SB/HGS DIAGNOSTIC LICENSE AGREEMENT
This Agreement is effective as of this 24th day of July, 1997
between, on the one hand, SmithKline Xxxxxxx Corporation, a corporation
organized under the laws of the Commonwealth of Pennsylvania, having a place of
business at Xxx Xxxxxxxx Xxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000, X.X.X. ("SB
corp"), SmithKline Xxxxxxx p.l.c., a corporation organized under the laws of
England and having a place of business at Xxxxx Xxxx Xxxx, Xxxxxxxxx, Xxxxxxxxx,
X.X. ("SB p.l.c.") (individually and collectively "SB"), and, on the other hand,
Human Genome Sciences, Inc., 0000 Xxx Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000
("HGS").
WITNESSETH THAT:
WHEREAS SB corp and HGS entered into the COLLABORATION AGREEMENT
(defined below) relating to sequencing of expressed genes and development of
practical applications therefor; and
WHEREAS SB and HGS now wish to amend the COLLABORATION AGREEMENT
with respect to HUMAN DIAGNOSTIC PRODUCTS (defined below);
NOW, THEREFORE, in consideration of the covenants and obligations
expressed herein, and intending to be legally bound, and otherwise to be bound
by proper and reasonable conduct, the parties agree as follows:
The parties now agree that the COLLABORATION AGREEMENT is superseded
in accordance with Paragraph 23.01 of such agreement and the AMENDED AND
RESTATED LICENSE AGREEMENT is superseded, both only with respect to HUMAN
DIAGNOSTIC PRODUCTS to read as follows:
1. DEFINITIONS
1.1. "AFFILIATE" shall mean any corporation, firm, partnership or other
entity, whether de jure or de facto, which directly or indirectly
owns, is owned by or is under common ownership with a party to this
Agreement to the extent of at least fifty percent (50%) of the equity
(or such lesser percentage which is the maximum allowed to be owned by
a foreign corporation in a particular jurisdiction) having the power
to vote on or direct the affairs of the entity and any person, firm,
partnership, corporation or other entity actually controlled by,
controlling or under common control with a party to this Agreement.
1.2. "AMENDED AND RESTATED LICENSE AGREEMENT" shall mean the agreement
between SB and HGS entered into May 31, 1995.
1.3. "ANTIBODY PRODUCT" shall mean an antibody (monoclonal or polyclonal)
and fragments and constructs thereof which may be useful for the
treatment or prevention of a disease or disorder in humans.
1.4. "BIOINFORMATICS" shall mean computer software and know-how useful for
the analysis, comparison, and curation of human nucleic acid
sequences; and information related to such sequences; and software for
the
constructionand maintenance of databases for the compilation of such
sequences and their associated information; each developed from May
19, 1993 through the end of the INITIAL RESEARCH TERM. BIOINFORMATICS
shall include software for the prediction of the three-dimensional
structure of proteins from primary sequence information but
BIOINFORMATICS shall not include software for rational drug design
based on such three-dimensional structure. To the extent
BIOINFORMATICS includes software licensed from a THIRD PARTY such
THIRD PARTY software is not included except to the extent that a party
has the right to transfer to the other party such software and its use
and the other party agrees to pay any royalty owed to the THIRD PARTY
for such software and its use.
1.5. "cDNA" shall mean complementary DNA prepared from human cells.
1.6. "CLINICAL STUDY" shall mean a study in humans of a product which study
is intended for use in obtaining approval to sell the product in a
"Major Market." However, in the case of a product for which no human
clinical studies are required, then CLINICAL STUDY shall mean,
instead, initiation of country-wide sales of a product in a "Major
Market." By "Major Market" is meant the United States, Canada, Japan,
Great Britain, France, Germany, or Italy.
1.7. "COLLABORATION AGREEMENT" shall mean the Collaboration Agreement
entered into between SB and HGS effective as of May 19, 1993, as
amended as of immediately before the EFFECTIVE DATE.
1.8. "COLLABORATION PARTNER" shall mean those entities which are set forth
in Appendix B of the JUNE 1996 SB/HGS LICENSE AGREEMENT, and any
entity added to such Appendix pursuant to that agreement by mutual
written agreement between SB and HGS.
1.9. "COLLABORATION PARTNER AGREEMENT" shall mean an agreement among HGS
and SB and a COLLABORATION PARTNER and designated in writing by SB and
HGS as a COLLABORATION PARTNER AGREEMENT, pursuant to the JUNE 1996
SB/HGS LICENSE AGREEMENT.
1.10. "COLLABORATION PARTNER PATENT" shall mean all patents and patent
applications filed during the INITIAL RESEARCH TERM which are or
become owned by a COLLABORATION PARTNER or to which a COLLABORATION
PARTNER otherwise has, now or in the future, the right to grant
licenses, only to the extent HGS and SB have the rights to grant
licenses thereto under a COLLABORATION PARTNER AGREEMENT. Included
within the definition of COLLABORATION PARTNER PATENTS are all
continuations, continuations-in-part, divisions, patents of addition,
reissues, renewals, extensions, registrations,
confirmations, re-examinations thereof and any provisional
applications and all SPCs.
1.11 "COLLABORATION PRODUCT" shall mean any product, process, substance,
composition or service which (i) is based on the use of or is derived
by use of HGS TECHNOLOGY and/or SB TECHNOLOGY and/or (ii) is covered
by a HGS PATENT and/or (iii) is covered by a SB PATENT; and/or (iv) is
covered by a COLLABORATION PARTNER PATENT; and/or (v) is based on or
is derived by use of a TARGET and/or is a THERAPEUTIC PROTEIN and/or
biological information on such TARGET or THERAPEUTIC PROTEIN all as to
which SB and/or HGS receives rights from a COLLABORATION PARTNER under
a COLLABORATION PARTNER AGREEMENT. An incidental or immaterial use (or
no use) of such technology or patents in (i)-(v) shall not cause a
product, process, substance, composition or service to become a
COLLABORATION PRODUCT.
1.12. "DIAGNOSTIC RESEARCH PLAN" shall mean a written plan for researching,
developing and commercializing a HUMAN DIAGNOSTIC PRODUCT. An example
of such a plan is shown in Appendix A. RESEARCH PROGRAMS under the
COLLABORATION AGREEMENT submitted prior to the EFFECTIVE DATE shall be
deemed, to the extent that they cover HUMAN DIAGNOSTIC PRODUCTS,
DIAGNOSTIC RESEARCH PLANS submitted by SB under this Agreement in
accordance with Section 4.1.
1.13. "DRUG PRODUCT" shall mean a product (including VACCINES, as defined in
the JUNE 1996 SB/HGS LICENSE AGREEMENT), which is not a THERAPEUTIC
PROTEIN, GENE THERAPY VACCINE (as defined in the JUNE 1996 SB/HGS
LICENSE AGREEMENT) or ANTIBODY PRODUCT, which may be useful for the
treatment or prevention of a disease or disorder in a human.
1.14. "EFFECTIVE DATE" shall mean the date first written above.
1.15. "GENE" shall mean a cDNA or a human gene or a family of such human
genes or any portion of such cDNA, gene or genes.
1.16. "HGS" shall mean Human Genome Sciences, Inc.
1.17. "HGS HUMAN DIAGNOSTIC PRODUCT" shall mean a COLLABORATION PRODUCT that
is a HUMAN DIAGNOSTIC PRODUCT to which HGS obtains rights in
accordance with Section 4 and as to which HGS retains rights under
this Agreement.
1.18. "HGS PATENT(S)" shall mean all patents and patent applications to the
extent they claim HGS TECHNOLOGY, which are or become owned by
HGS or to which HGS otherwise has, now or in the future, the right to
grant licenses. Included within the definition of HGS PATENTS are all
continuations, continuations-in-part, divisions, patents of addition,
reissues, renewals, extensions, registrations, confirmations,
re-examinations thereof and any provisional applications and all SPCs.
1.19. "HGS PRODUCT" shall mean (1) a COLLABORATION PRODUCT in the HGS FIELD;
or (2) a COLLABORATION PRODUCT in the SB FIELD (a) to which HGS
obtains rights in accordance with the JUNE 1996 SB/HGS LICENSE
AGREEMENT; and/or (b) which is a THERAPEUTIC PROTEIN discovered or
developed by or on behalf of HGS after the INITIAL RESEARCH TERM;
and/or (c) which is a DRUG PRODUCT or ANTIBODY PRODUCT discovered or
developed by or on behalf of HGS at any time.
1.20. "HGS TECHNOLOGY" shall mean any and all data, substances, processes,
materials, formulae, know-how and inventions with respect to GENES
and/or expression products thereof (including sequence and function)
which are useful within the HGS FIELD, SB FIELD, and/or the field of
HUMAN DIAGNOSTIC PRODUCTS, and which are developed by or on behalf of
HGS during or prior to the INITIAL RESEARCH TERM and which are owned
by HGS or with respect to which HGS has a right to grant a license. In
the event HGS in-licenses from a THIRD PARTY a DRUG PRODUCT, ANTIBODY
PRODUCT, THERAPEUTIC PROTEIN or HUMAN DIAGNOSTIC PRODUCT in each case
discovered by a THIRD PARTY with no use of HGS TECHNOLOGY, such
product and information generated by HGS directly related to the
research and development of such product, shall not be HGS TECHNOLOGY.
