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[CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT
HAVE BEEN REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE COMMISSION]
EXHIBIT 10.3
FELINE TOXOPLASMOSIS COOPERATION AGREEMENT
THIS AGREEMENT, is entered into as of June 10, 1994 between Paravax, Inc. ,
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxx Xxxxxxx, Xxxxxxxx ("Paravax") and
Xxxxx XX, X-00000 Xxxxxxxxxx, Xxxxxxx Xxxxxxxx of Germany ("Bayer").
Whereas Paravax is engaged in the research and development of a
vaccine for the prevention of feline toxoplasmosis (Toxoplasma gondii);
Whereas Bayer is interested in providing Paravax with certain funds to
support such research and development and to fund a portion of the research and
development expenses which Paravax has incurred prior to the date of this
Agreement; and
Whereas in exchange for providing such research and development
funding, Paravax is willing to grant to Bayer options to obtain certain rights
with respect to such feline toxoplasmosis vaccine;
N o w t h e r e f o r e:
The parties hereto agree as follows:
ARTICLE 1. OVERVIEW
1.1. Overview. This Feline Toxoplasmosis Cooperation Agreement (this
"Agreement" or this "Cooperation Agreement") is intended to set forth
the parameters pursuant to which Bayer and Paravax intend to develop,
manufacture and market a vaccine for the prevention of feline
toxoplasmosis (Toxoplasma gondii). During the initial phases of the
Cooperation Agreement, the primary goal shall be the development and
preliminary testing of a vaccine for the prevention of feline
toxoplasmosis. As set forth in ARTICLE 3. RESEARCH AND DEVELOPMENT,
Paravax will undertake the primary responsibility for attempting to
develop and preliminarily testing such a vaccine, and Bayer shall
offer Paravax such technical and scientific assistance in this
endeavor as Bayer deems desirable and appropriate. Bayer will also
provide funding to allow Paravax to perform such research and
development and preliminary testing activities. The primary goal of
the next stage of the Cooperation Agreement will be to conduct the
clinical testing necessary to determine and optimize the safety and
efficacy of the vaccine and to obtain the regulatory approvals
required to allow its manufacture and marketing. As set forth in
ARTICLE 4. CLINICAL TRIALS, Bayer shall determine the scope and nature
of such clinical testing, and Bayer and Paravax shall jointly
determine how to allocate responsibility for conducting such clinical
testing and obtaining such regulatory approvals. Bayer shall provide
the funding necessary to allow Paravax to conduct its portion of these
responsibilities. As set forth in ARTICLE 5. OPTION AND LICENSE, Bayer
shall have the option at any time to obtain a license to the
technology which Paravax develops pursuant to this Agreement, for
certain uses and subject to certain conditions and the payment of
certain royalties. As set forth in ARTICLE 6.
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MANUFACTURE OF TOXOPLASMOSIS VACCINE, to the extent that upon the
completion of Phase II of the Research Program Paravax has in place a
manufacturing facility that is approved by the appropriate regulatory
authorities, Paravax shall be entitled to manufacture the
Toxoplasmosis Vaccine, and to the extent that Paravax does not have
such a facility in place, or chooses not to so manufacture the
Toxoplasmosis Vaccine, Bayer shall manufacture, or have manufactured,
the Toxoplasmosis Vaccine for sale in the Territory and shall
manufacture Toxoplasmosis Vaccine for Paravax as required for sale
outside the Territory. As set forth in ARTICLE 7. DISTRIBUTION RIGHTS,
upon completion of the development and testing of a safe and
efficacious Toxoplasmosis Vaccine, Bayer shall have the right to enter
into a Distribution Agreement which shall allow Bayer to distribute
the vaccine throughout the world, with certain exceptions.
ARTICLE 2. DEFINITIONS
For purposes of this Agreement, the terms set forth below shall be
deemed to have the meanings indicated:
2.1. Distribution Agreement shall mean the Toxoplasmosis Vaccine
Distribution Agreement referred to in Section 7.1 hereof.
2.2. Manufacturing Agreement shall mean the Toxoplasmosis Vaccine
Manufacturing Agreement referred to in Section 6.2 hereof.
2.3. Paravax Technology shall mean all intellectual property of Paravax as
of date of this Agreement and any intellectual property of Paravax
developed during the term of this Agreement, to the extent related to
the research, development, manufacture or sale of a recombinant live
vector vaccine for the prevention of feline toxoplasmosis, including
but not limited to all patents and patent applications with respect to
such intellectual property.
2.4. Net Sales shall mean gross receipts from independent, unrelated
parties in bona fide arm's length transactions, less the following
deductions: (a) trade and/or quantity discounts actually allowed and
taken in such amounts as are customary in the trade; (b) commissions
paid or allowed to independent brokers and agents; (c) sales and other
excise taxes and duties paid, to the extent separately stated on an
invoice; and (d) amounts paid to cover transportation costs, to the
extent separately stated on an invoice.
2.5 Research Program shall mean the research program for the development
of a vaccine for the prevention of feline toxoplasmosis as set forth
on Exhibit A hereto, as amended by the parties pursuant to the terms
of this Agreement.
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2.6. Territory shall mean the entire world, with the exception of Japan and
Southeast Asia (which shall be deemed to include Korea, Thailand,
Singapore, Taiwan, China, Hong Kong, Malaysia, Indonesia, and the
Philippines).
