authorities authorize for reimbursement, or approve or determine
pricing for pharmaceutical products for reimbursement or otherwise,
such authorization, approval or determination.
1.35 "Products" means all pharmaceutical formulations and dosage forms,
which contain the Compound either alone or in combination with other
therapeutically active ingredients.
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1.36 "Regulatory Authority" means any Governmental Authority with
responsibility for granting any licenses or approvals necessary for the
marketing and sale of pharmaceutical products including, without
limitation, any drug regulatory authority of countries of the European
Union, Japan and the FDA, and where the context admits any ethics
committee or any equivalent review board.
1.37 [***].
1.38 [***] means [***] data contained in the final report of [***], that
demonstrate that [***]; except that if FDA informs Neurocrine that data
from a different combination of the above-listed trials or other data
[***], data that meets such FDA requirements shall be required for
purposes of demonstrating [***].
1.39 [***] means final FDA labeling (package insert) for the Product which
in the indication statement reflects effective use for [***].
1.40 "Statistically Significant Difference" means [***].
1.41 "Territory" means all countries of the world, as in existence from time
to time.
1.42. "Technology" shall mean information and all intellectual property,
including but not limited to, trade secrets, know-how, inventions and
technology, whether patentable or not, and Patent Rights in each case
directed to products, processes, formulations and/or methods but which
term shall specifically exclude copyright and all registered and
unregistered trademarks.
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1.43 [***].
1.44 [***].
1.45 "Valid Claim" means any claim from an issued and unexpired patent or
pending application (which has been pending for less than 7 years in
Japan and for less than 5 years in any other country) included within
the Patent Rights which has not been revoked or held unenforceable or
invalid by a decision of a court or other Governmental Authority of
competent jurisdiction, and which has not been disclaimed, denied or
admitted to be invalid or unenforceable through reissue or disclaimer
or otherwise.
1.46 "Year" means each calendar year during the term of this Agreement.
ARTICLE 2
2. LICENSES.
2.01 LICENSE. Subject to the terms of this Agreement, Neurocrine hereby
grants to Pfizer, and Pfizer hereby accepts: (a) an exclusive license
under the Neurocrine Patent Rights to make, have made, use, sell, offer
for sale, import, and have imported Products in the Territory; (b) an
exclusive license under the Neurocrine Technical Information to use in
the Territory all Neurocrine Technical Information in connection with
the manufacture,
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use or sale of Products in the Territory; (c) with respect to the DOV
Sublicense, an exclusive sublicense under all Patent Rights and DOV
Technical Information licensed to Neurocrine thereunder to make, have
made, use, sell, offer for sale, import, and/or have imported Products
in the Territory; and (d) [***], an exclusive sublicense to the
Compound and Licensed Product [***], to make, have made, use, sell,
offer for sale, import and/or have imported Products in the Territory.
It is understood and agreed that the foregoing exclusive licenses and
exclusive sublicenses grant to Pfizer the rights enumerated to the
exclusion of all other parties, including Neurocrine and its
Affiliates.
2.02 LICENSE GRANT TO NEUROCRINE. Pfizer hereby grants to Neurocrine a
non-exclusive right and license under the Pfizer Technical Information,
Neurocrine Technical Information and Neurocrine Patent Rights to carry
out its activities under the Development Program (as defined in the
Collaboration Agreement).
2.03 SUBLICENSING. With respect to the licenses and sublicenses granted to
Pfizer under Section 2.01, Pfizer shall have the right to grant
sublicenses (a) to its Affiliates, (b) within the United States to
non-Affiliate third parties which shall be subject to Neurocrine's
prior approval, which approval may not be unreasonably withheld, and
(c) outside the United States to non-Affiliate third parties. All
sublicenses will be consistent with the terms of this Agreement and
shall not relieve Pfizer of its obligations hereunder.
2.04 CROSS LICENSE OF TRADEMARKS. In order to enable each Party to perform
its obligations under the Collaboration Agreement, each Party hereby
grants to the other party a non-assignable, non-sublicensable,
non-exclusive, royalty free right and license to use the Neurocrine
corporate logos and trademarks, and (a) the Pfizer corporate logo and
trademark as well as (b) Pfizer's trademarks for Products (in the case
of (b) only, the "Pfizer Trademarks").
ARTICLE 3
3. MILESTONE PAYMENTS, LICENSE FEES AND ROYALTIES.
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In consideration of the licenses granted to Pfizer hereunder and the
disclosure to Pfizer of Neurocrine Technical Information, and subject
to the provisions of this Agreement, Pfizer shall pay to Neurocrine
milestone payments, license fees and royalties as follows:
3.01 MILESTONE PAYMENTS AND LICENSE FEES. Subject to the terms and
conditions of this Agreement, Pfizer shall pay to Neurocrine the
following:
EVENT [***] [***]
(a) Signing of this Agreement, $50,000,000
subject to Section 3.03 below.
(b) [***] [***] [***]
(c) [***] [***]
(d) FDA Acceptance [***] [***] [***]
(e) FDA Approval of [***] [***] [***]
(f) FDA Approval [***] [***] [***]
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(g) FDA Approval [***] [***] [***]
(h) FDA Approval [***] [***]
(i) 1st Launch [***] [***]
(j) Launch [***] [***]
The parties understand and agree that each of the payments referenced
in this Section 3.01 shall only be made once, and is subject to the following
terms and conditions:
(i) Unless otherwise set forth below, all payments pursuant to
this Section 3.01 shall be made by Pfizer within twenty (20)
days of receipt from Neurocrine of notice of achievement
(together with supporting documentation) of the applicable
event referenced above; provided, however, with respect to the
events referenced in Section 3.01 (b), or (c), which payment
shall be made within twenty (20) days of Pfizer's confirmation
that the applicable event has been achieved which confirmation
shall be provided or withheld in its reasonable discretion
(and if withheld, the reasons therefore provided to
Neurocrine), within twenty (20) days following Pfizer's
receipt of the applicable final study report(s)).
(ii) With respect to the events and payments referenced in Section
3.01 (b) or (c), if Pfizer reasonably believes such events
have not been satisfied or met, Pfizer shall be entitled to
refrain from paying the applicable amount unless and until
[***],
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as the case may be, pursuant to Section 4.3 of the
Collaboration Agreement, at which time Pfizer shall pay the
applicable milestone amount.
(iii) With respect to the events and payments referenced in Section
3.01(d), [***] in Section 4.3(c) of the Collaboration
Agreement (except to the extent that neither party may object
to such filing as provided therein), is a condition to payment
of such milestone
(iv) With respect to the events and payments referenced in Section
3.01(e), mutual agreement on [***] in Section 4.3(d) of the
Collaboration Agreement [***], is a condition to payment of
such milestone.
3.02 ROYALTIES.
(a) Subject to the terms and conditions of this Agreement, Pfizer shall pay
royalties to Neurocrine based on Net Sales on a country by country
basis in accordance with the following:
(i) With respect to Net Sales of Product in the United States, a
royalty equal to the sum of (A) [***] of such Net Sales in
consideration of Neurocrine Patent Rights if the Product sold
is embraced within any Valid Claim under Neurocrine Patent
Rights in the United States, (B) [***] of such Net Sales in
consideration of, and during any period of, product
exclusivity for new chemical entities (as provided for in 21
C.F.R. 314.108(b)) for the Product in the United States, and
(C) [***] of such Net Sales in consideration of Neurocrine
Technical Information for a period equal to [***] following
Launch of the first Product; provided, however, that in no
event may the sum of (A), (B) and (C) exceed a [***] royalty;
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(ii) With respect to Net Sales of Product in Japan, a royalty of
[***] of such Net Sales in consideration of Neurocrine Patent
Rights and Neurocrine Technical Information for a period equal
to the longer of (A) [***] following Launch of the first
Product in Japan, and (B) such date the Product is no longer
embraced within any Valid Claim under Neurocrine Patent Rights
in Japan; and
(iii) With respect to Net Sales of Product in each country of the
Territory other than the United States and Japan, a royalty of
[***] of such Net Sales in consideration of Neurocrine Patent
Rights and Neurocrine Technical Information for a period in
each such country equal to the longer of (A) [***] following
Launch of the first Product in such country, and (B) such date
the Product is no longer embraced within any Valid Claim under
Neurocrine Patent Rights in such country.
After the expiration of the above-referenced payment periods with
respect to Neurocrine Technical Information, Pfizer, its Affiliates and
sublicensees shall have a fully paid-up non-exclusive license with
regard to Neurocrine Technical Information for use in such country.
(b) (i) If, during a given calendar quarter, there is Generic
Competition in any country in the Territory, then, for each
such country in which there is Generic Competition, the
royalties on Neurocrine Patent Rights and Neurocrine Technical
Information payable to Neurocrine for the Net Sales of such
Product in such country during such calendar quarter will be
reduced by [***].
(ii) [***].
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(c) [***].
