EXHIBIT 2.6
(EXHIBIT B TO EXHIBIT 2.5 HEREOF)
EXHIBIT B
ISIS 3521 CLINICAL SUPPLY AGREEMENT
This ISIS 3521 Clinical Supply Agreement ("Agreement") is made and
entered into as of August 29, 2001 (the "Effective Date") between Xxx Xxxxx
and Company, a corporation organized and existing under the laws of the State
of Indiana ("LILLY") and Isis Pharmaceuticals, Inc., a corporation organized
and existing under the laws of the State of Delaware ("ISIS").
WITNESSETH
WHEREAS, ISIS and LILLY have entered into the Development and License Agreement
relating to the development and commercialization of ISIS 3521, and the
conditions to entering into this Agreement described in the Development and
License Agreement have been satisfied; and
WHEREAS, ISIS will initially manufacture, release and deliver ISIS 3521 API to
LILLY for support of ongoing clinical trials and will also perform CMC
activities and transfer to LILLY or a third party selected by LILLY the
technology to manufacture ISIS 3521 for commercial uses, pursuant to the terms
set forth herein;
NOW, THEREFORE, in consideration of the covenants herein contained, the parties
hereto agree as follows:
ARTICLE 1
DEFINITIONS
Capitalized terms used in this Agreement have the meanings set forth in
Exhibit 1 hereto.
ARTICLE 2
MANUFACTURE AND SUPPLY OF API
2.1 Subject to the terms and conditions set forth herein, LILLY will
provide ISIS with estimates of LILLY's requirements of API for support
of ongoing clinical trials prior to the start of Calendar Years 2002
and 2003. ISIS will supply API to LILLY, in amounts agreed upon by the
parties, based on LILLY's requirements and ISIS' Annual Capacity, in
accordance with the terms of this Agreement.
2.2 ISIS will provide bulk API to LILLY for use in Clinical Products. LILLY
will be responsible for the formulation, filling, finishing, labeling
and packaging of the Clinical Products, including stability studies;
provided, however, that, in accordance with
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Section 6.2, until the Release Technology Transfer is completed, ISIS
will perform Clinical Product release.
2.3 The parties acknowledge that as of the Effective Date, a third party
manufacturer performs the formulation, filling and finishing of
Clinical Product for ISIS. Following the Effective Date, LILLY will be
responsible for the formulation, filling and finishing of Clinical
Product and will use commercially reasonable efforts to promptly
establish, itself or through a third party manufacturer, the
manufacturing process for formulating, filling, and finishing Clinical
Product. If requested by LILLY, ISIS will cooperate with LILLY, as
appropriate, to enable LILLY to enter into an agreement with the third
party manufacturer used by ISIS to perform the formulation, filling and
finishing of Clinical Product.
ARTICLE 3
ORDERS AND LIMITATION OF SUPPLY
3.1 PRODUCTION AND DELIVERY PLANS AND ORDERS.
(a) Not later than July 1 of each year, except 2001, in which this
Agreement is in effect, LILLY will provide ISIS with a written estimate
of the amount of API LILLY will require during the subsequent Calendar
Year, which estimate will indicate the quantity of API to be utilized
in Clinical Products. [LILLY's API order estimate for Calendar Year
2002 is set forth on Exhibit 2. [*]
(b) At the time of delivery of each such estimate (but within 30 days after
the Effective Date with regard to the estimate for Calendar Year 2002),
LILLY representatives will meet with ISIS representatives to discuss
and agree upon a production and delivery plan for the next Calendar
Year (the "Production and Delivery Plan"). Each year's agreed-upon
Production and Delivery Plan will specify the quantity of API to be
utilized in Clinical Product that ISIS will supply to LILLY during the
subsequent Calendar Year, taking into account all relevant factors
including, without limitation, ISIS' Annual Capacity and its
obligations to other parties. Each such Production and Delivery Plan
will be deemed a firm purchase order of LILLY for the quantities of API
specified therein, and a firm commitment of ISIS to Manufacture and
supply such quantities of API to LILLY.
(c) The Production and Delivery Plan will further specify one or more dates
upon which Delivery of the API to be supplied by ISIS will occur during
the relevant Calendar Year. ISIS will use commercially reasonable
efforts to Deliver the API to LILLY according to the agreed-upon
Delivery schedule set forth in the Production and Delivery Plan. The
Production and Delivery Plan will provide for Delivery of API promptly
after completion of Manufacture and release. The date on which the
parties agree upon a Production and Delivery Plan for the following
Calendar Year will be referred to herein as the "API Order Date."
(d) Based on various considerations, including its obligations to Third
Parties and to its own drug development efforts, ISIS' Annual Capacity
will vary from year to year. ISIS'
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annual capacity for the Manufacture of API for Calendar Years 2002 and
2003 (the "Annual Capacity"), indicating the maximum amount of API
that LILLY may order from ISIS during each such Calendar Year, is set
forth in Exhibit 3.
(e) ISIS will purchase the Raw Materials used in the Manufacture. At its
sole discretion, LILLY will have the option to purchase some or all of
the Raw Materials used in the Manufacture. If Lilly so decides, LILLY
will notify ISIS, and the parties will work together to establish
appropriate procedures for order and delivery of and payment for such
Raw Materials to be purchased by LILLY.
3.2 COMMERCIAL MANUFACTURING .
LILLY and ISIS will work together to complete a plan for commercial
supply of API. LILLY and ISIS will work together to identify and
investigate other sources for the manufacture of API to be utilized for
Commercial Product. LILLY will inform ISIS in writing by July 1, 2002
of LILLY's decision, at its sole discretion, regarding whether LILLY,
ISIS and/or a third party will manufacture API to be utilized for
Commercial Product, and which of them shall be the primary source and
the back-up source of API to be utilized for Commercial Product. If, in
such notice, LILLY elects to have ISIS manufacture API to be utilized
for Commercial Product, LILLY and ISIS will negotiate in good faith,
and ISIS hereby commits, for ISIS to manufacture API to be utilized for
Commercial Product on substantially the terms set forth in Exhibit 8.
In such notice, LILLY will also provide LILLY's API order estimates for
Calendar Years 2003, 2004 and 2005.
3.3 LIMITATIONS OF SUPPLY.
In the event that at any time ISIS anticipates that it will be unable
to supply in whole or in part the quantities of API set forth in an
agreed-upon Production and Delivery Plan for any reason, including
without limitation force majeure, ISIS will notify LILLY in writing as
soon as possible of such anticipated shortfall. ISIS will also notify
LILLY of the underlying reason for the shortfall, proposed remedial
measures, the date such inability to supply the full order of API is
expected to end, and a proposed amount of API to be Delivered to LILLY.
[*] The proposed amount of API to be made available to LILLY hereunder
will be no less than [*] of the amount of raw materials or other
resources required for the Manufacture of API, taking into
consideration the amount of such raw materials or other resources
required by (i) LILLY under this Agreement and (ii) ISIS and its other
programs.
If ISIS cannot Manufacture as set forth in this Agreement, ISIS shall
so inform LILLY immediately upon the prediction or occurrence such
non-supply. In such event, LILLY shall have the right to Manufacture or
have Manufactured API for LILLY's needs and ISIS shall provide all
assistance and relevant information, know-how and data necessary for
LILLY in establishing and beginning the Manufacture of API.