2.7. Toxoplasmosis Vaccine shall mean a recombinant live vector vaccine for
the prevention of feline toxoplasmosis (Toxoplasma gondii) developed
during the term of this Agreement pursuant to the Research Program.
ARTICLE 3. RESEARCH AND DEVELOPMENT
3.1. Phases of the Research Program. The Toxoplasmosis Research Program is
divided into four Phases, as described on Exhibit A hereto, which will
be referred to in this Agreement as Phases I through IV. Phases I and
II of the Research Program are primarily concerned with the initial
research and development and preliminary testing of the Toxoplasmosis
Vaccine. Phases III and IV of the Research Program are primarily
concerned with the conduct of the clinical testing necessary to
determine and optimize the safety and efficacy of the vaccine and to
obtain the regulatory approvals required to allow its manufacture and
marketing, and their performance is addressed in Article 4 of this
Agreement.
3.2. Paravax Responsibility. Phases I and II. Paravax shall have primary
responsibility for performing Phases I and II of the Research Program.
Bayer shall offer Paravax such technical, scientific and other
assistance and cooperation for this undertaking as Bayer deems
appropriate. Paravax shall use diligent efforts to conduct Phases I
and II of the Research Program, with such modifications, additions and
deletions as Bayer and Paravax shall reasonably agree upon. Paravax
will provide Bayer with reports on a quarterly basis with respect to
its progress as to the Research Program. At semiannual intervals,
these reports will contain significant detail, and Paravax will host
semi-annual meetings, as requested by Bayer, to update Bayer personnel
as to its progress and plans with respect to the Research Program.
Paravax will use diligent efforts to promptly replace any significant
personnel who depart from Paravax while working on the Research
Program with appropriate personnel who meet reasonable criteria agreed
to with Bayer.
3.3. Research and Development Funding. Upon the execution of this
Agreement, Bayer shall pay to Paravax a lump sum payment of
US$[ ]. In addition, eight months, sixteen months and twenty-four
months after the date of this Agreement Bayer shall pay to Paravax
further lump sum payments of US$[ ] each. The total of such lump
sum payments, US$[ ], shall be deemed to be funding for a
portion of the research and development expenditures which Paravax has
undertaken prior to the date of this Agreement. Bayer shall also make
an initial advance research and development milestone payment of
US$[ ] to Paravax upon the execution of this Agreement. Bayer
shall make further research and development funding payments to
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Paravax as set forth on Exhibit A hereto upon completion of the
milestones through the end of Phase II of the Research Program
indicated on Exhibit A hereto. The specific dollar amounts set forth
herein and on Exhibit A hereto are intended to be net of any
withholding required upon transfer of funds to Paravax.
3.4. Unexpected Expenses. To the extent that the expense of completing the
Research Program greatly exceeds that contemplated by Paravax at the
time this Agreement was entered into, whether due to a change in
regulatory requirements or other change in circumstance, Paravax and
Bayer shall negotiate in good faith to reach agreement upon a
reasonable level of additional research and development funding to be
provided by Bayer in order to allow Paravax to complete the Research
Program; provided, however, that Bayer shall continue to be entitled
to terminate this Agreement pursuant to the provisions of Section 11.2
hereof. The parties agree that Paravax shall not be entitled to any
additional research and development funding simply by reason of the
fact that the research and development takes longer than Paravax
originally contemplated due to delays that are customary for research
and development such as the Research Program.
3.5. Bayer Technology. It is contemplated by the parties that Bayer may
from time to time, in its discretion, offer Paravax access to certain
Bayer proprietary technology which would assist in the development
and/or manufacture of the Toxoplasmosis Vaccine. In the event that
Bayer is willing to offer access to such technology to Paravax, the
parties will negotiate in good faith to reach agreement upon
reasonable terms and conditions upon which Paravax may make use of
such technology for the development and/or manufacture of the
Toxoplasmosis Vaccine.
3.6. Additional Antigens. Bayer and/or Paravax may from time to time wish
to consider adding additional non-toxoplasmosis antigens to the
Toxoplasmosis Vaccine being developed pursuant to this Agreement. In
such event, the parties shall cooperatively discuss the costs and
benefits of adding such additional antigens and shall negotiate in
good faith to reach agreement concerning the wisdom of adding such
additional antigens, how to perform the necessary research and
development and how this Agreement shall be appropriately amended.
3.7. Full Cooperation. Bayer and Paravax agree to cooperate fully during
the term of this Agreement to attempt in good faith to accomplish and
enhance the performance of the Research Program, including, among
other things, keeping each other fully informed of any possible
ancillary technology which would improve the Toxoplasmosis Vaccine,
such as live vaccine vector technology, which one or the other has, or
might be able to obtain, access to, to the extent they are entitled to
do so.