3.03 HSR. Promptly following signing of this Agreement and the Collaboration
Agreement, Pfizer and Neurocrine will take (i) all actions necessary to
make the filing required under the Xxxx-Xxxxx-Xxxxxx Act ("HSR Act"),
and (ii) reply at the earliest possible date with any requests for
information received from the Federal Trade Commission ("FTC") or
Antitrust Division of the Department of Justice ("DoJ") pursuant to the
HSR Act. The parties will, to the extent reasonably practicable,
consult with one another prior to making any filings, responses to
inquiries or other contacts with the FTC or DoJ concerning the
transactions contemplated hereby. Payment of the signing fees in
Section 3.01(a) and Section 8.4(a) of the Collaboration Agreement may
be deferred until such time as Pfizer receives notice of clearance from
the FTC or DoJ until the waiting period (and any extension thereof)
applicable to this Agreement under the HSR Act shall have been
terminated or shall have expired, at which time Pfizer shall pay within
ten (10) days such signing fees, plus interest thereon from the date
that is twenty (20) days after signing of this Agreement to the date of
payment, at the one year U.S. dollar LIBOR rate as published in The
Financial Times effective for the date on which this Agreement was
signed, and computed on an actual/360 basis.
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ARTICLE 4
4. ACCOUNTING, PROCEDURES FOR PAYMENTS, AND REPORTS.
Payments hereunder shall be subject to the following provisions:
4.01 Sales between or among Pfizer, its Affiliates or sublicensees shall not
be subject to royalties under Article 3; royalties shall only be
calculated upon Net Sales to an independent third party. Pfizer shall
be responsible for payments on Net Sales by its Affiliates or
sublicensees.
4.02 Pfizer shall make royalty payments to Neurocrine on Net Sales with
respect to each Payment Computation Period within thirty (30) days
after the end of each such period, and each payment shall be
accompanied by a report, on a country-by-country basis, identifying the
Product, gross sales, Net Sales, the specific deductions used in
arriving at Net Sales, the amount of royalties payable to Neurocrine,
and the deductions contained in the definition of "Net Sales" in the
DOV Sublicense. In addition, upon any termination of the Collaboration
Agreement where this Agreement does not terminate, Pfizer shall forward
to Neurocrine the information listed on Exhibit C. Said reports shall
be kept confidential by Neurocrine and not disclosed by Neurocrine to
any party other than DOV, ACY and their respective accountants,
officers and Boards of Directors (solely to the extent Neurocrine in
its good faith opinion believes it is obligated to make any such
disclosure under the terms of the DOV Sublicense), and Neurocrine
covenants that Neurocrine, and shall use reasonable efforts to insure
that DOV and ACY, and its or their respective accountants, officers and
Board members shall be obligated to keep such information confidential
and such information and reports shall only be used for the purposes of
determining payments under this Agreement.
4.03 All payments made hereunder shall be made in U.S. Dollars and shall be
made by electronic transfer in immediately available funds via either a
bank wire transfer, an ACH (automated clearing house) mechanism, or any
other means of electronic funds transfer, at Pfizer's election, to such
bank account as Neurocrine shall designate in writing at least five (5)
business days before the payment is due. For the purposes of
determining the
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amount of royalties due for the relevant Payment Computation Period,
the amount of Net Sales in any foreign currency shall be computed by
(a) converting such amount for the relevant Payment Computation Period
into U.S. dollars at the Average Exchange Rate for the Payment
Computation Period (the "Average Exchange Rate" means, for each Payment
Computation Period for each currency in which Products sales to third
parties are denominated, the average of the prevailing commercial rate
of exchange for purchasing U.S. Dollars with such currency on the last
Business Day of each Pfizer accounting period in the relevant Pfizer
Quarter as published in The Wall Street Journal), and (b) deducting the
amount of any governmental tax, duty, charge or other fee actually paid
by Pfizer or its Affiliates in respect of such conversion into and
remittance of U.S. dollars. All payments under this Agreement shall
bear interest from the date due until paid at a rate equal to the prime
rate of Citibank, NA as announced on the date such payment was due plus
two percent (2%).
4.04 All payments under this Agreement will be made without any deduction or
withholding for or on account of any tax unless such deduction or
withholding is required by applicable law or regulations. If the paying
party is so required to deduct or withhold such party will (i) promptly
notify the other party of such requirement, (ii) pay to the relevant
authorities the full amount required to be deducted or withheld
promptly upon the earlier of determining that such deduction or
withholding is required or receiving notice that such amount has been
assessed against the other party, (iii) promptly forward to the other
party an official receipt (or certified copy) or other documentation
reasonably acceptable to the other party evidencing such payment to the
authorities. In case the other party can not take a full credit against
its tax liability for the withholding tax deducted or withheld by the
paying Party, then such other party may propose a change to the then
current arrangement with respect to the flow of moneys under this
Agreement in order to reduce or eliminate the extra cost for any party
and the parties, with no obligation as to outcome, shall discuss such
proposal in good faith.
4.05 Pfizer shall, and shall cause its Affiliates and sublicensees to, keep
full and accurate books and records setting forth, on a
country-by-country basis, gross sales, Net Sales, the specific
deductions in arriving at Net Sales, and royalties payable to
Neurocrine. Pfizer
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shall permit Neurocrine, at Neurocrine's sole expense (or ACY or DOV at
their expense) by independent qualified public accountants employed by
Neurocrine (or by ACY or DOV, as the case may be) and acceptable to
Pfizer, to examine such books and records at any reasonable time, but
not later than five (5) years following the rendering of any such
reports, accountings and payments. The foregoing right of ACY and DOV
to authorize such examination shall be subject to the good faith legal
judgment by counsel to Neurocrine that is legally entitled thereto
under the terms of the DOV Sublicense. The foregoing right of review
may be exercised only once by Neurocrine with respect to any such
periodic report and payment. Such accountants may be required by Pfizer
to enter into a reasonably acceptable confidentiality agreement, and in
no event shall such accountants disclose to Neurocrine, DOV or ACY any
information other than such as relates to the accuracy of reports and
payments made or due hereunder. The opinion of said independent
accountants regarding such reports, accountings and payments shall be
binding on the parties hereto. In the event any payment by Pfizer shall
prove to have been incorrect by more than five percent (5%) to
Neurocrine's detriment, Pfizer will pay the reasonable fees and costs
of the independent auditor(s) for conducting such audit.
4.06 If at any time conditions or legal restrictions exist which conditions
or restrictions prevent the prompt remittance of the royalties due
hereunder, or if conversion into United States Dollars pursuant to the
provisions of Section 4.03 hereof cannot be effectuated, the parties
shall cooperate fully with each other and make reasonable efforts to
permit such remittance; if such efforts shall be unsuccessful, Pfizer,
its Affiliates or sublicensees shall then, as long as such conditions
or restrictions shall exist in such countries, pay the royalties in the
currency of the country of sale to such person, company or bank in said
country, as shall be nominated by Neurocrine.
4.07 In consideration for Pfizer lending or causing one or more of its
Affiliates to loan proceeds and make other advances of credit pursuant
to the Secured Loan Agreement, dated as of the date hereof, (the "Loan
Agreement") by and between Neurocrine and Pfizer, Neurocrine hereby
acknowledges and agrees that Pfizer shall, in the event a default shall
have occurred and is continuing after any applicable cure period, be
entitled, in its absolute and sole discretion, to offset, in part or in
full, from time to time, any and all
18
amounts due and unpaid by Pfizer under this Agreement against any and
all amounts due and unpaid under the Loan Agreement.
4.08 In the event the Collaboration Agreement terminates, on a quarterly
basis Pfizer shall provide to Neurocrine a report summarizing Pfizer's
developmental, regulatory, manufacturing and commercialization
activities with respect to the Products. Pfizer also agrees to provide
quarterly to Neurocrine the information set forth on Exhibit C hereto.
ARTICLE 5
5. TECHNICAL AND OTHER INFORMATION.
5.01 Promptly following the Effective Date, and thereafter periodically
during the term of this Agreement (periodically shall mean, except as
otherwise provided in the Collaboration Agreement, at least quarterly),
(a) Neurocrine shall provide to Pfizer reports disclosing all
Neurocrine Technical Information not previously disclosed (it being
understood between the parties that upon completion of the Registration
Program (as defined in the Collaboration Agreement) it is unlikely that
Neurocrine will conduct any research or development activities with
respect to Compound or Products and it is therefore, unlikely that any
new Neurocrine Technical Information will arise thereafter), and (b) so
long as the Collaboration Agreement shall remain in effect, Pfizer
shall provide to Neurocrine reports disclosing all Pfizer Technical
Information not previously disclosed. For so long as the Collaboration
Agreement is in effect the reports by each party shall be done through
reports of the Committees. Each report will be in the format and in the
level of detail as shall be agreed between the parties. All Neurocrine
Technical Information and Pfizer Technical Information heretofore
disclosed by each to the other shall be deemed to have been disclosed
pursuant to this Agreement and shall be subject to the provisions of
this Agreement, including but not limited to this Section 5.
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5.02 Until the earlier of (a) expiration of this Agreement, and (b) if this
Agreement is terminated prior to expiration, [***] following such
termination, each party shall maintain Confidential Information (as
defined in Section 5.03) of the other party in confidence, and shall
not disclose, divulge or otherwise communicate such Confidential
Information to others or use it for any purpose other than as permitted
under this Agreement or in connection with the development,
manufacture, marketing, promotion, distribution or sale of the Products
pursuant to this Agreement or the Collaboration Agreement, and each
party agrees to exercise its reasonable efforts to prevent and restrain
the unauthorized disclosure of such Confidential Information by any of
its directors, officers, employees, consultants, subcontractors,
licensees or agents.
