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EXHIBIT 10.14
[CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE
BEEN REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE COMMISSION]
COLLABORATIVE DEVELOPMENT AGREEMENT
THIS COLLABORATIVE DEVELOPMENT AGREEMENT dated as of June 28, 1994 (the
"Agreement"), is entered into between BIOSITE DIAGNOSTICS INCORPORATED, a
Delaware corporation ("Biosite"), having a place of business located at 00000
Xxxxxxx Xxxxxx, Xxxxx X, Xxx Xxxxx, Xxxxxxxxxx 00000, U.S.A., and E. MERCK, a
German general partnership ("Merck"), having a place of business located at
Xxxxxxxxxxx Xxxxxxx 000, X-00000 Xxxxxxxxx, Xxxxxxx.
W I T N E S S E T H :
WHEREAS, Biosite owns or has rights to certain significant technology
which may be used in the development of reagents and a test device for use with
a test device reader to form a system to quantitatively measure analytes in the
immunoassay field.
WHEREAS, Merck owns or has valuable knowledge relating to certain
significant technology which may be used in the development of reagents and a
test device for use with a test device reader to form a system to quantitatively
measure analytes in the immunoassay field.
WHEREAS, Biosite and Merck desire to collaborate in the development of
a hand held rapid in vitro immunoassay system, consisting of reagents, a testing
device and a reader, designed to quantitatively measure multiple cardiac
analytes released from damaged cardiac tissue for use in the diagnosis and
monitoring of myocardial infarction in humans, and if the parties mutually
agree, to quantitatively measure certain other analytes for use in certain other
fields.
WHEREAS, Biosite desires to manufacture the reagents and test devices,
and to engage a third party to develop and supply the test device reader, for
use in connection with such immunoassay system.
WHEREAS, Biosite desires to market and distribute such immunoassay
system in the United States of America and Canada, to appoint Merck as its
exclusive distributor in Europe, Latin America and South Africa, and to retain
the exclusive distribution rights in Japan and the rest of the world.
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NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained, the parties hereby agree as follows:
ARTICLE 1
DEFINITIONS
For purposes of the Agreement, the terms defined in this Article 1
shall have the respective meanings set forth below:
1.1 "Affiliate" shall mean, with respect to any Person, any other
Person which directly or indirectly controls, is controlled by, or is under
common control with, such Person. A Person shall be regarded as in control of
another Person if it owns, or directly or indirectly controls, at least forty
percent (40%) of the voting stock or other ownership interest of the other
Person, or if it directly or indirectly possesses the power to direct or cause
the direction of the management and policies of the other Person by any means
whatsoever.
1.2 "Commencement Date" shall mean July 1, 1994.
1.3 "Development Program" shall mean the development program, described
generally in the summary work plan set forth in Exhibit A, as revised from time
to time as provided in the Agreement.
1.4 "Europe" shall mean, collectively, Xxxxxxx, Xxxxxxx, Xxxxxxx,
Xxxxxx Xxxxxxxxxxx, Xxxxxxxx, Croatia, Czech Republic, Denmark, Estonia,
Finland, France, Georgia, Germany, Greece, Hungary, Ireland, Italy, Latvia,
Liechtenstein, Lithuania, Luxembourg, the Netherlands, Norway, Poland, Portugal,
Romania, Russia, Serbia, Slovakian Republic, Slovania, Spain, Sweden,
Switzerland, Turkey, Ukraine, the United Kingdom, White Russia and Yugoslavia.
1.5 "Field" shall mean the quantitative measurement of multiple cardiac
analytes released from damaged cardiac tissue, including CKMB, Troponin I and
Myoglobin, for use in the diagnosis and monitoring of myocardial infarction in
humans.
1.6 "Know-How" shall mean all information and data, which is not
generally known, including formulae, procedures, protocols, techniques and
results of experimentation and testing, which are necessary or useful to make,
use, develop, sell or seek regulatory approval in any country to market the
Product for use in the Field, in which Biosite or Merck has an ownership
interest and which is in the possession of Biosite or Merck on the date of the
Agreement or thereafter during the term of the Agreement.
1.7 "Latin America" shall mean, collectively, Argentina, Belize,
Bolivia, Brazil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala,
Guyana, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Uruguay and
Venezuela.
1.8 "LRE" shall mean LRE Relais+Elektronik GmbH, a German limited
liability company.
1.9 "Patent Rights" shall mean (a) all patent applications heretofore
or hereafter filed or having legal force in any country
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owned by or licensed to Biosite or Merck or to which Biosite or Merck otherwise
acquires rights, which claim the Product, any Product Component, or the process
of manufacture or use of the Product or any Product Component for use in the
Field, together with any and all patents that have issued or in the future issue
therefrom, including utility model and design patents and certificates of
invention; and (b) all divisionals, continuations, continuations-in-part,
reissues, renewals, extensions or additions to any such patents and patent
applications; all to the extent and only to the extent that Biosite or Merck now
has or hereafter will have the right to grant licenses, immunities or other
rights thereunder.
1.10 "Person" shall mean an individual, corporation, partnership,
trust, business trust, association, joint stock company, joint venture, pool,
syndicate, sole proprietorship, unincorporated organization, governmental
authority or any other form of entity not specifically listed herein.
1.11 "Product" shall mean the hand held rapid in vitro immunoassay
system, consisting of reagents, a testing device and a reader, developed under
the Development Program.
1.12 "Product Components" shall mean, collectively, the Reader, the
Reagents and the Testing Device as defined below:
1.12.1 "Reader" shall mean that certain testing device reader,
developed under the Reader Development and Supply Agreement, constituting a
component of the Product.
