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EXHIBIT 10.26
LICENSE AND RESEARCH
COLLABORATION AGREEMENT
THIS LICENSE AND RESEARCH COLLABORATION AGREEMENT has a signature date
as of the 23rd day of March 1997 (the "Signature Date"), but will be effective
only as provided in Section 19.14 below, by and between Geron Corporation, a
Delaware corporation having its principal place of business at 000 Xxxxxxxxxxxx
Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx, X.X.X. 00000 ("Geron") and Pharmacia & Upjohn
S.p.A., a corporation of Italy having its principal place of business at Xxx
Xxxxxx Xxxx, 0.0, 00000 Xxxxxx, Xxxxx ("P&U").
RECITALS
X. Xxxxx possesses certain rights pertaining to the inhibition of
the enzyme telomerase as it relates to the treatment of cancer in humans.
B. In April 1995, Geron entered into the KH Collaboration (as
defined below) with Kyowa Hakko Kogyo Co., Ltd., a corporation of Japan, for
the research and development of compounds that inhibit telomerase for the
treatment of cancer in humans and for sale in certain countries of Asia.
C. In December 1996, Geron and P&U entered into: (i) a Heads of
Agreement that describes a collaboration with the objective to discover and
develop pharmaceutical products containing compounds that inhibit telomerase
for the treatment of cancer in humans and for sale on a worldwide basis,
subject to Kyowa Hakko entering into an appropriate amendment to the
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KH Collaboration with Geron, and (ii) a Common Stock Purchase Agreement under
which P&U purchased U.S. 2,000,000 of Geron Common Stock.
X. Xxxxx and P&U desire to enter into this Agreement to achieve
the objective set forth in the Heads of Agreement, and Geron is
contemporaneously entering into (i) an amendment of the KH Collaboration to
conform to the terms and provisions of this Agreement and (ii) the Three-Way
Agreement (as defined below).
X. Xxxxx and P&U are also contemporaneously entering into a
second Common Stock Purchase Agreement pursuant to which Geron will sell and
P&U will purchase an additional U.S. 8,000,000 of Geron Common Stock in two
installments.
ARTICLE 1
DEFINITIONS
The following terms shall be defined as follows for the purposes of
this Agreement:
1.1 "Affiliate" means an entity that, directly or indirectly
through one or more intermediaries, controls, is controlled by or is under
common control with another entity. For purposes of this definition, "control"
means the direct or indirect ownership of (a) at least [*] or, if less than
[*], the maximum percentage as allowed by applicable law, of the outstanding
voting securities of such entity or (b) at least [*] of the decision making
authority of such entity.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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1.2 "Asian Territory" means China, Hong Kong, India, Indonesia,
Kampuchea, South and North Korea, Laos, Malaysia, Myanmar (formerly Burma), the
Philippines, Singapore, Taiwan, Thailand, and Vietnam. The Asian Territory
does not include Japan.
1.3 "Candidate Drug" means a compound suitable for commercial
development for use in the Field that has been selected by P&U in accordance
with Section 2.6 for further pre-clinical and clinical development by P&U in
accordance with P&U CD Selection Procedures and this Agreement.
1.4 "Clinical Expense Credit" means a credit against future
royalties payable to Geron pursuant to Article 7 equal to [*] percent ([*]%)
of the costs and expenses incurred [*].
1.5 "COGS" shall mean the sum of the following costs to the extent
allocable to a Product sold by P&U in the Territory for the particular period
during which any royalty is calculated (net of any intercompany transfer
pricing): [*]. COGS shall exclude the following: [*]. COGS shall be
calculated in a manner consistent with generally accepted accounting principles
used in the place
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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of manufacture, consistently applied. The methodology to be used in making the
allocations referred to above shall be consistent with P&U's methodology for
similar products and shall be consistent from year to year.
1.6 "Control" means, for purposes of this Agreement (other than
the definition of Affiliate), possession of the ability to grant a license or
sublicense as provided for herein without violating the terms of any agreement
or other arrangement with any Third Party. Rights which may be acquired by the
exercise of an option that would increase the royalty or other payment
obligation of the party exercising such option shall not be Controlled by such
party. Examples of the meaning of Control are set forth on EXHIBIT 1.6.
1.7 "Development Plan" means the written plan for clinical
development of a Product prepared by P&U in accordance with Section 3.1.
1.8 "Effective Date" shall have the meaning set forth in Section
19.14.
1.9 "Field" means the inhibition of the enzyme telomerase for the
treatment of cancer in humans, excluding treatments based on antisense,
ribozyme, or gene therapy-based telomerase inhibitors.
1.10 "Geron Compound" means a compound that [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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[*]. In the event a Geron Compound is identical to a P&U Compound or a KH
Compound, then that compound shall be deemed, for purposes of this Agreement, to
be a Compound of the party that identified or caused to be identified (i.e., by
submitting for screening) that compound as a telomerase inhibitor. For the
purpose of this Section 1.10 and Sections 1.19, 1.30, and 1.40, (i) a compound
is not a telomerase inhibitor unless it has a [*] as tested in the primary and
primary and secondary assays referred to in the Research Plan) of less than [*]
and [*] of at least [*] when tested in the secondary biochemical assays referred
to in the Research Plan, and (ii) two compounds are "Chemically Equivalent" if
(a) the second compound is an isomer, salt, or ester of the first compound or
(b) the second compound results from a chemical synthesis or compound
acquisition program based on the first compound or on SAR data relating to the
first compound, and the second compound does not have a [*] [*] as tested in the
primary and primary and secondary assays referred to in the Research Plan) of at
least [*] higher than the first compound.
1.11 "Geron Knowhow" means Information that (i) Geron discloses to
P&U under this Agreement, or (ii) is Controlled by Geron or its Affiliates
during the term of this Agreement, including Information resulting from the
Research. Geron Knowhow excludes Geron Patents.
1.12 "Geron Patent" means a Patent which claims a process, method,
apparatus, composition of matter, compound, chemical, material, or article of
manufacture useful in the Field (or the discovery, development, manufacture and
clinical use of compounds having
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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potential activity in the Field), which Patent is Controlled by Geron or its
Affiliates during the term of this Agreement, including Geron's undivided
interest in any Joint Patent. Set forth in EXHIBIT 1.12 is a list of all
current Geron Patents.
1.13 "Geron Technology" means the Geron Knowhow and Geron Patents,
collectively.
1.14 "IND" means an Investigational New Drug application filed with
the U.S. Food and Drug Administration or the comparable application in a Major
Country.
1.15 "Information" means techniques; inventions; practices;
methods; knowledge; knowhow; skill; experience; test data, including, without
limitation, pharmacological, toxicological, and clinical test data, analytical
and quality control data, having application in the Field.
1.16 "Joint Patent" means a Patent that claims a process, method,
apparatus, composition of matter, compound, chemical, material, or article of
manufacture useful in the Field (or the discovery, development, manufacture and
clinical use of compounds having potential activity in the Field) and the
subject of which is an invention jointly invented, as determined under the laws
of the jurisdiction in which a patent application for such invention is filed,
by Geron and P&U in the course of performing the Research.
1.17 "Joint Research Committee" or "JRC" means the committee
established pursuant to this Agreement with responsibility for directing the
Research.
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1.18 "KH Collaboration" means the License and Research
Collaboration Agreement between Geron and Kyowa Hakko, dated April 24, 1995, as
amended.
1.19 "KH Compound" means a compound useful in the Field that [*]
In the event a KH Compound is identical to a P&U Compound or a Geron Compound,
then that compound shall be deemed, for purposes of this Agreement, to be a
Compound of the party that first identified or caused to be identified (i.e., by
submitting for screening) that compound as a telomerase inhibitor.
1.20 "KH Knowhow" means Information which (i) Kyowa Hakko discloses
to Geron under the KH Collaboration or (ii) is Controlled (as defined in the KH
Collaboration) by Kyowa Hakko or its Affiliates during the term of this
Agreement. KH Knowhow excludes KH Patents.
1.21 "KH Patent" means a Patent which claims a process, method,
apparatus, composition of matter, compound, chemical, material, or article of
manufacture useful in the Field (or the discovery, development, manufacture and
clinical use of compounds having potential activity in the Field), which Patent
is Controlled (as defined in the KH Collaboration) by KH or its Affiliates
during the term of this Agreement, including KH's undivided interest in any
Patent jointly owned with Geron.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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1.22 "KH Technology" means the KH Knowhow and KH Patents,
collectively.
1.23 "Kyowa Hakko" or "KH" means Kyowa Hakko Kogyo Co., Ltd., a
corporation of Japan having its principal place of business at 0-0-0
Xxxxxxxxx, Xxxxxxx-Xx, Xxxxx, Xxxxx.
1.24 "Major Country" means [*]
1.25 "Major Sublicensee" means a Third Party to which P&U has
granted the right to manufacture, in whole or in part, and sell Products.
1.26 "NDA" means a New Drug Application filed with the U.S. Food
and Drug Administration or the comparable application in a Major Country.
1.27 "Patent" means any patent application or issued patent,
including any extension, registration, confirmation, continuation,
continuation-in-part, reissue, re-examination, renewal, supplementary
protection certificate or the like thereof in any country. A patent application
which is still pending more than [*] after its filing date shall not be
taken into account for the purpose of Article 7 after such time, until a patent
issues from such application; provided however, that in the event the patent
application is licensed from a Third Party and the license with such Third
Party provides for a longer pendency period, such longer pendency period shall
apply for purposes of this Agreement.
1.28 "Patent Costs" means the fees and expenses paid to legal
counsel and other third parties, and filing and maintenance expenses, incurred
in connection with the prosecution,
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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establishment and maintenance of rights under Patents applicable to Products,
including costs of patent interference and opposition proceedings, but
specifically excluding expenses related to litigation and any expenses related
to the enforcement of any Patent or the defense of any claim of patent
infringement.
1.29 "Product" means any pharmaceutical product or preparation that
comprises a Compound selected by P&U for development in accordance with Section
2.6 herein having activity in the Field, and that utilizes or was made as a
result of utilizing Geron Technology, KH Technology or P&U Technology.
1.30 "P&U Compound" means a compound useful in the Field that [*]
In the event a P&U Compound is identical to a Geron Compound or a KH Compound,
then that compound shall be deemed, for purposes of this Agreement, to be a
Compound of the party that first identified or caused to be identified (i.e., by
submitting for screening) that compound as a telomerase inhibitor.
1.31 "P&U Knowhow" means Information that (i) P&U discloses to
Geron under this Agreement, or (ii) is Controlled by P&U or its Affiliates
during the term of this Agreement, including Information resulting from the
Research. P&U Knowhow excludes P&U Patents.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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1.32 "P&U Patent" means a Patent which covers a method, apparatus,
compound, chemical, material, or article of manufacture useful in the Field (or
the discovery, development, manufacture and clinical use of compounds having
potential activity in the Field), which Patent is Controlled by P&U or its
Affiliates during the term of this Agreement, including P&U's undivided
interest in any Joint Patent.
1.33 "P&U CD Selection Procedures" means the written guidelines
adopted by P&U from time to time with respect to the general criteria,
procedures, and review process for selecting pharmaceutical compounds for
commercial development and, to the extent the same exist, the specific
guidelines applicable to oncology pharmaceuticals shall be considered P&U CD
Selection Procedures for purposes of this definition. P&U shall keep Geron
informed of such procedures, including any changes in such procedures. The
current P&U CD Selection Procedures are set forth in the Research Plan, which
shall be updated to reflect any change in such Procedures.
1.34 "P&U Technology" means the P&U Knowhow and P&U Patents,
collectively.
1.35 "P&U Sales" means the gross amount invoiced by P&U, its
Affiliates and Major Sublicensees for sales of Products, less: (i) rebates,
retroactive price reductions, and discounts, including cash discounts, (ii)
credits or allowances actually granted upon claims, rejections or returns of
Products, including recalls, regardless of the party requesting such, (iii)
freight, postage, shipping, and insurance charges paid for delivery of Product,
to the extent billed and
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paid by P&U, and (iv) taxes (other than income taxes), duties and other
governmental charges incurred in connection with the sale of Products.
1.36 "Research" means all work performed by or for Geron and P&U in
the Field during the Research Term according to the Research Plan.
1.37 "Research Plan" means the written plan for the Research to be
conducted during the Research Term attached hereto as EXHIBIT 1.37 .
1.38 "Research Term" means the period commencing on the Effective
Date and ending on the first to occur of (i) termination of this Agreement by
either party under Article 17, or (ii) the third anniversary of the Effective
Date (unless otherwise extended in accordance with this Agreement).
1.39 "Sales Plan" means the written plan prepared by P&U for the
commercialization of each Product in the Territory.