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ARTICLE 4
QUALITY STANDARDS; MANUFACTURING WORKING GROUP
4.1 QUALITY STANDARDS.
(a) With respect to API in process prior to the time the Quality Agreement
is adopted, ISIS will Manufacture such API in accordance with cGMP and
the same specifications as applied to the Manufacture of API for use in
Clinical Product used in the CS17 Study. Subject to the preceding
sentence, ISIS will Manufacture API for use in Clinical Product in
accordance with the API Specifications, cGMP, the DRD, the Quality
Agreement and other applicable rules and regulations of all Regulatory
Authorities and other regulatory agencies with jurisdiction over the
manufacture, use or sale of the API, as then in effect. If cGMP for the
U.S. and its foreign equivalent differ, LILLY will specify in writing
which cGMP will apply to each quantity of API ordered from ISIS by
LILLY. ISIS will be responsible for Manufacturing issues related to API
safety and regulatory compliance. Each party will promptly notify the
other party of any relevant new instructions or specifications required
by a Regulatory Authority, and of other applicable and regulations of
which that party becomes aware. The parties will confer with each other
with respect to the best means to comply with such requirement and will
allocate any costs of implementing such changes on an equitable basis.
The parties acknowledge that frequent change-over in the Manufacture of
API as may be necessary to comply with differing cGMP in the US and
abroad will reduce the Annual Capacity, and that any costs incurred by
ISIS in connection with such change-overs will be included in the
calculation of API Supply Cost.
(b) ISIS will perform quality control testing, as is specified (i) in the
Quality Agreement and API Specifications; and (ii) as required by a
Regulatory Authority and by the mutual written consent of the parties,
on each lot of API supplied for use in Clinical Product, prior to
shipment.
4.2 CERTIFICATE OF ANALYSIS.
(a) ISIS will provide a Certificate of Analysis to LILLY or its designated
agent with each lot of API supplied hereunder. Such Certificate of
Analysis will contain the results of the analysis of API as required in
the API Specifications, and will certify with respect to each shipment
and lot (identified by lot number): (i) the quantity of the shipment,
(ii) that the API delivered was Manufactured in accordance with the API
Specifications and in conformance with cGMP. The Certificate of
Analysis will contain any information in addition to that required
pursuant to subsection (a) above as may be required by the Regulatory
Authority of the country of destination of API or Product; provided,
that LILLY provides to ISIS sufficient documentation and information
necessary or useful to enable ISIS to conform with such requirements.
ISIS will provide the results of such analysis to LILLY, along with any
supporting data.
(b) LILLY will be under no obligation to accept any Delivered lot of API
without an accompanying Certificate of Analysis that conforms to
subsection (a) above. Each
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Certificate will contain the results of testing per the API
Specifications and a statement that the batch was prepared in
compliance with cGMP. ISIS will also make available for LILLY's
review ISIS' Manufacturing records for the API, including its master
and production batch records, for the purposes of assuring product
quality and compliance with agreed-upon Manufacturing procedures as
per the following Section 9.3, Quality Assurance Audits.
4.3 CHANGES TO MANUFACTURING PROCESS; MANUFACTURING WORKING GROUP.
(a) During the term of this Agreement, if ISIS proposes to make a material
change in Manufacturing materials, equipment, processes, procedures, or
to the API Specifications, the parties will discuss and address such
proposals as follows. Prior to implementing such a material change,
ISIS will notify the Manufacturing Working Group (the "MWG") of ISIS'
proposed material change, for consideration by the MWG pursuant to
Section 4.6. ISIS will provide information to the MWG regarding the
change at a level sufficient to allow the MWG members to evaluate such
changed Manufacturing process.
(b) The MWG will consist of 3 members from LILLY and 3 members from ISIS
and will be established promptly after the Effective Date. The members
will be individuals who are capable of responding to the technical,
financial, quality, and other issues that could arise under this
Agreement. The MWG can consult with, and receive assistance from, LILLY
and ISIS employees who are not MWG members. The additional objectives
of the MWG are (i) with the parties' quality units, to adopt the
initial Quality Agreement and Development Responsibilities Document and
subsequent amendments (if any) to each; and (ii) monitor the parties'
performance under this Agreement, including reviewing, on a periodic
basis, forecast accuracy and on-time delivery. The MWG shall report to
the parties at least once each calendar quarter and more frequently as
requested.
4.4 QUALITY AGREEMENT.
(a) Promptly (and in any event within 60 days) after the Effective Date,
the MWG will adopt the initial Quality Agreement for API for Clinical
Product (the "Quality Agreement").
(b) The MWG will, at least annually, review the Quality Agreement and will
amend it from time to time as necessary through the issuance of a
revised section incorporating the modification and stating the
effective date of the modification, signed by a duly authorized
representative from each party who is a member of the quality
control/quality assurance group, as evidenced by a signed, revised
Quality Agreement incorporating the revision number that sets forth the
effective date of the modifications and reason for the revision.
(c) The Quality Agreement will describe the parties' quality control,
quality assurance and regulatory responsibilities relating to the
Manufacture and release of the API by ISIS. The Quality Agreement will
include as an exhibit the current standard operating procedures of
ISIS, as may be amended by ISIS from time to time, listed in Exhibit 4.
ISIS will provide to LILLY not less than once per calendar year an
updated set of such
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standard operating procedures. All standard operating procedures used
by ISIS in connection with the Manufacture of API will comply with
cGMP.
(d) In the event of an inconsistency between the Quality Agreement and the
terms of this Agreement, the terms of this Agreement will apply.
4.5 DEVELOPMENT RESPONSIBILITY DOCUMENT.
(a) Promptly after the Effective Date, and in any event before initiation
of LILLY-sponsored clinical trials of the Product, the MWG will adopt
the initial Development Responsibilities Document ("DRD").
(b) The MWG will, at least annually, review the DRD and will amend it from
time to time through the issuance of a revised section incorporating
the modification and stating the effective date of the modification,
signed by a duly authorized representative of each party.
(c) The DRD will be similar to, but shorter than, a Manufacturing
Responsibilities Document and will provide specific guidance to the
parties to ensure the logistics for supply of Clinical Product to
support the Development Program.
(d) In the event of an inconsistency between the DRD and the terms of this
Agreement, the terms of this Agreement will apply.
4.6 PROCEDURES REGARDING CHANGES TO MANUFACTURING PROCESS.
(a) At its initial meeting, the MWG will consider and agree upon the
guidelines to be used to determine the approval process to be applied
to any material change in Manufacturing materials, equipment,
processes, procedures, or to the API Specifications proposed by ISIS.
ISIS will prepare and submit the guidelines to the MWG for
consideration, using the following 3 categories and providing examples
of the types of material changes that will be included in each
category:
(i) changes in production of API that may affect the filing of
an application for Marketing Approval or require prior Regulatory
Approval and will thus require LILLY's approval prior to
implementation;
(ii) changes that will require ISIS to notify LILLY prior to
implementation, but which do not require LILLY's approval; and
(iii) changes that do not require ISIS to notify LILLY prior
to implementation.
(b) If ISIS proposes to make a material change described in subsection
(a)(i), ISIS will notify the MWG and provide information to the MWG
regarding such change at a level sufficient to allow the MWG members to
evaluate the impact of such change on the Manufacturing Process, and to
form a basis for LILLY to determine whether or not to approve such
material change. If there are any additional questions regarding
notification
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and approval that arise during the term of this Agreement, ISIS will
submit the questions to the MWG or, if an immediate response is
required, will contact LILLY's Quality Assurance function to
determine the level of review/notification that may be required by
the proposed change. The parties will obtain the prior Regulatory
Approval and any other required approvals, if such approval is
required, before any such material change is implemented.
4.7 COMPLIANCE WITH LAWS.
In performing its obligations under this Agreement, ISIS will comply
with all applicable present and future orders, regulations,
requirements and laws ("Legal Requirements") of any and all U.S.
authorities and agencies, including without limitation laws and
regulations applicable to the transportation, storage, use, handling
and disposal of hazardous materials (the "U.S. Legal Requirements"),
and any Legal Requirements of other countries ("Foreign Legal
Requirements") of which it is informed by LILLY. If the U.S. Legal
Requirements conflict with the Foreign Legal Requirements, the parties
will discuss and agree on how to resolve such conflict.