1.12.2 "Reagents" shall mean those certain reagents, developed
under the Development Program, constituting a component of the Product.
1.12.3 "Testing Device" shall mean that certain testing device,
developed under the Development Program, containing the Reagents and
constituting a component of the Product.
1.13 "Reader Development and Supply Agreement" shall mean that certain
Development and Supply Agreement regarding the development of the Reader to be
entered into between Biosite and LRE, as amended, supplemented or restated from
time to time.
1.14 "South Africa" shall mean the Republic of South Africa.
1.15 "Steering Committee" shall mean the joint development committee
composed of representatives of Biosite and Merck described in Section 4.1 below.
1.16 "Supply and Distribution Agreement" shall mean that certain Supply
and Distribution Agreement dated as of even date, between Biosite and Merck, in
the form attached hereto as Exhibit B, as amended, supplemented or restated from
time to time.
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1.17 "Third Party" shall mean any Person other than Biosite, Merck and
their respective Affiliates.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
Each party hereby represents and warrants to the other party as
follows:
2.1 Existence and Power. Such party (a) is duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is
organized; (b) has the requisite power and authority and the legal right to own
and operate its property and assets, to lease the property and assets it
operates under lease, and to carry on its business as it is now being conducted
and (c) is in compliance with all requirements of applicable law, except to the
extent that any noncompliance would not have a material adverse effect on the
properties, business, financial or other condition of such party and would not
materially adversely affect such party's ability to perform its obligations
under the Agreement.
2.2 Authorization and Enforcement of Obligations. Such party (a) has
the requisite power and authority and the legal right to enter into the
Agreement and to perform its obligations hereunder and (b) has taken all
necessary corporate action on its part to authorize the execution and delivery
of the Agreement and the performance of its obligations hereunder. The Agreement
has been duly executed and delivered on behalf of such party, and constitutes a
legal, valid, binding obligation, enforceable against such party in accordance
with its terms.
2.3 Consents. All necessary consents, approvals and authorizations of
all governmental authorities and other Persons required to be obtained by such
party in connection with the Agreement have been obtained.
2.4 No Conflict. The execution and delivery of the Agreement and the
performance of such party's obligations hereunder do not conflict with or
violate any requirement of applicable laws or regulations.
2.5 DISCLAIMER OF WARRANTIES. NOTHING IN THE AGREEMENT SHALL BE
CONSTRUED AS A REPRESENTATION MADE, OR WARRANTY GIVEN, BY EITHER PARTY THAT ANY
PATENT WILL ISSUE BASED UPON ANY PENDING PATENT APPLICATION WITHIN THE PATENT
RIGHTS, THAT ANY PATENT WITHIN THE PATENT RIGHTS WHICH ISSUES WILL BE VALID, OR
THAT THE USE OF ANY LICENSE GRANTED HEREUNDER OR THAT THE USE OF ANY PATENT
RIGHTS WILL NOT INFRINGE THE PATENT OR PROPRIETARY RIGHTS OF ANY OTHER PERSON.
FURTHERMORE, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR
IMPLIED, WITH RESPECT TO THE PATENT RIGHTS, THE PRODUCT OR THE PRODUCT
COMPONENTS,
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INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
ARTICLE 3
DEVELOPMENT PROGRAM
3.1 Development Activities.
3.1.1 Scope of Development Program. Biosite and Merck shall
conduct the Development Program to develop, conduct all clinical testing and
apply for regulatory approval to market the Product for use in the Field in the
United States of America, Canada, Europe, Latin America and South Africa.
Biosite shall have the exclusive right to develop and commercialize the Product
for use in the Field in Japan and the rest of the world and to develop and
commercialize the Product for use outside the Field. Notwithstanding the
foregoing, if the parties mutually agree during the term of the Development
Program, they shall negotiate in good faith mutually acceptable agreements, on
terms and conditions substantially similar to those of the Agreement and the
Supply and Distribution Agreement, to develop and commercialize a disposable in
vitro immunoassay test device in combination with a hand held reader, for use in
either or both of the following fields: [CONFIDENTIAL MATERIAL REDACTED AND
FILED SEPARATELY WITH THE COMMISSION].
3.1.2 Development Responsibilities. Biosite and Merck shall
conduct the Development Program under the direction of the Steering Committee.
Biosite shall be responsible for the design, development and manufacturing
scale-up of the Reagents and the Testing Device, the clinical trials and
regulatory approval of the Product for use in the Field in the United States of
America and Canada. Merck shall be responsible for the clinical trials and
regulatory approval of the Product for use in the Field in the countries of
Europe and Latin America and in South Africa. Biosite shall be responsible for
the clinical trials and regulatory approval of the Product for use in the Field
in Japan and the rest of the world. Pursuant to the Reader Development and
Supply Agreement, LRE shall be responsible for the design and development of the
Reader. Biosite and Merck shall cooperate with LRE in the design and development
of the Reader.
3.1.3 Conduct of Development. Biosite and Merck each shall conduct
the Development Program in good scientific manner, and in compliance in all
material respects with all requirements of applicable laws and regulations and
all applicable good laboratory, clinical and manufacturing practices to attempt
to achieve its objectives efficiently and expeditiously. Biosite and Merck each
shall proceed diligently with the work set out in the Development Program by
using their respective good faith efforts to provide, among others, the
following resources:
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(a) allocation of sufficient time, effort, equipment and
facilities to the Development Program to carry out its obligations under the
Development Program and to accomplish the objectives thereof; and
(b) use of personnel with sufficient skills and experience as
are required to carry out its obligations under the Development Program and to
accomplish the objectives thereof.