1.40 "Selectable Compounds" means all compounds identified as
telomerase inhibitors by Geron or P&U prior to the Effective Date or by either
party or KH during the Research Term; provided, however, [*]
1.41 "Selection Period" means the period commencing on the
Effective Date and ending [*] months after the end of the Research
Term.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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1.42 "Territory" means the entire world.
1.43 "Third Party" means any person or entity other than Geron,
P&U, Kyowa Hakko, or an Affiliate of Geron, P&U, or Kyowa Hakko.
1.44 "Third Party License" means a license between a party to this
Agreement and any Third Party.
1.45 "Three-Way Agreement" means the Three Party Agreement dated as
of the Signature Date of this Agreement by and among Geron, P&U and Kyowa
Hakko.
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ARTICLE 2
RESEARCH
2.1 Collaborative Research. Geron and P&U will conduct the
Research on a collaborative basis with the goal of identifying compounds useful
in the Field and suitable for clinical development into commercially successful
Products in the Territory. As part of such collaboration, Geron and P&U shall
each use reasonable diligent efforts to engage in and conduct the Research and
shall commit the resources required for the Research, all as more particularly
set forth in the Research Plan. The Research Plan describes the activities and
resource commitments of Geron and P&U, including, without limitation, for
scientific research, drug discovery, screening and testing of compounds,
synthesizing compounds, and determining structure/activity relationships, to be
undertaken by each party in the Research. As further described in the Research
Plan, Geron shall disclose such Geron Knowhow and provide such technical
assistance and materials as may be reasonably required to establish its in
vitro telomerase inhibitor screening assays at P&U's (or its Affiliate's)
facilities. Subject to any rights of Third Parties, appropriately selected
compounds contained in libraries Controlled by P&U and its Affiliates shall be
screened by P&U or Geron to identify telomerase inhibitors as described in the
Research Plan. Subject to the approval of the JRC, Geron may contract with and
make payments to Third Parties for Research to be conducted in collaboration
with Geron consistent with the Research Plan. Any modifications of the Research
Plan shall be made by the JRC.
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2.2 Research Efforts.
(a) To further the purposes of the Research, each party may
provide certain of its employees to work at the other party's facilities,
subject to approval by the JRC. Each party shall record scientific data in
laboratory notebooks in a manner that protects the confidentiality of
information relating to the structure of telomerase inhibitor compounds of the
other party. On reasonable notice, and at reasonable intervals, each party
shall have the right to inspect and copy such notebooks and other relevant
records to the extent reasonably required to carry out its respective
obligations and to exercise its respective rights hereunder.
(b) Each party shall inform the other party and the JRC
in writing promptly upon the party's synthesis or identification of compounds or
compositions of matter that are Selectable Compounds. The party shall include
in such notices to the other party the [*] and any other information relevant to
the synthesizing or using of such Compounds in the Field. Upon request, each
party also shall supply to the other a reasonable quantity (sufficient for
analytical and biochemical characterization as determined by the JRC) of any
Compound synthesized by such party during the Selection Period.
2.3 Records of Research Expenditures. Geron will maintain
complete and accurate records of its expenditures for its Research, and provide
quarterly reports of such expenditures. Such records shall be open during
reasonable business hours for a period of [*] years from their creation
for examination at P&U's expense, such examination to take place on [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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[*] notice and not more often than [*] by a certified public accountant selected
by P&U and reasonably acceptable to Geron. Such accountant shall review the
records for the sole purpose of verifying the accuracy of expenditures reported
by Geron under this Agreement and to assure that such funds were expended for
the Research, and such information shall be considered confidential under the
terms of this Agreement. Such expenditures shall be accounted for in accordance
with generally acceptable accounting principles, consistently applied.
Qualifying expenditures shall be only an amount equal to [*] (adjusted annually
by the JRC), and [*] of sponsored research payments for work done by Third
Parties which is made available to the Research and performed in accordance with
the Research Plan. An "FTE" shall mean a full-time equivalent (as determined by
the employment policies of the party) scientist performing scientific work on or
directly related to the Research, and such amount shall include all direct
salaries, benefits and related taxes and other labor costs, all direct costs for
materials, supplies, travel, and subcontracted services, and all occupancy and
other indirect costs allocable to the Research.
2.4 Formation of Joint Research Committee. The Research will be
directed by a Joint Research Committee ("JRC") comprised of six (6) individuals
with half being appointed and replaced by Geron and the other half being
appointed and replaced by P&U. The initial appointees to the JRC are listed in
EXHIBIT 2.4; each party shall promptly notify the other party in writing of
replacements or appointments to the JRC. All decisions of the JRC shall
require a majority vote of all the members of the JRC. Matters resulting in
tie-votes shall be referred to the Chief Executive Officer of Geron and the
Managing Director of P&U for resolution;
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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provided however, that in no event shall any failure to resolve any tie-vote
cause termination of this Agreement or termination of P&U's obligation to make
any of the research payments in accordance with Article 8 hereof. The JRC will
meet in person at least twice a year to discuss the progress of the Research.
The chairperson of the JRC shall be selected from among the members of the JRC
alternatively by Geron and P&U to one year terms, commencing on the Effective
Date, with Geron selecting first. The JRC shall terminate and cease to exist
upon the first anniversary of the expiration of the Research Term.
2.5 Responsibilities of JRC. The purpose of the JRC is to oversee
and direct the Research. In addition to the JRC, each party shall appoint
employees to a project team to carry out the day-to-day activities involved in
identifying compounds active as telomerase inhibitors and suitable for clinical
development and to expedite the progress of compounds through the completion of
preclinical activities, all as described in the Research Plan. The JRC shall
further have the responsibility for modifying the Research Plan as necessary
over time to ensure the greatest likelihood of success in achieving the
objective of the Research Plan. Any modifications of the Research Plan shall
be memorialized in writing, formally reviewed by the JRC, and if approved by a
majority vote of the JRC, then incorporated herein by reference. The JRC shall
evaluate and discuss the results of and information related to the Research to
ensure that the Research Plan specifies appropriate scientific direction and
research goals, allocates research responsibilities correctly, and establishes
relevant time lines, and that there is appropriate scientific management of the
collaboration. The JRC shall summarize the progress of the
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Research in a written report distributed to each party at least once each
calendar year. The JRC shall establish procedures and guidelines to govern the
operation of the project team.
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2.6 Selection of Candidate Drugs for Development.
(a) During the Selection Period. [*]
(b) After the Selection Period. [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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[*]
2.7 Extension of Research Term and Selection Period. P&U shall
have, in its sole discretion, the right to extend the Research Term and
Selection Period for an additional [*] period upon providing written notice to
Geron of such election at least one hundred eighty (180) days prior to the
expiration of the Research Term. In the event P&U makes such election, P&U
shall pay Geron an additional [*] divided into [*] equal quarterly installments
beginning on the third anniversary of the original Research Term as a
non-refundable payment for research to be conducted by Geron during the [*]
extension period. Any such extension of the Research Term (and the activities
to be conducted during such extended period) shall be governed by the terms and
conditions of this Agreement.
2.8 Extension by Mutual Consent. Although the parties contemplate
that the objective of the Research, if achievable, is likely to be achieved
within three (3) years (or [*] if P&U elects to extend the Research Term in
accordance with Section 2.7 above) after the Effective Date, they recognize
that it may be desirable to extend the Research to complete work described in
the Research Plan that was near completion at the end of the Research Term or to
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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commence a new Research Plan. The parties agree to discuss and negotiate in
good faith any request by either party to extend the Research Term and the
terms and conditions under which such extension could occur.
2.9 Sharing of Information. Geron and P&U will exchange verbal or
written reports presenting a meaningful summary of their activities, including
research and development activities under this Agreement, on a monthly basis so
as to keep the other party reasonably informed in a timely manner of its
activities in the Field. Each party will make regular presentations to the
other of its activities under this Agreement, and additionally on an informal
basis, inform the other party of the work done under this Agreement. Each
party will provide the other with data or other information regarding any and
all work carried out in the course of the Research as reasonably requested by
the other party. This Section 2.9 applies to (i) Information generated by the
Research during the Research Term, (ii) Information relative to Candidate Drugs
under development as provided herein, and (iii) Information relative to
Products for which a royalty is due to Geron hereunder. Each party will make
available and disclose to the other party promptly after the Effective Date all
Knowhow of such party as of the Effective Date, to the extent necessary or
useful for the other party's conduct of the Research hereunder. Each party
will also disclose any additional Knowhow learned, acquired or discovered by
such party at any time before the end of the Research Term, promptly after such
Knowhow is learned. For such period of time as a Candidate Drug is being
diligently developed hereunder or a Product is being commercialized with
royalties due to Geron hereunder, Geron shall make available to P&U, in a
timely fashion, all applicable Geron Technology which is necessary or useful
for the
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evaluation, development, registration and commercialization of such Candidate
Drugs or Products. Further, for such period of time as a Candidate Drug is
being diligently developed hereunder or a Product is being commercialized with
royalties due to Geron hereunder, Geron will provide reasonable technical
assistance to P&U, as may be reasonably necessary for successful development
and commercialization of such Candidate Drugs or Products; provided however,
that following the Research Term, P&U shall reimburse Geron for such technical
assistance (calculated in accordance with Geron's then prevailing FTE rate) and
all reasonable out-of-pocket expenses, including food, travel and lodging
incurred in connection with such technical assistance. All discoveries or
inventions made during the Research Term by either P&U or Geron useful in or
relating to the Research or the Field, including without limitation,
information regarding initial discoveries of telomerase inhibitors and their
activities, derivatives, and results of in vitro and in vivo studies, assay
techniques and new assays will be disclosed to the other, with meaningful
discoveries or advances being communicated promptly after such information is
obtained or its significance is appreciated. Each party will make available to
the other raw data from work carried out in the course of the Research. During
the Research Term, with advance notice, Geron and P&U shall permit
representatives of the other to visit its premises and view Research work in
progress. During the Selection Period, Geron and P&U shall also permit the
other party to review any data or documentation (and make copies) arising out
of the Research and the other party's Technology.
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ARTICLE 3
DEVELOPMENT
3.1 Development in the Territory. P&U shall have the right to
manage and control the development of Candidate Drugs selected in accordance
with Section 2.6 in the Territory at its own expense. Promptly after selection
of each Candidate Drug, P&U shall prepare a written Development Plan for the
further preclinical and clinical development of such Candidate Drug, which Plan
shall be amended periodically as necessary. P&U shall provide a copy of such
Development Plan, and any amendments thereto, to Geron for review and comment.
P&U shall provide Geron with notice of all meetings of the P&U project
committee responsible for the development of the Candidate Drug, as well as
written materials sufficient to inform Geron of the progress of the clinical
development, and Geron shall be permitted to attend all such meetings. P&U
shall use reasonable diligent efforts, consistent with good pharmaceutical
industry practices, to develop Candidate Drugs selected by P&U for sale as
Products in the Territory in accordance with the Development Plan. Commencing
upon the [*] covering a Candidate Drug, P&U shall prepare and maintain complete
and accurate information regarding the world-wide clinical development of
Products and shall make such information available to Geron in the form of
written detailed reports to Geron at least twice per year. Such reports shall
summarize the status and results of all such development efforts. P&U also will
respond to reasonable requests by Geron for additional information regarding the
development of Candidate Drug. Notwithstanding Geron's right to review such
information and
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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provide such comments, P&U retains the right, subject to diligence requirements
contained in this Agreement, to develop Candidate Drugs in its sole discretion.
3.2 Termination of Development. [*]
3.3 Funding of Development Program. P&U shall be responsible for
conducting, and for all expenses related to, preclinical development and
clinical trials for all Products containing Candidate Drugs, including, without
limitation, toxicology studies, pharmacology studies, formulation, clinical
trials, and regulatory filings. If Geron co-promotes a particular Product in
the U.S. pursuant to Article 11 below, P&U shall be entitled to the Clinical
Expense Credit
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
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against royalties due Geron for that Product; provided however, that in no
event shall any Clinical Expense Credit or any portion thereof be applied more
than once.
ARTICLE 4
LICENSES
4.1 License to P&U. Subject to the terms and conditions of this
Agreement and the Three-Way Agreement, including, without limitation, the
royalty provisions of Article 7 of this Agreement and Geron's right to
co-promote and Kyowa Hakko's rights to co-promote and/or co-market, Geron
hereby grants to P&U an exclusive, royalty-bearing license under Geron
Technology to develop, make, have made, use, import, offer to sell, sell, and
have sold Products in the Territory with the right to grant sublicenses as
provided in this Agreement; provided, that, subject to Section 4.4 below and
the following sentence, Geron expressly reserves the right to use such Geron
Technology for all other purposes. Neither party shall, directly or indirectly,
develop or promote a Candidate Drug being developed by P&U in accordance with
Article 3 above or a Product for which P&U is under an obligation to pay
royalties to Geron in accordance with Article 7 below for use outside the Field
without the written consent of the other party, which consent shall not be
unreasonably withheld; provided however, that P&U shall not be deemed to be in
breach of this Agreement if Products sold by P&U are used outside of the Field,
provided that P&U (i) pays the applicable royalty due on such sales in
accordance with this Agreement and (ii) has not knowingly developed or promoted
such Product for sale or use outside of the Field.