4.8 DOCUMENTATION AND RECORD KEEPING.
ISIS will keep complete, accurate and authentic accounts, notes, data
and records of all of ISIS' work performed under this Agreement,
including, but not limited to, complete and adequate records pertaining
to the methods and facilities used for the Manufacture in accordance
with master production records, batch production records, product
history documents (e.g., master formulae, validation packages,
specifications, CT batch history documents, batch specific deviation
reports, COAs) Standard Operating Procedures ("SOPs"), as well as the
applicable regulations, including in the United States, so that API may
be used in the production of a substance to be used in humans. ISIS
will maintain these records for 2 years after expiration of the
Clinical Product that incorporates the particular API. LILLY will
notify ISIS in writing of the expiration of Products that incorporate
specific API pursuant to the procedures described in the DRD, and if
LILLY changes the expiration date on any Clinical Product. SOPs will be
maintained for 5 years after the document is superseded or deleted.
Upon expiration of the retaining periods for the respective records as
provided in this Section and in case ISIS wishes to cease retention of
such records, ISIS will notify LILLY so that LILLY may, at its cost,
retain such records.
4.9 REVIEWS.
ISIS will generate and provide annual summary reviews for API
Manufacturing and control as well as supporting documents or other
information for annual product reviews as agreed by the parties.
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ARTICLE 5
SUPPLY PRICE; PAYMENT AND TERMS OF SALE
5.1 SUPPLY PRICE.
(a) The API Clinical Supply Price will apply to all API supplied to LILLY
intended for use in a Clinical Product.
(b) Except as provided in Section 3.1 (a), for each calendar quarter, ISIS
will invoice LILLY for the API Clinical Supply Price of API Delivered
to LILLY during such calendar quarter. LILLY will pay each invoice
within [*] after receipt, subject to the provisions of Section 5.3.
Interest will be charged on late payments consistent with the
provisions of subsection (c) below.
(c) All payments due hereunder will be paid by wire transfer in U.S.
Dollars to such bank account designated in writing by ISIS from time to
time. LILLY will pay a late payment service charge of [*] per month [*]
on all past-due amounts.
5.2 DELIVERY.
(a) ISIS will deliver API to a carrier designated by LILLY FCA ISIS'
Facility (Incoterms 2000). The shipping and packaging specifications
will be agreed upon by the parties.
(b) In the event of a loss of work in process or API prior to the transfer
of title pursuant to the Delivery of API as provided in subsection (a)
above, any uninsured portion of the loss will be shared by LILLY and
ISIS as follows: [*] Any deductible will be applied ratably against all
items damaged or lost.
5.3 ACCEPTANCE AND CLAIMS; MATERIALS REVIEW BOARD.
(a) If LILLY claims that any sample of API did not meet the warranty
specified in Article 8, LILLY will notify ISIS in writing within 30
days of such Delivery, and a joint Materials Review Board formed under
subsection (b) below will review the test data generated by LILLY and
ISIS under QA approved procedures mutually agreed by the parties within
30 days after LILLY's notice to ISIS.
(b) Promptly after the Effective Date, ISIS and LILLY will each select 2
members of their in-house materials review boards (or other senior
personnel with appropriate qualifications) to participate in a joint
Materials Review Board ("MRB") that will review and consider any test
data generated by LILLY and ISIS with respect to the Delivered lot of
API.
(c) If the members of the MRB are thereafter unable to agree as to whether
the API met the warranty specified in Article 8, the parties will
cooperate and have the test data reviewed by an independent third party
selected by LILLY and approved by ISIS, which approval will not be
unreasonably withheld. If the independent third party reviewer cannot
determine whether the Delivered API in dispute met the warranty of
Article 8, a sample
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of the batch of the Delivered API in dispute retained by ISIS will
be analyzed in accordance with the API Specifications, under QA
approved procedures, by an independent testing laboratory of
recognized repute selected by LILLY and approved by ISIS, which
approval will not be unreasonably withheld. The results of such
laboratory testing will be final and binding on the parties on the
issue of compliance of the API with such warranty.
(d) If the Delivered API is determined to meet the warranty set forth in
Article 8, LILLY will bear the cost of any third party review and/or
independent laboratory testing performed pursuant to subsection (c)
above and will pay for the API in accordance with the terms of this
Agreement. If the API is determined not to meet the warranty set forth
in Article 8, ISIS will bear the cost of any third party review and/or
independent laboratory testing performed pursuant to subsection (c)
above.
(e) If ISIS agrees, or if it is determined pursuant to subsection (c)
above, that API did not conform to the warranty set forth in Article 8,
ISIS will use commercially reasonable efforts to Manufacture and
Deliver a replacement batch of API to LILLY for the batch of API that
did not conform to such warranty, and LILLY will pay ISIS for any such
replacement batch of API, including without limitation, all costs and
expenses associated with such Manufacture, consistent with the
provisions of Section 5.1 herein. [*]
(f) Any Delivered API which ISIS agrees did not meet, or which was
determined not to have met, the Article 8 warranty that is in LILLY's
control will, at ISIS' option, either be returned to ISIS or will be
destroyed pursuant to ISIS' instructions and with LILLY's approval,
which approval will not be unreasonably withheld, at ISIS' expense.
(g) Failure by LILLY to notify ISIS within [*] after Delivery of API which
does not meet the warranty under Article 8 will be a waiver of the
remedies available to LILLY under this Section 5.3.
(h) Should either party identify any possible latent defect of API that is
not revealed by the procedures set forth above within [*] of receipt of
any shipment by LILLY, it will so notify the other party immediately
upon discovery. LILLY and ISIS will discuss in good faith and agree
upon the appropriate measures to be taken by the parties related to
such latent defect.
5.4 TERMS OF SALE.
The terms and conditions of this Agreement will be controlling over any
inconsistent terms or conditions included in any agreed-upon order for
API or any other sales acknowledgment or document. No provision of any
LILLY forms purporting to be orders for API that may impose different
conditions than those herein referenced upon ISIS, LILLY or their
respective Affiliates will be of any force or effect unless expressly
agreed to in writing by both parties.
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5.5 RECORD KEEPING AND AUDIT.
ISIS will keep accurate records in sufficient detail to enable the API
Clinical Supply Price to be verified. Upon written request of LILLY and
not more than once in each Calendar Year, ISIS will permit
representatives of LILLY to have access during normal business hours to
such records as may be reasonably necessary to verify the API Clinical
Supply Price. Once specific records have been audited under this
Section 5.5, no further audit of such records may be made. If such
audit correctly concludes that any amounts are due to either party,
such payment will be made within [*] days after the determination by
the parties. The parties will treat all financial information subject
to review under this Section 5.5 in accordance with the confidentiality
provisions of the Development and License Agreement, which are
incorporated herein and made part of this Agreement by reference.
ARTICLE 6
TECHNOLOGY TRANSFER
6.1 TECHNOLOGY TRANSFER TEAM.
(a) The Technology Transfer will be coordinated and implemented under the
MWG. The MWG will form a team (the "Technology Transfer Team")
comprised of the members of the MWG and such additional employees of
each of the parties selected by the MWG as it deems appropriate to
effect the Technology Transfer (with equal representation of each of
the parties). Members of the Technology Transfer Team will each have
appropriate technical credentials, experience and knowledge; the
Technology Transfer Team will be co-chaired by a LILLY representative
and an ISIS representative from the MWG. The advice of additional
employees or consultants of either party may by mutual consent of the
parties be obtained.