3.1.4 Subcontracts. Biosite and Merck each may subcontract
portions of the Development Program to be performed by it in the normal course
of its business without the prior consent of the other; provided, however, that
(a) such subcontracting shall not involve the transfer of Know-How of the other
party to Third Parties; (b) the subcontracted party shall enter into a
confidentiality agreement with the subcontracting party in accordance with
Article 7 below; (c) the subcontracting party shall supervise such subcontract
work; and (d) the subcontracted party shall be in compliance in all material
respects with all requirements of applicable laws and regulations, together with
all applicable good laboratory, clinical and manufacturing practices.
3.2 Development Funding.
3.2.1 Jointly Funded Development Costs.
(a) The Jointly Funded Development Costs, as defined below,
shall be shared sixty percent (60%) by Biosite and forty percent (40%) by Merck.
The "Jointly Funded Development Costs" shall mean (i) one hundred percent (100%)
of those costs incurred by Biosite or Merck under the Development Program for
the design, development and manufacturing scale-up of the Reagents, the design,
development and manufacturing scale-up of the Testing Device; (ii) one hundred
percent (100%) of the costs, not to exceed [CONFIDENTIAL MATERIAL REDACTED AND
FILED SEPARATELY WITH THE COMMISSION], incurred by Biosite for the clinical
trials and regulatory approval of the Product for use in the Field in the United
States of America; (iii) one hundred percent (100%) of the costs, not to exceed
[CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION] in the
aggregate, incurred by Merck for the clinical trials and regulatory approval of
the Product for use in the Field in Europe, Latin America and South Africa; and
(iv) thirty percent (30%) of those costs paid by Biosite to LRE to fund the
development of the Reader under the Reader Development and Supply Agreement. The
parties currently estimate that the Jointly Funded Development Costs shall be
approximately US$5,300,000.
(b) Merck shall fund its share of the Jointly Funded Development
Costs (i) by paying Biosite the sum of US$660,000 on
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or before June 30, 1994, and the additional sum of US$660,000 on or before June
30, 1995, and (ii) by directly funding those certain costs of the clinical
trials and regulatory approval of the Product for use in the Field in Europe,
Latin America and South Africa as set forth in Section 3.2.1(a)(iii) above.
(c) Biosite shall fund its share of the Jointly Funded Development
Costs, and shall apply the funding received from Merck under the Agreement, for
the principal purpose of carrying out its obligations under the Development
Program and accomplishing the objectives thereof.
(d) If, during the term of the Development Program, Biosite enters
into an agreement with one or more Third Parties to develop and commercialize
the Product for use in the Field in Japan, Merck's obligation to fund its share
of the Jointly Funded Development Costs shall be reduced by an amount equal to
the following percentage of the following payments, if any, received by Biosite
from such one or more Third Parties in consideration for the rights to develop
and commercialize the Product for use in the Field in Japan: (i) forty percent
(40%) of any up-front licensing or marketing rights fees, (ii) forty percent
(40%) of any funding for the development of the Reagents and the Test Device,
and (iii) twelve percent (12%) of any funding for the development of the Reader.
(e) Each party shall maintain complete and accurate records of the
Jointly Funded Development Costs which it incurs. Within sixty (60) days after
June 30 and December 31 during the term of the Development Program, and within
sixty (60) days after the termination or expiration of the Development Program,
Biosite and Merck each shall prepare and provide the other party with a written
report, in reasonably specific detail, showing the Jointly Funded Development
Costs which it incurred during the applicable reporting period and during the
Development Program through the end of such period. Upon the written request of
a party (the "Requesting Party"), and not more than once in each calendar year,
the other party shall permit an independent certified public accounting firm of
internationally recognized standing, selected by the Requesting Party and
reasonably acceptable to the other party, at the Requesting Party's expense, to
have access during normal business hours to such of the records of the other
party as may be reasonably necessary to verify the accuracy of such reports
hereunder for any year ending not more than twenty four (24) months prior to the
date of such request. The accounting firm shall disclose to the Requesting Party
only whether the records are correct or not and the specific details concerning
any discrepancies. No other information shall be shared. The Requesting Party
shall treat all financial information subject to review
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under this Section 3.2.1(e) as confidential, and shall cause its accounting firm
to retain all such financial information in confidence.
(f) From time to time during the Development Program, if
necessary, Biosite and Merck each shall prepare and provide the Steering
Committee and the other party with a revised budget of the Jointly Funded
Development Costs incurred or to be incurred by such party. The Steering
Committee shall consider in good faith, and shall approve, such revised budget
and schedule of funding by Biosite and Merck consistent with the provisions of
this Section 3.2.1 and as reasonably necessary to fund the anticipated Jointly
Funded Development Costs as they are incurred.
(g) Within ninety (90) days after the expiration or termination of
the Development Program, Biosite and Merck shall meet and make a final
adjustment of the Jointly Funded Development Costs paid by each party consistent
with the provisions of this Section 3.2.1.
3.2.2 Independently Funded Development Costs. Merck shall be solely
responsible for funding one hundred percent (100%) of the costs, in excess of
[CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION] in the
aggregate, of clinical trials and regulatory approval of the Product for use in
the Field in Europe, Latin America and South Africa. Biosite shall be solely
responsible for funding (a) seventy percent (70%) of those costs paid by Biosite
to LRE to fund the development of the Reader under the Reader Development and
Supply Agreement, (b) one hundred percent (100%) of the costs, in excess of
[CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION] in the
aggregate, of the clinical trials and regulatory approval of the Product for use
in the Field in the United States, and (c) one hundred percent (100%) of the
costs of the clinical trials and regulatory approval of the Product for use in
the Field in the rest of the world other than the United States, Europe, Latin
America and South Africa.