5.03 For purposes of this Article 5, "Confidential Information" means all
materials, trade secrets or other information, including without
limitation, any data, proprietary information and materials (whether or
not patentable, or protectable as a trade secret) regarding a party's
technology, Products, business information or objectives, which is
disclosed in writing by a party to the other party and which is
designated as confidential by the disclosing party. All information
disclosed prior to the Effective Date by Neurocrine to Pfizer under or
pursuant to the confidentiality agreement between the parties dated
February 24, 2002 as amended, shall be deemed "Confidential
Information" of Neurocrine. There shall be excluded from the foregoing
definition of Confidential Information such information or data which:
(i) was known by the receiving party prior to its date of
disclosure to the receiving party as shown by the
receiving party's written records; or
(ii) either before or after the date of the disclosure to
the receiving party is lawfully disclosed to the
receiving party by third parties not in violation of
any obligation to the other party; or
(iii) either before or after the date of the disclosure to
the receiving party becomes published or generally
known to the public through no fault or omission on
the part of the receiving party or its Affiliates; or
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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(iv) is independently developed by or for the receiving party
without reference to or reliance upon the Confidential
Information; or
(v) is required to be disclosed by the receiving party to comply
with applicable Laws, to defend or prosecute litigation or to
comply with governmental regulations, provided that the
receiving party provides prior notice of such disclosure to
the other party and takes reasonable and lawful actions to
avoid and/or minimize the degree of such disclosure.
5.04 PUBLIC ANNOUNCEMENTS.
(a) Coordination. The parties agree on the importance of coordinating
their public announcements respecting this Agreement and the subject
matter thereof. Neurocrine and Pfizer will, from time to time, and
at the request of the other party discuss and agree on the general
information content relating to this Agreement and the Collaboration
Agreement which may be publicly disclosed.
(b) Announcements. The joint press release announcing the signing of the
transactions contemplated by this Agreement and the Collaboration
Agreement is attached to the Collaboration Agreement as Schedule
15.14 thereto and will be promptly disseminated following signing.
(c) In addition, Pfizer acknowledges that certain events related to the
progress of the collaboration contemplated hereunder and under the
Collaboration Agreement may be material to Neurocrine and therefore
the parties agree to make public disclosures, whether by press
release or publication, regarding the fact of the completion of
Phase III Product Studies and top line data therefrom, the filing of
an NDA, the First Approval with respect to the IR Product and the MR
Product, and the occurrence of any serious adverse events. These
releases may be Neurocrine releases or joint Neurocrine/ Pfizer
releases at Pfizer's option, and the parties agree to jointly draft
and will agree on the content of such disclosure. Except as
otherwise provided in this Section 5.04, neither party will make any
public announcement regarding this Agreement and/or the
collaboration (other
21
than the peer-reviewed publications which are subject to the
publication provisions set forth in Section 11.3 of the
Collaboration Agreement).
Notwithstanding the foregoing, a party may make any disclosure where in
such party's reasonable legal opinion it is required by applicable Law or
applicable stock exchange regulation or order or other ruling of a
competent court, provided that prior to such disclosure, the disclosing
party shall use reasonable efforts to notify the other party prior to
making such disclosure, and will provide the other party with an
opportunity to review and comment prior to release provided the disclosing
party shall not be required to delay any such disclosure by more than
forty-eight (48) hours to receive and discuss comments, so long as the
disclosing party has provided to the other party as much advance notice as
is reasonably practicable under the circumstances. Each party agrees that
it shall reasonably cooperate with the other with respect to all
disclosures regarding this Agreement to the Securities Exchange Commission
and any other governmental or regulatory agencies, including requests for
confidential treatment of proprietary information of either party included
in any such disclosure.
5.05 The confidentiality obligations of the parties under this Section 5 shall
be applicable to such parties, as well as their respective Affiliates,
employees, directors, agents, independent contractors and consultants.
ARTICLE 6
6. PATENTS.
6.01 Neurocrine and Pfizer shall cooperate in connection with the continued
prosecution and maintenance by Neurocrine of the Neurocrine Patent Rights
listed on Exhibit B [***]. Pfizer shall pay all reasonable and customary
expenses, including all reasonable fees for patent counsel, incurred by
Neurocrine in connection with annuities and other routine maintenance for
Neurocrine Patent Rights in the Territory. Neurocrine shall not abandon
any Neurocrine Patent Rights without at least ninety (90) days' prior
notice of such abandonment to Pfizer. If
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omitted portions.
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Neurocrine decides to abandon a Neurocrine Patent, Pfizer shall have the
option to obtain ownership of such Neurocrine Patent and related
applications free of charge and to continue the prosecution and
maintenance of such Neurocrine Patent and related applications in its own
name and at its expense. If Pfizer desires that Neurocrine file any
application for a patent in specific countries other than those enumerated
in Exhibit B hereto, or file any patent applications on improvements and
variations upon inventions disclosed in the Neurocrine Patent Rights or
otherwise relating to the Compound or the Products, Pfizer shall advise
Neurocrine of such countries or improvements, variations or inventions, as
the case may be. Neurocrine shall thereupon file patent applications as
requested, and Pfizer shall pay reasonable expenses, including reasonable
fees for patent counsel, for filing and prosecuting such requested patent
applications. Pfizer shall have reasonable access to all documentation,
filings and communications to or from the respective patent offices and
shall be kept fully advised as to the status of all pending applications
to the extent pertaining to the Compound or any Products. Neurocrine, its
agents and attorneys will give due consideration to all suggestions and
comments of Pfizer regarding any aspect of such patent prosecutions. In
addition, Neurocrine shall take all necessary steps and pay all expenses
necessary to maintain for the full life thereof all Neurocrine Patent
Rights, except that Pfizer shall pay expenses as provided above. [***].
6.02 If Pfizer (a) reasonably determines in good faith with respect to any
country in the Territory that, in order to avoid infringement of any
patent not licensed hereunder, it is reasonably necessary to obtain a
license in order to make, use, sell, offer for sale or import IR or MR
Product and to pay a royalty or other payment under such license
(including, without limitation, in connection with settlement of a patent
infringement claim), or (b) shall be subject to a final court or other
binding order or ruling requiring the payment of a royalty or other
payment to a third party patent holder in respect of sales of any Product,
then the amount of Pfizer's royalty payments under Section 3.02 with
respect to Net Sales in such country shall be reduced by the lesser of (i)
[***] of the amount of the royalty paid under such other license or (ii)
[***] of the sum of the amounts payable by Pfizer under Section 3.02(a)
hereof and Section 8.2(a) of the Collaboration Agreement
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
23
with respect to each such country, provided, however, in no event shall
royalty reduction under this Section 6.02, when aggregated with any
reduction in royalties due to Section 3.02(b), result in Pfizer paying
royalties under Section 3.02(a)(i) and Section 8.2 (a) of the
Collaboration Agreement of less than [***] in the United States, and
royalties under Section 3.02(a) (ii) or (iii), as applicable, of less than
[***] when Generic Competition exists or [***] when no Generic Competition
exists, in each case with respect to all other countries in the Territory.
6.03 If any third party shall in the reasonable opinion of either party, within
any country in the Territory, infringe any Neurocrine Patent Rights, the
party learning of such infringement shall promptly notify the other party
and provide it with any available evidence of such possible infringement.
Pfizer shall have the exclusive right to bring suit and to take action
against any infringer of the Neurocrine Patents in its own name, or in the
name of Neurocrine where necessary, in which case Pfizer shall control the
prosecution of any such suit or claim, including without limitation the
choice of counsel, and shall have the exclusive right to settle or dispose
of any such suit or claim. In this connection it is understood, without
limitation, that Pfizer shall have the unlimited right, with prior
consultation with Neurocrine, to commence an action for infringement of
any Neurocrine Patent within the forty-five (45) day period described in
Act (as defined in the Collaboration Agreement) against any applicant for
approval to sell a drug product in the United States which applicant makes
a certification, of the type referred to in section 505 (b) of the Act, to
the effect that any Neurocrine Patent is invalid or not infringed by the
drug product for which such applicant is seeking approval. Neurocrine
shall, at Pfizer's request, take all action reasonably necessary to assist
in any such suit, including joining as a party. In the event Pfizer shall
exercise its right to bring suit against any such infringer, Pfizer shall
bear the entire costs of such suit; provided, however, that if Neurocrine
is a party to any such suit and decides to be represented by its own
counsel, it shall be responsible for the fees of such counsel. The
proceeds of any recovery, court award or settlement of such action shall
first be applied to reimburse the parties for the costs and expenses of
such prosecution and the balance shall be paid [***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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6.04 In case any actions, claims, demands, suits or other legal proceedings
("Patent Claims") are brought or threatened to be brought against Pfizer
by a third party for infringement of such third party's patent(s) relating
to Product by virtue of Pfizer's manufacture, use, sale or offer for sale
of the Product hereunder, Pfizer shall notify Neurocrine forthwith of the
threat or existence of such actions with sufficient evidence thereof, to
enable the parties to prepare an appropriate defense strategy. The parties
shall consult together as to the action to be taken and as to how the
defense will be handled. Each party shall be entitled to participate in
the defense of Patent Claims and to be represented in such matters by
counsel of its choice. Each party shall be responsible for the fees of its
counsel. Subject to the other terms of this Section 6.04, Pfizer shall
have the right to manage the defense of Patent Claims consistent with this
Article 6.