(b) Decisions of the Technology Transfer Team will be made by unanimous
decision of the two-co-chairs; provided however, in the event that the
co-chairs do not, after good faith efforts, reach agreement on an
issue, the resolution and/or course of conduct in issue will be
determined in good faith by the MWG. In the event that the MWG does
not, after good faith efforts, reach agreement on such issue, the
resolution and/or course of conduct in issue will be determined in good
faith by the Product Leader at LILLY with respect to Product, who shall
hold at least an Executive Director position at LILLY, after
consultation with the Executive Vice President of ISIS.
(c) Throughout the entire Technology Transfer Term, the Technology Transfer
Team will meet at least once each month in person or by teleconference,
videoconference or by other mutually acceptable means, as necessary to
implement effectively and efficiently the Release Technology Transfer
Plan and the API Technology Transfer Plan.
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6.2 TECHNOLOGY TRANSFER FOR CLINICAL PRODUCT RELEASE.
(a) Promptly after the Effective Date, the Technology Transfer Team will
establish a plan (the "Release Technology Transfer Plan") for the
transfer to LILLY of the Release Technology as specified in the Release
Technology Transfer Plan (the "Release Technology Transfer"). The goal
of the Release Technology Transfer Plan is to effect the Release
Technology Transfer at the same time that Clinical Product release is
conducted for the second Phase III clinical trial of the Clinical
Product and in no event later than December 31, 2002.
(b) The Release Technology Transfer Plan will include INTER ALIA (i)
procedures designed to effect the prompt and efficient Release
Technology Transfer, (ii) a list of events necessary to accomplish the
Release Technology Transfer, (iii) a description of the training and
support to be provided by ISIS to LILLY during the Release Technology
Transfer, and (iv) the time period during which ISIS will perform the
Release Technology Transfer.
(c) During the Technology Transfer Term with respect to the Release
Technology Transfer, ISIS will (i) disclose and transfer to LILLY all
of the Release Technology as specified in the Release Technology
Transfer Plan and (ii) provide to LILLY the training and support
described in the Release Technology Transfer Plan and in this
Agreement.
(d) ISIS will use commercially reasonable efforts to perform the Release
Technology Transfer in accordance with the Release Technology Transfer
Plan and the terms of this Agreement. The parties will cooperate so
that the Release Technology Transfer may be completed as expeditiously
as possible.
(e) LILLY will use commercially reasonable efforts to implement the Release
Technology to be transferred by ISIS pursuant to this Section 6.2, and
to make available all reasonably necessary personnel and other
resources to enable such transfer without delay.
6.3 TECHNOLOGY TRANSFER PLAN FOR MANUFACTURE OF API.
(a) Promptly after LILLY notifies ISIS of its decision regarding the
manufacture of API to be utilized in Commercial Products as provided in
Section 3.2, the Technology Transfer Team will establish a plan (the
"API Technology Transfer Plan") for the transfer of the Manufacturing
Process and the Manufacturing Technology for the Manufacture of API
from ISIS to LILLY, its Affiliates or a third party designated by LILLY
(the "API Technology Transfer"). The goal of the API Technology
Transfer Plan is to enable LILLY to apply the Manufacturing Technology,
implement the Manufacturing Process and Manufacture API as soon as
practicable thereafter and in no event later than December 31, 2003.
(b) The API Technology Transfer Plan will include INTER ALIA (i) procedures
designed to effect the prompt and efficient API Technology Transfer,
(ii) a list of events necessary to accomplish the API Technology
Transfer, (iii) a description of the training and support to
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be provided by ISIS to LILLY during the API Technology Transfer, and
(iv) the time period during which ISIS will perform the API Technology
Transfer.
(c) During the Technology Transfer Term with respect to the API Technology
Transfer, ISIS will (i) disclose and transfer to LILLY all of the
Manufacturing Process and the Manufacturing Technology as specified in
the API Technology Transfer Plan and (ii) provide to LILLY the training
and support described in the API Technology Transfer Plan and in this
Agreement.
(d) ISIS will use commercially reasonable efforts to perform the API
Technology Transfer in accordance with the API Technology Transfer Plan
and the terms of this Agreement. The parties will cooperate so that the
API Technology Transfer may be completed as expeditiously as possible.
(e) LILLY and/or its third party manufacturer will use commercially
reasonable efforts to establish the Manufacturing Process for the
Manufacture of API to be transferred by ISIS pursuant to this Section
6.3, and to make available all reasonably necessary personnel and other
resources to enable such transfer without delay.
6.4 TRAINING AND SUPPORT.
The training and support to be provided by ISIS to LILLY in connection
with the Release Technology Transfer and the API Technology Transfer
(the "Technology Transfer") will include without limitation training
and support in a mutually acceptable facility in all of the methods
necessary to practice the Release Technology and the Manufacturing
Technology, as detailed in the Release Technology Transfer Plan and the
API Technology Transfer Plan. In addition, a reasonable number of
employees of LILLY and its Affiliates will be entitled to visit ISIS
facilities including without limitation pilot and commercial scale
facilities and testing laboratories to observe relevant processes in
operation. Moreover, ISIS will provide technical consultation on an
as-needed basis following NDA approval of Product for a time period to
be established by the Technology Transfer Team. ISIS also will be
available, if requested, for consultation during any regulatory
inspection or to assist in responding to regulatory questions that may
occur during Product registration activities.
6.5 PAYMENT OF TECHNOLOGY TRANSFER COSTS.
The Technology Transfer Team will submit a plan for resourcing the
Technology Transfer to the MWG. A budget for ISIS and LILLY resources
to be used in the performance of the Technology Transfer will be
developed to ensure effective forward planning and cost management.
LILLY will compensate ISIS [*] ISIS will invoice LILLY on a quarterly
basis for all activities performed and expenses incurred in accordance
with this Article. LILLY will pay each invoice within [*] days after
receipt. Interest will be charged on late payments consistent with the
provisions of Section 5.1(c).
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6.6 RECORDS.
ISIS will maintain records, in sufficient detail and in good scientific
manner appropriate for patent, regulatory and manufacturing purposes,
which will fully and properly reflect all of the work done and the
progress achieved in the performance of the Technology Transfer (the
"Records"). The Records at all times will be available to the
Technology Transfer Team and LILLY will have the right, during normal
business hours and upon reasonable notice, to inspect and copy all such
Records. LILLY also will have the right to arrange for its employees
and/or consultants to visit ISIS at its offices and laboratories and
other facilities during normal business hours on reasonable notice
concerning or in furtherance of the Technology Transfer and/or to
discuss the progress of the Technology Transfer and its results in
detail with the technical personnel and consultants of ISIS.
ARTICLE 7
ISIS CMC AND DEVELOPMENT ACTIVITIES
7.1 ISIS CMC ACTIVITIES.
(a) As part of its activities under the Development Plan set forth in the
Development and License Agreement, ISIS will perform the CMC items set
forth in Exhibit 5 hereto. ISIS will perform the listed activities and
such other activities as approved by the JDC in support of the
preparation and filing of the NDA according to the schedule set forth
in the Development Plan.
(b) In consideration of ISIS' performance of CMC activities in connection
with ISIS 3521 as set forth in Exhibit 5, LILLY will compensate ISIS
[*] ISIS will invoice LILLY on a quarterly basis for all activities
performed in accordance with this Article and related expenses.
Payments due under this Section will be due [*] days after receipt of
each invoice by LILLY. Interest will be charged on late payments
consistent with the provisions of Section 5.1(c).
7.2 ISIS DEVELOPMENT ACTIVITIES.
(a) As of the Effective Date, LILLY will also compensate ISIS for
additional development efforts undertaken by ISIS, such as analytical
methods development for raw materials, API and drug product testing and
release, and process development in connection with other
phosphorothioate oligodeoxynucleotides, which additional activities
support the activities of ISIS with regard to ISIS 3521 as approved by
the JDC and required pursuant to this Agreement and the Development and
License Agreement.