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ARTICLE 4. CLINICAL TRIALS
4.1. Phase III and IV of the Research Program. Phase III and IV of the
Research Program are primarily concerned with optimizing the safety,
efficacy and manufacturing of the Toxoplasmosis Vaccine and obtaining
the regulatory approvals required to allow its manufacture and
marketing. It is agreed that, as Bayer has greater regulatory
experience than Paravax and as Bayer will have responsibility for
marketing the Toxoplasmosis Vaccine, Bayer will be responsible for
designing the regulatory program, including clinical trial protocols,
to obtain the required regulatory approvals. Bayer shall complete such
design of the regulatory program prior to the completion of Phase II
of the Research Program, so that no delay exists between the
completion of Phase II of the Research Program and the commencement of
Phase Ill of the Research Program. Once such a regulatory program has
been designed, Paravax and Bayer shall jointly determine how to
allocate responsibility for conducting Phases III and IV of the
Research Program in order to complete such Phases in the most
efficient and expeditious manner. To the extent that Paravax is to
undertake responsibility for conducting portions of Phases III and IV
of the Research Program, Bayer shall provide Paravax in a timely
manner with an amount of funding which is sufficient to allow Paravax
to reasonably conduct and complete such portions of the Research
Program, including amounts necessary to conduct the clinical trials
and obtain the regulatory approvals contemplated. Paravax agrees that
it shall use diligent efforts to conduct all formal clinical trials in
a manner which is satisfactory for regulatory approval, as directed by
Bayer.
ARTICLE 5. OPTION AND LICENSE
5.1. Interim License. During the term of this Agreement, Bayer shall have a
license to use all Paravax Technology, including all results obtained
during the Research Program, and all biological materials created
during the Research Program, for purposes of assisting and evaluating
the conduct of the Research Program, including designing and
conducting the regulatory program referred to in Article 4 hereof, and
preparing for and conducting preliminary manufacturing of the
Toxoplasmosis Vaccine and for all other purposes which are consistent
with the provisions of this Cooperation Agreement.
5.2. Option. For a period of 180 days after a termination of this
Agreement, Bayer shall have an option to acquire a license to use all
Paravax Technology to the extent set forth below. The rights to be
granted pursuant to such license shall differ depending upon the
circumstances under which such option is exercised, as set forth
below.
5.3. Exercise upon Completion. In the event that this Agreement terminates
upon completion of the Research Program, as set forth in Section 11.1
hereof, Bayer shall obtain an exclusive license to use the Paravax
Technology to manufacture
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Toxoplasmosis Vaccine for sale in the Territory. Such license shall
terminate upon a termination of the Distribution Agreement at the
election of Bayer or by reason of a material breach by Bayer. During
the term of such license, Paravax shall not grant any other party a
license to use the Paravax Technology for the manufacture of any
recombinant vaccine for the prevention of feline toxoplasmosis for
sale in the territory, and Paravax will not use the Paravax Technology
for the manufacture of any recombinant vaccine for the prevention of
feline toxoplasmosis for sale in the Territory, except for sale
through Bayer pursuant to the Distribution Agreement. Bayer shall also
be entitled to obtain various nonexclusive licenses to use the Paravax
Technology for purposes other than a vaccine for the prevention of
feline toxoplasmosis, to the extent Paravax is contractually permitted
to grant such licenses. In the event that Bayer elects to obtain such
a license, Paravax and Bayer shall negotiate in good faith a
reasonable royalty rate and other reasonable terms and conditions for
such license.
5.4. Exercise upon Premature Termination caused by Paravax. In the event
that Bayer exercises its option to obtain a license to the Paravax
Technology upon the termination of this Agreement pursuant to Section
11.3 hereof as a result of a breach by Paravax, or upon the
termination of this Agreement by Bayer at its election pursuant to
Section 11.4 hereof as a result of an acquisition of Paravax, Bayer
shall obtain an exclusive license to use all of the Paravax Technology
to manufacture and sell vaccines for the prevention of feline
toxoplasmosis in the Territory. In such event, Paravax will not use
the Paravax Technology to manufacture and/or sell any recombinant
vaccine for the prevention of feline toxoplasmosis in the Territory
and will not grant any other party a license to use the Paravax
Technology to manufacture and/or sell any recombinant vaccine for the
prevention of feline toxoplasmosis in the Territory; provided,
however, that Paravax shall be entitled to use the Paravax Technology
in the Territory to manufacture, or have manufactured, a vaccine for
the prevention of feline toxoplasmosis for sale outside of the
Territory. Bayer shall also be entitled to obtain various nonexclusive
licenses to use the Paravax Technology for purposes other than a
vaccine for the prevention of feline toxoplasmosis, to the extent
Paravax is contractually permitted to grant such licenses. In the
event that Bayer elects to obtain such a license, Paravax and Bayer
shall negotiate in good faith a reasonable royalty rate and other
reasonable terms and conditions for such license.
5.5. Exercise upon Premature Termination caused by Xxxxx. In the event that
Bayer terminates this Agreement at its election pursuant to Section
11.2 hereof, Bayer shall be entitled to obtain various nonexclusive
licenses to use the Paravax Technology for other than a vaccine for
the prevention of feline toxoplasmosis, to the extent Paravax is
contractually permitted to grant such licenses. In the event that
Bayer elects to obtain such a license, Paravax and Bayer shall
negotiate in good faith a reasonable royalty rate and other reasonable
terms and conditions for such license.