ARTICLE 7
7. REPRESENTATIONS, WARRANTIES AND COVENANTS.
7.01 Neurocrine Representations and Warranties. Neurocrine hereby represents
and warrants, as of the date hereof, to Pfizer as follows:
(a) To Neurocrine's knowledge and except as disclosed to Pfizer in
Exhibit B, the issued patents encompassed within Neurocrine's Patent
Rights are valid and enforceable patents, no third party is
infringing any such patents and the manufacture, use, sale, offer
for sale or importation by Pfizer or Neurocrine of Compound or
Product does not and will not infringe any issued patents of third
parties, or patent applications which would, if issued, infringe the
rights of any third party. Neurocrine has furnished to Pfizer all
material information in its possession requested by Pfizer as to the
foregoing. Except as listed on Exhibit B [***] of all Neurocrine
Patent Rights and all Neurocrine Technical Information, and no other
person, firm, corporation or other entity has any right, interest or
claim in or to, and Neurocrine has not entered into any agreement
granting any right, interest or claim in or to, the Neurocrine
Patent Rights or Neurocrine Technical Information
*** Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
25
[***]. Exhibit E contains a complete list of all agreements
presently in effect in connection with the development and
manufacture of Products. Exhibit B contains a complete and correct
list of all patents and patent applications in the Territory owned
by or licensed to Neurocrine or any of its Affiliates (and
indicating which are owned and which are licensed) relating to the
manufacture, use, sale, offer for sale or importation of the
Compound or any Product. Neurocrine or its Affiliates own or possess
adequate licenses or other valid rights to use all patents, patent
rights and know-how (collectively, "Intellectual Property")
reasonably believed by Neurocrine as necessary to manufacture the
Products in the Territory, and to distribute, use and sell the
Products in the Territory, all free of any lien, encumbrance,
liability or other restriction [***].
(b) Neurocrine has heretofore disclosed to Pfizer all material
information, known to it or its Affiliates, with respect to (i) the
safety or efficacy of the Compound or the Product or (ii) [***].
(c) Neurocrine has the corporate power and authority to execute and
deliver this Agreement, the Collaboration Agreement and [***] and to
perform its obligations hereunder and thereunder, and the execution,
delivery and performance of this Agreement, the Collaboration
Agreement and [***] by Neurocrine have been duly and validly
authorized and approved by proper corporate action on the part of
Neurocrine, and Neurocrine has taken all other action required by
law, its certificate of incorporation or by-laws or any agreement to
which it is a party or to which it may be subject required to
authorize such execution, delivery and performance (other than
compliance with all applicable requirements of the HSR Act).
Assuming due authorization, execution and delivery on the part of
Pfizer [***], each of this Agreement and the Collaboration Agreement
and [***] constitutes a legal, valid and binding obligation of
Neurocrine, enforceable against Neurocrine in accordance with its
*** Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
26
respective terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and similar laws
relating to or affecting creditors generally or by general equitable
principles (regardless of whether such enforceability is considered
in a proceeding in equity or at law).
(d) The execution and delivery of this Agreement, the Collaboration
Agreement and [***] by Neurocrine and the performance by Neurocrine
contemplated hereunder and thereunder will not violate any
ordinance, law, decree or government regulation or any order of any
court or other governmental department, authority, agency or
instrumentality therein.
(e) Except for filings pursuant to the HSR Act, neither the execution
and delivery of this Agreement or the Collaboration Agreement or
[***] nor the performance hereof or thereof by Neurocrine requires
Neurocrine to obtain any permits, authorizations or consents from
any governmental body or from any other person, firm or corporation,
and such execution, delivery and performance will not result in the
breach of or give rise to any termination of any agreement or
contract to which (i) Neurocrine may be a party which relates to the
Neurocrine Patent Rights, Neurocrine Technical Information, the
Compound or the Product or (ii) [***] which relates to the
Neurocrine Patent Rights, Neurocrine Technical Information, the
Compound or the Product.
(f) There is no action, claim, demand, suit, proceeding, arbitration,
grievance, citation, summons, subpoena, inquiry or investigation of
any nature, civil, criminal, regulatory or otherwise, in law or in
equity, pending or relating to or, to Neurocrine's knowledge,
threatened against Neurocrine, or, to Neurocrine's knowledge, any
action, claim, demand, suit, proceeding, arbitration, grievance,
citation, summons, subpoena, inquiry or investigation of any nature,
civil, criminal, regulatory or otherwise, in law or equity, pending
or relating to or threatened [***], in each case in connection with
the Compound, the Product or any Neurocrine Patent Rights or
*** Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
27
Neurocrine Technical Information or against or relating to the
transactions contemplated by this Agreement or the Collaboration
Agreement.
(g) [***], there are no agreements to which Neurocrine or any of its
Affiliates is a party pursuant to which Neurocrine or any of its
Affiliates has a license, or an option to obtain a license, or holds
an immunity from suit, with respect to patents which (i) are
pending, applied for, granted or registered, and (ii) but for
Neurocrine's rights under such agreements, could be asserted by
third parties to be infringed by the manufacture, distribution, use,
sale, offer for sale or importation of the Products in the
Territory. Neurocrine has previously disclosed and provided complete
copies to Pfizer of all of Neurocrine's agreements with any third
parties regarding supply and manufacture of all goods and services
relating to the Compound and the Products, none of which have been
modified, supplemented or amended.
(h) [***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
28
(i) Exhibit E sets forth all sources of funding, grants or loans
Neurocrine has received and, [***] in connection with the discovery,
research and development of the Compound and any Product.
(j) Exhibit F sets forth a complete and accurate listing of all
pre-clinical and clinical studies, together with the dates and brief
descriptions of such studies, previously or currently undertaken or
sponsored by Neurocrine, [***] and their respective Affiliates and
by any third-party investigator with any contact with Neurocrine,
[***], data and reports relating to which true and complete copies
have been previously provided to Pfizer. Neurocrine has heretofore
disclosed to Pfizer all material correspondence and contact
information between Neurocrine and the FDA and other Regulatory
Authorities regarding the Compound and the Products, [***] and FDA
and other Regulatory Authorities relating thereto.
(k) No person owns fifty percent (50%) or more of the voting securities
of Neurocrine. Neurocrine has no subsidiaries other than
subsidiaries whose financial statements are reported on a
consolidated basis with Neurocrine.
For purposes of this Section 7.01, "to Neurocrine's knowledge" shall mean
to Neurocrine's knowledge after reasonable due inquiry.
7.02 Pfizer Representations and Warranties. Pfizer hereby represents and
warrants, as of the date hereof, to Neurocrine as follows:
(a) Pfizer has the corporate power and authority to execute and deliver
this Agreement and the Collaboration Agreement and to perform its
obligations hereunder and thereunder, and the execution, delivery
and performance of this Agreement and the Collaboration Agreement by
Pfizer have been duly and validly authorized and approved by proper
corporate action on the part of Pfizer, and Pfizer has taken all
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
29
other action required by law, its certificate of incorporation or
by-laws or any agreement to which it is a party or to which it may
be subject required to authorize such execution, delivery and
performance (other than compliance with all applicable requirements
of the HSR Act). Assuming due authorization, execution and delivery
on the part of Neurocrine, each of this Agreement and the
Collaboration Agreement constitutes a legal, valid and binding
obligation of Pfizer, enforceable against Pfizer in accordance with
its respective terms, except as such enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium and similar
laws relating to or affecting creditors generally or by general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(b) The execution and delivery of this Agreement and the Collaboration
Agreement and the performance by Pfizer contemplated hereunder and
thereunder will not violate (subject to obtaining appropriate
governmental health, pricing and reimbursement approvals) any state,
federal or other statute or regulation or any order of any court or
other governmental department, authority, agency or instrumentality
therein.
(c) There is no action, claim, demand, suit, proceeding, arbitration,
grievance, citation, summons, subpoena, inquiry or investigation of
any nature, civil, criminal, regulatory or otherwise, in law or in
equity, pending or relating to or, to the knowledge of Pfizer,
threatened against Pfizer in connection with or relating to the
transactions contemplated by this Agreement or the Collaboration
Agreement, and assuming the accuracy of the representations and
warranties of Neurocrine contained herein Pfizer is unaware and has
no reason to be aware of any basis for the foregoing.
(d) Except for filings pursuant to the HSR Act, neither the execution
and delivery of this Agreement or the Collaboration Agreement nor
the performance hereof or thereof by Pfizer requires Pfizer to
obtain any permits, authorizations or consents from any governmental
body, (subject to obtaining all necessary governmental
30
approvals with respect to the manufacture, use, sale, offer for sale
or importation of the Product) or from any other person, firm or
corporation and such execution, delivery and performance will not
result in the breach of or give rise to any termination of any
agreement or contract to which Pfizer may be a party, except that
may reasonably be expected to adversely affect the ability to
perform its obligations under this Agreement.
7.03 Covenants.
(a) Neurocrine covenants and agrees with Pfizer that Neurocrine shall
maintain the [***] in good standing and shall not take any actions
(or omit or fail to take any actions) which would result in a [***].