(b) In consideration of ISIS' performance of such additional activities in
connection with ISIS 3521, LILLY will compensate ISIS [*] used in
activities allocated to ISIS 3521 development, manufacture or support,
[*] Payments due under this Section will be due [*] days after receipt
of each invoice by LILLY. Interest will be charged on late payments
consistent with the provisions of Section 5.1(c).
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ARTICLE 8
PRODUCT WARRANTY
8.1 API SPECIFICATIONS; CGMPS; APPLICABLE LAWS.
Subject to Section 8.2 below, ISIS warrants that the API will, at the
time of Delivery, be Manufactured in accordance with and meet (a) the
API Specification; (b) cGMP; (c) requirements of the DRD and Quality
Agreement, and (d) the Legal Requirements.
8.2 FOREIGN MANUFACTURING REQUIREMENTS.
If the cGMP or the Legal Requirements applicable to the Manufacture of
API for use in the U.S. (the "U.S. Manufacturing Requirements") are
different from those applicable outside to the Manufacture of API for
use in countries other than the U.S. (the "Foreign Manufacturing
Requirements"), the warranty of subsection (a) will include such
Foreign Manufacturing Requirements only if LILLY has informed ISIS
thereof in writing as provided in Section 4.1, the parties have
resolved any conflicts as provided in Section 4.6, and have adapted the
Manufacturing Process, if necessary, as provided in Section 4.3.
8.3 MRB APPROVED API.
Notwithstanding anything in this Agreement, API will be deemed to
conform with API Specifications at the time of Delivery if approved by
the MRB pursuant to Section 5.3 for release and further processing into
Clinical Product.
ARTICLE 9
QUALITY CONTROL
9.1 SPECIFICATIONS AND PROCESS CHANGES.
The API Specification may not be materially amended, changed or
supplemented, except as provided in Section 4.3 and 4.6 above. Unless
otherwise specified in that Section, material changes required to
comply with applicable laws and regulations and Agency requirements
will be mutually agreed upon by ISIS and LILLY.
9.2 MATTERS RELATING TO THE FACILITY.
(a) ISIS will Manufacture API supplied by ISIS hereunder at the Facility,
which ISIS represents and warrants has passed inspections of the U.S.
and EU Agencies. ISIS will perform release testing of API at the
Facility and/or the facility of subcontractors
(b) ISIS will arrange for one or more qualified technical specialists from
LILLY, upon reasonable prior notice and during normal business hours,
to conduct inspections of the Facility. Observations and conclusions of
LILLY's audits or inspections will be issued to and promptly discussed
with ISIS and such corrective action as LILLY determines to be
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reasonably required will be promptly implemented by ISIS. ISIS will
maintain complete and accurate records of all reasonably relevant
information relating to the performance by ISIS of its obligations
hereunder. ISIS will permit LILLY to review, during the inspection at
the Facility, relevant cGMP documentation. The total number of
inspections under this Section 9.2(b) and audits under Section 9.3 per
Calendar Year will not exceed two.
9.3 QUALITY ASSURANCE AUDITS.
ISIS will perform inspections of its facilities to review its
manufacturing operations and assess its compliance with cGMP. In
addition, upon LILLY's written request and at mutually agreeable times
during normal business hours, ISIS will permit representatives of LILLY
to review ISIS' manufacturing operations and records and assess its
compliance with cGMP and quality assurance standards and to discuss any
manufacturing issues with ISIS' manufacturing and management personnel.
Under the Production and Delivery Plan, LILLY will have notice of how
many production runs ISIS may conduct in a given Calendar Year, which
will permit LILLY personnel to observe any such production run, if
LILLY so chooses, after providing notice to ISIS (and at its own
expense). In the event of a regulatory inspection that directly
involves the API, ISIS will immediately inform LILLY of the issuance of
the Notice of Inspection (or an equivalent notice from a non-U.S.
Regulatory Authority) will provide LILLY with copies of all
communications relating thereto and LILLY will be allowed to
participate.
9.4 TESTING.
(a) ISIS will perform such tests as are indicated in the API Specification.
Such testing methods will be qualified by ISIS prior to use and certain
of such tests will be stability indicating. No production lot of API
will be released for Delivery unless such tests show the API to meet
the API Specification. Should any production lot fail to meet API
Specification limits, such lot will not be released, unless the failure
is identified following release, in which case the identifying party
will immediately notify the other party and they will cooperate on the
actions to be taken as described in Section 5.3.
(b) ISIS is responsible for obtaining and retaining, at LILLY's expense,
the amount of API required for quality control release testing as
indicated in the API Specification, as applicable. Such amounts will be
retained for a period of not less than 1 year from the last retest date
prescribed by ISIS, and thereafter shipped at LILLY's request for
longer term storage at a designated LILLY facility.
(c) At LILLY's expense and approval, ISIS will perform an on-going program
of stability testing, as required in the stability plan to be agreed by
the parties, and provide a stability report to support the
transportation of API to a LILLY-designated facility. The stability
study period will be for a period specified by LILLY following
completion of Manufacture of such production lots and such stability
testing will be stability indicating. In the event that ISIS will
detect a change in a degradant in excess of the amount specified in the
stability plan of API in connection with such testing, ISIS will notify
LILLY, and as a part of each stability test of such lot thereafter,
ISIS will specifically
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incorporate additional testing and controls (e.g., storage condition
changes), as LILLY may reasonably specify.
(d) In consideration of ISIS' performance of testing as set forth in
subsection (c) above, LILLY will compensate ISIS for such performance
at the ISIS FTE Rate and will pay for any Out-of-Pocket Expenses
incurred in connection with such testing. ISIS will invoice LILLY on a
quarterly basis for all activities performed in accordance with this
Section 9.4 and related expenses. Payments due under this Section will
be due [*] after receipt of each invoice by LILLY. Interest will be
charged on late payments consistent with the provisions of Section
5.1(c).
9.5 INFORMATION RELATING TO MANUFACTURING CONDITIONS.
(a) Each party will notify the other immediately of any health hazards with
respect to API of which it becomes aware which may impact employees
involved in the Manufacture of API.
(b) Each party will promptly advise the other of any safety or toxicity
problem that is not part of the knowledge base readily available in
chemical manufacturing facilities of which either party becomes aware
regarding the API.
9.6 AGENCY INSPECTIONS.
ISIS hereby agrees to advise LILLY of any visit or inspection by an
Agency of the Facility relating to the Manufacture of API, provide
copies of all communications relating thereto and will permit one or
more qualified representative(s) of LILLY to be present, when possible.
If LILLY is not present during such a visit or inspection for any
reason, ISIS will promptly provide a copy of the actual report of the
results of the inspection to LILLY. ISIS will furnish LILLY copies of
all reports, documents or correspondence with respect to any such
Agency inspections of the Facility.
9.7 STORAGE AND DELIVERY.
ISIS will store and Deliver API in accordance with the DRD and Quality
Agreement, API Specifications and label requirements set forth by the
MWG and cGMP.
ARTICLE 10
REGULATORY MATTERS
10.1 ISIS will prepare and promptly provide necessary and useful
information, including without limitation Manufacturing information, as
is needed to support filings of Registrations by LILLY, its Affiliates,
sublicensees or distributors of Product. In addition, ISIS will
participate as required in resolving regulatory concerns. ISIS will be
responsible for maintaining current technical information needed to
support such submissions of Registrations, and accordingly will
promptly provide LILLY with advance notification of all changes in such
technical information required to be filed as
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amendment to CMC. All such activities will be at LILLY's expense,
which will be agreed to in advance by the parties.