3.2.3 Third Party License Fees. If Biosite or Merck is obligated to pay
any amounts to one or more Third Parties in consideration for the license or
other rights to any Third Party Patent Rights or Know-How, other than amounts
calculated on the basis of sales of Products, such amounts shall be shared sixty
percent (60%) by Biosite and forty percent (40%) by Merck.
3.3 Development Records and Reports.
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3.3.1 Records. Biosite and Merck each shall maintain records, in
sufficient detail and in good scientific manner appropriate for patent purposes,
which shall be complete and accurate and shall fully and properly reflect all
work done and results achieved in the performance of the Development Program
(including all data in the form required under all applicable laws and
regulations).
3.3.2 Inspection of Records. Biosite and Merck each shall have the
right, during normal business hours and upon reasonable notice, to inspect and
copy all such records of the other party to the extent reasonably required for
the performance of its obligations under the Agreement (with the party owning
the records determining what is reasonably required). Each party shall maintain
such records and the information of the other party contained therein in
confidence in accordance with Section 7.1 below and shall not use such records
or information except to the extent otherwise permitted by the Agreement.
3.3.3 Development Reports. Biosite and Merck each shall keep the
other informed of the progress of such party under the Development Program.
Within thirty (30) days following the end of each calendar quarter during the
term of the Development Program and within thirty (30) days following the
expiration or termination of the Development Program, Biosite and Merck each
shall prepare, and provide to each member of the Steering Committee and the
other party, a reasonably detailed written summary report which shall describe
the work performed by such party to date under the Development Program.
3.4 Term of Development Program. Except as provided herein, the term
of the Development Program shall commence on the Commencement Date and continue
for a period of five (5) years thereafter.
3.5 Project Leaders. Biosite and Merck each shall appoint a person (a
"Project Leader") to coordinate its part of the Development Program. The Project
Leaders shall be the primary contacts between the parties with respect to the
Development Program. Each party shall notify the other within thirty (30) days
after the date of the Agreement of the appointment of its Project Leader and
shall notify the other party as soon practicable upon changing this appointment.
3.6 Availability of Employees. Each party shall make its employees and
relevant reports of non-employee consultants available, upon reasonable notice
during normal business hours, at their respective places of employment to
consult with the other party on issues arising during the Development Program
and in connection with any request from any regulatory agency, including
regulatory, scientific, technical and clinical testing issues.
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3.7 Visit of Facilities. Representatives of Biosite and Merck may,
upon reasonable notice during normal business hours, (a) visit the facilities
where the Development Program is being conducted and the facilities where the
other party manufactures the Product or Product Components, and (b) consult
informally, during such visits and by telephone, with personnel of the other
party performing work on the Development Program. On such visits an employee of
the party conducting the development shall accompany the employee(s) of the
visiting party. If requested by the other party, Biosite and Merck shall cause
appropriate individuals working on the Development Program to be available for
meetings at the location of the facilities where such individuals are employed
at times reasonably convenient to the party responding to such request.
3.8 Exclusivity. During the term of the Development Program, neither
Biosite nor Merck shall perform, for itself or with any Affiliate or Third
Party, any research, development or commercialization activities regarding a
disposable in vitro immunoassay test device and a hand held reader for use in
the Field without the prior written consent of the other party, unless
specifically permitted under the Agreement.
ARTICLE 4
MANAGEMENT OF THE DEVELOPMENT PROGRAM
4.1 Steering Committee.
4.1.1 Composition. The Development Program shall be conducted
under the direction of the Steering Committee comprised of two (2) named
representatives of Biosite and two (2) named representatives of Merck. Each
party shall appoint its respective representatives to the Steering Committee
from time to time, and may substitute one or more of its representatives, in its
sole discretion, effective upon notice to the other party of such change.
4.1.2 Responsibilities. The Steering Committee shall be
responsible for directing the conduct of the Development Program, including the
design, development, clinical testing and application for regulatory approval in
the United States of America, Canada, Europe, Latin America and South Africa.
The Steering Committee (a) shall review the respective activities of the parties
under the Development Program in relation to the objectives thereof, set
priorities therefor and allocate responsibilities thereunder, (b) shall oversee
any anticipated and actual regulatory filings regarding the Product for use in
the Field, (c) shall consider and approve modifications to the Development
Program and the budget therefor, and (d) consider whether to terminate the
Development Program and, if necessary, make recommendations to the parties
regarding termination.
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4.1.3 Meetings. The Steering Committee shall meet not less than
once every six (6) months during the term of the Development Program, on such
dates and at such times and places as agreed to by Biosite and Merck,
alternating between San Diego and Darmstadt, or such other locations as the
parties shall agree. Each party shall be responsible for its own costs of
attending such meetings.
4.1.4 Committee Actions. Any approval, determination or other
action agreed to by all of the members of the Steering Committee or their
deputies present at the relevant Steering Committee meeting shall be the
approval, determination or other action of the Steering Committee; provided,
however, that both representatives of each party are present at such meeting.
4.2 Disagreements. All disagreements within the Steering Committee
shall be resolved in the following manner:
4.2.1 The representatives of the Steering Committee promptly shall
present the disagreement to the executive of each of Biosite and Merck who has
the principal responsibility for such party's work under the Agreement.
4.2.2 Such executives shall meet to discuss each party's view and
to explain the basis for their respective positions of such disagreement, and in
good faith shall attempt to resolve such disagreement among themselves.
4.2.3 If such executives cannot promptly resolve such
disagreement, then such executives shall establish a mechanism to resolve such
agreement promptly; provided, however, that the parties do not waive any rights
which they may have under the Agreement or otherwise as a result of one party's
settlement of a disagreement under this Section 4.2.3.