Neurocrine agrees that (i) it shall not amend, modify or supplement
the [***] or (ii) agree to or consent to any amendment, modification
or supplement to the [***], in such case without the consent of
Pfizer. In addition, Neurocrine shall not sell, assign, convey,
pledge, hypothecate or otherwise transfer the [***] or Neurocrine's
rights or obligations thereunder, or otherwise make any commitments
in a manner that conflicts with Pfizer's rights hereunder without
the consent of Pfizer. Neurocrine shall immediately notify Pfizer
upon receipt by Neurocrine or its Affiliates of any notice from
[***], or otherwise take any action which may affect Pfizer's rights
under this Agreement.
(b) Pfizer agrees to cooperate with Neurocrine in connection with
Neurocrine's [***] and will provide what NBI reasonably believes is
required, provided, however, Pfizer shall have no obligations or
liabilities under the [***].
(c) Pfizer covenants and agrees that it will use Commercially Reasonable
Efforts to develop and commercialize the Product in the Territory,
subject to the provisions of the Collaboration Agreement.
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omitted portions.
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ARTICLE 8
8. TERM. Subject to Section 9.01, this Agreement shall be effective as of the
Effective Date and shall remain in effect for so long as Pfizer is
obligated to make payments under Section 3 hereof, unless earlier
terminated as provided herein.
ARTICLE 9
9. EFFECTIVENESS AND TERMINATION.
9.01 Effectiveness.
(a) Notwithstanding to the contrary any of the provisions of this
Agreement but subject to Section 9.01(b) below, this Agreement shall
only become effective upon the Effective Date, and prior to the
Effective Date neither Neurocrine nor Pfizer shall have any rights
or obligations hereunder.
(b) Effective immediately as of the date first written above, Neurocrine
covenants and agrees that it will not negotiate, engage in or
otherwise enter into any one or more transactions involving (i) any
sale or grant of any rights to any Neurocrine Patent Rights or
Neurocrine Technical Information (including without limitation any
licenses or sublicenses), or (ii) any joint venture, co-promotion or
similar relationship involving any Neurocrine Patent Rights or
Neurocrine Technical Information. Effective immediately as of the
date first written above, each of Pfizer and Neurocrine covenant and
agree that Article 11 shall be in full force and effect. The parties
understand and agree that the obligations set forth in this Section
9.01(b) shall terminate on the 90th day following the date of this
Agreement if, but only, if the Effective Date has not occurred on or
before such 90th day (other than liability with respect to any
breaches prior to such 90th day under this Section 9.01(b) which
shall survive such termination).
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9.02 Termination For Breach.
(a) (i) If either Pfizer or Neurocrine materially breaches or
materially defaults in the performance or observance of any of
the provisions of this Agreement, and such material breach or
material default is not cured within ninety (90) days or, in
the case of failure to pay any amounts due hereunder sixty
(60) days, after the giving of notice by the other party
specifying such breach or default, the other party shall have
the right to terminate this Agreement in full upon a further
thirty (30) days' notice.
(ii) If Pfizer terminates all of its development activities for a
period of six (6) months or longer in the US Territory at any
time after it has the final decision making authority with
respect to the Development Program (other than for regulatory
restraints) and [***].
(iii) If Pfizer terminates the Development Program with respect to
any country in the ROW Territory or otherwise fails to conduct
any development activities directed to any such country,
[***], Pfizer will thereafter have six (6) months [***]. If
Pfizer fails within thirty (30) days to notify Neurocrine
[***], Neurocrine shall have the right to terminate this
Agreement with respect to such country effective upon thirty
(30) days notice.
(b) For purposes of this Agreement, materiality in all cases shall be
considered in the context of this Agreement and the Collaboration
Agreement taken as a whole; provided, however, no party shall be
deemed to be in material breach or material
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33
default if its actions or omissions primarily resulted from: (i)
compliance with any specific unanimous decision of a committee or
subcommittee under the Collaboration Agreement, or (ii) compliance
with any directive by the non-defaulting party for a matter in which
the non-defaulting party or any of its designees, representatives or
employees have exercised sole or final decision making authority
under the Collaboration Agreement, or (iii) compliance with the
express terms of this Agreement or the Collaboration Agreement, or
(iv) to the extent Pfizer uses efforts in substantial conformity
with Commercially Reasonable Efforts or Neurocrine uses efforts in
substantial conformity with commercially reasonable efforts
consistent with Section 2.12 of the Collaboration Agreement. A
material breach or material default in the performance of any of the
provisions of this Agreement shall include a material inaccuracy in
any representation or warranty contained herein.
(c) Upon the giving of any notice of default under Section 9.02(a), the
parties will in good faith meet to see if a plan to remedy the
alleged breach or default can be mutually agreed.
(d) Upon any termination under this Section 9.02, the provisions of
Section 9.05 shall apply.
9.03 Other Termination.
(a) Upon one hundred and eighty (180) days prior notice to Neurocrine,
Pfizer shall have the right at any time, without cause at Pfizer's
sole discretion, to terminate in full this Agreement, whereupon this
Agreement together with the Collaboration Agreement (if still in
effect) shall terminate one hundred and eighty (180) days after the
date of such notice.
(b) This Agreement shall terminate following any termination by Pfizer
of the Collaboration Agreement, except this Agreement shall not
terminate if Pfizer terminates the Collaboration Agreement due to
the events described under Sections
34
13.5 or 13.7 thereunder or upon a Change in Control (as defined in
the Collaboration Agreement).
(c) Upon one hundred and eighty (180) days prior notice to Neurocrine,
Pfizer shall have the right at any time or times, without cause at
its sole discretion, to terminate the licenses granted hereunder by
Neurocrine on a country-by-country basis other than with respect to
the United States and Japan. Upon a termination of licenses in any
country, the provisions of Section 9.05 shall apply with respect to
such country terminated.
(d) This Agreement shall automatically terminate upon termination by
Neurocrine of the Collaboration Agreement pursuant to Section
13.2(a) thereof or pursuant to the first sentence of Section 13.2(b)
thereof with respect to the US Territory.
(e) Upon any termination of this Agreement pursuant to this Section
9.03, the provisions of Section 9.05 shall apply.
9.04 Bankruptcy. Each party may, in addition to any other remedies available to
it by law or in equity, exercise the rights set forth below by written
notice to the other party (the "Insolvent Party"), in the event the
Insolvent Party shall have become insolvent or bankrupt, or shall have
made a general assignment for the benefit of its creditors, or there shall
have been appointed a trustee or receiver of the Insolvent Party or for
all or a substantial part of its property, or any case or proceeding shall
have been commenced or other action taken by or against the Insolvent
Party in bankruptcy or seeking reorganization, liquidation, dissolution,
winding-up arrangement, composition or readjustment of its debts or any
other relief under any bankruptcy, insolvency, reorganization or other
similar act or law of any jurisdiction now or hereafter in effect, and any
such event shall have continued for sixty (60) days undismissed, unbonded
and undischarged. All rights and licenses granted under or pursuant to
this Agreement by Neurocrine and Pfizer are, and shall otherwise be deemed
to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code,
licenses of rights to "intellectual property" as defined under Section 101
of the U.S. Bankruptcy Code. The parties agree that the parties as
licensees of such rights under this Agreement shall retain and may fully
exercise all of
35
their rights and elections under the U.S. Bankruptcy Code. The parties
further agree that, in the event of the commencement of a bankruptcy
proceeding by or against either party under the U.S. Bankruptcy Code, the
other party shall be entitled to a complete duplicate of (or complete
access to, as appropriate) any such intellectual property and all
embodiments of such intellectual property, and same, if not already in the
their possession, shall be promptly delivered to them (i) upon any such
commencement of a bankruptcy proceeding upon its written request
therefore, unless the party subject to such proceeding elects to continue
to perform all of their obligations under this Agreement or (ii) if not
delivered under (i) above, upon the rejection of this Agreement by or on
behalf of the party subject to such proceeding upon written request
therefore by the other party. In the event Neurocrine shall be an
Insolvent Party, Pfizer may retain the licenses set forth herein subject
to the payment of all milestones, license fees, royalties and other
payments or reimbursements set forth herein subject to Section 13.8 of the
Collaboration Agreement and Section 9.07 below.
9.05 Termination of Pfizer. In the event that this Agreement is terminated in
accordance with Sections 9.02 or 9.03, on a country-by-country basis:
(a) All licenses granted by Neurocrine to Pfizer in this Agreement will
revert to Neurocrine;
(b) Pfizer will pay to Neurocrine such amounts required to complete any
on-going Product Studies (including the Registration Program Product
Studies) plus any non-cancelable obligations with respect to future
Product Studies approved by a Committee;
(c) Pfizer will provide to Neurocrine, at no cost to Neurocrine, all
remaining clinical quantities of Product supplies and all remaining
commercial quantities of Product (including intermediates and work
in progress);
(d) Pfizer will disclose to Neurocrine all Pfizer Technical Information
generated prior to the date of termination of this Agreement not
previously disclosed to Neurocrine;
36
(e) Pfizer will assign to Neurocrine all filings with Governmental
Authorities relating to Products worldwide;
(f) Pfizer will grant to Neurocrine a perpetual, irrevocable,
non-exclusive, royalty-free, fully-paid, license under any Pfizer
Technical Information and Pfizer Trademarks, together with any
Patent Rights owned by Pfizer and used in connection with the
research, development, manufacture, use and sale of the Products;
(g) Pfizer will provide to Neurocrine any other assignable contracts
relating to the Products, reasonably required to allow Neurocrine to
continue the research and development of Products with no delay,
provided Pfizer shall have no continuing liability or obligation
thereunder.