1.21. "HGS SPECIAL TECHNOLOGY shall mean (1) all HGS TECHNOLOGY in existence
prior to June 28, 1996 and required to be transferred under the JUNE
1996 SB/HGS LICENSE AGREEMENT or transferred to SB under the
COLLABORATION AGREEMENT or the JUNE 1996 SB/HGS LICENSE AGREEMENT and
(2) all HGS TECHNOLOGY developed by or for HGS after June 28, 1996 and
during the INITIAL RESEARCH TERM required to be transferred under the
JUNE 1996 SB/HGS LICENSE AGREEMENT or transferred to SB by HGS under
the JUNE 1996 SB/HGS LICENSE AGREEMENT which is: (a) xxxxxxxx xxxx
with respect to cDNA and expression products thereof and
BIOINFORMATICS relating thereto, (b) information on biological
function of TARGETS and screens for such TARGETS, and/or (c)
biological information on THERAPEUTIC PROTEINS for their use as
TARGETS, and (3) HGS clones containing sequences in (1) and 2(a).
1.22. "HUMAN DIAGNOSTIC PRODUCTS" shall mean any substance, process,
composition or service intended to identify, analyze or detect one
or more characteristics, genes, proteins, or any other molecule of, or
in an individual human, including but not limited to, forensics,
diagnosis, prognosis, or monitoring of a disease, predisposition to a
disease, or other abnormality or evaluation of health. HUMAN
DIAGNOSTIC PRODUCTS shall also include such products intended for
commercial sale for research in laboratory animals. It is expressly
understood that a HUMAN DIAGNOSTIC PRODUCT includes DIAGNOSTIC(S) as
defined in the JUNE 1996 SB/HGS LICENSE AGREEMENT.
1.23. "INITIAL RESEARCH TERM" shall mean the term beginning May 19, 1993 and
ending June 30, 2001.
1.24. "JUNE 1996 SB/HGS LICENSE AGREEMENT" shall mean the SB/HGS LICENSE
AGREEMENT entered into between SB and HGS effective as of June 28,
1996.
1.25. "make, have made, use and sell" shall mean all exclusionary rights now
or in the future conferred by a patent or equivalent of a patent
(e.g., a SPC), copyright, or trade secret law of each applicable
respective jurisdiction of the world, including but not limited to the
right to make, have made, use, offer to sell, sell, import, copy,
display, and distribute.
1.26. "NET SALES" shall mean gross receipts from sales of a SB HUMAN
DIAGNOSTIC PRODUCT or a HGS HUMAN DIAGNOSTIC PRODUCT, as the case may
be, (on a product-by-product basis) by SB or HGS or, except as
provided below, their respective AFFILIATES, licensees, distributors
trading on SB's or HGS's account or joint ventures or other associated
companies, less deductions for (i) transportation, shipping and
postage charges, including transportation, insurance, and customs
duties to the extent separately invoiced; (ii) sales and excise taxes
and duties paid or allowed by a selling party and any other
governmental charges imposed upon the production, importation, use or
sale of such product; (iii) normal and customary trade, quantity and
cash discounts allowed and rebates including but not limited to
Medicaid and Medicaid-like rebates; and (iv) allowances or credits to
customers on account of rejection or return of such product or on
account of retroactive price reductions affecting such product. Sales
between or among a party to this Agreement and its respective
AFFILIATES, licensees, distributors trading on SB's or HGS's account,
or joint ventures or other associated companies shall be included
within NET SALES only if such purchaser is an end-user of the
applicable HUMAN DIAGNOSTIC PRODUCT. Otherwise, NET SALES shall only
include the subsequent, final sales to THIRD PARTIES.
1.27. "PROTEIN RESEARCH PLAN" shall mean a written plan to research and
develop a THERAPEUTIC PROTEIN, as such plan is defined in the JUNE
1996 SB/HGS LICENSE AGREEMENT.
1.28. "RESEARCH PLAN" shall have the same meaning as in the JUNE 1996 SB/HGS
LICENSE AGREEMENT, except that it shall also include DIAGNOSTIC
RESEARCH PLANS.
1.29. "RESEARCH PROGRAM" shall have the meaning ascribed to it in the
COLLABORATION AGREEMENT.
1.30. "RESEARCH TERM EXTENSIONS" shall mean extensions of the INITIAL
RESEARCH TERM obtained pursuant to Paragraph 6.1.
1.31. "SB" shall mean SmithKline Xxxxxxx Corporation and/or SmithKline
Xxxxxxx, p.l.c., and any past (from May 19, 1993 through the EFFECTIVE
DATE), present or future AFFILIATE thereof, which AFFILIATE holds the
relevant right and/or is or was or will be necessary or required to
perform any obligations of SB under this Agreement and/or obligations
of either of them are subsequently assigned and/or delegated pursuant
to Section 20 of this Agreement.
1.32. "SB FIELD" shall have the same meaning as in the JUNE 1996 SB/HGS
LICENSE AGREEMENT.
1.33. "SB HUMAN DIAGNOSTIC PRODUCT" shall mean a COLLABORATION PRODUCT that
is a HUMAN DIAGNOSTIC PRODUCT to which SB obtains rights pursuant to
Section 4 and as to which SB retains rights under this Agreement.
1.34. "SB PATENT(s)" shall mean all patents and patent applications to the
extent they claim SB TECHNOLOGY, which are or become owned by SB or to
which SB otherwise has, now or in the future, the right to grant
licenses. Included within the definition of SB PATENTS are all
continuations, continuations-in-part, divisions, patents of addition,
reissues, renewals, extensions, registrations, confirmations,
re-examinations thereof and any provisional applications and all SPCs.
SB PATENTS shall include TAKEDA PATENTS, as defined in the JUNE 1996
SB/HGS LICENSE AGREEMENT, to the extent such patents and patent
applications claim SB TECHNOLOGY.
1.35. "SB DIAGNOSTIC PATENT(s)" shall mean SB PATENT(s), only to the extent
such patents have claims that cover a HUMAN DIAGNOSTIC PRODUCT.
1.36. "SB TECHNOLOGY" shall mean any and all data, substances, processes,
materials, formulae, know-how, inventions and information useful
within the HGS FIELD, SB FIELD, and/or the field of HUMAN DIAGNOSTIC
PRODUCTS, which are based on the use of or derived by use of HGS
SPECIAL TECHNOLOGY and are developed by or on behalf of SB during the
INITIAL RESEARCH TERM, or RESEARCH TERM EXTENSIONS
or under a RESEARCH PLAN submitted by SB pursuant to this Agreement
prior to the later of four (4) years after the INITIAL RESEARCH TERM
or four (4) years after RESEARCH TERM EXTENSIONS. SB TECHNOLOGY shall
not include technologies, reagents or materials made by SB merely
because of an incidental or immaterial use (or no use of) of HGS
SPECIAL TECHNOLOGY in the development of such technologies, reagents
or materials or merely because of an incidental or immaterial use of
(or no use of) such technologies, reagents or materials in a RESEARCH
PLAN. SB TECHNOLOGY shall include TAKEDA TECHNOLOGY, as defined in the
JUNE 1996 SB/HGS LICENSE AGREEMENT, to the extent that such TAKEDA
TECHNOLOGY is based on the use of or derived by use of (a) HGS SPECIAL
TECHNOLOGY, or (b) SB TECHNOLOGY as defined in the preceding two
sentences of this Paragraph.
1.37. "SPC" shall mean a right based upon a patent to exclude others from
making, using or selling a product, process, substance, composition or
service, such as a Supplementary Protection Certificate.
1.38. "SPECIAL SB TECHNOLOGY" shall mean (1) all SB TECHNOLOGY developed by
or on behalf of SB in existence prior to June 28, 1996 required to be
transferred under the JUNE 1996 SB/HGS LICENSE AGREEMENT or
transferred to HGS by SB under the COLLABORATION AGREEMENT or the JUNE
1996 SB/HGS LICENSE AGREEMENT, (2) all SB TECHNOLOGY developed by or
on behalf of SB after June 28, 1996 which SB is required to transfer
or transfers to HGS under the JUNE 1996 SB/HGS LICENSE AGREEMENT
and/or (3) SB TECHNOLOGY otherwise lawfully obtained by HGS. With
respect to information contained in a DIAGNOSTIC RESEARCH PLAN
submitted by SB pursuant to this Agreement, SPECIAL SB TECHNOLOGY
shall not include items of the type identified in Sections 1, 2, or 3
of the outline attached as Appendix A.