4.3 Steering Committee Reports. Within thirty (30) days following each
Steering Committee meeting during the term of the Agreement, the Steering
Committee shall prepare and provide to each party a reasonably detailed written
summary report which shall (a) describe the work performed to date under the
Development Program, (b) evaluate the work performed in relation to the
objectives of the Development Program, and (c) state any recommendations or
determinations of the Steering Committee regarding the Development Program.
ARTICLE 5
SUPPLY AND DISTRIBUTION
Biosite shall have the exclusive right to distribute the Product for
use in the Field in the United States of America and Canada. On the terms and
subject to the conditions of the Supply and Distribution Agreement and the
Reader Development and Supply
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Agreement, Biosite shall appoint Merck as its exclusive distributor of the
Product for use in the Field in Europe, Latin America and South Africa. Biosite
shall have the exclusive right to distribute the Product for use in the Field in
Japan and the rest of the world.
ARTICLE 6
LICENSES
6.1 Biosite Technology. On the terms and subject to the conditions of
the Agreement, Biosite hereby grants to Merck an exclusive license (or in the
case of licensed Third Party Patent Rights and Know-How, when permissible, an
exclusive sublicense) under Biosite's Patent Rights and Biosite's Know-How, to
perform its obligations under the Development Program. Merck may not grant
sublicenses under such license to any Affiliate or Third Party without the prior
written consent of Biosite.
6.2 Merck Technology. On the terms and subject to the conditions of
the Agreement, Merck hereby grants to Biosite an exclusive license (or in the
case of licensed Third Party Patent Rights and Know-How, when permissible, an
exclusive sublicense) under Merck's Patent Rights and Merck's Know-How, to
perform its obligations under the Development Program, and to make, have made,
use and sell the Product. Biosite may not grant sublicenses under such license
to any Affiliate or Third Party without the prior written consent of Merck.
ARTICLE 7
CONFIDENTIALITY AND PUBLICATION
7.1 Confidential Information. During the term of the Agreement, and
for a period of five (5) years following the expiration or earlier termination
hereof, each party shall maintain in confidence all information (including
samples) disclosed by the other party and identified as, or acknowledged to be,
confidential (the "Confidential Information"), and shall not use, disclose or
grant the use of the Confidential Information except on a need-to- know basis to
those directors, officers, employees, consultants, clinical investigators,
contractors, permitted sublicensees or permitted assignees, to the extent such
disclosure is reasonably necessary in connection with such party's activities as
expressly authorized by the Agreement. To the extent that disclosure is
authorized by the Agreement, prior to disclosure, each party hereto shall obtain
agreement of any such person or entity to hold in confidence and not make use of
the Confidential Information for any purpose other than those permitted by the
Agreement. Each party shall notify the other promptly upon discovery of any
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unauthorized use or disclosure of the other party's Confidential Information.
7.2 Permitted Disclosures. The confidentiality obligations contained
in Section 7.1 above shall not apply to the extent that (a) any receiving party
(the "Recipient") is required (i) to disclose information by law, order or
regulation of a governmental agency or a court of competent jurisdiction, or
(ii) to disclose information to any governmental agency for purposes of
obtaining approval to test or market a product, provided in either case that the
Recipient shall provide written notice thereof to the other party and sufficient
opportunity to object to any such disclosure or to request confidential
treatment thereof; or (b) the Recipient can demonstrate that (i) the disclosed
information was public knowledge at the time of such disclosure by the other
party hereunder, or thereafter became public knowledge, other than as a result
of actions of the Recipient, its directors, officers, employees, consultants,
clinical investigators, contractors, permitted sublicensees and permitted
assignees in violation hereof; (ii) the disclosed information was rightfully
known by the Recipient or its affiliates (as shown by its written records) prior
to the date of disclosure to the Recipient by the other party hereunder; or
(iii) the disclosed information was disclosed to the Recipient or its affiliates
on an unrestricted basis from a source unrelated to any party to the Agreement
and not under a duty of confidentiality to the other party. Notwithstanding any
other provision of the Agreement, Biosite may disclose Confidential Information
of Merck relating to information developed pursuant to the Agreement to any
person or entity with whom Biosite has, or is proposing to enter into, a
business relationship, as long as such person or entity has entered into a
confidentiality agreement with Biosite.
7.3 Publication. Subject to the provisions of Sections 7.1 and 7.2
above, Biosite and Merck each shall have the right to publish the results of its
work performed under the Agreement; provided, however, that such party shall
provide the other party the opportunity to review any proposed manuscripts or
any other proposed disclosure describing said work sixty (60) days prior to
their submission for publication or other proposed disclosure. If the other
party believes patentable subject matter is disclosed in the manuscript or other
disclosure and so notifies the first party, or if such submission for
publication or other disclosure would cause the loss of significant foreign
patent rights, said publication will be withheld for a reasonable period of time
until United States patent filings are completed in accordance with Article 8
below.
7.4 Terms of the Agreement. Biosite and Merck shall not disclose any
terms or conditions of the Agreement to any Third Party without the prior
consent of the other party, except as required by applicable law or to Persons
with whom Merck or Biosite has entered into or proposes to enter into a business
relationship, provided that such Persons shall enter into the
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required confidentiality agreement. Notwithstanding the foregoing, prior to
execution of the Agreement, Merck and Biosite shall agree upon the substance of
information that can be used to describe the terms of this transaction, and
Merck and Biosite may disclose such information, as modified by mutual agreement
from time to time, without the other party's consent.
7.5 Use of Name. Except as required by applicable law, neither party
shall use the name of the other party or the other party's employees in any
advertisement, press release or publicity with reference to the Agreement,
without prior written approval of the other party, which approval shall not be
unreasonably withheld.