9.06 Divestiture by Pfizer.
(a) If in connection with any proposed acquisition or merger or inquiry
of a Governmental Authority, Pfizer determines that in order to
facilitate clearance or obtain approval from any Governmental
Authority with responsibility for enforcing antitrust or competition
Laws regarding such acquisition or merger or inquiry, it would be
advisable, in Pfizer's business judgement, to assign or sublicense
or otherwise transfer (any such assignment, sublicense or transfer,
a "Divestiture Transaction") Pfizer's rights and obligations under
this Agreement to any third party, Pfizer shall notify Neurocrine
thereof ("Notice of Divestiture"). The Notice of Divestiture shall
not be required to disclose any details of any such proposed
Divestiture Transaction.
(b) [***].
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omitted portions.
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9.07 Survival of Obligations. Notwithstanding any termination of this
Agreement, (a) neither party shall be relieved of any obligations incurred
prior to such termination, including the payment obligations, and (b) the
obligations of the parties with respect to (I) the protection and
nondisclosure of Confidential Information (Article 5) and Indemnification
(Article 10) shall survive termination of this Agreement, and (II) each
other Section or schedule of this Agreement which is expressed to survive
termination or which is required to give effect to such termination or the
consequences of such termination shall survive termination, and (c)
subject to Section 10.04(c)(vi) and Section 10.06, termination of this
Agreement shall not release either party from any obligation or liability
which shall have accrued at the time of termination or preclude either
party from pursuing all rights at law and in equity with respect to any
default under this Agreement, and (d) unless this Agreement expressly
provides that termination shall be the sole and exclusive remedy for a
particular breach hereof, either party's right to commence an action, suit
or other proceeding claiming breach of this Agreement by the other party
shall survive termination. Upon a termination of this Agreement by Pfizer,
Neurocrine shall promptly return to Pfizer all written Confidential
Information previously disclosed by Pfizer, and all copies thereof. Upon
any other termination of this Agreement, each party shall promptly return
to the other party all
38
written Confidential Information, and all copies thereof, of such other
party, except as specifically provided in this Agreement.
ARTICLE 10
10. INDEMNIFICATION.
10.01 Pfizer. Subject to the terms and conditions of this Agreement, Pfizer will
indemnify, defend and hold harmless Neurocrine and its Affiliates, (each,
a "Neurocrine Indemnified Party") from and against any and all Liability
(as defined below) which:
(a) is incurred, suffered or sustained by a Neurocrine Indemnified Party
or to which a Neurocrine Indemnified Party becomes subject (whether
or not in connection with any claim by any Third Party (as defined
in Section 10.05 below)), arising out of or resulting from (i) any
misrepresentation or breach of any representation or warranty made
by Pfizer in this Agreement or the Collaboration Agreement, or (ii)
any breach of any of the covenants or agreements of Pfizer in this
Agreement or the Collaboration Agreement; and/or
(b) the Neurocrine Indemnified Party may be required to pay to one or
more Third Parties resulting from or arising out of any claims of
any nature (i) solely in connection with the Supplemental Program
(including without limitation any Product Liability related thereto)
or (ii) directly resulting from Pfizer's failure to manufacture, or
to cause third parties to manufacture, Products in accordance with
the then-existing Specifications as determined in accordance with
the terms of the Collaboration Agreement but in the case of this
clause (ii) only to the extent [***] (collectively, the Liabilities
described in this Section 10.01(b) are referred to as the "Pfizer
Liability").
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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[***]
10.02 Indemnification by Neurocrine. Subject to the terms and conditions of this
Agreement, Neurocrine will indemnify, defend and hold harmless Pfizer and
its Affiliates (each, a "Pfizer Indemnified Party") from and against any
and all Liability which:
(a) is incurred, suffered or sustained by a Pfizer Indemnified Party or
to which a Pfizer Indemnified Party becomes subject (whether or not
in connection with any claim by any Third Party), arising out of or
resulting from (i) any misrepresentation or breach of any
representation or warranty made by Neurocrine in this Agreement or
the Collaboration Agreement, or (ii) any breach of any of the
covenants or agreements of Neurocrine in this Agreement or the
Collaboration Agreement; and/or
40
(b) the Pfizer Indemnified Party may be required to pay to one or more
Third Parties arising out of any claims of any nature: (i) solely in
connection with Neurocrine's development of the Product prior to the
Effective Date and the Registration Program (including without
limitation any Product Liability related thereto) or (ii) directly
resulting from Neurocrine's failure to manufacture, or to cause
third parties to manufacture, Products in accordance with the
then-existing Specifications as determined in accordance with the
terms of the Collaboration Agreement but in the case of this clause
(ii) only to the extent (***) (collectively, the Liabilities
described in this Section 10.02(b) are referred to as the
"Neurocrine Liability").
[***].
[***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
41
Notwithstanding anything to the contrary contained herein, Pfizer shall be
entitled, at all times, to avail itself of the right to obtain specific
performance and other injunctive relief in relation to all matters under
this Agreement and/or the Collaboration Agreement [***]. In connection
with any litigation referenced in this paragraph, Neurocrine hereby agrees
to waive all defenses involving laches and statutes of limitations. [***].
[***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
42
[***]:
(i) [***].
(ii) [***].
10.03 Definitions of Liability and Product Liability. For purposes of this
Agreement, "Liability" shall mean, subject to Section 10.06, any and all
(a) claims, losses, liabilities, damages, fines, royalties, governmental
penalties or punitive damages, deficiencies, interest, awards, and
judgements, and (b) with respect to third parties, settlement amounts and
all of the items referred to in clause (a) above which, in accordance with
Section 10.06, include special, indirect, incidental and consequential
damages (including without limitation lost profits), and (c) in connection
with all of the items referred in clauses (a) and (b) above, any and all
costs and expenses (including reasonable attorneys' fees and all other
expenses reasonably incurred in investigating, preparing or defending any
litigation or proceeding, commenced or threatened). For purposes of this
Agreement, "Product Liability" shall mean any and all Liability and claims
of Third Parties relating to any actual or alleged death or bodily injury
caused or allegedly caused by the use of the Products; it being understood
and agreed that all Liability as and to the extent referenced in Section
10.01 or Section 10.02 or breaches of any representations or warranties in
this Agreement or the Collaboration Agreement shall be excluded from the
definition of
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"Product Liability" as used herein, except with respect to Product
Liability as specifically provided in Sections 10.01(b)(i) and
10.02(b)(i).
10.04 Co-Indemnity and Neurocrine Contractual Indemnity.
(a) Product Liability.
(i) Notwithstanding anything to the contrary contained herein
(except with respect to Product Liability as specifically
provided in Sections 10.01(b)(i) and 10.02(b)(i)), the Parties
understand and agree that all indemnification obligations for
Product Liability shall be governed by the provisions of this
Section 10.04 (but not be governed by the provisions of either
Sections 10.01 or 10.02).
(ii) Subject to the timing of payments as provided in Section
10.04(c) below and the provisions of this sentence, Neurocrine
shall indemnify, defend and hold the Pfizer Indemnified
Parties harmless under the terms hereof from and against [***]
of the amount of any and all Product Liability as and when
such Product Liability arises on and after the Effective Date,
and Pfizer shall indemnify, defend and hold Neurocrine
Indemnified Parties harmless under the terms hereof from and
against [***] of the amount of any and all of such Product
Liability as and when such Product Liability arises on and
after the Effective Date; it being understood and agreed that
(X) the purpose of the provisions of this sentence is that
Neurocrine and Pfizer shall pay for and otherwise share the
cost of all Product Liability [***] and [***], respectively,
and (Y) in the event of any termination in full of
Co-Promotion activities by Neurocrine under the Collaboration
Agreement, Pfizer shall indemnify, defend and hold Neurocrine
Indemnified Parties harmless under the terms hereof from and
against [***] of the amount of any and all of any Product
Liability directly resulting from Products sold after the date
of termination in full of Co-Promotion activities by
Neurocrine as and when
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
44
such Product Liability arises, and (Z) in the event of any
termination of the Collaboration Agreement where, as a result,
this Agreement terminates, Neurocrine shall indemnify, defend
and hold Pfizer Indemnified Parties harmless under the terms
hereof from and against [***] of the amount of any and all of
any Product Liability directly resulting from Products sold
after the date of termination of this Agreement by or on
behalf of or under the authority of Neurocrine as and when
such Product Liability arises.
(iii) For purposes of this Agreement, Pfizer shall be entitled to
become the "Indemnifying Party" as that term is used in
Section 10.05 and therefore Pfizer shall have full control of
any such claim from a Third Party involving Product Liability
as contemplated in Section 10.05 (other than in respect of
circumstances where Section 10.04(a)(ii)(Z) shall apply) so
long as the Litigation Conditions are satisfied.
(b) IP Liability.
(i) Notwithstanding anything to the contrary contained herein, the
Parties understand and agree that all indemnification
obligations for IP Liability shall be governed by the
provisions of this Section 10.04 (but not be governed by the
provisions of either Sections 10.01 or 10.02).