1.39. "TARGET" shall mean a GENE or expression product thereof (e.g.,
receptors, enzymes or ion channels) which could be used for screening
or other drug discovery purpose to identify compounds or antibodies
with a biochemical or pharmacological effect.
1.40. "TERRITORY" shall mean all the countries and territories in the world.
1.41. "THERAPEUTIC PROTEIN" shall mean a polypeptide derived from a GENE
(not including an ANTIBODY PRODUCT) which may be useful for the
treatment or prevention of a disease or disorder in humans.
1.42. "THIRD PARTY(IES)" shall mean any party other than a party to this
Agreement or an AFFILIATE of SB, or HGS.
2. GRANTS
2.1. RESEARCH AND DEVELOPMENT
2.1.1. HGS hereby grants to SB a non-exclusive, world-wide license
under HGS SPECIAL TECHNOLOGY, claims of HGS PATENTS that
cover HGS SPECIAL TECHNOLOGY and COLLABORATION PARTNER
PATENTS to perform research and development of HUMAN
DIAGNOSTIC PRODUCTS during the INITIAL RESEARCH TERM and
RESEARCH TERM EXTENSIONS pursuant to this Agreement,
provided however that HGS will not have a license to make,
have made, use and sell a HUMAN DIAGNOSTIC PRODUCT based on
HGS diagnostic research except as described herein.
2.1.2. HGS hereby grants to SB a non-exclusive, world-wide, license
under HGS SPECIAL TECHNOLOGY, claims of HGS PATENTS that
cover HGS SPECIAL TECHNOLOGY and COLLABORATION PARTNER
PATENTS to perform research and development of HUMAN
DIAGNOSTIC PRODUCTS after the INITIAL RESEARCH TERM and
RESEARCH TERM EXTENSIONS pursuant to a DIAGNOSTIC RESEARCH
PLAN submitted by SB pursuant to this Agreement.
2.1.3. SB hereby grants to HGS a non-exclusive, world-wide, license
under SB DIAGNOSTIC PATENTS to perform research and
development of HUMAN DIAGNOSTIC PRODUCTS during the INITIAL
RESEARCH TERM and RESEARCH TERM EXTENSIONS, but not to the
extent that such SB DIAGNOSTIC PATENT covers any SB HUMAN
DIAGNOSTIC PRODUCT and/or any HUMAN DIAGNOSTIC PRODUCT which
is the subject of a DIAGNOSTIC RESEARCH PLAN filed by SB
during the INITIAL RESEARCH TERM.
2.1.4. SB hereby grants to HGS a non-exclusive, world-wide, license
under SB DIAGNOSTIC PATENTS to perform research and
development of HUMAN DIAGNOSTIC PRODUCTS after the INITIAL
RESEARCH TERM and RESEARCH TERM EXTENSIONS pursuant to a
DIAGNOSTIC RESEARCH PLAN submitted by HGS pursuant to this
Agreement, but not to the extent that such SB DIAGNOSTIC
PATENT covers any SB HUMAN DIAGNOSTIC PRODUCT and/or any
HUMAN DIAGNOSTIC PRODUCT which is the subject of a
DIAGNOSTIC RESEARCH PLAN filed by SB during the INITIAL
RESEARCH TERM.
2.1.5. HGS hereby grants to SB a non-exclusive, world-wide, license
under HGS SPECIAL TECHNOLOGY, HGS PATENTS AND COLLABORATION
PARTNER PATENTS to perform research
and development in the HGS FIELD (as that term is defined in
the June 1996 SB/HGS LICENSE AGREEMENT) only in furtherance
of research and development of HUMAN DIAGNOSTIC PRODUCTS (i)
during the INITIAL RESEARCH TERM and RESEARCH TERM
EXTENSIONS, and (ii) after the INITIAL RESEARCH TERM under a
RESEARCH PLAN submitted by SB pursuant to this Agreement.
For the avoidance of doubt, no license is granted (other
than to perform research and development pursuant to this
Section 2.1.5) to SB hereunder to make, have made, use and
sell COLLABORATION PRODUCTS in the HGS FIELD.
2.2. SB HUMAN DIAGNOSTIC PRODUCTS
2.2.1. HGS hereby grants to SB an exclusive, sublicenseable
world-wide license under HGS SPECIAL TECHNOLOGY, claims of
HGS PATENTS that cover HGS SPECIAL TECHNOLOGY, and
COLLABORATION PARTNER PATENTS to make, have made, use and
sell in the TERRITORY, each SB HUMAN DIAGNOSTIC PRODUCT, as
to which SB obtains rights under Section 4 during the
INITIAL RESEARCH TERM.
2.2.2. HGS hereby grants to SB a non-exclusive, sublicenseable
world-wide license under HGS SPECIAL TECHNOLOGY, claims of
HGS PATENTS that cover HGS SPECIAL TECHNOLOGY, and
COLLABORATION PARTNER PATENTS to make, have made, use and
sell in the TERRITORY, each SB HUMAN DIAGNOSTIC PRODUCT, as
to which SB obtains rights under Section 4 during RESEARCH
TERM EXTENSIONS.
2.2.3. SB shall have the right to license SB HUMAN DIAGNOSTIC
PRODUCTS at any time.
2.2.4. Except for agreements permitted by Paragraph 7.2 or the JUNE
1996 SB/HGS LICENSE AGREEMENT, the rights granted to SB by
HGS under this Agreement and SB's rights to SB TECHNOLOGY
and SB PATENTS are licenseable and/or transferable by SB to
a THIRD PARTY only with respect to a SB HUMAN DIAGNOSTIC
PRODUCT, and only pursuant to an Agreement by which SB
grants a license to a THIRD PARTY for a SB HUMAN DIAGNOSTIC
PRODUCT as permitted under this Paragraph 2.2.3 and in which
the THIRD PARTY agrees to covenants and obligations with
respect to the use of such SB HUMAN DIAGNOSTIC PRODUCT, and
any HGS TECHNOLOGY, HGS PATENTS, SB PATENTS and SB
TECHNOLOGY to be licensed to such THIRD PARTY which are
essentially identical to the covenants and obligations of SB
under this Agreement.
2.3. HGS HUMAN DIAGNOSTIC PRODUCTS
2.3.1. SB hereby grants to HGS a non-exclusive, sublicenseable
world-wide license under SB DIAGNOSTIC PATENTS to make, have
made, use and sell in the TERRITORY, each HGS HUMAN
DIAGNOSTIC PRODUCT as to which HGS obtains rights under
Section 4 during the INITIAL RESEARCH TERM and RESEARCH TERM
EXTENSIONS, but not to the extent that such SB DIAGNOSTIC
PATENT covers any SB HUMAN DIAGNOSTIC PRODUCT and/or any
HUMAN DIAGNOSTIC PRODUCT which is the subject of a
DIAGNOSTIC RESEARCH PLAN filed by SB during the INITIAL
RESEARCH TERM..
2.3.2. Except for agreements permitted by Paragraph 7.2, the rights
to SB DIAGNOSTIC PATENTS granted to HGS by SB under this
Agreement are licenseable and/or transferable by HGS to a
THIRD PARTY only with respect to a HGS HUMAN DIAGNOSTIC
PRODUCT, and only pursuant to an Agreement by which HGS
grants a license to a THIRD PARTY to a HGS HUMAN DIAGNOSTIC
PRODUCT as permitted under this Agreement and in which the
THIRD PARTY agrees to covenants and obligations which limit
the use of SB DIAGNOSTIC PATENTS which are essentially
identical to the covenants and obligations of HGS under this
Agreement.
2.3.3. Except for (i) licenses granted by HGS to SB under this
Agreement; and (ii) licenses granted to THIRD PARTIES with
respect to HGS HUMAN DIAGNOSTIC PRODUCTS as permitted by
Paragraph 2.3.2, during the INITIAL RESEARCH TERM, HGS shall
not grant any rights or license to HUMAN DIAGNOSTIC PRODUCTS
that are COLLABORATION PRODUCTS. In addition, during the
INITIAL RESEARCH TERM, HGS shall not grant to any THIRD
PARTY diagnostic research rights to access the database or
other diagnostic research and/or development rights other
than those associated with the licensing of a specific HGS
HUMAN DIAGNOSTIC PRODUCT as provided herein.
2.3.4. Notwithstanding anything else to the contrary, SPECIAL SB
TECHNOLOGY developed after June 28, 1996 and claims of SB
PATENTS developed after June 28, 1996, and RESEARCH PROGRAMS
submitted under the COLLABORATION AGREEMENT shall not be
disclosed by HGS to a THIRD PARTY until such patents and
technology have, prior to such disclosure, become generally
available to the public other than through a breach of this
Agreement.
2.4. All the grants in this Section 2 are subject to all the terms and
conditions of the Agreement.
2.5. Except as expressly provided herein, SB retains all rights to SB
DIAGNOSTIC PATENTS.