10.2 The mutual goal of ISIS and LILLY will be to maintain an integrated
approach to the content and timing of all submissions of Registrations
made by LILLY in an effort to obtain and maintain regulatory approvals
of a Product. To ensure this mutual goal is met, with respect to issues
pertaining to API or to a Product, ISIS will provide to LILLY the right
to review and reference all authorizations, certificates, methodologies
and specifications in the possession or under the control of ISIS
relating to the pharmaceutical/technical development and Manufacture or
any component thereof to the extent needed for LILLY's filings of
Registrations.
ARTICLE 11
INDEMNIFICATION AND INSURANCE
11.1 INDEMNIFICATION.
(a) ISIS will defend, indemnify and hold harmless LILLY, its Affiliates and
their respective directors, officers, employees and agents, and their
respective successors and permitted assigns, from any and all claims,
actions, causes of action, liabilities, losses, damages, costs or
expenses, including reasonable attorney's fees, which arise out of or
relate to claims that may be brought or instituted against them by
third parties to the extent based upon or arising out of (i) the
failure by ISIS to meet the warranties set forth in Article 8; (ii) a
material breach by ISIS of its obligations set forth in this Agreement;
or (iii) gross negligence or willful misconduct of ISIS, its officers,
employees and agents in the performance of its obligations hereunder.
(b) LILLY will defend, indemnify and hold harmless ISIS, its Affiliates and
their respective directors, officers, employees and agents, and their
respective successors and permitted assigns, from any and all claims,
actions, causes of action, liabilities, losses, damages, costs or
expenses, including reasonable attorney's fees, which arise out of or
relate to claims that may be brought or instituted against them by
third parties to the extent based upon or arising out of (i) a material
breach by LILLY of its obligations set forth in this Agreement; or (ii)
gross negligence or willful misconduct of LILLY, its officers,
employees and agents in the performance of its obligations hereunder.
11.2 CLAIMS.
(a) If a claim is made against a party entitled to indemnification under
this Article 11, and if that party intends to seek indemnification with
respect thereto under this Article 11, the party seeking
indemnification (the "Indemnitee") will promptly notify the
indemnifying party (the "Indemnifying Party") of such claim. The
Indemnifying Party will defend, negotiate and settle such claim, and
the Indemnitee will cooperate with the Indemnifying Party in connection
therewith. The Indemnitee may participate in the defense of any claim
with counsel of its own choice and at its own expense. Neither party
will settle or compromise any such claim without the other party's
prior written consent, which
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consent will not be unreasonably withheld. The indemnity agreement in
this Article 11 will not apply to amounts paid in settlement of any
claim if such settlement is effected without the consent of the
Indemnifying Party, which consent will not be unreasonably withheld.
Failure of the Indemnitee to deliver notice to the Indemnifying Party
within a reasonable time after becoming aware of a claim will not
relieve the Indemnifying Party of any liability to the Indemnitee
pursuant to this Article 11, except to the extent such delay
prejudices the Indemnifying Party's ability to defend such claim.
11.3 INSURANCE.
Each party will maintain during the term of this Agreement and for [*]
thereafter, at its own expense, (i) commercial general liability
insurance, including contractual liability coverage, with a minimum
limit of [*] per occurrence and [*] annual aggregate; (ii) property
insurance with a minimum limit of [*]; and (iii) statutory workers'
compensation coverage as required by law.
ARTICLE 12
TERM AND TERMINATION
12.1 TERM.
This Agreement will be effective as of the Effective Date, and unless
sooner terminated as provided herein, will continue in effect until
December 31, 2003; provided that LILLY may, in its sole discretion,
extend the term of this Agreement for up to two additional, consecutive
one-year periods by providing ISIS with written notice of such
extension at least six months prior to the then scheduled expiration
date of this Agreement (using ISIS' Annual Capacity for 2003 for any
such additional year). The term of this Agreement may be further
extended by mutual written agreement of the parties.
12.2 TERMINATION BY EITHER PARTY.
This Agreement may be terminated with written notice by either party at
any time during the term of this Agreement:
(a) if the other party is in breach of its material obligations hereunder
and has not cured such breach within 90 days after written notice
requesting cure of the breach has been given; provided, however, in the
event of a good faith dispute with respect to the existence of a
material breach, the 90-day cure period will be tolled until such time
as the dispute is resolved pursuant to Section 14.6; or
(b) upon the filing or institution of bankruptcy, reorganization,
liquidation or receivership proceedings by the other party or upon an
assignment of a substantial portion of the assets for the benefit of
creditors by the other party; provided, however, in the case of any
involuntary bankruptcy proceeding such right to terminate will only
become effective if the party consents to the involuntary bankruptcy or
such proceeding is not dismissed within 90 days of the filing thereof.
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12.3 TERMINATION OF DEVELOPMENT AND LICENSE AGREEMENT.
This Agreement will automatically terminate in the event the
Development and License Agreement is terminated for any reason.
12.4 PAYMENT OF OUTSTANDING DEBTS.
Upon expiration or termination of this Agreement for whatever reason,
LILLY and ISIS will settle all outstanding invoices or monies owed to
the other party in accordance with the terms of this Agreement.
12.5 EFFECT OF TERMINATION OR EXPIRATION.
(a) If this Agreement is terminated by LILLY pursuant to Section 12.2(a),
all orders will be automatically cancelled and ISIS will terminate the
Manufacture of API as soon as practicable. LILLY will have the option
but not the obligation to (i) purchase all quantities of API stored at
ISIS by paying the API Clinical Supply Price as provided in Section
5.1, and (ii) undertake the Manufacture of API or seek a third party to
do such Manufacture. If LILLY undertakes to Manufacture or have
Manufactured API, then ISIS will continue the transfer of technology
pursuant to Article 6 on an expedited basis, at LILLY's expense.
(b) If this Agreement is terminated by LILLY pursuant to Section 12.2(b),
LILLY (i) will purchase all quantities of API stored at ISIS by paying
the API Clinical Supply Price as provided in Section 5.1, and (ii) will
have the right to undertake the Manufacture of API or seek a third
party to do such Manufacture.
(c) If this Agreement is terminated by ISIS pursuant to Section 12.2(a),
ISIS will have the option but not the obligation to supply under all
outstanding quantities set forth in the Production and Delivery Plan at
the API Clinical Supply Price or the API Commercial Supply Price, as
applicable. If ISIS elects to so supply, LILLY's payment obligations
relating thereto including, without limitation, those set forth in
Section 5.1 will continue to apply until all outstanding obligations of
LILLY to ISIS are fulfilled.
(d) If this Agreement is terminated pursuant to Section 12.3, all
outstanding quantities of API set forth in the Production and Delivery
Plan will be automatically cancelled and ISIS will terminate the
Manufacture of API as soon as practicable. In addition, LILLY will be
responsible for all other Manufacturing costs associated with API
pursuant to Section 5.1 at the time of termination. Notwithstanding the
foregoing, ISIS will use its best efforts to mitigate any costs payable
by LILLY under this Section 12.5(d).
(e) If this Agreement expires pursuant to Section 12.1, LILLY will purchase
all API ordered by LILLY during the term of this Agreement. ISIS will
Deliver such API in accordance with Section 5.2.
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ARTICLE 13
DAMAGE LIMITATIONS
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, IN NO EVENT
WILL EITHER PARTY HERETO, OR ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS
OR AFFILIATES BE LIABLE TO THE OTHER PARTY OR SUCH OTHER PARTY'S
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, AFFILIATES OR SUBLICENSEES FOR
ANY INDIRECT, CONSEQUENTIAL, INCIDENTAL OR SPECIAL DAMAGES, COSTS OR
EXPENSES (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOST REVENUES
AND/OR LOST SAVINGS) SUFFERED OR INCURRED BY THE OTHER PARTY, WHETHER
BASED UPON A CLAIM OR ACTION OF CONTRACT, WARRANTY, NEGLIGENCE, STRICT
LIABILITY OR OTHERWISE, ARISING FROM THIS AGREEMENT.