ARTICLE 8
INVENTIONS AND PATENT RIGHTS
8.1 Ownership. The entire right and title in all inventions,
discoveries, improvements or other technology directed to the Product, the
Product Components or the process of the manufacture or use thereto, whether or
not patentable, and any patent applications or patents based thereon, conceived
during and as a result of the Development Program (collectively, the
"Inventions") (a) by employees or others acting solely on behalf of Biosite, or
its affiliates shall be owned solely by Biosite (the "Biosite Inventions"), (b)
by employees or others acting solely on behalf of Merck or its Affiliates shall
be owned solely by Merck (the "Merck Inventions"), and (c) by employees or
others acting jointly on behalf of Biosite and Merck, or their respective
Affiliates, shall be owned jointly by Biosite and Merck (the "Joint
Inventions"). Each party promptly shall disclose to the other party the making,
conception or reduction to practice of Inventions by employees or others acting
on behalf of such party. Biosite and Merck each hereby represents that all
employees and other Persons acting on its behalf in performing its obligations
under the Agreement shall be obligated under a binding written agreement to
assign to it, or as it shall direct, all Inventions made or developed by such
employees or other Persons.
8.2 Patent Prosecution and Maintenance. The party owing an Invention,
and Biosite in the case of a Joint Invention, shall be responsible for and shall
control the preparation, filing, prosecution and maintenance of all patents and
patent applications related to such Invention. However, the list of countries in
which patent applications shall be filed in the case of a Joint Invention must
be approved by Merck beforehand, which approval may not be unreasonably withheld
or delayed. The party controlling the patents and patent applications with
respect to an Invention shall pay all costs incurred in connection therewith;
provided, however, Biosite and Merck shall equally share all such costs with
respect to Joint Inventions. Biosite shall use its good faith efforts to provide
Merck with an opportunity to review and comment
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on the text of each patent application with respect to a Joint Invention before
filing, and shall supply Merck with a copy of such patent application as filed,
together with notice of its filing date and serial number. Biosite and Merck
each shall cooperate with the other party, execute all lawful papers and
instruments and make all rightful oaths and declarations as may be necessary in
the preparation, prosecution and maintenance of all patents and other filings
referred to in this Section 8.2.
8.3 Notification of Infringement. Each party shall notify the other
party of any infringement known to such party of any Patent Rights of the other
party and shall provide the other party with the available evidence, if any, of
such infringement.
8.4 Enforcement of Patent Rights. The party owning any Patent Rights,
and Biosite in the case of Patent Rights claiming a Joint Invention, at its sole
expense, shall have the right to determine the appropriate course of action to
enforce such Patent Rights or otherwise xxxxx the infringement thereof, to take
(or refrain from taking) appropriate action to enforce such Patent Rights, to
control any litigation or other enforcement action and to enter into, or permit,
the settlement of any such litigation or other enforcement action with respect
to such Patent Rights, and shall consider, in good faith, the interests of the
other party in so doing. If Biosite does not, within one hundred twenty (120)
days of receipt of notice from Merck, xxxxx the infringement or file suit to
enforce Patent Rights claiming a Joint Invention against at least one infringing
party, Merck shall have the right to take whatever action it deems appropriate
to enforce such Patent Rights; provided, however, that, within thirty (30) days
after receipt of notice of Merck's intent to file such suit, Biosite shall have
the right to jointly prosecute such suit and to fund up to one-half (1/2) the
costs of such suit. The party controlling any such enforcement action shall not
settle the action or otherwise consent to an adverse judgment in such action
that diminishes the rights or interests of the non-controlling party without the
prior written consent of the other party. All monies recovered upon the final
judgment or settlement of any such suit to enforce the Patent Rights shall be
shared, after reimbursement of expenses, by Biosite and Merck as follows: (a)
two thirds (2/3) shall be retained by the party that has the right under the
Supply and Distribution Agreement to distribute the Product in the country of
such infringement, and (b) one third (1/3) shall be shared by the parties pro
rata according to the respective percentages of costs borne by each in such
suit. Notwithstanding the foregoing, Biosite and Merck each shall fully
cooperate with the other party in the planning and execution of any action to
enforce the Patent Rights.
8.5 No Other Technology Rights. Except as otherwise provided in the
Agreement, under no circumstances shall a party,
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as a result of the Agreement, obtain any ownership interest or other right in
any technology, know-how, patents, pending patent applications, products,
vaccines, antibodies, cell lines or cultures, or animals of the other party,
including items owned, controlled or developed by the other, or transferred by
the other to such party at any time pursuant to the Agreement. It is understood
and agreed by the parties that the Agreement does not grant to either party any
license or other right in basic technology of the other party except to the
extent necessary to enable the parties to carry out their part of the
Development Program or the development and marketing of the Product.
ARTICLE 9
TERM AND TERMINATION
9.1 Expiration. Unless terminated earlier pursuant to Sections 9.2 or
9.3 below, the Agreement shall expire on the date ninety (90) days after
expiration or termination of the Development Program.
9.2 Termination by Mutual Agreement. The parties may terminate the
Development Program at any time upon the express written agreement of both
parties, in which case the Agreement shall terminate on the date ninety (90)
days after termination of the Development Program.
9.3 Termination for Cause. Except as otherwise provided in Section 12.2
below, either party may terminate the Agreement upon or after the breach of any
material provision of the Agreement by the other party if the other party has
not cured such breach within ninety (90) days after notice thereof from the non-
breaching party.