3. PAYMENTS AND ROYALTIES
3.1. Payments to HGS
3.1.1. SB shall pay a royalty [***] of NET SALES of each SB HUMAN
DIAGNOSTIC PRODUCT sold by SB or SB licensees.
3.1.2. Royalty obligations on SB HUMAN DIAGNOSTIC PRODUCTS sold by
SB or SB licensees under this Agreement shall terminate on a
country-by-country and product-by-product basis on the later
of (i) ten (10) years after first country-wide launch of
each product in each country or (ii) expiration of the
COLLABORATION PARTNER PATENT, HGS PATENT or SB DIAGNOSTIC
PATENT which covers the making, using or selling of such
product in such country.
3.2. Payments to SB
3.2.1. If a HGS HUMAN DIAGNOSTIC PRODUCT is sublicensed to a THIRD
PARTY and such HGS HUMAN DIAGNOSTIC PRODUCT is covered by a
claim of a SB DIAGNOSTIC PATENT, then HGS shall pay a
royalty of [***] of NET SALES of each such HGS HUMAN
DIAGNOSTIC PRODUCT sold by such HGS licensee. Subject to
Section 3.3, no royalty is owed on sales by HGS.
3.2.2. Royalty obligations on HGS HUMAN DIAGNOSTIC PRODUCTS sold by
HGS licensees under this Agreement shall terminate on a
country-by-country and product-by-product basis on the later
of (i) ten (10) years after first country-wide launch of
each product in each country or (ii) expiration of the SB
DIAGNOSTIC PATENT which covers the making, using or selling
of such product in such country.
3.3. ROYALTIES TO THIRD PARTIES
3.3.1. Any royalties owed to a THIRD PARTY, including a
COLLABORATION PARTNER or TAKEDA, by HGS or SB, on the NET
SALES of a SB HUMAN DIAGNOSTIC PRODUCT shall be the sole
responsibility of SB.
3.3.2. Any royalties owed to a THIRD PARTY, including a
COLLABORATION PARTNER or TAKEDA, by HGS or SB, on the NET
SALES of a HGS HUMAN DIAGNOSTIC PRODUCT shall be the sole
responsibility of HGS.
3.4. Except as provided in Sections 3.1, 3.2, or 3.3, no other payments or
obligations, including but not limited to copromotion payments,
milestones, and licensing fees, shall be owed by either SB or HGS to
the other for an SB DIAGNOSTIC PRODUCT or an HGS DIAGNOSTIC PRODUCT,
as the case may be, under this Agreement or any other agreement
between SB and HGS existing as of the EFFECTIVE DATE of this
Agreement.
4. DIAGNOSTIC RESEARCH PLANS
4.1. SB shall obtain rights in accordance with Section 2 of this Agreement
to a HUMAN DIAGNOSTIC PRODUCT, provided that SB is the first among the
parties to this Agreement to submit a DIAGNOSTIC RESEARCH PLAN for the
specific HUMAN DIAGNOSTIC PRODUCT during the INITIAL RESEARCH TERM or
any RESEARCH TERM EXTENSIONS. [***]
4.2. Subject to the provisions of Sections 4.1 and 4.3, HGS shall obtain
rights in accordance with Section 2 of this Agreement to a HUMAN
DIAGNOSTIC PRODUCT, provided that HGS is the first among the parties
to this Agreement to submit a DIAGNOSTIC RESEARCH PLAN for the
specific HUMAN DIAGNOSTIC PRODUCT during the INITIAL RESEARCH TERM or
any RESEARCH TERM EXTENSIONS.
4.3. During the INITIAL RESEARCH TERM, HGS may only submit DIAGNOSTIC
RESEARCH PLANS for HUMAN DIAGNOSTIC PRODUCTS in accordance with either
of the following conditions:
4.3.1. HGS may submit up to [***] DIAGNOSTIC RESEARCH PLANS for
HUMAN DIAGNOSTIC PRODUCTS, one such plan in connection with
each PROTEIN RESEARCH PLAN submitted by HGS pursuant to the
JUNE 1996 SB/HGS LICENSE AGREEMENT. The DIAGNOSTIC RESEARCH
PLAN shall cover only the same GENE as the PROTEIN RESEARCH
PLAN and/or expression product of such GENE and/or antibody
against such expression product.
4.3.2. HGS may submit a DIAGNOSTIC RESEARCH PLAN for a HUMAN
DIAGNOSTIC PRODUCT which corresponds to a HGS PRODUCT, other
than a THERAPEUTIC PROTEIN, at the time
HGS or its licensee initiates a CLINICAL STUDY of such HGS
PRODUCT (i.e., a DRUG PRODUCT or an ANTIBODY PRODUCT). [***]
4.4. ALL DIAGNOSTIC RESEARCH PLANS submitted by either party shall be
submitted to the RC established under the JUNE 1996 SB/HGS LICENSE
AGREEMENT.
4.5. In the event that SB obtains rights to a SB HUMAN DIAGNOSTIC PRODUCT
pursuant to Section 4.1 and such diagnostic is directed to the same
GENE as a PROTEIN RESEARCH PLAN submitted by HGS pursuant to the JUNE
1996 SB/HGS LICENSE AGREEMENT, SB shall make such SB HUMAN DIAGNOSTIC
PRODUCT available to HGS or its therapeutic licensee on standard
commercial terms when such product becomes available as a commercial
product.
4.6. In the event that the research, development or commercialization of
the THERAPEUTIC PROTEIN or HGS PRODUCT in connection with which a
DIAGNOSTIC RESEARCH PLAN has been submitted by HGS pursuant to Section
4.3.1 or 4.3.2 is terminated by HGS, all HGS rights under HGS PATENTS
and know-how to the HGS HUMAN DIAGNOSTIC PRODUCT (which HGS HUMAN
DIAGNOSTIC PRODUCT was contained in the DIAGNOSTIC RESEARCH PLAN
submitted by HGS in conjunction with said THERAPEUTIC PRODUCT or HGS
PRODUCT) shall be assigned to SB.
5. PRODUCT DEVELOPMENT
5.1. SB shall have full control and authority over development,
registration and commercialization of SB HUMAN DIAGNOSTIC PRODUCT. HGS
shall have full control and authority over development, registration
and commercialization of HGS HUMAN DIAGNOSTIC PRODUCT.
5.2. Each party may delegate such responsibilities in whole or in part to
its licensees.
5.3. Each party shall keep the other informed of progress of its efforts to
develop and commercialize SB HUMAN DIAGNOSTIC PRODUCT or HGS
HUMAN DIAGNOSTIC PRODUCT. Each party shall keep the other party
informed of its, and its licensees progress to develop and
commercialize SB HUMAN DIAGNOSTIC PRODUCTS or HGS HUMAN DIAGNOSTIC
PRODUCTS as the case may be.
5.4. SB shall use its diligent efforts to develop, market, promote and sell
SB HUMAN DIAGNOSTIC PRODUCT as to which SB obtains rights under
Section 4 equivalent to those efforts it uses with respect to products
of similar value and status, subject to SB's right to terminate such
efforts and surrender such rights in and to such product.
5.5. HGS shall use its diligent efforts to develop, promote and sell HGS
HUMAN DIAGNOSTIC PRODUCT as to which HGS obtains rights to under
Section 4 equivalent to those efforts it uses with respect to products
of similar value and status, subject to HGS's right to terminate such
efforts and surrender such exclusive rights in and to such product.
5.6. Within sixty (60) days after the end of each calendar year, SB and HGS
shall provide to each other in writing annual reports with respect to
work performed by or for it under DIAGNOSTIC RESEARCH PLANS which
shall consist of updates to DIAGNOSTIC RESEARCH PLANS substantially in
the form of the APPENDIX A.
5.7. SB and HGS shall not use any information or data in RESEARCH PLANS
submitted by the other, other than information which is HGS SPECIAL
TECHNOLOGY AND SPECIAL SB TECHNOLOGY as specified in Sections 1, 2 and
3 of a RESEARCH PLAN.
6. RESEARCH TERM EXTENSIONS
6.1. The INITIAL RESEARCH TERM may be extended by SB as RESEARCH TERM
EXTENSIONS for up to five (5) additional years on a year-by-year basis
by written notice to HGS at least sixty (60) days prior to the end of
the INITIAL RESEARCH TERM or any yearly extension thereof, provided
(1) such written notice is accompanied by a payment of [***] for each
additional year; and (2) SB has extended the INITIAL RESEARCH TERM of
the JUNE 1996 SB/HGS LICENSE AGREEMENT for the same period of time.