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4.2 Research Licenses. Subject to the terms and conditions of this
Agreement and the Three-Way Agreement, Geron hereby grants to P&U a world-wide,
paid-up right and license under the Geron Technology solely to (a) discover
compounds and conduct the Research during the Research Term, and (b) conduct
secondary and tertiary screening and further evaluation of Selectable Compounds
during the Selection Period. Subject to the other provisions of this Agreement
and the Three-Way Agreement, P&U hereby grants to Geron during the Research
Term a world- wide, paid-up right and license under the P&U Technology solely
to conduct the Research. Subject to the terms and conditions of this Agreement
and Geron's existing licenses to Kyowa Hakko under the KH Collaboration, each
party covenants that during the Research Term it shall not grant any other
licenses to any Third Party equivalent to, or that are reasonably likely to
conflict with, the rights granted under this Section 4.2, other than limited
non-commercial material transfer agreements and confidential disclosure
agreements that are restricted to academic uses or under which Geron retains
the rights to acquire, or to negotiate the acquisition of, the inventions in
the Field that directly result from the use of such materials or confidential
information. Neither party may grant sublicenses under the rights granted by
the other party in this Section, except to Affiliates.
4.3 Sublicensing. P&U shall have the right to sublicense any and
all of its rights under Section 4.1 of this Agreement to (i) its Affiliates
without Geron's consent and (ii) any Third Party only with the prior written
consent of Geron, which consent shall not be unreasonably withheld.
Notwithstanding the foregoing, P&U may sublicense (i) its rights to sell
Products to distributors in the ordinary course of business and (ii) upon
advance written notice to
26
Geron, its rights to manufacture Products to contract manufacturers for sale by
P&U or its Affiliates, and (iii) in any country where required by local law or
customary pharmaceutical industry practices, its rights to manufacture and sell
Products to Major Sublicensees.
4.4 Exclusivity. Except as otherwise provided for in this
Agreement, the KH Collaboration, or sponsored research agreements with
institutions under which P&U or Geron Control (or have the option to Control)
all material rights to inventions in the Field arising therefrom ("SRAs"), any
research or development conducted or funded by P&U or Geron in the Field during
the Research Term shall be deemed to be Research conducted pursuant to this
Agreement. [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
27
[*]
4.5 Existing Third Party Technology. The licenses granted herein
include sublicenses to certain technology and other rights that have been
licensed from Third Parties ("Third Party Licenses"), including sponsored
research agreements and options for patent licenses. Each party agrees that, to
benefit from any sublicense under this Agreement, each party must abide by the
terms and conditions of such Third Party Licenses. The party who entered into
the Third Party License shall be responsible to the Third Party for all
payments and other obligations attributable to this Agreement for Third Party
Licenses in existence as of the Effective Date. To the extent any expansion of
the rights granted pursuant to a Third Party License after the Signature Date
increases the royalty or other obligations of either Geron or P&U, then such
expansion shall be deemed to be an acquisition of new Third Party Technology
and shall be governed in accordance with Section 4.6. EXHIBIT 4.5 contains a
complete list of all Third Party Licenses entered into by Geron prior to the
Signature Date of this Agreement, and Geron has provided P&U or its counsel
complete and correct copies of all such agreements, as amended.
4.6 New Third Party Technology. Following the Effective Date, if
either party believes that technology related to the Field that is owned or
controlled by Third Parties would be necessary or useful for the Research or to
achieve the purpose of this Agreement, Geron and P&U will consult regarding
licensing or acquiring such technology. The determination of whether such
licenses and/or acquisitions shall be sought, the party that shall approach and
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
28
negotiate with such Third Parties, and the terms of any agreements with such
Third Parties, including, without limitation, payments for sponsored research,
shall be made by the JRC. Subject to the Three-Way Agreement, the cost of
obtaining any licenses so approved by the JRC and the payment of any fees or
royalty obligations thereunder shall be borne by [*]. If the JRC does not
approve the license or acquisition of such technology, either party shall be
permitted to acquire or obtain a license to any such Third Party technology at
its own cost and without the other party's permission. Both parties shall be
obligated to inform the other of such licensing or acquisition opportunities.
Neither party shall be obligated to grant any sublicense to such Third Party
technology to the other party after the Effective Date unless the other party
agrees to pay an agreed upon portion of such costs and royalties. Exhibit 1.6
illustrates the parties' intent concerning the meaning of certain provisions of
Sections 4.5 and 4.6.
4.7 Limitations. To the extent permitted by law, P&U shall not
sell Products to any Third Party that P&U believes will resell or use the
Products in violation of this Agreement or the Three-Way Agreement. In the
event such violations occur, P&U shall use reasonable diligent efforts to
correct such violations and to prevent any future violations by such Third
Parties.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
29
ARTICLE 5
COMMERCIALIZATION
5.1 Commercialization in the Territory. P&U shall use reasonable
diligent efforts to market and sell Products successfully in the Territory,
including but not limited to, the United States and each Major Country. After
the first sale of a Product and prior to the end of each calendar year, P&U
shall develop and maintain a plan for the commercialization of each Product in
the Territory for the following calendar year ("Sales Plan"). P&U shall
promptly deliver to Geron a copy of each such Sales Plan. Each Sales Plan
shall include a comprehensive marketing and sales strategy for the applicable
Product in the Territory, including projected market share for the Product and
projected marketing resource commitment to the Sales Plan. P&U shall report
its progress as measured against each Sales Plan to Geron at least [*] in
summary written form and at least [*] in a detailed written report.
5.2 Advertising and Trademarks. Unless otherwise agreed in
writing, P&U shall have the sole authority to name Products containing P&U
Compounds throughout the Territory. To the extent lawfully permitted, each
Product label shall identify Geron as a licensor of each Product and, for
Products that Geron co-promotes, shall carry Geron's logo under license from
Geron. All Products sold by P&U (except for Products containing KH Compounds
co-marketed with KH in Japan) and all Products containing P&U Compounds sold by
P&U or KH in a given country shall be identified and advertised using such
trademarks as P&U shall select, own, or
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
30
otherwise acquire. The trademarks for Products containing KH Compounds
co-marketed with KH in Japan shall be determined as provided in Three-Way
Agreement.
5.3 Termination of Commercialization. [*]
ARTICLE 6
MANUFACTURING
Except as set forth in the Three-Way Agreement, P&U shall use
reasonable diligent efforts to manufacture Products for commercial sale by P&U
in the Territory in a cost-effective manner, and P&U shall use reasonable
diligent efforts to ensure an adequate supply of Product for commercial sale in
the Territory, including adequate contingency plans in the event of loss of
primary manufacturing facilities.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
31
ARTICLE 7
ROYALTIES
7.1 Royalties. In consideration of the license granted to P&U
under Section 4.1, P&U shall pay to Geron a royalty on P&U Sales of Products in
the Territory calculated each calendar year as follows on a Product-by-Product
basis:
(a) [*] of P&U Sales at or below U.S. [*]
(b) [*] of P&U Sales over U.S. [*] and at or below U.S.
[*]
(c) [*] of P&U Sales over U.S. [*] and at or below U.S.
[*]; and
(d) [*] of P&U Sales over U.S. [*]
For purposes of this Article 7, a Product shall include any
Product that is comprised of the same Compound or an [*]. Royalties shall be
payable by P&U on all sales of Product co-promoted by Geron in the United
States and by KH in the UK and Germany. Royalties shall not be payable by P&U
on sales of Products to KH for its resale in Japan and the Asian Territory
under co- marketing or other arrangements where such resales by KH are not
booked as P&U sales. KH's sales of such Products shall be subject to
royalties under the KH Collaboration.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
32
7.2 Term of Royalty Payments. Royalty payments shall continue to
accrue and be payable with respect to P&U Sales of Products and will
automatically expire on a country-by-country and Product-by-Product basis upon
the earlier to occur of (a) or (b), where:
(a) is the later to occur of:
(i) for a Product for which the Product itself,
the method of manufacture of the Product in the manner practiced by or
authorized by P&U, the use of the Product in the manner promoted by P&U, or the
sale of the Product is not claimed in one or more P&U Patents or Geron Patents
during the term of this Agreement, [*] from first commercial sale of such
Product in such country;
(ii) for a Product for which the Product itself,
the method of manufacture of the Product in the manner practiced by or
authorized by P&U, the use of the Product in the manner promoted by P&U, or the
sale of the Product is claimed in one or more P&U Patents or Geron Patents
during the term of this Agreement, [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
33
(b) [*]
7.3 Paid Up License. Upon expiration of each royalty obligation
on a country-by-country and Product-by-Product basis as provided in Section
7.2, (i) each party shall have a non-exclusive, fully paid-up license under the
other party's Knowhow to make, have made, use, import, offer to sell, sell, and
have sold such Product in such country with the right to grant sublicenses as
provided in this Agreement, and (ii) the parties agree to discuss in good faith
a fair and equitable arrangement for the parties to market generic products.
Notwithstanding the foregoing, Geron and its Affiliates shall not be permitted
to use, nor shall P&U be required to disclose, any Confidential Information of
P&U related to the clinical development, manufacture or marketing of any such
Product upon the expiration of the royalty obligation with respect to such
Product.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
34
7.4 Reduction of Royalties.
(a) [*] the royalties payable under Section 7.1 above shall
be reduced for a given quarter in the event that such Product has a combined
COGS and royalty payment (without taking into account any credits), expressed as
a percentage of P&U Sales, that exceeds [*] of the P&U Sales of such Product for
such quarter, as follows:
COGS + Royalty Royalty Rate Reduction
-------------- ----------------------
[*] [*]
[*] [*]
[*] [*]
provided, however, that in no event shall the royalty due Geron be reduced by
the terms of this Section 7.4 to below [*]. Any such royalty reduction for any
calendar quarter shall be effective only to the extent P&U delivers to Geron a
written notice that specifies in reasonable detail P&U's calculation of COGS,
including, without limitation, a breakdown of the major line items making up the
COGS (the "Royalty Reduction Notice"). The Royalty Reduction Notice shall be
sent to Geron along with the written account specified in Section 7.6 herein.
For each quarter in which the Royalty Reduction Notice is delivered to Xxxxx,
Xxxxx shall be entitled to have an independent accounting firm selected by Geron
and reasonably acceptable to P&U inspect P&U's accounting records for the
purpose of commenting on P&U's accounting practices
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
35
for the determination of COGS. P&U shall allow the firm to review the COGS
specified in Royalty Reduction Notice against P&U's accounting records and shall
reasonably cooperate with such review. All information received from P&U in
connection with the inspection and review shall be considered Confidential
Information under the terms of this Agreement. In the event the independent
accounting firm determines that the COGS reported in the Royalty Reduction
Notice does not reflect the COGS reported in P&U's accounting records, Geron
shall promptly notify P&U [*]. In the event the parties are unable to agree on
a COGS determination, then the matter shall be submitted to arbitration in
accordance with Section 19.10. In the event that it is ultimately determined
that P&U overstated COGS in the Royalty Reduction Notice, P&U shall pay to Geron
an amount equal to the royalty amounts not paid to Geron as a result of the
Royalty Reduction Notice, [*] of such underpayments and the costs related to
such audit. Such rights of inspection and review shall be subject to the notice
and records retention limitations set forth in Section 7.10.
(b) In the event royalties are reduced pursuant to Section
7.4(a) for [*] Geron shall have the right to engage an independent consultant
reasonably acceptable to P&U to review P&U's manufacturing processes and other
elements of COGS. The independent consultant shall have reasonable access to
all aspects of P&U's manufacturing process and other aspects of P&U's operations
that are relevant to COGS, including the ability to inspect the manufacturing
facilities, to review manufacturing documentation and to meet and interview
manufacturing personnel. P&U shall provide reasonable assistance to the
independent consultant
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
36
and all information received in connection with the review shall be considered
Confidential Information under the terms of this Agreement. Upon completion of
the review, the independent consultant shall provide a written report to both
parties that (i) assesses P&U's manufacturing processes and other elements of
COGS against prevailing industry comparative measures and (ii) provides
recommendations for reducing COGS. The parties agree to meet and discuss the
report and to consider in good faith all recommendations for reducing COGS
contained therein. The inspection and review rights of Geron set forth in this
Section 7.4 shall apply to P&U and any contract manufacturer engaged by P&U,
and P&U will use reasonable diligent efforts to secure such rights for Geron in
the event KH manufactures Products for P&U pursuant to the Three-Way Agreement.