9.4 Effect of Expiration and Termination. Expiration or termination of
the Agreement shall not relieve the parties of any obligation accruing prior to
such expiration or termination. The provisions of Articles 5 and 6 shall survive
expiration of the Agreement, and the provisions of Articles 7 and 10 shall
survive the expiration or termination of the Agreement.
ARTICLE 10
INDEMNITY
10.1 Indemnity. Each party shall indemnify, defend and hold harmless
the other party, its directors, officers, employees and agents from all losses,
liabilities, damages and expenses (including reasonable attorneys' fees and
costs) that they may suffer as a result of any claims, demands, actions or other
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proceedings made or instituted by any third party against any of them and
arising out of or relating to any breach of the Agreement by the indemnifying
party, or any recklessness or intentional act or omission by or on behalf of the
indemnifying party in the performance of its activities contemplated by the
Agreement, other than those certain losses, liabilities, damages and expenses
arising out of the gross negligence or willful misconduct of the indemnified
party.
10.2 Procedure. A party (the "Indemnitee") that intends to claim
indemnification under this Article 10 shall promptly notify the other party (the
"Indemnitor") of any such loss, liability, damage or expense, or any claim,
demand, action or other proceeding with respect to which the Indemnitee intends
to claim such indemnification. The Indemnitor shall have the right to
participate in, and, to the extent the Indemnitor so desires, jointly with any
other indemnitor similarly noticed, to assume the defense thereof with counsel
selected by the Indemnitor; 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 representation of the 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 obligations under this Article 10 shall not apply to
amounts paid in settlement of any loss, liability, damage or other expense if
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 Article 10, 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 Article
10. The Indemnitor may not settle the action or otherwise consent to an adverse
judgment in such action that diminishes the rights or interests of the
Indemnitee without the express written consent of the Indemnitee. The
Indemnitee, its employees and agents, shall cooperate fully with the Indemnitor
and its legal representatives in the investigation of any action, claim or
liability covered by this indemnification.
10.3 Insurance. Merck and Biosite each shall maintain, through self
insurance or otherwise, comprehensive general liability insurance, including
contractual liability insurance, against claims for bodily injury or property
damage arising from its activities contemplated by the Agreement, in such
amounts as it customarily maintains for similar activities. Biosite and Merck
each shall maintain such insurance during the term of the Agreement and
thereafter for so long as it maintains insurance for itself covering such
activities.
ARTICLE 11
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CONCILIATION AND ARBITRATION
11.1 Conciliation. Biosite and Merck shall exercise their commercially
reasonable efforts to settle between themselves in an amicable way any dispute,
controversy or claim which may arise out of or relating to the Agreement within
thirty (30) days after one party receives notice from the other party of such
dispute, controversy or claim.
11.2 Arbitration. If not settled by the parties in accordance with
Section 11.1 above, any dispute, controversy or claim originally initiated by
either party and arising out of or relating to the Agreement shall be referred
to and resolved by binding arbitration, held in New York, New York, United
States of America, and conducted in accordance with the American Arbitration
Association ("AAA") Commercial Arbitration Rules, and the following provisions:
11.2.1 The arbitral tribunal shall be composed of three (3)
persons each of whom shall be neutral, independent and impartial. Each party
shall nominate an arbitrator, and the two (2) arbitrators so appointed shall
appoint a third, who shall act as president of the arbitral tribunal. If either
party fails to nominate an arbitrator within thirty (30) days of receiving
notice of the nomination of an arbitrator by the other party, such (second)
arbitrator shall be appointed at the request of the first party by the AAA. If
the two arbitrators selected by the parties fail to select a third, presiding
arbitrator within twenty (20) days of the appointment of the second arbitrator,
the third arbitrator shall be appointed at the request of the first party by the
AAA.
11.2.2 The arbitrators shall hold a preliminary meeting with the
parties within thirty (30) days of the appointment of the third or presiding
arbitrator for the purpose of determining the issues to be decided in the
arbitration, the specific procedures to be followed and the schedule for
briefing and/or hearings. The arbitrators shall hold a hearing which, unless the
parties otherwise agree, should be recorded by stenographic or other means.
Within one hundred twenty (120) days of the preliminary meeting (except in
extraordinary cases), the arbitrators shall issue an award in writing which
shall state the reasons for the award and which, except as set forth in the
following sentence, shall be final and binding between the parties. Judgment
upon the award rendered by the arbitrators may be entered in any court of
competent jurisdiction.
11.2.3 The parties agree that the award of the arbitrators shall
be the sole and exclusive remedy between them regarding any claims,
counterclaims, issues or accountings presented or pled to the arbitrators; that
it shall be made and shall promptly by payable in United States dollars free of
any tax, deduction or offset; and that any costs, fees or taxes
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incident to enforcing the award shall, to the maximum extent permitted by law,
be charged against the party resisting such enforcement.
11.2.4 Questions concerning arbitrability under this dispute
resolution clause shall be governed exclusively by the United States Arbitration
Act. The arbitrators shall be empowered to consider and decide claims or issues
arising under or relating to state and federal statutes governing business
practices, but shall not be empowered to nor shall they award punitive damages.
11.2.5 As part of any arbitral award rendered pursuant to this
Section 11.2, the arbitrators shall make an award of arbitral costs and
reasonable attorneys' fees to the prevailing party.
11.2.6 The Agreement shall be governed by and construed in
accordance with the laws of the State of New York and shall not be governed by
the United Nations Convention on Contracts for the Internationsl Sale of Goods.