7. EXCHANGE OF INFORMATION AND CONFIDENTIALITY
7.1. During the term of this Agreement and thereafter, irrespective of any
termination earlier than the expiration of the term of this Agreement,
HGS and SB shall not use or reveal or disclose to THIRD PARTIES any
information or materials received from the other party, without first
obtaining the written consent of such other party, except as permitted
hereunder. This confidentiality and non-use obligation shall not apply
to disclosures to or uses by TAKEDA pursuant to the SB/TAKEDA
AGREEMENT or disclosures to or uses by COLLABORATION PARTNERS pursuant
to COLLABORATION
PARTNER AGREEMENTS. Unless otherwise restricted by this Agreement, the
confidentiality and non-use provisions of this Paragraph shall not
apply to such information which
a) was known to the receiving party or generally known to the
public prior to its disclosure hereunder;
b) subsequently becomes known to the public by some means other
than a breach of this Agreement;
c) is subsequently disclosed to the receiving party by a THIRD
PARTY having a lawful right to make such disclosure;
d) is required by law or bona fide legal process to be
disclosed, provided that the party required to make the
disclosure takes all reasonable steps to restrict and
maintain confidentiality of such disclosure and provides
reasonable notice to the party providing the information
and/or materials;
e) is approved for release by the parties, or
f) is independently developed by employees or agents of either
party or their respective parent corporation or their
AFFILIATES and/or subsidiaries without any knowledge of the
information and/or materials provided by the other party.
7.2.
7.2.1. Nothing in Paragraph 7.1 shall be construed as preventing
either party from disclosing any information to an AFFILIATE
or to a licensee, distributor or joint venture or other
associated company of either party for the purpose of
developing or commercializing SB HUMAN DIAGNOSTIC PRODUCT,
or HGS HUMAN DIAGNOSTIC PRODUCT as permitted by this
Agreement, provided such AFFILIATE, licensee, distributor or
joint venture or other associated company has undertaken a
similar obligation of confidentiality and non-use with
respect to the confidential information.
7.2.2. In the event that SB intends to transfer or disclose HGS
SPECIAL TECHNOLOGY or SB TECHNOLOGY to a THIRD PARTY
collaborator that is a not-for-profit entity (and/or an
investigator working for a not-for-profit entity) no such
transfer or disclosure shall take place until such THIRD
PARTY enters into an agreement with SB by which SB is
granted a license to all inventions and patent rights based
thereon which result from the use of such technology. To the
extent any such invention would be HGS TECHNOLOGY or SB
TECHNOLOGY if invented or discovered by SB and/or HGS, then
such invention shall be HGS TECHNOLOGY or SB TECHNOLOGY as
the case may be subject to the terms and conditions of this
Agreement. HGS agrees that SB may enter into agreements
pursuant to this Paragraph using an
Agreement substantially in the form of MTAs used by SB
and/or HGS under the COLLABORATION AGREEMENT.
7.2.3. Either party may disclose HGS TECHNOLOGY and SB TECHNOLOGY
to THIRD PARTY contractors or collaborators to facilitate or
carry out research activities under this Agreement provided
that such THIRD PARTIES enter into an agreement with such
party which contains confidentiality provisions
substantially the same as those set forth herein and which
provides that all rights in inventions and which result from
the use of such technology by the THIRD PARTY shall be owned
by HGS or SB or exclusively licensed to HGS or SB as the
case may be with a right to grant licenses. To the extent
any such invention or discovery would be HGS TECHNOLOGY or
SB TECHNOLOGY if invented or discovered by SB and/or HGS,
then such invention or discovery shall be HGS TECHNOLOGY or
SB TECHNOLOGY as the case may be subject to the terms and
conditions of this Agreement.
7.3. All confidential information disclosed by one party to the other shall
remain the intellectual property of the disclosing party. In the event
that a court or other legal or administrative tribunal, directly or
through an appointed master, trustee or receiver, assumes partial or
complete control over the assets of a party to this Agreement based on
the insolvency or bankruptcy of such party, the bankrupt or insolvent
party shall promptly notify the court or other tribunal (i) that
confidential information received from the other party under this
Agreement remains the property of the other party and (ii) of the
confidentiality obligations under this Agreement. In addition, the
bankrupt or insolvent party shall, to the extent permitted by law,
take all steps necessary or desirable to maintain the confidentiality
of the other party's confidential information and to insure that the
court, other tribunal or appointee maintains such information in
confidence in accordance with the terms of this Agreement.
7.4. No public announcement concerning (i) the existence of or terms of
this Agreement (ii) research and/or discoveries made by a party and,
(iii) exercise of a party of rights granted under this Agreement shall
be made, either directly or indirectly, by the other party to this
Agreement without prior written notice to the other party and, except
as may be legally required, or as may be required for a public
offering of securities, or as may be required for recording purposes,
without first obtaining the approval of the other party and agreement
upon the nature and text of such announcement. The party desiring to
make any such public announcement shall inform the other party of the
proposed announcement or disclosure in reasonably sufficient time
prior to public release, and shall provide the other party with a
written copy thereof, in order to allow such other party to comment
upon such announcement or disclosure. This Paragraph shall not apply
to any information in a public announcement which is information
essentially
identical to that contained in a previous public announcement agreed
to pursuant to this Paragraph.
7.5. For the avoidance of doubt, nothing in this Agreement shall be
construed as preventing or in any way inhibiting either party from
complying with statutory and regulatory requirements governing the
development, manufacture, use and sale or other distribution of
products in any manner which it reasonably deems appropriate,
including, for example, by disclosing to regulatory authorities
confidential or other information received from a party or THIRD
PARTIES. The parties shall take reasonable measures to assure that no
unauthorized use or disclosure is made by others to whom access to
such information is granted. Any materials provided by one party to
the other under this Agreement shall be subject to the confidentiality
and non-use provisions set out in this Section. All such materials
shall be used in compliance with all applicable laws and regulations.
SB and HGS each certifies that it is regularly engaged in conducting
tests in vitro or in animals used only for laboratory research
purposes, that all materials which SB or HGS receive under this
Agreement will actually be used for these purposes only, and that no
animal used for such tests will be used for any food purposes or kept
as a domestic pet or livestock.
7.6. SB and HGS agree to comply with any applicable law or regulation of
the United States or any country governing the export or reexport of
products (including test equipment), software, and technical data (and
the product of such data).
7.7. All rights and licensing granted under or pursuant to this Agreement
by HGS to SB are, and shall irrevocably be deemed to be, "intellectual
property" as defined in Section 101(56) of the Bankruptcy Code. In the
event of the commencement of a case by or against either party under
any Chapter of the Bankruptcy Code, this Agreement shall be deemed an
executory contract and all rights and obligations hereunder shall be
determined in accordance with Section 365(n) thereof. Unless a party
rejects this Agreement and the other party decides not to retain its
rights hereunder, the other party shall be entitled to a complete
duplicate of (or complete access to, as appropriate) all intellectual
property and all embodiments of such intellectual property held by the
party and the party shall not interfere with the rights of the other
party, which are expressly granted hereunder, to such intellectual
property and all embodiments of such intellectual property from
another entity. Further, this Agreement shall be deemed, upon
presentation to another entity, to be the same as an express
instruction by the party to such other entity to provide such
intellectual property and all embodiments of such intellectual
property directly to the other party. Without limiting the foregoing
provisions in this Paragraph, the other party shall be entitled to all
post-bankruptcy-petition improvements, updates, or developments of
intellectual property created
hereunder. If such intellectual property is not fully developed as of
the commencement of any bankruptcy case, the other party shall have
the right to complete development of the property.
7.8. Nothing in this Agreement shall be construed as requiring HGS to
disclose HGS SPECIAL TECHNOLOGY to SB or SB to disclose SB SPECIAL
TECHNOLOGY to HGS other than as already required under Section 12.1 of
the JUNE 1996 SB/HGS LICENSE AGREEMENT.
8. PATENT PROSECUTION AND LITIGATION
8.1. Each party shall have and retain sole and exclusive title to all
inventions, discoveries, designs, works of authorship and other
know-how which are made, conceived, reduced to practice or generated
only by its employees, agents, or other persons acting under its
authority. Each party shall own an equal undivided interest in all
such inventions, discoveries, designs, works of authorship and other
know-how made, conceived, reduced to practice or generated jointly by
employees, agents, or other persons acting under the authority of both
parties. In the event of jointly owned inventions, HGS shall have the
first right to file, prosecute and maintain patents and applications
directed thereto under the terms and conditions of Paragraph 8.2. If a
joint owner does not desire to file, prosecute or maintain a patent or
patent application to a joint inventions, such owner shall assign its
ownership interest therein to the other. All patents and patent
applications to joint inventions which are HGS SPECIAL TECHNOLOGY and
SPECIAL SB TECHNOLOGY shall be both SB PATENTS and HGS PATENTS,
subject to the terms and conditions of this Agreement; otherwise, any
joint owner shall be free to dispose of its interest therein without
accounting to the other joint owner.
8.2. HGS shall have the right within its sole discretion and at its expense
to prepare, file, prosecute and maintain HGS PATENTS. With respect to
HGS PATENTS as to which SB retains a license hereunder, subject to
Paragraph 8.9, HGS shall keep SB informed with respect to the filing
and prosecution thereof. In the event that SB desires that HGS obtain
and maintain patent protection in any country with respect to HGS
SPECIAL TECHNOLOGY as to which SB retains a license hereunder, HGS
shall do so at the cost and expense of SB.