(ii) Subject to the timing of payments as provided in Section
10.04(c) below and the provisions of this sentence, Neurocrine
shall indemnify, defend and hold the Pfizer Indemnified
Parties harmless under the terms hereof from and against [***]
of the amount of any and all IP Liability as and when such IP
Liability arises, and Pfizer shall indemnify, defend and hold
Neurocrine Indemnified Parties harmless under the terms hereof
from and against [***] of the amount of any and all of such IP
Liability as and when such IP Liability arises; it being
understood and agreed that (X) the purpose of the provisions
of this sentence is that Neurocrine and Pfizer shall pay for
and otherwise share the cost of all IP
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
45
Liability [***] and [***], respectively, and (Y) in the event
of any termination in full of Co-Promotion activities by
Neurocrine under the Collaboration Agreement, Pfizer shall
indemnify, defend and hold Neurocrine Indemnified Parties
harmless under the terms hereof from and against [***] of the
amount of any and all of any IP Liability directly resulting
from Products sold after the date of termination in full of
Co-Promotion activities by Neurocrine as and when such IP
Liability arises, and (Z) in the event of any termination of
the Collaboration Agreement where, as a result, this Agreement
terminates, Neurocrine shall indemnify, defend and hold Pfizer
Indemnified Parties harmless under the terms hereof from and
against [***] of the amount of any and all of any IP Liability
directly resulting from Products sold after the date of
termination of the Collaboration Agreement by or on behalf of
or under the authority of Neurocrine as and when such IP
Liability arises.
(iii) For purposes of this Agreement, Pfizer shall be entitled to
become the "Indemnifying Party" as that term is used in
Section 10.05 and therefore Pfizer shall have full control of
any such claim from a Third Party involving IP Liability as
contemplated in Section 10.05 (other than in respect of
circumstances where Section 10.04(b)(ii)(Z) shall apply) so
long as the Litigation Conditions are satisfied.
(c) [***]:
(i) [***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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(ii) [***].
(iii) [***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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(iv) [***].
(v) [***].
(vi) [***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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(vii) [***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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10.05 Indemnification Procedure.
(a) A party seeking indemnification pursuant to Article 10 (an
"Indemnified Party") shall give prompt notice to the party from whom
such indemnification is sought (the "Indemnifying Party") of the
commencement or assertion of any claim from any unaffiliated third
party (a "Third Party") (which in no event includes any claims by
any Pfizer Indemnified Party or any Neurocrine Indemnified Party) in
respect of which indemnity may be sought hereunder, shall give the
Indemnifying Party such information with respect thereto as the
Indemnifying Party may reasonably request, and shall not make any
admission concerning such claim from a Third Party, unless such
admission is required by applicable Law or legal process, including
in response to questions presented in depositions or
interrogatories. Any admission made by the Indemnified Party, except
for an admission required by applicable Law or legal process, or the
failure to give such notice shall relieve the Indemnifying Party of
any liability hereunder only to the extent that the ability of the
Indemnifying Party to defend such claim from a Third Party is
prejudiced thereby. The Indemnifying Party shall have the right,
exercisable by written notice to the Indemnified Party within thirty
(30) days of receipt of notice from the Indemnified Party of the
commencement or assertion of a claim from a Third Party, to assume
and conduct the defense of such claim from a Third Party, with
counsel selected by the Indemnifying Party and reasonably acceptable
to the Indemnified Party, provided that (i) other than with respect
to claims for Product Liability and IP Liability for which Pfizer
has assumed the defense as provided herein (which shall not include
Product Liability as set forth in Section 10.02), the claim from a
Third Party does not seek (and continues not to seek) specific
performance of the Indemnified Party; and (ii) the Indemnifying
Party expressly agrees in writing that as between the Indemnifying
Party and the Indemnified Party, the Indemnifying Party shall be
solely obligated to satisfy and discharge the claim from a Third
Party in full, subject to Section 10.04 (where Pfizer only shall be
responsible for Product Liability and IP Liability as provided
herein). (The conditions set forth above are collectively referred
to as the "Litigation Conditions"). Subject to the initial and
continuing satisfaction in full
50
of the Litigation Conditions and the terms and conditions of Article
10, the Indemnifying Party shall have full control of such claim
from a Third Party, including settlement negotiations and any legal
proceedings. If the Indemnifying Party does not assume the defense
of such claim from a Third Party in accordance with this Section
10.05 or the Litigation Conditions are not at any time then
satisfied in full, the Indemnified Party may defend the claim from a
Third Party.
(b) The Indemnifying Party or the Indemnified Party, as the case may be,
shall have the right to participate in (but not control), at its own
expense (subject to the immediately succeeding sentence), the
defense of any claim from a Third Party which the other is defending
as provided in this Agreement. The Indemnifying Party shall not be
liable for any litigation costs or expenses incurred, without its
consent, by the Indemnified Party where the action or proceeding is
under the control of the Indemnifying Party and the Indemnifying
Party is conducting such defense diligently; provided, however, that
if (i) the Litigation Conditions have not been met or cease to be
met in full, or (ii) the Indemnifying Party fails in any material
way to take reasonable steps necessary to defend diligently such
claim from a Third Party, the Indemnified Party may assume its own
defense, and the Indemnifying Party will be liable for all
reasonable costs or expenses paid or incurred in connection
therewith.
(c) The Indemnifying Party, if it shall have assumed the defense of any
claim from a Third Party as provided in this Agreement, shall not
consent to a settlement of, or the entry of any judgment arising
from, any such claim from a Third Party to the extent such claim
from a Third Party involves equitable or other non-monetary relief
from the Indemnified Party. No party shall, without the prior
written consent of the other parties, enter into any compromise or
settlement which commits the other parties to take, or to forbear to
take, any action.
(d) Whether or not the Indemnifying Party chooses to defend or prosecute
any claim from a Third Party, all the parties hereto shall cooperate
in the defense or prosecution thereof and shall furnish such
records, information and testimony, and
51
attend such conferences, discovery proceedings, hearings, trials and
appeals, as may be reasonably requested in connection therewith.
(e) Any indemnification hereunder shall be made net of any insurance
proceeds recovered by the Indemnified Party from Third Party;
provided, however, that if, following the payment to the Indemnified
Party of any amount under this Article 10, such Indemnified Party
recovers any such insurance proceeds in respect of the claim for
which such indemnification payment was made, the Indemnified Party
shall promptly pay an amount equal to the amount of such proceeds
(but not exceeding the amount of such indemnification payment) to
the Indemnifying Party.
10.06 Limitation of Damages/Sole Remedy. IN NO EVENT SHALL PFIZER OR NEUROCRINE
BE LIABLE UNDER THIS AGREEMENT OR THE COLLABORATION AGREEMENT FOR (X)
SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT
LIMITATION, LOSS OF PROFITS) SUFFERED BY ANY NEUROCRINE PARTIES OR ANY
PFIZER PARTIES, RESPECTIVELY, OR [***], EXCEPT (A) TO THE EXTENT ANY SUCH
DAMAGES ARE PAID TO A THIRD PARTY AS PART OF A THIRD PARTY CLAIM, AND (B)
IN THE EVENT OF AN INTENTIONAL AND WILLFUL BREACH IN BAD FAITH OF ANY
REPRESENTATION, WARRANTY, COVENANT OR AGREEMENT BY NEUROCRINE OR PFIZER
(AS THE CASE MAY BE) OF THIS AGREEMENT. EXCEPT FOR SUITS FOR SPECIFIC
PERFORMANCE OR OTHER INJUNCTIVE RELIEF AND EXCEPT AS EXPRESSLY PROVIDED IN
THIS AGREEMENT AND THE COLLABORATION AGREEMENT, INDEMNIFICATION PURSUANT
TO THIS ARTICLE 10 SHALL BE THE SOLE AND EXCLUSIVE REMEDY (WHETHER BASED
ON CONTRACT, TORT OR ANY OTHER LEGAL THEORY) AVAILABLE TO NEUROCRINE OR
PFIZER FOR ANY MISREPRESENTATION UNDER OR BREACH OF THIS AGREEMENT OR THE
COLLABORATION AGREEMENT. [***].
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10.07 Insurance. Pfizer will name Neurocrine, [***] as additional insureds on
its product liability insurance, which insurance shall provide coverage of
not less than [***]. Promptly after the Effective Date Pfizer will supply
Neurocrine with evidence of such coverage and during the term of this
Agreement, Pfizer will inform Neurocrine of any modifications to such
coverages.
ARTICLE 11
11. NON-COMPETITION.
11.01 Pfizer Non-Competition. If during the term of this Agreement Pfizer or any
of its Affiliates intends to Commercialize (as hereinafter defined) a
prescription pharmaceutical product having an Insomnia Indication in the
Territory (a "Competitive Product"):
(a) If such Competitive Product's [***]:
(i) [***]
(ii) [***].
(b) If such Competitive Product's [***]:
(i) [***]
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(ii) [***]:
[***].
(c) If Pfizer Launches any Competitive Product defined in Section
11.01(b) ("Section 11.01(b) Product"), then neither Pfizer or its
Affiliates shall:
(i) Engage in negative promotional activities, [***]
(ii) [***].
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
54
(iii) [***].
(iv) [***].
(d) Notwithstanding to the contrary any provisions of this Agreement or
the Collaboration Agreement, in no event shall Pfizer be required
under this Agreement or under the Collaboration Agreement to engage
in any activity regarding a Product which Pfizer is prohibited from
undertaking under Section 11.01(c) with respect to a Section
11.01(b) Product, and Section 11.01(c) shall be applicable, on the
same basis, mutatis mutandis, to promotional activities regarding
the Product vis-a-vis any Competitive Product of Pfizer.