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5.6. Royalty Rates. The license granted to Bayer pursuant to Section 5.1
hereof shall be royalty free. A license with respect to Toxoplasmosis
Vaccine granted to Bayer pursuant to Section 5.3 hereof shall provide
for the payment of royalties to Paravax of [ ]% of Net Sales of
Toxoplasmosis Vaccine, other than Toxoplasmosis Vaccine which is sold
by Paravax to Bayer pursuant to the Distribution Agreement. A license
with respect to a vaccine for the prevention of feline toxoplasmosis
granted to Bayer pursuant to Section 5.4 hereof shall provide for the
payment of royalties to Paravax of [ ]% of Net Sales of any such feline
toxoplasmosis vaccine. Bayer's obligation to pay any such royalties
shall terminate upon the later of (i) the expiration of all of the
licensed patents, or (ii) ten years from the first commercial sale of
a licensed product by or on behalf of Bayer. In the event that any
royalty and/or license fee is required to be paid to any third party
with respect to the use, manufacture or sale of Toxoplasmosis Vaccine,
other than any amounts which Paravax is contractually obligated to pay
as of the date of this Agreement, such expense shall be borne equally
by Paravax and Bayer. Paravax and Bayer shall jointly decide to
undertake any contractual commitment to pay any such license fee or
royalty with respect to the manufacture or sale of Toxoplasmosis
Vaccine. Paravax shall be solely responsible to bear the cost of any
license fee or royalty which Paravax is contractually obligated to pay
as of the date of this Agreement.
5.7. License Agreements. At any time, upon the request of Bayer, Bayer and
Paravax shall negotiate in good faith the form of the license
agreement for any license to be granted to Bayer pursuant to this
Article 5. Such license agreement shall contain the substantive terms
described in this Article 5, together with such other reasonable and
customary terms as the parties shall agree upon. Such license
agreement shall be subject to appropriate decreases in royalties upon
the expiration of patents. Such license agreement shall also provide
for Paravax to provide Bayer with reasonable assistance and
documentation in order to facilitate Bayer's permitted use of the
Paravax Technology.
ARTICLE 6. MANUFACTURE OF TOXOPLASMOSIS VACCINE
6.1. Manufacturing Source. To the extent that upon the completion of Phase
II of the Research Program Paravax owns, or leases pursuant to a long
term lease, a manufacturing facility which has been approved by the
United States Department of Agriculture or, if applicable, the United
States Food and Drug Administration which allows Paravax to produce
Toxoplasmosis Vaccine for which regulatory approval or clearance for
sale can be obtained in a specific country in the Territory, the
parties shall proceed as though Paravax shall manufacture the
Toxoplasmosis Vaccine for distribution in that country by Bayer
pursuant to the Distribution Agreement. To the extent that upon the
completion of Phase II of the Research Program Paravax does not have
such an approved manufacturing facility which allows it to produce
Toxoplasmosis Vaccine for which regulatory approval or clearance for
sale can be
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obtained in a specific country, the parties shall proceed as though
Bayer shall manufacture the Toxoplasmosis Vaccine for distribution in
that country by Bayer pursuant to the Distribution Agreement. Paravax
may elect to forego or cease manufacture of Toxoplasmosis Vaccine at
any time, provided that Paravax gives Bayer adequate notice to allow
Bayer, or a third party, to prepare for the manufacturing requirements
of producing the Toxoplasmosis Vaccine for, as applicable, Phases III
and IV of the Research Program and/or manufacture for commercial sale.
After the commencement of Phase III of the Research Program, Paravax
shall have no right to regain from Bayer the right to manufacture the
Toxoplasmosis Vaccine; however, Bayer agrees that it shall favorably
consider any such request made by Paravax. In the event that Paravax
elects to forego or cease manufacture of the Toxoplasmosis Vaccine,
Bayer shall be entitled to manufacture all of Bayer's requirements for
Toxoplasmosis Vaccine pursuant to the license described in Section 5.3
above.
6.2. Manufacturing Agreement. In the event that Paravax does not
manufacture any Toxoplasmosis Vaccine, as described in Section 6.1
hereof, Bayer and Paravax shall enter into a Manufacturing Agreement
pursuant to which Bayer shall manufacture, or have manufactured, the
Toxoplasmosis Vaccine for Paravax for sale outside of the Territory
and sell such Toxoplasmosis Vaccine to Paravax at a reasonable price
to be agreed upon by Paravax and Bayer. Such Manufacturing Agreement
shall include such other reasonable and customary terms as the parties
shall agree upon, consistent with the terms of this Cooperation
Agreement.
ARTICLE 7. DISTRIBUTION RIGHTS
7.1. Distribution Agreement. Upon Bayer's decision to file for regulatory
approvals for a Toxoplasmosis Vaccine, Bayer and Paravax shall enter
into a Toxoplasmosis Vaccine Distribution Agreement. Such Distribution
Agreement shall include the substantive terms described in Articles 7,
8, 9 and 10 of this Cooperation Agreement, together with such other
reasonable and customary terms as the parties shall agree upon,
consistent with the terms of this Cooperation Agreement. The term of
such Distribution Agreement shall be perpetual, subject to termination
by Bayer at its election or termination by Bayer or Paravax as a
result of a breach by the other party.
7.2. Grant of Rights. During the term of the Distribution Agreement, Bayer
and its affiliated companies shall have the exclusive right to
distribute Toxoplasmosis Vaccine in the Territory. Bayer and its
affiliated companies shall be entitled to distribute the Toxoplasmosis
Vaccine both directly and through distributors. Bayer shall use
diligent efforts during the term of the Distribution Agreement to
promote, market, distribute and sell Toxoplasmosis Vaccine in the
countries in the Territory listed on Exhibit B hereto. Bayer shall
have no obligation to promote, market, distribute or ell Toxoplasmosis
Vaccine in any portion of the Territory in which it is not
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commercially reasonable to do so.