ARTICLE 14
MISCELLANEOUS
14.1 FORCE MAJEURE.
Neither party will be held liable or responsible to the other party nor
be deemed to have defaulted under or breached the Agreement for failure
or delay in fulfilling or performing any term of the Agreement when
such failure or delay is caused by or results from causes beyond the
reasonable control of the affected party including without limitation
embargoes, war, acts of war (whether war be declared or not),
insurrections, riots, civil commotions, strikes, lockouts or other
labor disturbances, or acts of God. The affected party will notify the
other party of such force majeure circumstances as soon as reasonably
practical and will make every reasonable effort to mitigate the effects
of such force majeure circumstances.
14.2 ASSIGNMENT.
This Agreement will inure to the benefit and be binding upon each
party, its successors and assigns. The Agreement may not be assigned or
otherwise transferred, nor, except as expressly provided hereunder, may
any right or obligations hereunder be assigned or transferred by either
party without the prior written consent of the other party; provided,
however, that either party may, without such consent, assign the
Agreement and its rights and obligations hereunder to an Affiliate or
in connection with the transfer or sale of all or substantially all of
its assets, or in the event of its merger or consolidation or change in
control or similar transaction. Any permitted assignee will assume all
obligations of its assignor under the Agreement. Any attempted
assignment not in accordance with this Section 14.2 will be void.
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14.3 SEVERABILITY.
In the event any one or more of the provisions contained in this
Agreement should be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein will not in any way be affected or impaired
thereby, unless the absence of the invalidated provision(s) adversely
affect the substantive rights of the parties. The parties will in such
an instance use their best efforts to replace the invalid, illegal or
unenforceable provision(s) with valid, legal and enforceable
provision(s) which, insofar as practical, implement the purposes of
this Agreement.
14.4 NOTICES.
All notices which are required or permitted hereunder will be in
writing and sufficient if delivered personally, sent by facsimile or
electronic mail (and promptly confirmed), sent by nationally-recognized
overnight courier or sent by registered or certified mail, postage
prepaid, return receipt requested, addressed as follows:
if to ISIS, to: Isis Pharmaceuticals, Inc.
Carlsbad Research Center
0000 Xxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Executive Vice President
Fax No.: (000) 000-0000
E-Mail: xxxxxxxxx@xxxxxx.xxx
with a copy to: Attention: General Counsel
Fax No.: (000) 000-0000
E-Mail: xxxxxx@xxxxxx.xxx
if to LILLY, to: Xxx Xxxxx and Company
Lilly Xxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: General Patent Counsel
Fax No.: (000) 000-0000
E-Mail: xxxxxxxx_xxxxxx_x@xxxxx.xxx
or to such other address as the party to whom notice is to be given may
have furnished to the other party in writing in accordance herewith.
Any such notice will be deemed to have been given when delivered if
personally delivered or sent by facsimile or electronic mail on a
business day, on the business day after dispatch if sent by
nationally-recognized overnight courier and on the third business day
following the date of mailing if sent by mail.
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14.5 GOVERNING LAW.
This Agreement will be governed by and construed in accordance with the
laws of the State of Delaware without reference to any rules of
conflict of laws.
14.6 DISPUTE RESOLUTION; OVERSIGHT COMMITTEE.
The parties recognize that disputes may from time to time arise between
the parties during the term of this Agreement. In the event of such a
dispute, either party, by written notice to the other party, may have
such dispute referred to the Oversight Committee, the function of which
is to attempt resolution of any disputes arising under this Agreement
by good faith negotiations. The Oversight Committee will endeavor to
resolve such disputes within 30 days after such notice is received. The
Oversight Committee will be comprised of two designated executive
officers (or their successors), one from each party. Said designated
officers are as follows:
For ISIS: Chief Executive Officer
For LILLY: Executive Vice President
14.7 REMEDIES.
In the event the parties are unable to resolve any disputes hereunder
pursuant to the dispute resolution measures provided herein, each party
may pursue its rights and remedies in law or equity in any court of
competent jurisdiction.
14.8 ENTIRE AGREEMENT.
This Agreement and the Development and License Agreement contain the
entire understanding of the parties with respect to the license,
development and commercialization of Products containing API and the
Manufacture and supply of API. All express or implied agreements and
understandings, either oral or written, heretofore made by the parties
on the same subject matter are expressly superseded by this Agreement
and the Development and License Agreement. This Agreement may be
amended, or any term hereof modified, only by a written instrument duly
executed by both parties hereto.
14.9 HEADINGS.
The captions to the several Articles and Sections hereof are not a part
of the Agreement, but are merely a convenience to assist in locating
and reading the several Articles and Sections hereof.
14.10 INDEPENDENT CONTRACTORS.
It is expressly agreed that ISIS and LILLY will be independent
contractors and that the relationship between the two parties will not
constitute a partnership, joint venture or agency. Neither ISIS nor
LILLY will have the authority to make any statements,
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representations or commitments of any kind, or to take any action,
which will be binding on the other, without the prior consent of the
other party.
14.11 WAIVER.
The waiver by either party hereto of any right hereunder, or the
failure to perform, or a breach by the other party will not be deemed a
waiver of any other right hereunder or of any other breach or failure
by said other party whether of a similar nature or otherwise.
14.12 COUNTERPARTS.
The Agreement may be executed in two or more counterparts, each of
which will be deemed an original, but all of which together will
constitute one and the same instrument.
14.13 WAIVER OF RULE OF CONSTRUCTION.
Each party has had the opportunity to consult with counsel in
connection with the review, drafting and negotiation of this Agreement.
Accordingly, the rule of construction that any ambiguity in this
Agreement will be construed against the drafting party will not apply.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective
Date.
XXX XXXXX AND COMPANY ISIS PHARMACEUTICALS, INC.
By:/s/ AUGUST X. XXXXXXXX By:/s/ B. XXXXX XXXXXXXX
--------------------------------- ------------------------------------
Name: August X. Xxxxxxxx Name: B. Xxxxx Xxxxxxxx
------------------------------- ---------------------------------
Title: Executive Vice President Title: Executive Vice President & CFO
------------------------------ --------------------------------
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EXHIBIT 1
DEFINITIONS
1.1 "AFFILIATE" with respect to either party means any person,
organization, corporation or other business entity (collectively,
"Person") controlling, controlled by, or under common control with such
party. For purposes of this definition, "control" refers to (a) the
possession, directly or indirectly, of the power to direct the
management or policies of a Person, whether through the ownership of
voting securities, by contract or otherwise, and (b) the ownership,
directly or indirectly, of at least 50% of the voting securities or
other ownership interest of a Person.
1.2 "AGENCY" means the U.S. Food and Drug Administration. In the event
LILLY provides written notice to ISIS that LILLY intends to conduct
Development Program activities outside of the United States, the term
"Agency" will mean with respect to such activities outside the United
States the Regulatory Authority (as defined below) of the country
specified in such notice involved in granting any approvals relating to
such Development Program activities.
1.3 "ANNUAL CAPACITY" has the meaning as defined in Section 3.1(d).
1.4 "API" means the bulk drug substance ISIS 3521 as described in
Exhibit 6.
1.5 "API SPECIFICATION" will mean the specification comprising methods,
tests and acceptance criteria or release limits of API, which may be
amended from time to time by the MWG. The current API Specification is
attached as Exhibit 6.
1.6 "API CLINICAL SUPPLY PRICE" means [*] of the API Supply Cost.
1.7 API SUPPLY COST" means the cost of Manufacture of API described in
Exhibit 7.