8.3. SB shall have the right within its sole discretion and at its expense
to prepare, file, prosecute and maintain SB PATENTS. With respect to
SB PATENTS as to which HGS retains a license hereunder, subject to
Paragraph 8.10, SB shall keep HGS informed with respect to the filing
and prosecution thereof. In the event that HGS desires that SB obtain
and maintain patent protection in any country with respect to SPECIAL
SB TECHNOLOGY as to which HGS retains a license hereunder, SB shall do
so at the cost and expense of HGS.
8.4. Each party, on behalf of itself and its directors, employees,
officers, shareholders, agents, successors and assigns hereby waives
any and all actions and causes of action, claims and demands
whatsoever, in law or equity of any kind it or they may have against
the other party, its officers, directors, employees, shareholders,
agents, successors and assigns, which may arise in any way, except as
a result of gross negligence, recklessness, or willful misconduct, in
performance of patent activities under this Section.
8.5. In the event that HGS or SB becomes aware of actual or threatened
infringement of a SB PATENT or HGS PATENT anywhere in the TERRITORY,
that party shall promptly notify the other party in writing. The owner
of the SB PATENT or HGS PATENT shall have the first right but not the
obligation to bring, at its own expense, an infringement action
against any THIRD PARTY and to use the other party's name in
connection therewith. If the owner of the patent does not commence a
particular infringement action within thirty (30) days, the other
party, after notifying the owner in writing, shall be entitled to
bring such infringement action at its own expense to the extent that
such party is licensed thereunder and in its own name and/or in the
name of the owning party. The foregoing notwithstanding, in the event
that an alleged infringer certifies pursuant to 21 USC
355(b)(2)(A)(vii)(IV) or (j)(2)(A)(iv) against an issued HGS PATENT or
SB PATENT covering a HUMAN DIAGNOSTIC PRODUCT, the party receiving
notice of such certification shall immediately notify the other party
of such certification, and if fourteen (14) days prior to expiration
of the forty five (45) day period set forth in 21 USC 355(c)(3)(C) or
(j)(4)(B)(iii), the owner of the HGS PATENT or SB PATENT fails to
commence an infringement action, the party receiving notice, in its
sole discretion, at its own expense and to the extent that it is
licensed under the HGS PATENT or SB PATENT, shall be entitled to bring
such infringement action in its own name and/or in the name of the
owning party. The party conducting such action shall have full control
over its conduct, including settlement thereof provided such
settlement shall not be made without the prior written consent of the
other party if it would adversely affect the patent rights of the
other party. In any event, HGS and SB shall assist one another and
cooperate in any such litigation at the other's request without
expense to the requesting party.
8.6. HGS and SB shall recover their respective actual out-of-pocket
expenses, or equitable proportions thereof, associated with any
litigation or settlement thereof from any recovery made by any party.
Any excess amount shall be shared between SB and HGS in an amount
proportional to their respective losses and expenses.
8.7. The parties shall keep one another informed of the status of and of
their respective activities regarding any such litigation or
settlement thereof.
8.8. The owner of a SB PATENT or HGS PATENT shall have the first right to
seek extensions of the terms of the patent and to seek to obtain SPCs.
A party who is developing, selling or planning to sell a product
covered by a patent shall have the second right. Each party shall
assist the other in the obtaining of such extensions or SPCs including
by authorizing the other party to act as its agent.
8.9. The disclosure obligations of Paragraph 8.2 shall only apply to HGS
PATENTS which include HGS SPECIAL TECHNOLOGY which HGS has disclosed
to SB pursuant to the JUNE 1996 SB/HGS LICENSE AGREEMENT.
8.10. The disclosure obligations of Paragraph 8.3 shall only apply to SB
PATENTS which claim SPECIAL SB TECHNOLOGY which SB has disclosed to
HGS pursuant to the JUNE 1996 SB HGS LICENSE AGREEMENT.
9. TRADEMARKS AND NON-PROPRIETARY NAMES
9.1. SB, at its expense, shall be responsible for the selection,
registration and maintenance of all trademarks which it employs in
connection with SB HUMAN DIAGNOSTIC PRODUCT and shall own and control
such trademarks. Nothing in this Agreement shall be construed as a
grant of rights, by license or otherwise, to HGS to use such
trademarks for any purpose other than as provided in this Agreement.
9.2. SB, at its expense, shall be responsible for the selection and
registration of non-proprietary names employed by SB for SB HUMAN
DIAGNOSTIC PRODUCT.
9.3. HGS, at its expense, shall be responsible for the selection,
registration and maintenance of all trademarks which it employs in
connection with HGS HUMAN DIAGNOSTIC PRODUCT and shall own and control
such trademarks. Nothing in this Agreement shall be construed as a
grant of rights, by license or otherwise, to SB to use such trademarks
for any purpose other than as provided in this Agreement.
9.4. HGS, at its expense, shall be responsible for the selection and
registration of non-proprietary names employed by HGS for HGS HUMAN
DIAGNOSTIC PRODUCT.
10. STATEMENTS AND REMITTANCES
10.1. Each party, as the case may be, shall keep and require its licensees
to keep complete and accurate records of all NET SALES of HGS HUMAN
DIAGNOSTIC PRODUCT and SB HUMAN DIAGNOSTIC PRODUCT, subject to
royalties under the licenses granted herein. Each party shall have the
right, at its expense, through a certified public accountant or like
person reasonably acceptable to the other party, to examine such
records during
regular business hours during the life of this Agreement and for six
(6) months after its termination; provided, however, that such
examination shall not take place more often than once a year and
provided further that such accountant shall report only as to the
accuracy of the royalty statements and payments, including the
magnitude and source of any discrepancy. Neither party nor their
licensees shall be required to maintain such records for more than
three (3) years.
10.2. Within sixty (60) days after the close of each calendar quarter, each
party shall deliver to the other a true accounting of all SB HUMAN
DIAGNOSTIC PRODUCT, or HGS HUMAN DIAGNOSTIC PRODUCT sold by it and its
licensees and distributors during such quarter for which royalties are
payable and shall at the same time pay all royalties due. Such
accounting shall show sales on a country-by-country and
product-by-product basis.
10.3. Any tax paid or required to be withheld on account of the licensing
party based on royalties payable under this Agreement shall be
deducted from the amount of royalties otherwise due. Taxes paid or
withheld from monies due SB by its licensees shall be deducted
proportionately from the amount of monies otherwise due HGS. Each
party shall secure and send to the other proof of any such taxes
withheld and paid.
10.4. All royalties due under this Agreement shall be payable in U.S.
dollars. If governmental regulations prevent remittances from a
foreign country with respect to sales made in that country, the
obligation to pay royalties on sales in that country shall be
suspended until such remittances are possible. Each party shall have
the right, upon giving written notice to the other, to receive payment
in that country in local currency.
10.5. Monetary conversions from the currency of a foreign country, in which
a product is sold, into United States currency shall be made at the
official exchange rate in force in that country for financial
transactions on the last business day of the calendar quarter or half
year for which the royalties are being paid. If there is no such
official exchange rate, the conversion shall be made at the rate for
such remittances on that date as certified by Citibank, N.A., New
York, New York, U.S.A.
11. TERM AND TERMINATION
11.1. This Agreement shall come into effect as of the EFFECTIVE DATE and
shall remain in full force and effect unless earlier terminated as
provided in this Section 11.
11.2. In the event HGS fails to make a payment to SB under this Agreement
with respect to a HGS HUMAN DIAGNOSTIC PRODUCT when due, or fails to
meet its obligations under Section 5 with respect to a HGS HUMAN
DIAGNOSTIC PRODUCT, in addition to any other remedy which it may
have, SB may notify HGS in writing that all of HGS's rights with
respect to such HGS HUMAN DIAGNOSTIC PRODUCT shall terminate as of
sixty (60) days after such written notice and HGS's rights with
respect thereto shall terminate unless such payment is made or such
failure is cured, prior to the expiration of such sixty (60) day
period.
11.3. In the event SB fails to make a payment to HGS under this Agreement
with respect to a SB HUMAN DIAGNOSTIC PRODUCT when due, or fails to
meet its obligations under Section 5 with respect to a SB HUMAN
DIAGNOSTIC PRODUCT, in addition to any other remedy which it may have,
HGS may notify SB in writing that all of SB's rights with respect to
such SB HUMAN DIAGNOSTIC PRODUCT shall terminate as of sixty (60) days
after such written notice and SB's rights with respect thereto shall
terminate unless such payment is made or such failure is cured, prior
to the expiration of such sixty (60) day period.