7.3. Competing Products. Other than Toxoplasmosis Vaccine, and any other
vaccine licensed from and/or developed by Paravax, Bayer shall not
directly, or through any subsidiary or affiliated corporation, sell in
the Territory any vaccine for the prevention of feline toxoplasmosis
during the term of the Distribution Agreement. Bayer also agrees that
neither it nor any subsidiary or affiliated corporation shall directly
or indirectly solicit sales of Toxoplasmosis Vaccine for use in any
animal other than domestic felines.
7.4. Additional Territories. In the event that a Paravax relationship for
the distribution of Toxoplasmosis Vaccine with an existing partner
terminates as to any portion of the world not included in the
Territory, Paravax agrees that, before entering into a relationship
with any new partner for the distribution of the Toxoplasmosis Vaccine
in such portion of the world, it will first offer Bayer the option to
obtain distribution rights for the Toxoplasmosis Vaccine in that
portion of the world upon reasonable terms and conditions and will
negotiate in good faith with Bayer with respect to such reasonable
terms and conditions if Bayer is interested in obtaining such rights.
ARTICLE 8. PURCHASE OF TOXOPLASMOSIS VACCINE
8.1. Purchase Obligation. To the extent that Paravax is entitled to be the
manufacturing source for Toxoplasmosis Vaccine in some or all of the
Territory, pursuant to the provisions of Section 6.1 hereof, the
Distribution Agreement shall provide that Bayer will purchase from
Paravax all quantities of Toxoplasmosis Vaccine to be sold by it or on
behalf of it pursuant to the Distribution Agreement in such portions
of the Territory. Bayer's obligation to purchase Toxoplasmosis Vaccine
from Paravax shall terminate in the event that Paravax consistently
fails to provide in a timely manner the Toxoplasmosis Vaccine which
Bayer orders pursuant to the terms of the Distribution Agreement or in
the event that Paravax elects to cease or forego manufacture of the
Toxoplasmosis Vaccine pursuant to Section 6.1 hereof. To the extent
that Paravax manufactures Toxoplasmosis Vaccine, the terms set forth
in this Article 8 shall be incorporated in the Distribution Agreement
for purposes of Bayer's purchases of such Toxoplasmosis Vaccine.
8.2. Transfer Price. The per dose price at which Bayer shall purchase
Toxoplasmosis Vaccine from Paravax pursuant to the Distribution
Agreement shall be equal to the sum of (i) [
], (ii)
[ ], and (iii) [
]. To the extent that Paravax and Bayer are unable to agree upon
the price at which [ ] would manufacture the Toxoplasmosis
Vaccine, Paravax and Bayer shall agree upon [
]
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[
] for the manufacture
of the Toxoplasmosis Vaccine in those quantities which Bayer
reasonably expects to purchase Toxoplasmosis Vaccine in the upcoming
year. Upon [
] for purposes of the calculation of the transfer price payable
to Paravax. In addition, Paravax and Bayer will discuss increases to
this price in good faith on a yearly basis in order to compensate
Paravax for increases in the costs of raw materials, labor and other
manufacturing expenses.
8.3. Shipment. All prices and shipments shall be F.C.A. Paravax's Fort
Xxxxxxx, Colorado location, and risk of loss or damage shall pass to
Bayer on delivery to a common carrier. Bayer shall pay, or reimburse
Paravax for, the amount of any sales, use, excise or similar taxes and
all expenses of clearing customs and duties associated with importing
or exporting the Toxoplasmosis Vaccine purchased from Paravax for sale
by or on behalf of Bayer within the Territory.
8.4. Packaging. Bayer shall supply the art work and language for all
labels, packaging, product inserts and related items. Bayer shall bear
any expense, including discarded materials, resulting from any change
in such packaging, labeling, inserts or art work requested by Bayer.
Bayer shall market the Toxoplasmosis Vaccine using Bayer's tradenames,
trademarks, logos and trade dress; however, to the extent the
Toxoplasmosis Vaccine is manufactured by Paravax, Bayer's name as
distributor and Paravax's name as manufacturer shall receive equal
prominence in the descriptive materials.
8.5. Forecasts and Purchase Orders. In order to assist Paravax in planning
its production schedule for the Toxoplasmosis Vaccine, Bayer shall, no
later than last day of each calendar quarter, provide Paravax with a
good faith forecast of the Toxoplasmosis Vaccine that Bayer expects to
purchase during each of the following four calendar quarters. The
amounts so forecast for the immediately following two quarters shall
be deemed to be a noncancellable order for delivery during such
quarter; provided, however, that Bayer shall not be obligated to
purchase more than 75 % of the amount so forecast for the second such
quarter. Any additional amounts to be purchased by Bayer shall be
purchased by written purchase order submitted to Paravax. Paravax
shall not be obligated to accept any purchase order which provides for
delivery in less than 90 days from the date of its receipt. Paravax
shall be entitled to establish economically reasonable minimum
quantities for individual deliveries in light of production expenses.
8.6 Payment. Payment for Toxoplasmosis Vaccine shall be due in full thirty
(30) days from the date of receipt of invoice, which shall be on or
after the date of shipment.