7.5 Royalty on Combination Products. In the event a Product is
sold in a combination product with one or more other therapeutically active
ingredients, P&U Sales shall be calculated by multiplying the P&U Sales of that
combination product by the fraction A/C, where A is the gross selling price of
the Product sold separately and C is the gross selling price of the combination
product. The gross selling price of the Product and any other therapeutically
active ingredients contained in the combination product shall be for a quantity
comparable to that contained in the combination product and of the same class,
purity and potency. When no gross selling price is available for such Product,
P&U shall calculate a hypothetical gross selling price for such Product,
allocating the same proportion of costs, overhead and profits as are then
allocated to similar substances made by P&U and having an ascertainable current
gross selling
37
price. P&U shall include in each royalty report a full description of the
method by which any calculation pursuant to this Section 7.5 is made.
7.6 Reporting and Payment of Royalties. P&U shall deliver to
Geron within [*] after the end of each calendar quarter a written account,
including quantities, of P&U Sales by P&U and its Affiliates' and Major
Sublicensees and the amount of the royalty payment due to Geron for such
quarter. In each country where P&U is unable to remove the local currency
received from P&U Sales, royalties accrued in that country shall be paid to
Geron in the country in local currency by deposit in a local bank designated by
Geron. For the purpose of computing P&U Sales for Products sold in a currency
other than United States Dollars, such currency shall be converted into United
States Dollars in accordance with P&U's customary and usual translation
procedures. P&U shall only withhold taxes on such royalties as required by law
but shall use reasonable diligent efforts to reduce such withholdings to the
greatest extent possible and to remit promptly to Geron any refunds or rebates
of taxes paid by P&U on behalf of Geron.
7.7 Sales to Affiliates and Sublicensees. Sales of a Product
between P&U, its Affiliates and its Major Sublicensees, or among such
Affiliates and such Major Sublicensees, shall not be subject to royalty, which
shall instead be applied on P&U Sales as defined in Section 1.35.
7.8 Samples to Third Parties. No royalties shall accrue on the
disposition of reasonable quantities of Products for no charge by P&U as
promotional samples to Third Parties; provided however, that beginning [*] of a
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
38
Product in the United States or a Major Country, such quantities shall not
exceed [*] of the total number of units of that Product dispensed, whether by
sale or otherwise, [*] unless otherwise consented to by Geron.
7.9 Minimum Royalty Payments Royalty credits available to P&U in
accordance with this Agreement or any other legally binding agreement between
the parties shall not reduce the royalty amounts otherwise then due to Geron by
more than [*]. Unused credits may be carried over into subsequent royalty
periods.
7.10 Records of P&U Sales, Clinical Trials Expenses, and Costs of
Goods Sold. P&U will maintain complete and accurate records of clinical trial
expenses, P&U Sales, COGS, and other such factors as are relevant to the royalty
and other payments to be made by P&U under this Agreement. Such records shall
be open during reasonable business hours for a period of [*] from their creation
for examination at Geron's expense, such examination to take place on thirty
(30) days written notice but not more often than [*] by a certified public
accountant selected by Geron and reasonably acceptable to P&U. Such accountant
shall review the records for the sole purpose of verifying the accuracy of the
payments made by P&U under this Agreement, and such information shall be
considered Confidential Information under the terms of this Agreement. In the
event the examination shows an underpayment for any calendar quarter examined,
P&U shall pay Geron the amounts underpaid. In the event such underpayment is in
excess of [*] due to an error on the part of P&U, P&U shall
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
39
pay, in addition to the amount of the underpayment, [*] of such underpayment and
the cost of such examination.
7.11 Royalty Credits. P&U may credit the following against the
royalties payable to Geron under Section 7.1:
(a) Clinical Expense Credit as provided in Section 3.3;
(b) [*] of all milestone payments made by P&U under
Article 9; and
(c) the creditable amounts referred to in Section 14.7.
ARTICLE 8
RESEARCH PAYMENTS
8.1 Research Payments. In consideration of the Research to be
performed by Geron pursuant to this Agreement, P&U shall pay to Geron the
following non-refundable amounts as payment for the expenses related to such
Research on the dates such payments are due:
(a) U.S. $1.25 million in cash due within ten (10)
business days after the Effective Date of this Agreement for research expenses
to be incurred from the Effective Date of this Agreement until June 30, 1997;
and
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
40
(b) U.S. $1.25 million in cash due quarterly on July 1,
October 1, January 1 and April 1 thereafter during the Research Term for
research expenses to be incurred for the calendar quarter following such date.
8.2 Excess Research Payments. If Geron does not expend the
aggregate amount provided by P&U to Geron pursuant to Section 8.1 for Research
during the Research Term, the parties shall agree upon possible extensions of
the Research and possible additional research programs to utilize fully, on
P&U's behalf, such amounts.
8.3 Withholding Obligations. The amounts specified in Section 8.1
shall be net of any amounts to be withheld by P&U in accordance with the
applicable withholding provisions of the tax laws of Italy, the U.S., or any
other country. Geron shall be entitled to receive in cash the exact amount
specified under each subsection of Section 8.1 notwithstanding the effect of
any and all withholding or other payments made by P&U as a result of such
provisions.
ARTICLE 9
MILESTONES
9.1 Milestone Payments. In consideration of the rights granted
under this Agreement, each of the following non-refundable payments will be
made by P&U upon the first achievement of the following milestones:
(a) U.S. [*] in cash due upon the first selection of a
Candidate Drug by P&U in accordance with Section 2.6;
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
41
(b) U.S. [*] in cash due upon the first filing of an NDA
for a Candidate Drug selected by P&U in accordance with Section 2.6; and
(c) U.S. [*] in cash due upon the first approval of an
NDA for a Candidate Drug selected by P&U in accordance with Section 2.6.
9.2 Milestone Payments for Additional Candidate Drugs and
Products. In consideration of the rights granted under this Agreement, and
only in the event the Research results in the creation of Candidate Drugs in
addition to those for which a corresponding milestone payment under Section 9.1
has been made, each of the following non-refundable payments will be made by
P&U upon the first achievement of the following milestones:
(a) U.S. [*] in cash due upon the second filing of an
IND for a Candidate Drug selected by P&U in accordance with Section 2.6;
(b) U.S. [*] in cash due upon the earlier of (i) the
enrollment of the first patient in the earlier of either a Phase IIB or
Phase III trial initiated to demonstrate efficacy to obtain regulatory approval
for a specific indication or (ii) the second filing of an NDA for a Candidate
Drug selected by P&U in accordance with Section 2.6; and
(c) U.S. [*] in cash due upon the second approval of an
NDA for a Candidate Drug selected by P&U in accordance with Section 2.6.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
42
No milestone payment under this Section 9.2 shall be payable in respect of a
Candidate Drug comprised of the same Candidate Drug or an [*] thereof for
which a corresponding milestone payment was previously paid pursuant to
Section 9.1.
9.3 Milestone Payments Generally. All such payments shall be made
by wire transfer to the bank account designated by Geron within 15 days after
achievement of the applicable milestone event. [*]
9.4 Withholding Obligations. The amounts specified in Sections
9.1 and 9.2 shall be net of any amounts to be withheld by P&U in accordance
with the applicable withholding provisions of the tax laws of Italy, the U.S.,
or any other country. Geron shall be entitled to receive in cash the exact
amount specified under each subsection of Sections 9.1 and 9.2 notwithstanding
the effect of any and all withholding or other payments made by P&U as a result
of such provisions.
9.5 Credit Against Royalties. [*] of all milestone payments made
by P&U under this Article 9 shall be credited against future royalties payable
to Geron pursuant to Section 7.1.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
43
ARTICLE 10
SALE OF EQUITY
P&U agrees to purchase and Geron agrees to sell an aggregate of U.S.
8,000,000 of Geron's Common Stock in a series of two separate equity
investments on the terms and conditions set forth in the Common Stock Purchase
Agreement attached hereto as EXHIBIT 10.
ARTICLE 11
GERON CO-PROMOTION
11.1 Co-Promotion. Geron shall have the right to co-promote with
P&U certain of the Products in the United States on a [*] basis. Subject to
the terms of Section 11.3 below, Geron shall elect such rights on a
Product-by-Product basis by notice to P&U no later than sixty (60) days after
P&U notifies Geron of the commencement of [*]
11.2 Co-Promotion Agreement. If Geron so elects to co-promote any
Product, Geron and P&U (or P&U's U.S. Affiliate) shall promptly enter into a
separate agreement containing the essential terms set forth in EXHIBIT 11 and
such modifications or other terms as the parties may mutually agree are
appropriate for the co-promotion of a particular Product. While some
additional terms may be included to implement a co-promotion arrangement for a
particular Product and to reflect the then existing market conditions, Exhibit
11 contains all of the essential terms of such a co-promotion agreement. In
the event the parties do not enter into a separate
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
44
agreement prior to the first commercial sale of such Product, then Geron and
P&U shall co-promote such Product on the essential terms set forth in
Exhibit 11.
11.3 Applicable Products. Geron's co-promotion rights shall be
limited as follows:
(a) Geron shall have the right to co-promote the first
Product containing a P&U Compound for a period of [*] after its first
commercial sale in the United States; Geron shall not have the right to
co-promote any subsequent Product containing a P&U Compound, provided, however,
that in the event the first Product containing a P&U Compound is not sold by
P&U in the United States for a period of at least [*], Geron shall have the
right to co-promote any other Product containing a P&U Compound, if any, for
the balance of such [*] term.
(b) Geron shall have the right to co-promote in the
United States all Products containing Geron and KH Compounds for the period of
time [*] in accordance with the terms of this Agreement; provided, however,
Geron's right to co-promote shall not terminate in the event [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
45
ARTICLE 12
THREE-WAY AGREEMENT AND KYOWA HAKKO
12.1 Three-Way Agreement. Geron and P&U agree and acknowledge that
certain of the rights and obligations set forth in this Agreement are subject
to the terms and conditions of the Three-Way Agreement. Geron and P&U further
agree and acknowledge that in the event of a conflict between the terms and
conditions of this Agreement and the terms and conditions of the Three-Way
Agreement, the terms and conditions of the Three-Way Agreement shall prevail.
12.2 Termination of the KH Collaboration. In the event the KH
Collaboration terminates or expires during the term of this Agreement (other
than as a result of a breach by Geron) [*] basis, by providing the other party
with written notice within one hundred eighty (180) days following the
termination or expiration of the KH Collaboration. If P&U elects to assume KH's
rights described in clause (a) in the foregoing sentence, the product shall be
thereafter deemed a Product for all purposes of this Agreement, including
without limitation the royalty obligations of Article 7 contained herein, and,
in addition, P&U shall be obligated to (i) make any unpaid milestone payments
specified in the KH Collaboration with respect to such product and (ii) assume
KH's obligations to develop such products in Japan and the Asian Territory. If
Geron so
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
46
elects to co-promote any such product, Geron and P&U shall promptly enter into
a separate agreement containing such terms as the parties may mutually agree
are appropriate for the co-promotion of a particular product. In the event the
parties do not enter into a separate agreement prior to the first commercial
sale of such product in Japan, the matter shall be submitted for resolution in
accordance with Section 19.10. Geron shall not assign or sublicense its right
to co-promote in Japan, except in connection with a marketing collaboration
with a Japanese partner reasonably acceptable to P&U; provided, however, that
in the case of a product containing a P&U Compound, the parties shall discuss
the nature and scope of any such marketing collaboration. Upon expiration or
termination of the KH Collaboration, Geron shall not have any rights to
co-promote with P&U any Products in either the United Kingdom or Germany.
ARTICLE 13
CONFIDENTIALITY
13.1 Confidentiality; Exceptions. Except to the extent expressly
authorized by this Agreement or otherwise agreed in writing, the parties agree
that, for the term of this Agreement and for [*] thereafter, the receiving party
shall keep confidential and shall not publish or otherwise disclose or use for
any purpose other than as provided for in this Agreement any Information and
other information and materials furnished to it by the other party pursuant to
this Agreement (collectively, "Confidential Information"), except to the extent
that it can be established by the receiving party that such Confidential
Information:
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
47
(a) was already known, other than under an obligation of
confidentiality, to the receiving party at the time of disclosure by the other
party;
(b) was generally available to the public or otherwise
part of the public domain at the time of its disclosure to the receiving party;
(c) became generally available to the public or otherwise
part of the public domain after its disclosure and other than through any act
or omission of the receiving party in breach of this Agreement;
(d) was disclosed to the receiving party, other than
under an obligation of confidentiality, by a Third Party who had no obligation
to the disclosing party not to disclose such information to others; or
(e) was independently developed by the receiving party
without the use of the other party's Confidential Information.