1.8 "API ORDER DATE" means the date on which the parties agree upon a
Production and Delivery Plan for the following Calendar Year, as set
forth in Section 3.1(c).
1.9 "CALENDAR YEAR" means each successive period of 12 months commencing on
January 1 and ending on December 31.
1.10 "cGMP" means the current good manufacturing practices described in Q7A
ICH Good Manufacturing Practice Guide for Active Pharmaceutical
Ingredients and 21 CFR Parts 210 ET SEQ. as applicable to the
Manufacture of API in the U.S., as are in effect on the Effective Date
or as may subsequently be modified or supplemented. In the event LILLY
provides written notice to ISIS that LILLY intends to conduct the
Development Program activities in countries outside of the United
States, the term "cGMP" will also include corresponding good
manufacturing practices in such countries, provided that to the extent
any conflict exists between cGMP applicable in the U.S. and in such
countries, the cGMP of the U.S. will apply, unless the parties agree
otherwise as provided in Section 4.1, 4.3, 4.6 and 8.2.
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1.11 "CLINICAL PRODUCT" means a formulated pharmaceutical product containing
API in finished form for use in conducting clinical trials prior to
Regulatory Approval.
1.12 "COMMERCIAL PRODUCT" means a formulated pharmaceutical product
containing API for all uses after Regulatory Approval has been obtained
for the Product.
1.13 "COMBINATION PRODUCT" means any pharmaceutical product that comprises
the API and at least one other active compound(s) and/or ingredients.
All references to Product in this Agreement will be deemed to include
Combination Product.
1.14 "CS17 STUDY" means the Phase III clinical trial conducted by ISIS that
is ongoing as of the Effective Date, as further described in the
Development Plan.
1.15 "DELIVER" OR "DELIVERY" means the delivery of API by ISIS to the
carrier pursuant to Section 5.2.
1.16 "DEVELOPMENT AND LICENSE AGREEMENT" means the agreement for the
development and commercialization of ISIS 3521 entered into by ISIS and
LILLY on August 14, 2001.
1.17 "DEVELOPMENT PLAN" means the plan for the development of ISIS 3521
attached as Exhibit C to the Development and License Agreement.
1.18 "DEVELOPMENT PROGRAM" means the activities undertaken by ISIS and LILLY
as set forth in the Development Plan.
1.19 "DRD" has the meaning as defined in Section 4.5.
1.20 "FACILITY" means the Manufacturing facility of ISIS located in 0000
Xxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxx.
1.21 "FTE" means the equivalent of the scientific or technical work of at
least a total of [*] hours per year on or directly related to the
Manufacture, the Technology Transfer, CMC activities or any other
activities contemplated under this Agreement, carried out by a
qualified employee or consultant. Scientific or technical work can
include, but is not limited to, [*]
1.22 "ISIS 3521" means the phosphorothioate oligodeoxyribonucleotide that
targets human protein kinase C disclosed and claimed (as SEQ ID NO 2)
in U.S. Patent No. 5,703,054.
1.23 "ISIS FTE RATE" means [*]
1.24 "JDC" means the joint development committee established under the
Development and License Agreement.
1.25 "LEGAL REQUIREMENTS" has the meaning as defined in Section 4.7.
1.26 "MANUFACTURE" or "MANUFACTURED" or "MANUFACTURING" means all operations
involved in the manufacturing, quality control testing (including
in-process, release and
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stability testing, if applicable), releasing, packaging and shipping
of API under this Agreement.
1.27 "MANUFACTURING PROCESS" means the process steps set forth in master
batch records for ISIS 3521 in the version existing as of the Effective
Date, including reasonable minor variants and extensions of process
steps thereof.
1.28 "MANUFACTURING TECHNOLOGY" means any and all scientific and technical
data and information including without limitation formulas, methods,
techniques, protocols, and processes controlled by ISIS as of the
Effective Date which are necessary for performing the Manufacturing
Process.
1.29 "MANUFACTURING WORKING GROUP" or "MWG" has the meaning set forth in
Section 4.3 herein.
1.30 "MATERIALS REVIEW BOARD" has the meaning set forth in Section 5.3(b)
herein.
1.31 "MARKETING APPROVAL" means the act of a Regulatory Authority necessary
for the marketing and sale of the Product in a country or regulatory
jurisdiction, including, without limitation, the approval of the NDA by
the FDA.
1.32 "MRD" means the Manufacturing Responsibilities Document for the supply
of Commercial Product that includes key contacts, supply chain
diagrams, forecasting processes, the details of shipping and receiving,
and a process for informing ISIS of the batch numbers and expiration
date of Product referencing the batch numbers of API contained therein.
1.33 "NDA" means a new drug application or other application filed with the
FDA to obtain approval for marketing a Product in the United States, or
any future equivalent process.
1.34 "OUT-OF-POCKET EXPENSES" means costs, other than labor costs, that are
directly related to the activities outlined in the Development Plan and
this Agreement, including, without limitation, costs of travel,
supplies, outside services and consultants.
1.35 "OVERSIGHT COMMITTEE" has the meaning set forth in Section 14.6 herein.
1.36 "PRODUCT" means preparation(s) containing API for the treatment of
cancer in humans, including preparations for use in clinical trials
("Clinical Product") and preparations for sale by prescription,
over-the-counter or any other method ("Commercial Product").
1.37 "PRODUCTION AND DELIVERY PLAN" has the meaning a defined in Section
3.1(b).
1.38 "QUALITY AGREEMENT" has the meaning as defined in Section 4.4.
1.39 "RAW MATERIALS" means any raw materials intended for use in the
Manufacture of the Product, including those that may not appear in the
Product.
3.
1.40 "REGISTRATIONS" means the technical, medical and scientific licenses,
registrations, authorizations and/or approvals of API or Product
(including, without limitation, IND, DMF, NDA or other prerequisite
manufacturing approvals or authorizations, and marketing authorization
based upon such approvals or authorizations) that are required by any
national, supranational (e.g., the European Commission or the Council
of the European Union), regional, state or local regulatory agency,
department, bureau or other governmental entity, as amended or
supplemented from time to time.
1.41 "REGULATORY AUTHORITY" means any applicable government regulatory
authority involved in granting approvals for the marketing, and/or
pricing of a Product worldwide, including without limitation, in the
United States, the Food and Drug Administration ("FDA"), and any
successor government authority having substantially the same function,
and foreign equivalents thereof.
1.42 "REGULATORY APPROVAL" means the act of a Regulatory Authority necessary
for the Manufacture of Product in a country or regulatory jurisdiction.
1.43 "RELEASE TECHNOLOGY" means any and all scientific and technical data
and information including without limitation formulas, methods,
techniques, protocols, and processes controlled by ISIS as of the
Effective Date regarding Clinical Product release.
1.44 "TECHNOLOGY TRANSFER" has the meaning set forth in Section 6.4 herein.
1.45 "TECHNOLOGY TRANSFER TEAM" has the meaning set forth in Section 6.1
herein.
1.46 "TECHNOLOGY TRANSFER TERM" means the time period following the
Effective Date, as determined by the Technology Transfer Team, during
which the Technology Transfer will take place.
4.
EXHIBIT 2
LILLY'S API ORDER ESTIMATE FOR CALENDAR YEAR 2002
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EXHIBIT 3
MANUFACTURING CAPACITY OF ISIS
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EXHIBIT 4
LIST OF ISIS SOPS
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EXHIBIT 5
ISIS CMC ACTIVITIES
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EXHIBIT 6
API SPECIFICATIONS
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EXHIBIT 7
CALCULATION OF API SUPPLY COST
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EXHIBIT 8
TERMS OF COMMERCIAL SUPPLY OF API BY ISIS
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