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Accounts outstanding more than thirty (30) days will be subject to a
monthly charge at the rate of one and one half percent (1.5 %) per
month, or the maximum permitted by law, whichever is less.
8.7. Warranty. Paravax will warrant that the Toxoplasmosis Vaccine supplied
by Paravax will be free from defects in manufacturing and workmanship,
and will conform to agreed upon standards and specifications, during
the shelf life indicated by Paravax for such Toxoplasmosis Vaccine
(the "Warranty Period"), provided that the Toxoplasmosis Vaccine is
maintained under the storage conditions defined by Paravax. Any
Toxoplasmosis Vaccine which is found to be defective during the
Warranty Period may be returned for replacement. Bayer agrees to
report to Paravax any suspected product defect or customer complaint.
Paravax shall have the right to decide to recall any or all of the
Toxoplasmosis Vaccine, and Bayer agrees to comply with any recall
procedures for such Toxoplasmosis Vaccine decided on by Paravax. There
shall be no remedies for defective Toxoplasmosis Vaccine other than
those expressly set forth herein, and Paravax will make no other
warranties of any kind, express or implied, with respect to
Toxoplasmosis Vaccine. Paravax will, however, bear any producer
liability to third parties with respect to any Toxoplasmosis Vaccine
manufactured by Paravax, to the extent imposed by applicable law.
ARTICLE 9. PATENT INDEMNIFICATION
9.1. Infringement Defense. Paravax and Bayer will jointly defend any claim,
suit or proceeding brought against Bayer and/or Paravax to the extent
it is based upon a claim that the Toxoplasmosis Vaccine sold by Bayer
or on behalf of Bayer pursuant to the Distribution Agreement infringes
upon any patent or trade secret rights of any third party. Bayer and
Paravax agree that they shall promptly notify the other in writing of
any such claim or action and give the other full information and
assistance in connection therewith. Paravax and Bayer shall jointly
control the defense of any such claim or action and the settlement or
compromise of any such claim or action. Paravax and Bayer will jointly
pay all damages, costs and expenses paid in settlement or finally
awarded to third parties against Bayer and/or Paravax for such claim
or in such action. If the Toxoplasmosis Vaccine is, or in Paravax' s
or Bayer's opinion might be, held to infringe as set forth above,
Paravax and Bayer shall jointly determine whether to replace or modify
such Toxoplasmosis Vaccine so as to avoid infringement, or procure the
right for Bayer and Paravax to continue the manufacture, use and
resale of such Product. Paravax and Bayer shall also jointly determine
how the expense of any replacement, modification or procurement of
rights shall be borne by Paravax and Bayer. If neither of such
alternatives is commercially reasonable, any infringing Toxoplasmosis
Vaccine held by Bayer and purchased from Paravax shall be returned to
Paravax and Paravax's sole liability, in addition to its obligation to
pay damages, costs and expenses as set forth above, shall be to refund
the amounts paid for such returned Toxoplasmosis Vaccine by Bayer, and
Paravax shall have no further
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obligation to supply Toxoplasmosis Vaccine to Bayer pursuant to the
Distribution Agreement.
9.2. Limitation. Paravax will have no liability for any claim of
infringement arising as a result of Bayer's use of the Toxoplasmosis
Vaccine in combination with any items not supplied by Paravax, any
modification of the Toxoplasmosis Vaccine by Bayer or third parties,
or, in the event that Bayer manufactures the Toxoplasmosis Vaccine,
any manufacturing process used by Bayer. THE FOREGOING STATES THE
ENTIRE LIABILITY OF PARAVAX TO BAYER OR ANY PURCHASER OR USER OF
TOXOPLASMOSIS VACCINE CONCERNING INFRINGEMENT OF INTELLECTUAL PROPERTY
RIGHTS, INCLUDING BUT NOT LIMITED TO, PATENT AND TRADE SECRET RIGHTS.
ARTICLE 10. PATENTS
10.1. Ownership of Inventions. As between the parties, all rights to
inventions or discoveries invented or discovered jointly by Paravax
and Bayer under this Cooperation Agreement shall be jointly owned.
Each party shall have the right to use such inventions and discoveries
for such purposes as it shall deem appropriate, upon agreement with
the other party as to appropriate and reasonable compensation for uses
other than those contemplated by this Agreement; provided, however,
that to the extent set forth in the Distribution Agreement, Bayer
shall have the sole right to distribute Toxoplasmosis Vaccine in the
Territory. As between the parties, all rights to inventions or
discoveries invented or discovered solely by Paravax under this
Cooperation Agreement shall belong to Paravax. Bayer shall have no
rights with respect to such inventions or discoveries other than the
rights to enter into the license agreements and the Distribution
Agreement, as set forth herein. As between the parties, all rights to
inventions or discoveries invented or discovered solely by Bayer under
this Cooperation Agreement shall belong to Bayer.
10.2. Patent Filings. During the term of this Cooperation Agreement and the
Distribution Agreement, Paravax shall consult with Bayer as to all
patent filings and other patent actions related to the Toxoplasmosis
Vaccine. Paravax and Bayer shall make such patent filings, and take
such other actions with respect to patent filings, as they jointly
determine are appropriate, using counsel selected by Paravax and
consented to by Bayer, which consent will not be unreasonably
withheld.