13.2 Authorized Disclosure. Each party may disclose the other's
Confidential Information to the extent such disclosure is reasonably necessary
in filing or prosecuting patent applications, prosecuting or defending
litigation against Third Parties, complying with applicable governmental
regulations or conducting preclinical or clinical trials or otherwise in the
development and commercialization of Products hereunder, provided that if a
party makes any such disclosure of the other party's Confidential Information
it will give reasonable advance notice to the other party of such disclosure
requirement and, except to the extent inappropriate or
48
impractical, will use its reasonable best efforts to secure confidential
treatment of such Confidential Information required to be disclosed. With the
prior consent of the other party, such consent not to be unreasonably withheld,
each party may also disclose Confidential Information to Third Parties who have
agreed to collaborate on the research, development, marketing and sale of
compounds or products; provided, that such Third Party agrees in writing to
restrictions substantially similar to the restrictions set forth in
Section 13.1.
ARTICLE 14
OWNERSHIP OF INTELLECTUAL PROPERTY AND PATENT RIGHTS
14.1 Patents Resulting from the Research Plan. During the Research
Term, Geron shall promptly inform P&U of all inventions in the Field that are
conceived or reduced to practice by service providers of Geron, solely or
jointly with service providers of P&U. During the Research Term, P&U shall
promptly inform Geron of all inventions in the Field that are conceived or
reduced to practice by service providers of P&U, solely or jointly with service
providers of Geron. For the purpose of this Article 14, "service providers"
shall mean employees of the applicable party, and consultants or other persons
or entities which are lawfully required to assign inventions to the applicable
party. Inventions conceived or reduced to practice during the course of
performing the Research shall be owned as follows:
(a) Such inventions shall be owned by P&U if conceived
and reduced to practice solely by service providers of P&U. All Patents
covering such inventions shall be P&U Patents. In the United States only, if a
continuation-in-part application is filed on a P&U Patent
49
by Geron for an invention described in subsection (c) below, Geron hereby
assigns its entire right, title and interest in any such continuation-in-part
application to P&U and P&U hereby grants to Geron, subject to the licenses
granted P&U hereunder, a perpetual, worldwide, non-exclusive, transferable,
royalty free, fully paid-up license to use such Patents for any purpose outside
the Field. Such license shall continue notwithstanding termination or
expiration of this Agreement.
(b) Such inventions shall be owned by Geron if conceived
and reduced to practice solely by service providers of Geron. All Patents
covering such inventions shall be Geron Patents. In the United States only, if
a continuation-in-part application is filed on a Geron Patent by P&U for an
invention described in subsection (c) below, P&U hereby assigns its entire
right, title and interest in any such continuation-in-part application to Geron
and Geron hereby grants to P&U, subject to the licenses granted Geron
hereunder, a perpetual, worldwide, non-exclusive, transferable, royalty free,
fully paid-up license to use such Patents for any purpose outside the Field.
Such license shall continue notwithstanding termination or expiration of this
Agreement.
(c) Such inventions shall be owned jointly by P&U and
Geron if conceived and reduced to practice jointly by or on behalf of service
providers of P&U and Geron. Such persons shall agree to assign such inventions
to P&U and Geron, as applicable. Patents claiming such jointly invented
inventions shall be Joint Patents. Subject to the licenses granted under this
50
Agreement, each party shall have the right to use Joint Patents without
accounting to the other party.
14.2 Patent Strategy. Subject to the provisions of this Article
14, the parties will cooperate in the development and execution of a patent
strategy that maximizes patent protection of Products throughout the Territory
and minimizes patent expenses. With respect to Joint Patents in particular,
Geron and P&U shall decide by mutual written agreement on a case-by-case basis
the party with primary responsibility for Joint Patent filings, prosecution,
and maintenance. Each party shall assure that each of its employees,
consultants and other contractors who perform the Research shall be lawfully
obligated to assign or license all inventions conceived or reduced to practice
during the course of performing such work to such party.
14.3 P&U Responsibility for Patent Filings. P&U will diligently
file, prosecute and maintain P&U Patents and, to the extent having primary
responsibility therefor, Joint Patents to claim commercially relevant
discoveries and inventions in the Field throughout the world. P&U will
endeavor to ensure whenever possible that claims are filed and are issued in
such Patents in the Field and that all such Patents are filed and prosecuted to
ensure the validity of such Patents. P&U will endeavor to give Geron prompt
notice of any decision to prepare a Patent relating to the Field. P&U will also
endeavor to provide Geron with draft copies of all such Patents and related
Patent prosecution documents, and Geron shall have, to the extent reasonably
possible under the circumstances, an opportunity to comment. P&U will confer
with Geron, and make reasonable effort to adopt Geron's suggestions regarding
the prosecution of such Patents.
51
Notwithstanding the foregoing, P&U shall have the right to take such actions as
are reasonably necessary to preserve its rights under P&U Patents throughout
the world. After filing a Patent or Patent prosecution document in the Field,
P&U will provide Geron a copy of any such filing. In addition, P&U will
provide Geron with a copy of any official action and P&U submissions in such
Patents, including an English translation thereof, if available.
14.4 Geron Responsibility for Patent Filings. Geron will
diligently file, prosecute and maintain Geron Patents and, to the extent having
primary responsibility therefor, Joint Patents to claim commercially relevant
discoveries and inventions in the Field throughout the world. Geron will
endeavor to ensure whenever possible that claims are filed and are issued in
such Patents in the Field and that all such Patents are filed and prosecuted to
ensure the validity of such Patents. Geron will endeavor to give P&U prompt
notice of any decision to prepare a Patent in the Field. Geron will also
endeavor to provide P&U draft copies of all such Patents and related Patent
prosecution documents, and P&U shall have, to the extent reasonably possible
under the circumstances, an opportunity to comment. Geron will confer with
P&U, and make reasonable effort to adopt P&U's suggestions regarding the
prosecution of such Patents. Notwithstanding the foregoing, Geron shall have
the right to take such actions as are reasonably necessary to preserve its
rights under Geron Patents throughout the world. After filing a Patent or
Patent prosecution document in the Field, Geron will provide P&U a copy of any
such filing. In addition, Geron will provide P&U with a copy of any official
action and Geron's submission in such Patents, including an English translation
thereof, if available.
52
14.5 Enforcement Rights. Each party shall promptly inform the
other party after it becomes aware of the possible infringement of any of the
Patents by any Third Party. Promptly after such notice, the parties agree to
meet and discuss in good faith the appropriate strategy to stop such
infringement. [*] shall have the first right to institute, prosecute, and
control any action or proceeding with respect to any Patent at its own cost and
expense. Should [*] elect not to institute, prosecute and control any such
action or proceeding within ninety (90) days following notice of any such
infringement, [*] shall have the right to institute, prosecute and control
any such action or proceeding with respect to any Patent at its own cost and
expense. Each party will timely grant any necessary authority it may legally
grant to the other party to enforce the rights under such Patent in its name in
the Field, all at the expense of the party bringing such action. The party not
controlling such action or proceeding shall have the right to participate in
such action or proceeding at its own expense and also agrees to cooperate in
such action as may be reasonably requested by the party controlling such action
or proceeding, including, without limitation, being named as a party in such
action or proceeding. Any amounts recovered as a result of such action shall
be allocated in the following order: (i) to reimburse the party initiating and
controlling the action for its reasonable out-of-pocket expenses in making such
recovery; (ii) to reimburse the other party for its reasonable out-of-pocket
expenses in making such recovery; [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
53
14.6 Patent Costs. Patent Costs for P&U Patents shall be borne
solely by P&U. Patent Costs for Geron Patents shall be borne solely by Geron.
Patent Costs for Joint Patents shall be borne by the party with primary
responsibility for that Joint Patent, on a case-by-case basis.
14.7 Infringement of Third Party Patents. If any Third Party
asserts a claim of patent infringement against P&U or Geron on account of
either P&U's or Geron's use, manufacture, or sale of Products in the Territory,
the party receiving such notice shall promptly notify the other of the
existence and details of such claim. Promptly after such notice, the parties
agree to meet and discuss in good faith the appropriate strategy to defend
against such. The parties agree to cooperate with one another in the defense
against any such claims. [*] shall, at [*] expense, control the defense
against any claim of patent infringement brought against P&U or Geron resulting
from the manufacture, sale or use of a Product by P&U, provided however, that
(i) [*] shall have the right to participate, at [*] expense, in such
defense and (ii) [*] shall be entitled to offset against the royalties payable
to [*] under Article 7 above for such Product [*] costs and
expenses (including reasonable fees for outside counsel but excluding costs for
in-house counsel) incurred by P&U to defend such claim and all royalties and
other amounts paid or payable to dispose of such claim, but excluding any
costs, expenses and other amounts relating to an unsuccessful defense against a
claim of willful infringement or punitive damages. [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
54
[*] If a claim is asserted against Geron or P&U
for activities conducted by Geron in accordance with the Research Plan, Geron
shall defend such action at its own expense.
14.8 Back-up Rights. Should Geron determine not to file,
prosecute, issue or maintain a Geron Patent or Joint Patent in the Field, it
will timely grant any necessary authority it may legally grant to P&U to file,
prosecute, issue or maintain such Patent in the name of Geron in the Field, all
at the expense of P&U. P&U shall exercise reasonable judgment consistent with
good pharmaceutical industry practices in determining whether to file,
prosecute, issue or maintain any Patent, whether under Section 14.3 or this
Section 14.8, and shall not willfully avoid the issuance of any patent to avoid
the payment of royalties to Geron; provided, however, that in the event Geron
believes that P&U has breached the foregoing covenant, the parties shall agree
to submit the matter for resolution in accordance with Section 19.10.
14.9 Assignment. Neither party may assign its rights under any
Joint Patent except with the prior written consent of the other party,
provided, however, that either party may assign such rights without consent to
an Affiliate or other permitted assignee of this Agreement.
14.10 Patent Term Extension
(a) Geron shall promptly notify P&U of (i) the issuance of each
Geron Patent, giving the date of issue and patent number for each such Patent,
and (ii) each notice pertaining to any
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
55
Geron Patent which it receives as a patent owner pursuant to the Drug Price
Competition and Patent Term Restoration Act of 1984 (hereinafter called the
"Act"), including but not limited to notices pursuant to Section Section 101
and 103 of the Act from persons who have filed an abbreviated NDA ("ANDA").
The parties shall cooperate in the enforcement of any Patent against any person
who has filed an ANDA in the manner provided in Section 14.7 above.
(b) Geron and P&U shall cooperate to obtain the maximum patent
term restoration under the Act. Geron and P&U shall also cooperate to obtain
supplementary protection certificates in respect to Patents issued by each
national patent office in the European Union, and the equivalent patent term
extensions in Japan and other countries. Each application for such extensions
shall be timely submitted by the party responsible under Sections 14.3 or 14.4
for filing and maintaining the applicable Patent.
ARTICLE 15
REPRESENTATIONS AND WARRANTIES
15.1 Both Parties. Each of the parties hereby represents and
warrants that: (a) it has taken all necessary corporate action to authorize the
execution and delivery of this Agreement and the Three-Way Agreement, and the
performance of its obligations thereunder; (b) this Agreement and the Three-Way
Agreement have been duly executed and delivered on behalf of such party and
constitute legal and binding obligations binding upon such party and
enforceable in accordance with their terms; (c) the execution, delivery and
performance of this Agreement and the Three-Way Agreement by such party does
not conflict with any agreement, instrument or
56
understanding, oral or written, to which it is a party or by which it is bound,
nor violate any law or regulation of any court, governmental body, or
administrative or other agency having jurisdiction over it; (d) except as set
forth in the KH Collaboration with regard to Geron, it has not, and during the
term of this Agreement will not, grant any right to any Third Party relating to
its respective Technology in the Field which would abrogate or otherwise
diminish the rights granted to the other party hereunder; and (e) it shall
comply in all material respects with all laws, rules and regulations applicable
to the performance of its obligations hereunder, including, to the extent
applicable to such party, the discovery, development, manufacture,
distribution, import and export and sale of pharmaceutical products.
15.2 Additional Representation by P&U. P&U further represents and
warrants that it has obtained all necessary approvals and consents of Pharmacia
& Upjohn, Inc. to enter into this Agreement and the Three-Way Agreement.
15.3 Additional Representation of Geron. Geron further represents
and warrants that, notwithstanding anything to the contrary contained herein:
(a) it owns or Controls all existing Geron Knowhow and all current Geron
Patents, including those listed on Exhibit 1.12, free and clear of any liens,
third party claims or restrictions that are inconsistent with the grant of
rights hereunder to P&U; (b) in respect to all existing Third Party Licenses,
it has the right to grant the rights granted to P&U hereunder without any
further consents, it is not aware that is in default thereunder and will take
all actions reasonably required to comply in all material respects with all
such Licenses during the term of this Agreement; (c) it has disclosed to P&U or
its counsel all
57
Patents known by it to be owned by Third Parties and to be of material
relevance in the Field; (d) it is not aware of any Patent or other intellectual
property rights of any Third Party which is reasonably likely to materially and
adversely affect either party's ability to conduct the Research or P&U's
ability to exercise and exploit any license granted to it under this Agreement;
(e) it is not aware of any facts or circumstances which are reasonably likely
to cause any of the issued Geron Patents to be invalid or any of the pending
Geron Patents not to be validly issued; and (f) except as expressly set forth
in the Third Party Licenses or otherwise on Exhibit 4.5, the license rights
granted to P&U shall not be subject to any retained rights of any state,
Federal or national government or governmental entity, including rights of the
United States Government under the Xxxx-Xxxx Act.