11.4. Either party may terminate this Agreement if, at any time, the other
party shall file in any court or agency pursuant to any statute or
regulation of any state or country, a petition in bankruptcy or
insolvency or for reorganization or for an arrangement or for the
appointment of a receiver or trustee of the party or of its assets, or
if the other party proposes a written agreement of composition or
extension of its debts, or if the other party shall be served with an
involuntary petition against it, filed in any insolvency proceeding,
and such petition shall not be dismissed within sixty (60) days after
the filing thereof, or if the other party shall propose or be a party
to any dissolution or liquidation, or if the other party shall make an
assignment for the benefit of creditors.
11.5. Notwithstanding the bankruptcy of HGS or SB, or the impairment of
performance by HGS or SB of its obligations under this Agreement as a
result of bankruptcy or insolvency of HGS or SB, the other party shall
be entitled to retain the licenses granted herein, subject to rights
of a party to terminate this Agreement for reasons other than
bankruptcy or insolvency as expressly provided in this Agreement.
11.6. Neither party shall have the right to terminate this Agreement except
under Paragraph 11.4, provided however that nothing in this Agreement
shall limit any remedies for breach which may be available pursuant to
a judgment of a court, in law or equity, including termination of this
Agreement or of any or all rights hereunder.
12. RIGHTS AND DUTIES UPON TERMINATION
12.1. Upon termination of this Agreement in its entirety or with respect to
any SB HUMAN DIAGNOSTIC PRODUCT or HGS HUMAN DIAGNOSTIC PRODUCT or to
any country, each party shall notify the other of the amount of such
product it and its licensees and distributors then have on hand, the
sale of which would, but for the termination, be subject to
royalty, and such party and its licensees and distributors shall
thereupon be permitted to sell that amount of the product provided
that the party shall pay the royalty thereon at the time herein
provided for.
12.2. Termination of this Agreement shall terminate all outstanding
obligations and liabilities between the parties arising from this
Agreement except those described in Paragraphs 2.2.4, 2.3.2, 2.3.4,
7.1, 7.3, 7.5, and 8.1 and Sections 10, 12, 14, 16, and 23, as well as
any provision not specified in this Paragraph which is clearly meant
to survive termination of this Agreement.
12.3. Termination of the Agreement in accordance with the provisions hereof
shall not limit remedies which may be otherwise available in law or
equity.
13. WARRANTIES AND REPRESENTATIONS
Nothing in this Agreement shall be construed as a warranty that SB
PATENTS, COLLABORATION PARTNER PATENTS or HGS PATENTS are valid or
enforceable or that their exercise does not infringe any patent rights
of THIRD PARTIES. A holding of invalidity or unenforceability of any
such patent, from which no further appeal is or can be taken, shall
not affect any obligation already accrued hereunder, but shall only
eliminate royalties otherwise due under such patent from the date such
holding becomes final.
13.1. Each party warrants and represents that it has the right to enter into
this Agreement and to perform in accordance therewith.
13.2. Except as otherwise expressly set forth herein neither party makes any
representations or extends any warranties of any kind, either express
or implied, including, but not limited to, warranties of
merchantability or fitness for a particular purpose.
13.3. Each party guarantees that its respective AFFILIATES will perform all
obligations under this Agreement as if such AFFILIATES were
signatories of this Agreement.
14. INDEMNIFICATION
14.1. SB shall defend, indemnify and hold harmless HGS, AFFILIATES of HGS,
licensors of HGS and their respective directors, officers,
shareholders, agents and employees, from and against any and all
liability, loss, damages and expenses (including attorneys' fees) as
the result of claims, demands, costs or judgments which may be made or
instituted against any of them arising out of the manufacture,
possession, distribution, use, testing, sale or other disposition by
or through SB or any THIRD PARTY granted rights by SB under this
Agreement of any SB HUMAN DIAGNOSTIC PRODUCT. SB's obligation to
defend, indemnify and hold harmless shall include claims, demands,
costs or judgments, whether for
money damages or equitable relief by reason of alleged personal injury
(including death) to any person or alleged property damage, provided,
however, the indemnity shall not extend to any claims against an
indemnified party which result from the gross negligence or willful
misconduct of such indemnified party. SB shall have the exclusive
right to control the defense of any action which is to be indemnified
in whole by SB hereunder, including the right to select counsel
acceptable to HGS to defend HGS and to settle any claim, provided
that, without the written consent of HGS (which shall not be
unreasonably withheld or delayed), SB shall not agree to settle any
claim against HGS to the extent such claim has a material adverse
effect on HGS. The provisions of this Paragraph shall survive and
remain in full force and effect after any termination, expiration or
cancellation of this Agreement and obligation hereunder shall apply
whether or not such claims are rightfully brought. SB shall require
each licensee to agree to indemnify HGS in a manner consistent with
this Paragraph.
14.2. HGS shall defend, indemnify and hold harmless SB, AFFILIATES of SB,
licensors of SB and their respective directors, officers,
shareholders, agents and employees, from and against any and all
liability, loss, damages and expenses (including attorneys' fees) as
the result of claims, demands, costs or judgments which may be made or
instituted against any of them arising out of the manufacture,
possession, distribution, use, testing, sale or other disposition by
or through HGS or its AFFILIATES or any THIRD PARTY granted rights by
HGS under this Agreement of any HGS HUMAN DIAGNOSTIC PRODUCT. HGS's
obligation to defend, indemnify and hold harmless shall include
claims, demands, costs or judgments, whether for money damages or
equitable relief by reason of alleged personal injury (including
death) to any person or alleged property damage, provided, however,
the indemnity shall not extend to any claims against an indemnified
party which result from the gross negligence or willful misconduct of
such indemnified party. HGS shall have the exclusive right to control
the defense of any action which is to be indemnified in whole by HGS
hereunder, including the right to select counsel acceptable to SB to
defend SB and to settle any claim, provided that, without the written
consent of SB (which shall not be unreasonably withheld or delayed),
HGS shall not agree to settle any claim against SB to the extent such
claim has a material adverse effect on SB. The provisions of this
Paragraph shall survive and remain in full force and effect after any
termination, expiration or cancellation of this Agreement and HGS
obligation hereunder shall apply whether or not such claims are
rightfully brought. HGS shall require each licensee to agree to
indemnify SB in a manner consistent with this Paragraph.
14.3. A person or entity that intends to claim indemnification under this
Section 14 (the "Indemnitee") shall promptly notify the other party
(the "Indemnitor") of any loss, claim, damage, liability or action in
respect of which the Indemnitee intends to claim such indemnification,
and the
Indemnitor, after it determines that indemnification is required of
it, shall assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an Indemnitee
shall have the right to retain its own counsel, with the fees and
expenses to be paid by the Indemnitor if Indemnitor does not assume
the defense; or, if representation of such Indemnitee by the counsel
retained by the Indemnitor would be inappropriate due to actual or
potential differing interests between such Indemnitee and any other
party represented by such counsel in such proceedings. The indemnity
agreement in this Section 14 shall not apply to amounts paid in
settlement of any loss, claim, damage, liability or action is such
settlement is effected without the consent of the Indemnitor, which
consent shall not be withheld unreasonably. The failure to deliver
notice to the Indemnitor within a reasonable time after the
commencement of any such action, if prejudicial to its ability to
defend such action, shall relieve such Indemnitor of any liability to
the Indemnitee under this Section 14, but the omission so to deliver
notice to the Indemnitor will not relieve it of any liability that it
may have to any Indemnitee otherwise than under this Section 14. The
Indemnitee under this Section 14 its employees and agents, shall
cooperate fully with the Indemnitor and its legal representatives in
the investigations of any action, claim or liability covered by this
indemnification. In the event that each party claims indemnity from
the other and one party is finally held liable to indemnify the other,
the Indemnitor shall additionally be liable to pay the reasonable
legal costs and attorneys' fees incurred by the Indemnitee in
establishing its claim for indemnity.
15. FORCE MAJEURE
15.1. If the performance of any party of this Agreement by either party, or
of any obligation under this Agreement, is prevented, restricted,
interfered with or delayed by reason of any clause beyond the
reasonable control of the party liable to perform, unless conclusive
evidence to the contrary is provided, the party so affected shall,
upon giving written notice to the other party, be excused from such
performance to the extent of such prevention, restriction,
interference or delay, provided that the affected party shall use its
reasonable best efforts to avoid or remove such causes of
non-performance and shall continue performance with the utmost
dispatch whenever such causes are removed. When such circumstances
arise, the parties shall discuss what, if any, modification of the
terms of this Agreement may be required in order to arrive at an
equitable solution.
16. GOVERNING LAW
16.1. This Agreement shall be deemed to have been made in the Commonwealth
of Pennsylvania and its form, execution, validity, construction and
effect shall be determined in accordance with the laws of the
Commonwealth of Pennsylvania, U.S.A. 17.
17. SEPARABILITY
17.1. In the event any portion of this Agreement shall be held illegal, void
or ineffective, the remaining portions hereof shall remain in full
force and effect.
17.2. If any of the terms or provisions of this Agreement are in conflict
with any applicable statute or rule of law, then such terms or
provisions shall be deemed inoperative to the extent that they may
conflict therewith and shall be deemed to be modified to conform with
such statute or rule of law.