10.3. Patent Enforcement. During the term of the Distribution Agreement,
Bayer shall have the right to bring actions to enforce any patent
rights held by Paravax with respect to the Toxoplasmosis Vaccine
against infringement in the countries in the Territory in which Bayer
has the right to distribute the Toxoplasmosis Vaccine pursuant to the
Distribution Agreement. Paravax shall provide such assistance and
cooperation in connection with such enforcement actions as Bayer shall
reasonably request. In the
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event that Bayer elects not to enforce any such patent rights, Paravax
may, but is not obligated to, bring actions with respect to such
infringement, and Bayer shall provide such assistance and cooperation
in connection with such actions as Paravax shall reasonably request.
Bayer shall not settle or compromise any such action which it brings
to enforce any patent with respect to the Toxoplasmosis Vaccine
without Paravax's consent, which consent will not be unreasonably
withheld. Where such an enforcement action has been brought by Bayer,
Bayer shall maintain the litigation at its own expense and shall keep
any judgment and award arising from such action. Where such an
enforcement action has been brought by Paravax, Paravax shall maintain
the litigation at its own expense and shall keep any judgments and
awards arising from such action.
ARTICLE 11. TERM AND TERMINATION
11.1. Term. The term of this Agreement shall commence on the date first set
forth above and shall end on the earlier of the date upon which this
Agreement is terminated pursuant to the provisions of this Article 11
or upon the completion of the Research Program.
11.2. Bayer Termination. Bayer shall have the right to terminate this
Agreement upon any anniversary of the date hereof, beginning with the
second such anniversary (but not before payment of the twenty-four
month lump sum payment due pursuant to Section 3.3 hereof), upon
written notice given not less than 90 days prior to such anniversary.
In the event that Bayer elects to so terminate this Agreement, Paravax
shall repay all amounts paid by Bayer pursuant to this Agreement at a
rate of [
], of any vaccine for the
prevention of feline toxoplasmosis developed by Paravax based on the
work conducted pursuant to the Research Program during the term of
this Agreement. Paravax's obligation to make such payments to Bayer
shall not commence until after the completion of the second full
calendar year in which such a vaccine has been marketed in the
Territory, and such payments shall only be made with respect to Net
Sales of such vaccine which take place after the completion of such
second full calendar year.
11.3. Termination for Breach. Either party shall have the right to terminate
this Agreement upon written notice if
(a) the other party is in breach of any material provision of
this Agreement and such breach has not been remedied within
30 days after written notice of such breach has been given;
or
(b) the other party enters into liquidation, whether compulsory
or voluntary, or has a receiver appointed as to all or any
part of its assets, or takes or suffers
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any similar action in consequence of debt.
11.4. Paravax Acquisition. Bayer shall have the right to terminate this
Agreement upon written notice to Paravax given within ninety (90) days
of any acquisition of Paravax by a third party, whether by merger or
sale or other transfer of a substantial majority of the assets of
Paravax. In the event that Bayer elects to so terminate this
Agreement, Bayer shall, upon the request of Paravax, provide
reasonable assistance to aid Paravax in satisfying its contractual
obligations with respect to the supply of vaccines for the prevention
of feline toxoplasmosis for sale outside of the Territory.
11.5. Paravax Termination. Paravax shall not have the right to unilaterally
terminate this Agreement; provided, however, that in the event that
Paravax determines that it is unlikely that the Research Program can
be successfully completed, Paravax and Bayer shall negotiate an
appropriate termination of this Agreement.
ARTICLE 12. CONFIDENTIALITY
12.1. Confidential Information. It is agreed that during the term of this
Agreement Paravax and Bayer may each disclose certain Confidential
Information to the other for purposes of furthering or evaluating
progress under this Agreement. The term "Confidential Information" for
these purposes shall include all technical, business, financial, or
marketing information which one party (the "Disclosing Party")
discloses to the other party (the "Receiving Party"), except any
portion of such information which:
a. is now or later made known to the public through no
default by the Receiving Party of its obligations
under this Agreement;
b. the Receiving Party can show was in its possession
prior to disclosure by the Disclosing Party;
c. is rightfully received by the Receiving Party from a
third party without any accompanying secrecy
obligation; or
d. is independently developed by the Receiving Party by
persons who neither had access to Confidential
Information of the Disclosing Party nor received
direction from persons who had access to Confidential
Information of the Disclosing Party.
12.2. Confidentiality Obligation. A Receiving Party agrees to hold in
confidence and not disclose to any third parties any of the
Confidential Information of the Disclosing Party without the prior
consent of the Disclosing Party; provided, however, that to the extent
required in order to obtain regulatory approval, a Receiving Party may
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disclose such Confidential Information to the appropriate regulatory
authorities. A Receiving Party agrees to limit any disclosure of the
Confidential Information only to those of its employees and outside
professional advisors who have a need to know and who are bound by
confidentiality obligations, and to advise such persons of the
Receiving Party's obligations under this Agreement. A Receiving Party
further agrees to use Confidential Information received from the other
party only for purposes of furthering or evaluating progress under
this Agreement. Any tangible materials that contain any Confidential
Information shall be returned to the Disclosing Party promptly upon
request, and any portions of any memoranda, reports or documents
created by the Receiving Party which contain any Confidential
Information shall be destroyed upon the request of the Disclosing
Party; provided, however, that the Receiving Party may keep a single
copy of all such tangible materials for purposes of demonstrating
compliance with the provisions of this Agreement.