ARTICLE 16
PUBLICITY AND PUBLICATIONS
16.1 Publicity Review. The parties agree that the public
announcement of the execution of this Agreement shall be in the form of a press
release to be agreed upon by the parties. In addition, Geron and P&U will
jointly discuss and agree on the scope and content of any statement to the
public regarding this Agreement or any aspect of this Agreement, subject in
each case to disclosure otherwise required by law or regulation, including,
without limitation, disclosure required by (i) order of a court, (ii) United
States or Italian securities law filings in connection with public offerings or
periodic reporting requirements, or (iii) prosecution of patent applications.
In such event, the disclosing party shall promptly notify the other party of
such
58
disclosure before or as soon as practical after the disclosure. Geron and P&U
agree that all such statements to the public shall be accurate in all material
respects, consistent with requirements for confidentiality under Article 13,
designed to limit the advantage a competitor of Geron or P&U may gain from any
such statement, in compliance with the requirements of disclosure under any
applicable securities laws or associated with periodic reporting requirements,
and consistent with the standards and customs in the pharmaceutical industry
for such statements by companies comparable to Geron and P&U. The terms of
this Agreement may also be disclosed to Third Parties solely to the extent
reasonably required in the disclosing party's ordinary course of business, so
long as such disclosure is made under an obligation of confidentiality;
provided however, that in no event may the terms of this Agreement be disclosed
to potential collaborators or licensees without the prior written consent of
the other party, such consent not to be unreasonably withheld. P&U and Geron
shall have the right to review all SEC filings of the other party describing
the terms of this Agreement or the arrangements between the parties reflected
herein, prior to their submission to the SEC, including all proposed redacted
copies of this Agreement. Geron and P&U shall have no obligation to submit any
SEC filings or other documents to the other party that contain identical
information previously approved by the other party for disclosure in the same
context. Geron and P&U shall give due respect to any reasonable and timely
request by the other party with respect to such filings, including confidential
treatment of selected portions of this Agreement.
16.2 Publications. Each party agrees that it shall not publish or
present the results of the Research without the opportunity for prior review by
the other party. Each party shall
59
provide to the other the opportunity to review any proposed abstracts,
manuscripts, or presentations (including information to be presented verbally)
which describe a Product or a compound that may lead to a Product and that has
not been previously disclosed to the public at least sixty (60) days prior to
the intended date of such publication, and such submitting party agrees, upon
written request from the other party, not to submit such abstract or manuscript
for publication or to make such presentation until the other party has been
provided a reasonable period of time to file patent applications on any
material in such publication or presentation which it believes is patentable or
to otherwise require the redaction of any material business, clinical or
scientific information. It is the intent of the parties not to disclose
publicly any information which may adversely affect any patent rights or either
party's reasonable commercial interests.
ARTICLE 17
TERM AND TERMINATION
17.1 Term. This Agreement shall commence as of the Effective Date
and, shall continue in effect until the later of [*]
17.2 Termination for Breach. If either party materially breaches
this Agreement at any time, which breach is not cured within ninety (90) days
of written notice thereof from the non-breaching party, the non-breaching party
may elect either to terminate this Agreement, in which case all rights and
obligations of each party under this Agreement shall terminate, or modify this
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
60
Agreement on the terms and conditions set forth below. Promptly after delivery
of any such notice of material breach, the parties shall meet to discuss all
relevant facts and circumstances and attempt to agree upon a remedial plan. In
the event of such a breach by Geron during the Research Term, P&U may elect to
modify the Agreement as follows: [*] In the event of such a breach by Geron
after the Research Term, P&U may elect to modify the Agreement as follows: [*]
In the event of such a breach by P&U during the Research Term, then Geron may
elect to modify this Agreement as follows: [*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
61
[*]. In the event that such termination occurs after the Research Term
as a result of a breach by P&U of its development or commercialization
obligations under this Agreement, including, without limitation, Sections 3.1
or 5.1 hereof, and the breach specifically relates solely to a specific
Candidate Drug or Product, [*]. Any termination or modification under this
Section 17.2 shall be subject to Sections 17.6 and 17.7.
17.3 Termination for Bankruptcy. Either party may terminate this
Agreement with notice if the other party makes an assignment for the benefit of
creditors, is the subject of proceedings in voluntary or involuntary bankruptcy
instituted on behalf of or against such party, or has a receiver or trustee
appointed for all or substantially all of its property; provided that in the
case of an involuntary bankruptcy proceeding such right to terminate shall only
become effective if the party consents to the involuntary bankruptcy or such
proceeding is not dismissed within one hundred eighty (180) days after the
filing thereof. Except for rights to trademarks and trade names, all rights
and licenses granted under or pursuant to this Agreement by P&U or Geron are,
and shall otherwise be deemed to be, for purposes of Section 365(n) of the U.S.
Bankruptcy Code, licenses of right 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 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 party
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
62
hereto which is not a party to such proceeding 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 their possession, shall be promptly delivered to them (i) upon any
such commencement of a bankruptcy proceeding upon their written request
therefor, 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 therefor by an
non-subject party.
17.4 Termination for Certain Other Events. This Agreement shall
terminate, upon notice from either party, in the event: [*] Upon any
such termination pursuant to this Section 17.4, all rights and licenses granted
by Geron to P&U shall terminate and all payment obligations due thereafter
under this Agreement shall terminate.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
63
17.5 Change of Control.
(a) During the Research Term. In the event that during
the Research Term a Third Party or KH or its Affiliates (the "Acquiring Party")
shall propose to acquire, directly or indirectly, [*] or more of the outstanding
shares entitled to vote for the election of directors of Xxxxx, Xxxxx shall
notify P&U of the proposed acquisition not less than sixty (60) days prior to
consummation of such acquisition. P&U shall have the right, within 60 days of
such notice, to elect to do one of the following: [*] P&U may make such election
contingent upon the consummation of the proposed transaction. [*]
(b) After the Research Term. If, at any time after the
Research Term, any Acquiring Party shall propose to acquire, directly or
indirectly, [*] or more of the
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
64
outstanding shares entitled to vote for the election of directors of Xxxxx,
Xxxxx shall notify P&U of the proposed acquisition not less than sixty (60) days
prior to consummation of such acquisition. P&U shall have the right, within
sixty (60) days of such notice, [*] P&U may make such election contingent upon
the consummation of the proposed transaction. [*]
(c) General. Promptly after Geron notifies P&U concerning
any proposed transaction with an Acquiring Party, the parties shall meet and
discuss in good faith the issues related to the proposed transaction. Any
Confidential Information of P&U relating to the clinical development,
manufacture or marketing of Products shall not be disclosed to any Acquiring
Party and may not be used by any Acquiring Party. P&U shall not be required to
disclose any such Confidential Information to any Acquiring Party.
17.6 Surviving Rights. The obligations and rights of the parties
under Sections 2.3, 7.3, 7.10, 14.1, 14.6, 14.7, 14.9 and 16.1 and Articles 13,
17, 18, and 19 of this Agreement will survive termination.
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
65
17.7 Accrued Rights, Surviving Obligations. Termination,
relinquishment, or expiration of this Agreement for any reason shall be without
prejudice to any rights which shall have accrued to the benefit of either party
prior to such termination, relinquishment, or expiration, including damages
arising from any breach hereunder. Such termination, relinquishment, or
expiration shall not relieve either party from obligations which are expressly
indicated to survive termination or expiration of the Agreement.
ARTICLE 18
INDEMNIFICATION, DISCLAIMERS AND LIMITATIONS
18.1 P&U Indemnification. P&U shall indemnify and hold Geron and
its Affiliates harmless from and against any and all liability, damage, loss,
cost (including reasonable attorneys' fees), and expense resulting from any
claim for bodily injury or property damage: (a) relating to the development,
manufacture, use, distribution, or sale of any Product by P&U, its Affiliates or
sublicensees in the Territory, or (b) due to the negligence or willful
misconduct of P&U, its Affiliates or sublicensees, or their employees or agents.
P&U shall indemnify and hold Geron and its Affiliates harmless from and against
any and all liability, damage, loss, cost (including reasonable attorneys'
fees), and expense resulting from any (i) breach of P&U's representations under
Article 15, (ii) except as provided in Section 18.2 below, claim of patent
infringement or violation of other intellectual property rights arising out of
P&U's, its Affiliate's or sublicensee's conduct of the Research or Geron's, its
Affiliate's or sublicensee's use of the P&U Technology in the conduct of the
Research or (iii) claims of patent infringement arising out
66
of P&U's, its Affiliates' or sublicensees' method of manufacture of Candidate
Drugs and Products.
18.2 Geron Indemnification. Geron shall indemnify and hold P&U and
its Affiliates harmless from and against any and all liability, damage, loss,
cost (including reasonable attorneys' fees), and expense resulting from any
claim: (a) relating to the development, manufacture, use, distribution or sale
by Geron, its Affiliates or sublicensees of any product containing Geron or KH
Compounds, the rights to which reverted to Geron under this Agreement or (b)
other than product liability claims, (i) arising directly out of Geron's
co-promotion activities pursuant to this Agreement, or (ii) due to the
negligence or willful misconduct of Geron, its Affiliates or sublicensees, or
their employees or agents. Geron shall indemnify and hold P&U and its
Affiliates harmless from and against any and all liability, damage, loss, cost
(including reasonable attorneys' fees), and expense resulting from any (i)
breach of Geron's representations under Article 15, or (ii) claim of patent
infringement or violation of other intellectual property rights arising out of
Geron's, its Affiliate's or sublicensee's conduct of the Research or P&U's, its
Affiliate's or sublicensee's use of the Geron Technology in the conduct of the
Research.
18.3 Employees. Each party shall indemnify and hold the other
party harmless, and hereby forever releases and discharges the other party,
from and against all claims, demands, liabilities, damages and expenses
(including attorney's fees) arising out of personal injury (including death) or
property damage incurred or suffered by employees or consultants of the
67
indemnifying party, its Affiliates or contractors in the performance of or
under this Agreement, except to the extent caused by the sole negligence,
recklessness or willful misconduct of such other party, its employees or
agents.
18.4 Claim Procedure. Upon obtaining knowledge of the institution
of any action, proceeding, or other claim or demand of indemnity hereunder, the
party seeking indemnification (the "Indemnified party") shall promptly notify
in writing the other party thereof (the "Indemnifying party"). If such claim or
demand relates to a claim or demand asserted by a Third Party, the Indemnifying
party shall have the right at its expense to employ counsel to defend such
claim or demand and the Indemnified party shall have the right, but not the
obligation, at its expense to participate in the defense of any such claim or
demand. So long as the Indemnifying party is defending such claim or demand in
good faith, the Indemnified party will not settle such claim or demand without
the Indemnifying party's consent. The Indemnified party shall make available to
the Indemnifying party all records and other materials reasonably required by
it in contesting a claim or demand asserted by a Third Party against the
Indemnified party and shall cooperate in the defense thereof.
18.5 Limited Liability. NOTWITHSTANDING ANYTHING ELSE IN THIS
AGREEMENT OR OTHERWISE, NEITHER GERON (OR ITS AFFILIATES) NOR P&U (OR ITS
AFFILIATES) WILL BE LIABLE WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT
UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY, OR
68
OTHER LEGAL OR EQUITABLE THEORY FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES OR
LOST PROFITS.
18.6 Warranty Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED
IN THIS AGREEMENT, NEITHER PARTY MAKES ANY WARRANTY WITH RESPECT TO ANY
TECHNOLOGY, GOODS, SERVICES, RIGHTS, OR OTHER SUBJECT MATTER OF THIS AGREEMENT
AND HEREBY DISCLAIMS WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, AND NON-INFRINGEMENT WITH RESPECT TO ALL OF THE FOREGOING.
ARTICLE 19
MISCELLANEOUS
19.1 Reasonable Diligent Effort. As used herein, the term
"reasonable diligent effort" means efforts and resources commonly used in the
research-based pharmaceutical industry for a product at a similar stage in its
product life taking into account the establishment of the product in the
marketplace, the competitiveness of the marketplace, the proprietary position
of the product, the regulatory structure involved, the profitability of the
product and other relevant factors. Such resources and efforts shall be
determined for a particular Product on a case-by-case basis; and it is
anticipated that the level of effort will change over time reflecting changes
in the status of the Product and the marketplace.