ARTICLE 12
MISCELLANEOUS
12.1 Notices. Any consent, notice or report required or permitted to be
given or made under the Agreement by one of the parties to the other shall be in
writing, delivered personally or by facsimile (and promptly confirmed by
personal delivery, air mail, internationally-recognized delivery service or
courier), air mail, internationally-recognized delivery service or courier,
postage prepaid (where applicable), addressed to such other party at its address
indicated below, or to such other address as the addressee shall have last
furnished in writing to the addressor and (except as otherwise provided in the
Agreement) shall be effective upon receipt by the addressee.
If to Biosite: Biosite Diagnostics Incorporated
00000 Xxxxxxx Xxxxxx, Xxxxx X
Xxx Xxxxx, Xxxxxxxxxx 00000, U.S.A.
Attention: Xxx X. Xxxxxxxxxxxx
President
with a copy to: Pillsbury Madison & Sutro
000 Xxxxxxxxxx Xxxxxx, 15th Floor
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, X.X.X.
Attention: Xxxxxx X. Xxxxxx, Xx.
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If to Merck: E. Merck
Frankfurter Strasse 250
D-64293 Darmstadt
Germany
Attention: Xx. Xxxxx Xxxxxxxx
with a copy to: E. Merck
Xxxxxxxxxxx Xxxxxxx 000
X-00000 Xxxxxxxxx
Xxxxxxx
Attention: LEW/Licensing
12.2 Force Majeure. Neither party shall 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 to the extent, and for so long as, such failure or delay is caused by
or results from causes beyond the reasonable control of the affected party
including fire, floods, embargoes, war, acts of war (whether war be declared or
not), insurrections, riots, civil commotions, strikes, lockouts or other labor
disturbances, acts of God or acts, omissions or delays in acting by any
governmental authority or the other party.
12.3 Assignment. 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
consent of the other party; provided, however, that either Biosite or Merck may,
without such consent, assign the Agreement and its rights and obligations
hereunder in connection with the transfer or sale of all or substantially all of
its business, or in the event of its merger or consolidation or change in
control or similar transaction. Any permitted assignee shall assume all
obligations of its assignor under the Agreement.
12.4 Severability. Each party hereby acknowledges that it does not
intend to violate any public policy, statutory or common laws, rules,
regulations, treaty or decision of any government agency or executive body
thereof of any country or community or association of countries. Should one or
more provisions of the Agreement be or become invalid, the parties shall
substitute, by mutual consent, valid provisions for such invalid provisions
which valid provisions in their economic effect are sufficiently similar to the
invalid provisions that it can be reasonably assumed that the parties would have
entered into the Agreement with such provisions. In case such provisions cannot
be agreed upon, the invalidity of one or several provisions of the Agreement
shall not affect the validity of the Agreement as a whole, unless the invalid
provisions are of such essential importance to the Agreement that it is to be
reasonably assumed that the parties would not have entered into the Agreement
without the invalid provisions.
12.5 U.S. Export Laws and Regulations. Biosite and Merck each
acknowledge that the development and commercialization rights and information
disclosure requirements of the Agreement are subject to the laws and regulations
of the United States of America relating to the export of products and technical
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information. Without limitation, Biosite and Merck each shall comply with all
such laws and regulations.
12.6 Entire Agreement. The Agreement contains the entire understanding
of the parties with respect to the subject matter hereof. All express or implied
agreements and understandings, either oral or written, heretofore made are
expressly superseded by the Agreement. The Agreement may be amended, or any term
hereof modified, only by a written instrument duly executed by both parties.
12.7 Headings. The captions to the several Articles and Sections
hereof are not a part of the Agreement, but are merely guides or labels to
assist in locating and reading the several Articles and Sections hereof.
12.8 Independent Contractors. It is expressly agreed that Biosite and
Merck shall be independent contractors and that the relationship between the two
parties shall not constitute a partnership, joint venture or agency. Neither
Biosite nor Merck shall have the authority to make any statements,
representations or commitments of any kind, or to take any action, which shall
be binding on the other, without the prior consent of the party to do so.
12.9 Language. The English language version of the Agreement shall
govern and control any translations of the Agreement into any other language.
12.10 Waiver. The waiver by either party of any right hereunder or the
failure to perform or of a breach by the other party shall 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.
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12.11 Counterparts. The Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed the Agreement as of the
date first set forth above.
BIOSITE DIAGNOSTICS INCORPORATED
By /s/ Xxx X. Xxxxxxxxxxxx
---------------------------------
Title: President
E. MERCK
By /s/ Xx. Xxxxxx Xxxxxxxx
---------------------------------
Title: General Manager
Diagnostics Division
By /s/ Xx. Xxxxx Xxxxxxx
---------------------------------
Title: Head of Department
Marketing and Sales
Diagnostics Division
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EXHIBIT A
WORK PLAN
I. Test Device (Biosite)
o Develop one-step test device.
o Develop pilot production plant.
o Develop full-scale production plant.
II. Reagents (Biosite)
o Purchase/characterize antigens for CKMB, Troponin I, Myoglobin
and controls.
o Obtain antigen licenses where needed.
o Develop monoclonal antibodies to CKMB, Troponin I, Myoglobin
and controls.
o Obtain antibody licenses where needed.
o Select monoclonal antibodies for conjugates and solid phase.
o Develop fluorescent label dyes for antibody/dye conjugates.
III. Test Panel (Biosite)
o Select reagents for desired performance in test devices.
o Optimize test panel to meet product performance specification
(sensitivity, range, specification).
o Optimize test panel for performance with clinical specimen.
o Scale-up pilot plant to support manufacture of test panels for
optimization activities.
o Conduct North American clinical trials and obtain regulatory
approvals.
o Develop full-scale manufacturing plant to support world-wide
demand for test panels.
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EXHIBIT B
SUPPLY AND DISTRIBUTION AGREEMENT
[SEE EXHIBIT 10.15]