12.3. Confidentiality of Agreement. In addition, neither party will disclose
to any third party, other than with the prior written consent of the
other party, the terms and conditions of this Agreement, except as may
be required by applicable law, regulation or court order. The
provisions of this Article 12 shall survive any termination of this
Agreement for a period of ten (10) years.
ARTICLE 13. MISCELLANEOUS
13.1. Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the assigns of Paravax and Bayer; however,
neither Paravax nor Bayer shall be entitled to assign its rights and
obligations under this Agreement without the express written consent
of the other. Notwithstanding the immediately preceding, such consent
shall not be required for an assignment of the rights and obligations
of Paravax or Bayer to a wholly owned subsidiary or which takes place
as part of an acquisition of Paravax, whether by merger or sale or
other transfer of substantially all of the assets of Paravax;
provided, however, that nothing in this Section 13.1 shall be deemed
to limit the rights of Bayer pursuant to the provisions of Section
11.4 hereof.
13.2. Relationship of Parties. Nothing in this Agreement shall constitute or
be deemed to constitute a partnership between the parties. The
relationship between Bayer and Paravax shall be strictly that of
sponsor and researcher. Bayer, its officers, agents and employees,
shall under no circumstances be considered the agents, employees or
representatives of Paravax, and Paravax, its officers, agents and
employees, shall under no circumstances be considered the agents,
employees or representatives of Bayer. Bayer shall not have the right
to enter into any contracts or binding commitments in the name of or
on behalf of Paravax in any respect whatsoever, and Paravax shall not
have the right to enter into any contracts or binding commitments in
the name of or on behalf of Bayer in any respect whatsoever.
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13.3. Notices. Notices required hereunder shall be deemed properly given
upon hand delivery (including professional courier such as Federal
Express) to the addresses set forth below, or to such other address as
a party shall have given notice of in accordance herewith.
Paravax: Paravax, Inc.
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxx Xxxxxxx, XX 00000
Attn: President
Bayer: Xxxxx XX
Geschaftsbereich Veterinar
VT-F/Leitung
D-51368 Leverkusen
Germany
Attn: Prof. Xx. X. Xxxxxx
13.4. Force Majeure. Neither party shall be liable for any failure to
perform any of its obligations hereunder (other than the payment of
money) which results from act of God, the elements, fire, flood,
component shortages, force majeure, riot, insurrection, industrial
dispute, accident, war, embargoes, legal restrictions or any other
cause beyond the control of such party.
13.5. Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of Kansas, without regard to its
provisions concerning the applicability of the laws of other
jurisdictions.
13.6. Arbitration. Should any dispute, controversy or difference of opinion
arise between the parties hereto out of or in relation to or in
connection with this Agreement, or the breach thereof, the parties
shall first endeavor to reach an amicable resolution thereof. Should
the parties fail to reach such an amicable resolution, any such
dispute, controversy or difference of opinion shall be resolved by
arbitration in accordance with the arbitration rules of the
International Chamber of Commerce, then in force, by one or more
arbitrators appointed in accordance with such rules. Any such
arbitration shall be held in Kansas City, Missouri if requested by
Bayer, and in Leverkusen, Germany if requested by Paravax, and all
proceedings shall be held in the English language. Any award rendered
shall be final and binding upon the parties. Judgement upon the award
may be entered in any court having jurisdiction, or application may be
made to such court for judicial acceptance of the award and/or an
order of enforcement as the case may be.
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13.7. Severability. If any provision or provisions of this Agreement shall
be held to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
13.8. Entire Agreement. This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter hereof and
may only be amended by a writing signed by both parties.
13.9. Titles and Headings. The titles or headings, articles, sections or
paragraphs set forth in this Agreement have been inserted merely to
facilitate reference and shall have no bearing upon the interpretation
of any of the provisions of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed on their behalf as of the date first set forth above.
PARAVAX, INC.
By /s/ XXXXX X. XXXX
--------------------------
Title: President
----------------------
XXXXX XX
By /s/ X. XXXXXX
-----------------------
Title: Head of Research
-----------------------
BG Animal Health
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FELINE TOXOPLASMOSIS VACCINE RESEARCH & DEVELOPMENT PLAN : EXHIBIT A
[
]
1
19
[
]
2
20
[
]
3
21
Feline Recombinant Toxoplasmosis Vaccine Timetable
------------------------------------------------------------------------------------------------------------------
PHASE 1 Year 1 Year 2 Year 3 Year 4
==================================================================================================================
TASK
==================================================================================================================
[
]
22
FELINE RECOMBINANT TOXOPLASMOSIS VACCINE
PHASE I/II MILESTONES AND PAYMENTS
===================================================================================================================
MILESTONES MOS. PAYMENT BY
($000 OMITTED)
-------------------------------------------------------------------------------------------------------------------
Performance(1) Milestones(2)
===================================================================================================================
===================================================================================================================
[
]
(1) Payment upon completion of the time (month) listed if performance level
is acceptable.
(2) Payment upon successful achievement of milestone, independent of time.
(3) Payment upon fulfilling criteria of Milestone 5.
(4) As identified above in this exhibit.
23
Exhibit B
to
Feline Toxoplasmosis Cooperation Agreement
United States of America
Federal Republic of Germany
United Kingdom
France