69
19.2 Assignment; Sale or Merger. Neither Geron nor P&U shall have
the right to assign any or all of its rights under this Agreement to any Third
Party or KH or its Affiliates without the prior written consent of the other
party. Notwithstanding the foregoing, but subject to the terms of Section
17.5, either party may assign all of its rights or obligations under this
Agreement without the other party's consent (i) to any Affiliate provided that
such Affiliate is also assigned the related business and assets which are the
subject of this Agreement and (ii) in connection with the sale of all or
substantially all of the assigning party's related business, whether by merger,
stock sale, or other transaction; provided that in either case, such assignment
shall not relieve such party of its responsibilities for performance of its
obligations under this Agreement. This Agreement shall survive any merger of
either party with or into another party.
19.3 Meetings. Meetings of the JRC may be called by either party
on thirty (30) days written notice to the other unless such notice is waived by
the parties in writing or by the attendance of all representatives. The JRC
may be convened, polled, or consulted from time to time by means of
telecommunication or correspondence.
19.4 Retained Rights. Except as expressly set forth in this
Agreement, nothing in this Agreement shall limit in any respect the right of
either party to conduct research and development and market products outside
the Field using such party's Technology, and no license to use the other
party's Technology to do so is granted herein by implication.
19.5 Force Majeure. Neither party shall lose any rights hereunder
or be liable to the other party for damages or losses or otherwise be deemed to
be in default on account of failure of
70
performance by the defaulting party if the failure is occasioned by government
action, war, fire, earthquake, explosion, flood, strike, lockout, embargo, act
of God, or any other similar or dissimilar cause beyond the control of the
defaulting party; provided, that the party claiming force majeure has exerted
all reasonable efforts to avoid or remedy such force majeure, provided,
however, that in no event shall a party be required to settle any labor dispute
or disturbance.
19.6 Further Actions. Each party agrees to execute, acknowledge
and deliver such further instruments, and to do all such other acts as may be
necessary or appropriate to carry out the purposes and intent of this
Agreement.
19.7 No Trademark Rights. Except as otherwise expressly provided
herein, no right is granted by the Agreement to use in any manner the name
"Geron" or "Pharmacia & Upjohn" or any other trade name or trademark of the
other party in connection with the performance of this Agreement.
19.8 Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered personally or by facsimile
transmission (receipt verified), five (5) business days after mailed by
registered or certified mail (return receipt requested), postage prepaid, or
sent by express courier service to the parties at the following addresses (or
at such other address for a party as shall be specified by like notice,
provided that notices of a change of address shall be effective only upon
receipt thereof):
If to Geron, addressed to: Geron Corporation, 000 Xxxxxxxxxxxx Xxxxx,
Xxxxx Xxxx, XX 00000; Attention: President; Telephone: 000-000-0000;
Facsimile: 000-000-0000; with a copy
71
to: Venture Law Group, 0000 Xxxx Xxxx Xxxx, Xxxxx Xxxx, XX 00000; Attention:
Xxxxxx X. Xxxxx; Telephone: 000-000-0000; Facsimile: 000-000-0000.
If to P&U, addressed to: P&U & Upjohn S.p.A., Xxx Xxxxxx Xxxx, 0.0,
00000 Xxxxxx, Xxxxx; Attention: Managing Director; Telephone: x00 0 0000 0000;
Facsimile: x00 0 0000 0000; with a copy to: Xxxxxx & Xxxx, 000 Xxxxxxx Xxxx.,
Xxxxxxxx, Xxxxxxxxxxx 00000; Attention: Xxxxx X. Xxxxxxxxxx, Xx.; Telephone:
(000) 000-0000; Facsimile: (000) 000-0000.
19.9 Governing Law. This Agreement shall be governed by the laws
of the State of New York, U.S.A., as such laws are applied to contracts entered
into and to be performed within such state notwithstanding the provisions
governing conflict of laws under such laws to the contrary.
19.10 Dispute Resolution.
(a) General. The parties recognize that disputes as to
certain matters may arise from time to time arise during the term of this
Agreement which relate to either party's rights or obligations hereunder. It
is the objective of Geron and P&U to establish procedures to facilitate the
resolution of disputes arising under this Agreement in an expedient manner by
mutual cooperation and without resort to litigation. To accomplish this
objective, the parties agree to follow the procedures set forth in this Section
19.10, if and when a dispute arises under this Agreement.
72
(b) Prior Negotiation. Except for disputes within the
JRC, all disputes hereunder will be resolved as provided in this Section 19.10.
Either party may, by written notice to the other, have such dispute referred to
their respective chief executive officers, for attempted resolution by good
faith negotiations within twenty (20) business days after such notice is
received. In the event the designated executive officers are not able to
resolve such dispute within thirty (30) business days after such notice, either
party may at anytime thereafter invoke the provisions of Section 19.10(c).
(c) Arbitration. Except for disputes within the JRC, any
controversy or claim arising out of or relating to this Agreement, or the
breach thereof, will be finally settled by binding arbitration in New York, New
York U.S.A. under the Commercial Arbitration Rules of the American Arbitration
Association, by three arbitrators appointed in accordance with said rules.
Each party shall select one such arbitrator, and the two arbitrators so chosen
shall select the third arbitrator. The arbitrators shall apply New York law,
without reference to rules of conflicts or law or rules of statutory
arbitration, to the resolution of any dispute. Judgment on the award rendered
by the arbitrators may be entered in any court having jurisdiction thereof.
Notwithstanding the foregoing, the parties may apply to any court of competent
jurisdiction for preliminary or interim equitable relief to compel arbitration
in accordance with this Section 19.10, or to resolve any disputes primarily
relating to patent matters (including, without limitation, matters relating to
the validity, scope or ownership of patents) without breach of this arbitration
provision.
73
19.11 Waiver. All waivers must be in writing signed by authorized
representatives of both parties. Except as specifically provided for herein,
the waiver from time to time by either of the parties of any of their rights or
their failure to exercise any remedy shall not operate or be construed as a
continuing waiver of same or of any other of such party's rights or remedies
provided in this Agreement.
19.12 Severability. If any term, covenant or condition of this
Agreement or the application thereof to any party or circumstance shall, to any
extent, be held to be invalid or unenforceable, then (i) the remainder of this
Agreement, or the application of such term, covenant, or condition to parties
or circumstances other than those as to which it is held invalid or
unenforceable shall not be affected thereby, and each term, covenant, or
condition of this Agreement shall be valid and be enforced to the fullest
extent permitted by law; and (ii) the parties hereto covenant and agree to
renegotiate for a period of ninety (90) days after such provision is held to be
invalid or unenforceable any such term, covenant, or application thereof in
good faith to provide a reasonably acceptable alternative to the term,
covenant, or condition of this Agreement or the application thereof that is
invalid or unenforceable, it being the intent of the parties that the basic
purposes of this Agreement are to be effectuated.
19.13 Entire Agreement. This Agreement and the Three-Way Agreement
set forth all the covenants, promises, agreements, warranties, representations,
conditions, and understandings between the parties hereto and supersedes and
terminates all prior agreements and understandings, including, without
limitation, the Heads of Agreement dated December 20,
74
1996, other than those pertaining to confidential information between the
parties and the Common Stock Purchase Agreements dated December 20, 1996, and
March 23, 1997. There are no covenants, promises, agreements, warranties,
representations, conditions, or understandings, either oral or written, between
the parties other than as set forth herein. No subsequent alteration,
amendment, change, or addition to this Agreement shall be binding upon the
parties hereto unless reduced to writing and signed by the respective
authorized officers of the parties.
19.14 Effective Date.
(a) This Agreement shall be effective the business day
following the satisfaction of the last to occur of each of the following (the
"Effective Date"):
(i) all filings shall have been made, and the
expiration or termination of all waiting periods under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended;
(ii) amendment of the KH Agreement in a manner
satisfactory to each of P&U and Geron;
(iii) execution of the Three-Way Agreement by
Geron, P&U and Kyowa Hakko; and
(iv) receipt of all other government approvals
necessary to enter into this Agreement, the Three-Way Agreement and the
amendment to the KH Collaboration.
75
(b) P&U and Geron shall use their best efforts to satisfy
each of the foregoing conditions as soon as possible following the Signature
Date.
19.15 Third Party Rights. The parties acknowledge that certain of
the obligations, rights and licenses granted pursuant to this Agreement are
subject to the terms and conditions of applicable Third Party Licenses. Except
as expressly set forth in Article 15, in the event of a conflict between the
terms and conditions of this Agreement and the applicable Third Party License,
the terms and conditions of the applicable Third Party License shall control.
76
IN WITNESS WHEREOF, the parties have executed this License and
Research Collaboration Agreement in duplicate originals by their proper
officers as of the date and year first above written.
GERON CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------
Title: President
----------------------------
PHARMACIA & UPJOHN S.p.A.
By: /s/ Xxxxxxxx Xxxxxxxxx
-------------------------------
Title: Managing Director
----------------------------
77
EXHIBIT 1.6
INTERPRETIVE EXAMPLES
The following examples are intended to illustrate the parties' intent
concerning the meaning of the sections of the Agreement set forth below:
SECTION 1.6 - "CONTROL"
Control shall include rights which a party may acquire by the exercise of a
option under, for example, a sponsored research agreement so long as the
applicable royalty rate does not exceed the rate set forth in a related license
agreement already in effect between the parties. If the royalty rate increases
(or additional payments are required which are not otherwise payable under an
existing Third Party License), the exercise of such rights shall be treated as
an expansion of a Third Party License under Section 4.6.
SECTION 4.5/4.6 - NEW "THIRD PARTY LICENSES"
Geron shall pay all royalties and other payments due under its existing Third
Party Licenses to the extent not exceeding the rate or amounts now set forth in
such Licenses. If, for example, a new invention arises under an existing
sponsored research agreement and Geron may acquire
78
rights to such invention only upon the payment of a royalty rate higher than
the rate now set forth in any applicable Third Party License, the acquisition
of such rights shall be deemed an expansion of such Third Party License as
described in Section 4.5. Whether Geron acquires such rights shall first be
determined by the JRC under Section 4.6. If the JRC approves the acquisition
of such rights, the royalty payments exceeding the amounts set forth in the
existing applicable Third Party Rights shall be shared equitably as provided in
Section 4.6.
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
79
EXHIBIT 1.12
GERON PATENTS
I. PATENTS OWNED BY GERON
1. Telomerase Screens and Inhibitors: [*]
2. TRAP and other Telomerase Activity Assays: [*]
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
80
3. RNA Component of Telomerase (hTR): [*]
[*]
4. hTR Promoter Screen: [*]
[*]
5. Telomerase Cloning: [*]
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
81
6. Telomere Length Assays: [*]
[*]
II.PATENTS EXCLUSIVELY LICENSED BY OR UNDER OPTION TO GERON
1. Third Party Licensor: The Board of Regents of the University
of Texas ("UT" - all) and The Board of Regents of the University of California
("UC" - 2/3 through 4/5). [*]
[*]
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
82
[*]
[*]
2. Third Part Optionor: Baylor University. [*]
[*]
3. Third Party Optionor: Cold Spring Harbor Laboratory. [*]
[*]
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
83
[*]
4. Third Party Licensor: Xxxx Xxxxxxxxxx Cancer Research Center.
[*]
[*]
5. Third Party Optionor: McMaster University. [*]
[*]
6. Third Party Licensor: University Technology Corporation (for
the University of Colorado). [*]
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
84
EXHIBIT 1.37
RESEARCH PLAN
AIM: This workplan provides the description of activities, timelines and
resource allocations concerned with the P&U-Geron collaborative research
project to discover and develop small organic inhibitors of telomerase for the
treatment of cancer in humans.
GENERAL PRINCIPLES: Research activities aimed at discovering telomerase
inhibitors will be pursued in a collaborative and coordinated fashion by Geron
and P&U. To maximize synergy, both sides will contribute with the most
appropriate resources, including FTEs, taking into account the expertise and
capabilities present at each site, thus avoiding duplication and overlap.
A Project Team will be established with members from Geron and P&U representing
key competencies required for optimal advancement of research. Thus the
composition of the Project Team may change as the collaboration progresses.