17.3. In the event that the terms and conditions of this Agreement are
materially altered as a result of Paragraphs 17.1 or 17.2, the parties
will renegotiate in good faith the terms and conditions of this
Agreement to resolve any inequities.
18. ENTIRE AGREEMENT
18.1. This Agreement, the JUNE 1996 SB/HGS LICENSE AGREEMENT, and the
COLLABORATION PARTNER AGREEMENTS entered into as of the date written
above, constitutes the entire agreement between the parties relating
to the subject matter hereof and supersedes all previous writings and
understandings relating to such subject matter. No terms or provisions
of this Agreement shall be varied or modified by any prior or
subsequent statement, conduct or act of either of the parties, except
that the parties may amend this Agreement by written instruments
specifically referring to and executed in the same manner as this
Agreement.
18.2. The headings and titles to the Sections and Paragraphs of this
Agreement are inserted for convenience only and shall not be deemed a
part hereof or affect the construction or interpretation of any
provision hereof.
19. NOTICES
19.1. Any notice required or permitted under this Agreement shall be sent by
air mail, postage pre-paid, courier or fax to the following addresses
of the parties or such other addresses as may be notified to the
parties as provided herein:
HGS: HUMAN GENOME SCIENCES, INC.
Key Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
fax: 000-000-0000
copy to: HGS: HUMAN GENOME SCIENCES, INC.
Key Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
fax: 000-000-0000
SB: SMITHKLINE XXXXXXX CORPORATION
Swedeland Road
King of Xxxxxxx, Xxxxxxxxxxxx 00000
Attention: Director,
Alliances & Technologies Group
SmithKline Xxxxxxx Pharmaceuticals
fax: 000-000-0000
copy to: SMITHKLINE XXXXXXX CORPORATION
Swedeland Road
X.X. Xxx 0000
Xxxx xx Xxxxxxx, Xxxxxxxxxxxx 00000
Attention: Corporate Intellectual Property
fax: 000-000-0000
19.2. Any notice required or permitted to be given concerning this Agreement
shall be effective upon receipt by the party to whom it is addressed.
20. ASSIGNMENT
20.1. This Agreement and the licenses herein granted shall be binding upon
and inure to the benefit of the successors in interest of the
respective parties. Neither this Agreement nor any interest hereunder
shall be assignable by either party without the written consent of the
other provided, however, that SB or HGS may assign this Agreement or
any of its rights or obligations hereunder to any AFFILIATE or to any
THIRD PARTY with which it may merge or consolidate, or to which it may
transfer all or substantially all of its assets to which this
Agreement relates, without obtaining the consent of the other party,
provided the assigning party remains liable under this Agreement and
that the THIRD PARTY assignee or surviving entity assumes in writing
all of its obligations under this Agreement.
21. RECORDING
21.1. SB and HGS shall have the right, at any time, to record, register, or
otherwise notify this Agreement in appropriate governmental or
regulatory offices anywhere in the TERRITORY, and the other party
shall provide reasonable assistance to the notifying party in
effecting such recording, registering or notifying.
22. DISPUTE RESOLUTION
22.1. Senior management of SB and HGS shall endeavor to resolve all disputes
under this Agreement.
22.2. If senior management does not timely resolve any such dispute, then
either party may submit such to binding arbitration pursuant to the
SB/HGS
arbitration agreement dated 19 August, 1993 as may be amended from
time to time.
23. COVENANTS
23.1.
23.1.1. SB agrees not to use SB TECHNOLOGY except
23.1.1.1. during the INITIAL RESEARCH TERM and RESEARCH
TERM EXTENSIONS to perform research and
development of HUMAN DIAGNOSTIC PRODUCTS and
after the INITIAL RESEARCH TERM and RESEARCH
TERM EXTENSIONS to perform research and
development of a SB HUMAN DIAGNOSTIC PRODUCT
pursuant to a DIAGNOSTIC RESEARCH PLAN
submitted by or on behalf of SB pursuant to
this Agreement, 23.1.1.2. in the HGS FIELD (as
defined in the JUNE 1996 SB/HGS LICENSE
AGREEMENT) only (i) in furtherance of research
and development of HUMAN DIAGNOSTIC PRODUCTS
during the INITIAL RESEARCH TERM AND RESEARCH
TERM EXTENSIONS, and (ii) after the INITIAL
RESEARCH TERM AND RESEARCH TERM EXTENSIONS
only in furtherance of research and
development of SB HUMAN DIAGNOSTIC PRODUCTS
pursuant to a DIAGNOSTIC RESEARCH PLAN
submitted by or on behalf of SB pursuant to
this Agreement, 23.1.1.3. to make, have made,
use, and sell SB HUMAN DIAGNOSTIC PRODUCT
(other than SB HUMAN DIAGNOSTIC PRODUCTS to
which SB's rights have been terminated
pursuant to Paragraph 11.3), 23.1.1.4. to
grant licenses that SB is otherwise permitted
to grant pursuant to this Agreement, and
23.1.1.5. as otherwise permitted in the JUNE
1996 SB/HGS LICENSE AGREEMENT.
23.1.2. During and after the INITIAL RESEARCH TERM, SB
agrees not to use HGS SPECIAL TECHNOLOGY
except as licensed and permitted pursuant to
this Agreement or the JUNE 1996 SB/HGS LICENSE
AGREEMENT.
23.1.3. Notwithstanding the preceding, SB shall have
the right to use SB TECHNOLOGY that is solely
based on or derived from published information
and/or information which otherwise becomes
lawfully known to SB independently of this
Agreement, unless: (i) the information is
claimed in a published HGS PATENT or SB PATENT
and there is no THIRD PARTY patent application
or patent with an earlier priority date which
discloses the information or
(ii) the SB TECHNOLOGY results from a
DIAGNOSTIC RESEARCH PLAN undertaken by SB.
23.2. HGS shall not use SPECIAL SB TECHNOLOGY except as licensed or
permitted under this Agreement. Notwithstanding the preceding, HGS
shall have the right to use SPECIAL SB TECHNOLOGY independently of
this Agreement if such SPECIAL SB TECHNOLOGY is solely based on or
derived from published information and/or information which otherwise
becomes lawfully known to HGS independently of this Agreement, unless:
the information is claimed in a published HGS PATENT or SB PATENT and
there is no THIRD PARTY patent application or patent with an earlier
priority date which discloses the information.
23.3. Notwithstanding anything else to the contrary, the following uses of
SB TECHNOLOGY and/or HGS SPECIAL TECHNOLOGY shall not be a breach of
this Agreement by SB:
23.3.1. use of unpatented HGS TECHNOLOGY outside a RESEARCH PLAN
submitted by SB in accordance with this Agreement or the
JUNE 1996 SB/HGS LICENSE AGREEMENT after the later of the
end of the INITIAL RESEARCH TERM or RESEARCH TERM EXTENSIONS
which HGS TECHNOLOGY at the time of such use is generally
available to the public, and/or
23.3.2. use of SB TECHNOLOGY outside a RESEARCH PLAN submitted by SB
in accordance with this Agreement or the JUNE 1996 SB/HGS
LICENSE AGREEMENT developed after the later of the end of
the INITIAL RESEARCH TERM or RESEARCH TERM EXTENSIONS which
is SB TECHNOLOGY only as a result of the use of unpatented
HGS TECHNOLOGY which is generally available to the public at
the time of such use; and/or
23.3.3. use of BIOINFORMATICS after the end of the INITIAL RESEARCH
TERM or RESEARCH TERM EXTENSION which BIOINFORMATICS is SB
TECHNOLOGY; and/or 23.3.4. use of SB TECHNOLOGY with respect
to any products discovered four (4) years after the later of
the end of the INITIAL RESEARCH TERM or RESEARCH TERM
EXTENSIONS outside a RESEARCH PLAN submitted by SB in
accordance with this Agreement or the JUNE 1996 SB/HGS
LICENSE AGREEMENT.
24. COUNTERPARTS
24.1. This Agreement may be executed in any number of counterparts, and each
such counterpart shall be deemed an original instrument, but all such
counterparts together shall constitute but one agreement.
IN WITNESS WHEREOF, the parties, through their authorized officers,
have executed this Agreement as of the date first written above.
SmithKline Xxxxxxx Corporation
By:______________________________
SmithKline Xxxxxxx, p.l.c.
By:______________________________
Human Genome Sciences, Inc.
By:______________________________
Appendix A
SAMPLE DIAGNOSTIC RESEARCH PLAN
1. Background
a. Target Identification (HGS Sequence ID#)
b. Brief description of data regarding potential diagnostic
utility
2. Key milestones
a. List key milestones and anticipated dates for achievement
b. Describe current status of project relative to milestones
and associated dates for accomplishments
3. Clinical Evaluation
a. List clinical utility claims desired
b. Briefly describe the studies needed for clinical evaluation
and status of those studies.
4. Patent Status