11.02 Neurocrine Non-Competition. If, during the term of this Agreement,
Neurocrine or any of its Affiliates proposes to Commercialize a
Competitive Product in the Territory, Neurocrine or such Affiliate shall,
if such Competitive Product's primary mechanism of
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
55
action is through binding with [***], divest (by license, sale or similar
transaction) such Competitive Product.
11.03 [***].
11.04 For purpose of this Section 11 "Commercialize" means directly or
indirectly to market, sell, detail, promote or distribute, but in no event
shall include an out-license or other divestiture of intellectual property
rights to a person who markets sells details, promotes or distributes.
ARTICLE 12
12. MISCELLANEOUS.
12.01 Force Majeure. No party shall be liable for failure of or delay in
performing obligations set forth in this Agreement, and no party shall be
deemed in breach of its obligations, if such failure or delay is due to
natural disasters or any causes reasonably beyond the control of such
party.
12.02 Assignment. This Agreement and all rights and obligations granted
hereunder shall not be assignable by any party without the prior consent
of the other, except that (a) Pfizer may in connection with a Divestiture
Transaction assign this Agreement, (b) Pfizer may assign this Agreement,
and after all amounts due under the Loan Agreement have been paid in full
and the Loan Agreement has been terminated, Neurocrine may assign this
Agreement, in each case, in whole or in part, to any Affiliate of such
party or to any successor to substantially all of such party's business or
assets; provided, however, in the case of Pfizer and Neurocrine, the
assigning party shall remain responsible for all obligations hereunder if
its Affiliate shall fail to perform hereunder.
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12.03 Governing Law. This Agreement shall be governed by the laws of the State
of New York without regard to its conflict of laws rules.
12.04 Jurisdiction. With respect to any suit, action or proceeding relating to
this Agreement (each, a "Proceeding"), each party hereto irrevocably (i)
subject to the final sentence of this Section 12.04, agrees and consents
to be subject to (A) in the case of any Proceeding commenced by Pfizer,
the exclusive jurisdiction of the United States District Court for the
Southern District of California or any California state court sitting in
San Diego, California, United States of America (any such court, the
"California Court"), and (B) in the case of any Proceeding commenced by
Neurocrine, the exclusive jurisdiction of the United States District Court
for the Southern District of New York or any New York state court sitting
in New York, New York, United States of America (any such court, the "New
York Court") and (ii) waives any objection which it may have at any time
to the laying of venue of any Proceeding brought in any such California
Court or New York Court (collectively, the "Courts") as provided in this
Section 12.04, waives any claim that such Proceeding has been brought in
an inconvenient forum and further waives the right to object, with respect
to such Proceeding, that such Court does not have any jurisdiction over
such party. Notwithstanding the foregoing: (a) if the Court adjudicating
such Proceeding refuses for any reason to exercise jurisdiction over the
dispute, either party shall be free to bring such Proceeding in any other
Court in such state as provided above and, in the event such other Courts
refuse for any reason to exercise jurisdiction over the dispute, either
party shall be free to bring such Proceeding in any other court, and (b)
if any party (the "initiating party") commences a Proceeding in any Court,
the other party (the "defendant party") shall possess and retain the right
to assert in that same Proceeding all claims and defenses that the
defendant party may have against the initiating party, including without
limitation all counterclaims and setoffs, and (c) in the case of any suits
for specific performance or other injunctive relief, the parties will seek
to bring such actions in the Courts as provided in the first sentence of
this Section 12.04, except where the applicable Courts as a result of
jurisdictional requirements cannot issue the specific performance
requested in a timely manner.
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12.05 Notices. All notices, instructions and other communications hereunder or
in connection herewith shall be in writing, shall be sent to the address
below and shall be: (a) delivered personally; (b) sent by registered or
certified mail, return receipt requested, postage prepaid; (c) sent via a
reputable nationwide overnight courier service; or (d) sent by facsimile
transmission. Any such notice, instruction or communication shall be
deemed to have been delivered upon receipt if delivered by hand, three (3)
Business Days after it is sent by registered or certified mail, return
receipt requested, postage prepaid, one (1) Business Day after it is sent
via a reputable nationwide overnight courier service, or when transmitted
with electronic confirmation of receipt, if transmitted by facsimile (if
such transmission is on a Business Day; otherwise, on the next Business
Day following such transmission).
If to Pfizer: If to Neurocrine:
PFIZER INC. NEUROCRINE BIOSCIENCES, INC.
000 Xxxx 00xx Xxxxxx 10555 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000 Xxx Xxxxx, Xxxxxxxxxx 00000-0000
Fax: 000-000-0000 Fax: 000-000-0000
Attention: President, Pfizer Attention: President
Pharmaceuticals Group
CC; General Counsel
With a copy to: Senior Vice President
and General Counsel
Fax: 000-000-0000
In case any party changes its address at which notice is to be received, notice
of such change shall be given without delay to the other party.
12.06 Entire Agreements; Amendments. This Agreement, together with the
Collaboration Agreement, sets forth the entire agreement and understanding
among the parties hereto as to the subject matter hereof and all
agreements or understandings, verbal or written, made between Neurocrine
and Pfizer before the date hereof with respect to the subject matter
hereof. None of the terms or this Agreement shall be amended, supplemented
or modified except in writing signed by the parties hereto.
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12.07 Severability. If and solely to the extent that any provision of this
Agreement shall be invalid or unenforceable, or shall render this entire
Agreement to be unenforceable or invalid, such offending provision shall
be of no effect and shall not effect the validity of the remainder of this
Agreement or any of its provisions; provided, however, the parties shall
use their respective reasonable efforts to renegotiate the offending
provisions to best accomplish the original intentions of the parties.
12.08 Waivers. Any term or condition of this Agreement may be waived at any time
by the party that is entitled to the benefit thereof, but no such waiver
shall be effective unless set forth in a written instrument duly executed
by or on behalf of the party or parties waiving such term or condition.
Neither the waiver by any party of any term or condition of this Agreement
nor the failure on the part of any party, on one or more instances, to
enforce any of the provisions of this Agreement or to exercise any right
or privilege, shall be deemed or construed to be a waiver of such term or
condition for any similar instance in the future or of any subsequent
breach hereof. All rights, remedies, undertakings, obligations and
agreements contained in this Agreement shall be cumulative and none of
them shall be a limitation of any other remedy, right, undertaking,
obligation or agreement.
12.09 Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, successors and
permitted assigns.
12.10 Further Assurances. Following the date hereof, Neurocrine and Pfizer
shall, and shall cause each of their respective Affiliates to, from time
to time, execute and deliver such additional instruments, documents,
conveyances or assurances and take such other actions as shall be
necessary or otherwise reasonably requested by Pfizer or Neurocrine, to
confirm and assure the rights and obligations provided for in this
Agreement, and render effective the consummation of the transactions
contemplated thereby provided however that neither party will be required
under this paragraph 11.09 to deliver instruments, documents, conveyances
or assurances of any third party.
12.11 Third Party Beneficiaries. None of the provisions of this Agreement shall
be for the benefit of or enforceable by any third party including, without
limitation, any creditor of either party hereto. No third party shall
obtain any right under any provision of this
59
Agreement or shall by reasons of any such provision make any claim in
respect of any debt, liability or obligation (or otherwise) against either
party hereto.
12.12 Counterparts. This Agreement may be executed in any two or more
counterparts, each of which, when executed, shall be deemed to be an
original and all of which together shall constitute one and the same
document.
12.13 Headings. Headings in this Agreement are included herein to ease of
reference only and shall have no legal effect. References to Sections and
Schedules are to Sections and Schedules of this Agreement unless otherwise
specified.
12.14 Registration and Filing of the Agreement. To the extent, if any, that a
party concludes in good faith that it is required under applicable Laws to
file or register this Agreement or a notification thereof with any
Governmental Authority, including without limitation the US Securities and
Exchange Commission, or the US Federal Trade Commission, in accordance
with applicable Laws, such party may do so and shall provide the other
party to this Agreement with a written copy of all proposed filings or
registrations to allow for a reasonably sufficient time for review and
comment by the other party. The other party shall cooperate in such filing
or notification and shall execute all documents reasonably required in
connection therewith. In such situation, the parties will request
confidential treatment of sensitive provisions of the Agreement, to the
extent permitted by Law. The parties shall promptly inform each other as
to the activities or inquiries of any such Governmental Authority relating
to this Agreement, and shall cooperate to respond to any request for
further information therefrom.
12.15 Non-Solicitation of Employees. During the term of this Agreement, neither
party shall, directly or indirectly, recruit, or solicit any employee of
the other party with whom such party has come into contact or interacted
for the purposes of performing this Agreement, without the prior consent
of the other party, except pursuant to general solicitations not targeted
at such employees.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above by their duly authorized officers.
NEUROCRINE BIOSCIENCES, INC.
By: /s/ Xxxx X. Xxxxx
-------------------------------
Name: Xxxx X. Xxxxx
Title: President and Chief Executive
Officer
PFIZER INC.
By: /s/ Xxxxx X. XxXxxxxxx
-------------------------------
Name: Xxxxx X. XxXxxxxxx
Title: Chairman of the Board and
Chief Executive Officer
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