[*]
[Graphic: Work Flow Chart which indicates in
graphic flow-chart format the basic research
responsibilities arising from this agreement.]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
85
DESCRIPTION OF ACTIVITIES:
Basic Research
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
86
Screening
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
87
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
88
CD CRITERIA
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
89
[*]
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
90
EXHIBIT 2.4
JOINT RESEARCH COMMITTEE
Geron's initial appointees to the JRC: Xxxxxx X. Xxxxxxx
Xxxxxxxx Xxxxx
Xxxxxx X. Xxxxxx
P&U's initial appointees to the JRC: Xxxxxxxx Xxxxxxxxx
Xxxxx Xxxxxxx
Rolf Klepzen
91
EXHIBIT 4.5
THIRD PARTY LICENSES
X. XXXXX SPONSORED RESEARCH AGREEMENTS
A. University of Texas Southwestern Medical Center -- [*]
X. XxXxxxxx University -- [*]
C. Cold Spring Harbor Laboratory -- [*]
X. Xxxxxx College of Medicine -- [*]
II. LICENSES GRANTED TO XXXXX
X. University Technology Corporation (for the University of
Colorado) -- Exclusive Patent License Agreement Effective 9 December
1996.
B. The Regents of the University of Texas -- [*]
C. The Regents of the University of California -- Exclusive
Patent License Agreement Effective 2 February 1994.
D. Cold Spring Harbor Laboratory -- Exclusive License Agreement
for Telomerase Inhibition Screen Effective September 1993.
III. LICENSES GRANTED BY XXXXX
X. The U.S. and State Governments -- Licenses Granted Pursuant to
Government Funding (standard statutory licenses granted to the U.S.
Government in connection with the receipt of governmental funding,
i.e., royalty-free license to the government and march-in rights):
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
92
1. National Cooperative Drug Discovery Grant;
Telomerase: A Molecular Target for Cancer Chemotherapy (with
Memorial Xxxxx-Xxxxxxxxx Cancer Center); Funding Period: 21
September 1995 to 31 August 2000.
2. The Regents of the University of California
Breast Cancer Research Program; Telomerase: A Factor for Early
Detection of Breast Cancer; Funding Period I July 1995 to 30
June 1997.
3. National Science Foundation Grant; Telomere
Synthesis and Maintenance in Higher Eukaryotes (formerly with
the University of California, Xxxxx); Funding Period 15 April
1993 to 31 March 1997.
4. National Institute of Aging Grant; Structure
and Function of Telomeres in Mammalian Aging (Cold Spring
Harbor Laboratory & McMaster University); Funding Period 15
September 1991 to 31 July 1996.
5. Small Business Research Program SBIR Grant
(Phase 1); Telomerase Expression as a Prognostic Indicator for
Breast Cancer; Funding Period: March 1995 to May 1995. Note
Phase 2 application is pending and has received favorable
consideration (Funding Period 1 March 1997 to 30 April 1999).
6. National Science Foundation Grant;
Transcriptional Enhancers and Chromatin Structure (formerly
with the University of Michigan); Funding Period: 31 May 1993
to 31 May 1995.
7. Allied Signal Project; Cell and Animal Models
of Telomere Loss in Aging (with Cold Spring Harbor Laboratory
& McMaster University); Funding Period: 1 April 1993 to 30
October 1994.
8. Small Business Research Program SBIR Grant
(Phase 1); Telomerase Inhibition as a Selective Anti-Cancer
Therapy; Funding Period 7 July 1994 to 7 December 1994.
B. Research-Use-Only Kit Licenses
1. Boehringer Mannheim -- TRAP Assay Kits;
Effective 21 March 1996.
2. Dako Corporation -- Telomerase RNA Component
Assay Kits; Effective 27 February 1996.
93
3. Kyowa Medex Co., Ltd.-- TRAP Assay Kits &
Clinical Diagnostics Using Same; Effective 12 June 1996.
4. Oncor, Inc. -- TRAP Assay Kits; Effective 1
November 1995.
5. Pharmingen -- TRAP Assay and Telomere Length
Analysis Kits; Effective Date 15 October 1996.
94
EXHIBIT 10
COMMON STOCK PURCHASE AGREEMENT
(Attached as Exhibit 10.29 to the Company's Report on
Form 10-Q for the Quarter Ended March 31, 1997)
95
EXHIBIT 11
CO-PROMOTION TERMS
The following terms shall be contained in a separate co-promotion agreement
that shall be entered into pursuant to Section 11.2 of the Agreement. In this
Exhibit 11 "P&U" shall refer to the Pharmacia & Upjohn Affiliate in the United
States, which shall be a party to the co-promotion agreement.
1. Direct Sales Forces. The parties shall co-promote the
Products in the United States using their own direct sales
forces and a centrally coordinated marketing approach
developed by P&U. The Products shall be sold with identical
packaging and promotional materials.
2. Manufacturing Distribution and Pricing. P&U will be solely
responsible for manufacturing, physically distributing,
shipping, booking sales, and invoicing all Products. P&U
shall also be solely responsible for determining the sales
price and all pricing related strategies.
3. Account Allocation. Although P&U has the primary marketing
role, Geron shall have the right to deploy a co-promotion
sales force. Such Geron sales force shall comprise such
number of sales representatives as may be required to
effectively perform the level of detailing and other
promotional activities required to achieve [*]of the sales in
the United States, which the parties now intend will require
having [*] of the total number of direct sales representatives
detailing and promoting the Products. The parties agree to
allocate accounts in an unbiased manner based on objective,
quantifiable information and market research data with the
objective of allocating to each party accounts from which each
such party will have the opportunity to maximize sales. Geron
recognizes that P&U's representatives may also call on the
same accounts to promote P&U's other products, and may also
promote the Products. However, the representatives will
coordinate their efforts to optimize the calling effort on
each account.
4. Sales and Distribution. Winless otherwise agreed, P&U shall
have the sole responsibility with respect to the following:
4.1 Booking sales for and distribution of Products.
Geron shall refer orders to P&U.
_____________________
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
96
4.2 Handling all returns of Products. Any Products
returned to Geron shall be shipped to the facility
responsible for shipment of Products in United States
to the attention of the Returned Goods Department or
another location as may be designated by P&U.
4.3 Handling all recalls of Products. Geron will make
available to P&U, upon request, all of its pertinent
records which P&U may reasonably request to assist
P&U in effecting any recall.
4.4 Handling all aspects of order processing, invoicing
and collection, Product distribution, warehousing,
inventory and receivables, and collection of data of
sales to hospitals and other end users.
4.5 Handling all other customer service related
functions.
5. Marketing and Promotional Materials. All marketing and
promotional materials related to the Products shall be
prepared by P&U, and all marketing and promotional platforms
and campaigns shall be subject to review and approval by P&U.
P&U shall be entitled to select any Third Parties involved in
the preparation of such materials. With respect to written
and visual promotional or educational materials, to the extent
such materials identify or otherwise make reference to either
of the parties, Geron and P&U shall both be presented and
described as having participated in the development and
commercialization of such Product, as permitted by applicable
laws and regulations. All documentary information,
promotional material and oral presentations (where practical)
regarding the detailing and promoting of Products shall state
this arrangement and display the names and logos of Geron and
P&U.
6. Training Program. P&U shall develop training programs
relating to Products for the sales forces of each party. The
parties agree to utilize such training programs on an ongoing
basis to assure a consistent, focused promotional strategy.
The initial training shall be carried out at a time which is
mutually acceptable to the parties, and which is prior to but
reasonably near the date on which the first NDA approval is
expected. As additional members are added to the parties'
respective sales forces, training will be given to groups of
the newly selected members. While P&U will be responsible for
providing such training, Geron shall pay all costs and
expenses for its sales representatives, including salaries,
and travel expenses.
7. Compliance with Laws. Geron shall comply with all applicable
laws and regulations, and drug regulatory agency policies and
guidelines relating to the promotion of the Product.
8. Direct Sales. Each party shall maintain its own direct sales
force of suitably qualified and trained professional
representatives. Such representatives shall be employees or
independent contractors of such party. Geron's sales force
shall
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97
comprise such number of sales representative that equals
approximately [*] of the total number of Geron and P&U sales
representatives Detailing (as defined below) and promoting the
Products. Neither party shall have any authority or
responsibility for the hiring, firing, compensation or
employee benefits of the other party's sales force personnel.
Each party shall pay all costs and expenses required to
maintain its own sales force, including salaries, bonuses,
benefits, car allowances, and travel expenses. Geron's
compensation set forth below is based on Geron's compliance
with the foregoing requirements. In all material respects
(other than as to employment matters), P&U shall treat the
Geron and P&U representatives as a combined sales force and
shall provide the Geron representatives with the same support
and assistance it provides its own representatives Detailing
and promoting the Products.
9. Promotional Plan. P&U, in consultation with Geron, shall
establish a marketing and promotional plan each year (the
"Promotional Plan"). The Promotional Plan shall include the
general promotional activities planned for such year, and the
allocation of specific responsibilities of the sales forces of
P&U and Geron. Such specific responsibilities shall include
the expected level of detailing and other promotional
activities by Geron, and an allocation of the accounts and
markets to which each party shall focus its detailing efforts.
10. Detailing Effort. Geron shall detail the Products as required
by the Promotional Plan using its qualified direct sales force
personnel. The detailing effort shall be shared in accordance
with the allocation described in Paragraph 3 above.
"Detailing" shall mean a face-to-face meeting with individual
physicians or other potential prescribers of the Products
where the Products and its therapeutic use are presented in
the [*] Geron shall allow P&U's sales management personnel
from time to time to accompany its sales representatives on
detail calls to monitor their performance and facilitate
training.
11. Co-Promotion Compensation. Geron shall receive an annual fee
equal to [*] of the [*], which shall be determined as follows:
11.1 The [*] shall equal [*] in the co-promotion country,
less:
(a) COGS,
(b) Distribution Expenses,
(c) Royalties, and
(d) Marketing Costs
11.2 Each of The foregoing terms shall be defined as
follows:
____________________
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
-3-
98
(a) "COGS" shall be as defined in the Agreement.
(b) "Distribution Expenses" means [*].
(c) "Royalties" means [*].
(d) "Marketing Costs" means [*].
(e) "Allocable Overhead" means [*].
-4-
* Certain portions of this Exhibit have been omitted for which confidential
treatment has been requested and filed separately with the Securities and
Exchange Commission.
99
All accounting and allocation of costs will be consistent with
the costs attributed to P&U product management as measured in
P&U's standard accounting system for activities directly
related to products sold.
12. Adverse Drug Events. The parties recognize that P&U, as the
holder of the NDA, may he required to submit information and
file reports to various governmental agencies on compounds
under clinical investigation, compounds proposed for
marketing, or marketed drugs. Information must be submitted
at the time of initial filing for investigational use in
humans and at the time of a request for market approval of a
new drug. In addition, supplemental information must be
provided on compounds at periodic intervals and adverse drug
experiences must be reported at more frequent intervals
depending on the severity of tile experience. Consequently,
each party agrees to follow P&U's standard operating
procedures ("SOPs") for the reporting of adverse events in
effect from to time to time and, to the extent not
inconsistent with the SOPs, the following:
12.1 provide to the other for initial and/or periodic
submission to government agencies significant
information on the drug from preclinical laboratory,
animal toxicology and pharmacology studies, as well
as adverse drug experience reports from clinical
trials and commercial experiences with the compound;
12.2 in connection with investigational drugs, report to
the other within three (3) days of the initial
receipt of a report of any unexpected or serious
adverse experience with the drug, or sooner if
required for either party to comply with regulatory
requirements; and
12.3 in connection with marketed drugs, report to the
other within five (5) business days of the initial
receipt of a report of any adverse experience with
the drug that is serious and unexpected or sooner if
required for either party to comply with regulatory
requirements. Serious adverse experiences mean any
experience that suggests a significant hazard,
contraindication, side effect or precaution, or any
experience that is fatal or life threatening, is
permanently disabling, requires or prolongs inpatient
hospitalization, or is a congenital anomaly, cancer,
or overdose. An unexpected adverse experience is one
not identified in nature, specificity, severity or
frequency in the current investigator brochure of the
U.S. labeling for the drug. Each party also agrees
that if it contracts with a Third Party for research
to be performed by such Third Party on the drug, that
party agrees to require such Third party to report to
contracting party the information set forth in
subparagraphs 12.1, 12.2 and 12.3 above.
-5-
100
13. Other Terms.
13.1 P&U shall xxxxx Xxxxx such rights under P&U's
trademarks for the Products as shall be necessary to
perform the co-promotion activities.
13.2 Geron may not conduct, directly or indirectly, any
clinical trials of the Product. All required Phase
IV and marketing trials shall be conducted by P&U.
13.3 If required in the United States, P&U shall grant
such rights under its NDA and other registrations as
may be required for Geron to conduct its
co-promotional activities.
13.4 P&U shall have the right to terminate the
co-promotion agreement if Geron fails to remedy a
material breach within a reasonable time. P&U may
also terminate the copromotion agreement if it
permanently withdraws the Products from the market in
the United States.
13.5 Each party shall have the right to inspect the
records of the other party relevant to monitoring the
other party's performance, including Geron's
detailing records and P&U's costs records relating to
the determination of the Net Marketing Margin.
13.6 Such additional or modified terms as may be required
to comply with any legal requirements of the United
States.
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