EXHIBIT 10.7
CERTAIN INFORMATION IN THIS EXHIBIT IS SUBJECT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. IN ACCORDANCE WITH RULE 406 UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, SUCH INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. THE LOCATION OF SUCH OMITTED INFORMATION HAS
BEEN INDICATED WITH AN ASTERISK(*).
Dated: 26 June, 1989
MEDICAL RESEARCH COUNCIL
-and-
TANOX BIOSYSTEMS INC
LICENSE
FOR
WINTER PATENT
THIS AGREEMENT is made the 26th day of June, One Thousand Nine Hundred and
Eighty-Nine, between MEDICAL RESEARCH COUNCIL of 00 Xxxx Xxxxxxxx, Xxxxxx X0X
0XX (hereinafter called "MRC" which expression includes its successors and
assigns) of the one part and TANOX BIOSYSTEMS, INC., 00000 Xxxxxx Xxxx, Xxxxx
000, Xxxxxxx, Xxxxx 00000, U.S.A. (hereinafter called the "Licensee" which
expression includes its successors and permitted assigns) of the other part.
WHEREAS, MRC is the proprietor of certain patent rights as herein defined in
respect of the genetic engineering of monoclonal antibodies comprising the
replacement, in whole or in part, of the complementarity determining regions of
one antibody by those of another.
Now, it is hereby agreed as follows:
1. DEFINITIONS.
(1) In this Agreement, the following words and expressions shall be
construed as follows:
"THE EFFECTIVE DATE" shall mean the date set forth above.
"THE RESHAPING PROCESS" shall mean the genetic engineering of
monoclonal antibodies comprising the replacement, in whole or in part,
of the complementarity determining regions of one antibody by those of
another as described in the Winter Patent.
"THE PRODUCTS" shall mean products produced either directly or
indirectly from antibodies which have been modified using the
Reshaping Process and which are in a form capable of being marketed or
sold upon a commercial basis (the parties intend that the Products
will include in some manner such an antibody).
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"AFFILIATE" means any company, partnership or other entity which
directly or indirectly controls, is controlled by or is under common
control with either party to this Agreement.
"CONTROL" means the ownership of more than fifty percent (50%) of the
issued share capital or the legal power to direct or cause the
direction of the general management and policies of the party in
question.
"FIELDS" shall mean the field of human therapy and human in vivo and
in vitro diagnostics.
"NET RECEIPTS" shall mean all monies received by Licensee in respect
of the sale of the Products, less the following items to the extent
that they are paid or allowed and, as appropriate, indicated on the
invoice:
o normal discounts actually granted;
o credits allowed for Products returned or not accepted by
customers;
o packaging, transportation and prepaid insurance changes on
shipments or deliveries to customers;
o taxes actually incurred and paid by Licensee in connection with
the sale or delivery of Products to customers.
"THE WINTER PATENT" shall mean the patents and applications therefor
set out in Schedule 1 hereto of which MRC is the proprietor or under
which MRC has the right to grant licenses at the Commencement Date and
any divisions, renewals, continuations, extensions or reissues
thereof, and any further patent application which names the same
Xxxxxxx Xxxxxx as an inventor and discloses and claims similar subject
matter, or which claims the same Convention priority
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date; and any patent granted or to be granted on such patent
application(s). MRC will promptly notify Licensee of the issuance of
any such patents.
"THE BOSS PATENTS" shall mean
(i) European Patent Application 0 120 693 (84301996.9) of 23
March 1984 naming Xxxxxxx Xxxx Xxxx as an inventor;
(ii) GB Patent Application 8308235 of 25 March 1983;
(iii) Japanese Patent Application 501609/84 of 23 March 1984;
(iv) and any patent granted or to be granted on such patent
application(s).
(v) US Patent 4 816 397 of 28 March 1989.
(2) In this Agreement, the singular shall where the context so permits
include the plural and vice versa.
2. COMMENCEMENT.
This Agreement shall be deemed to have come into force on the Effective
Date and shall be read and construed accordingly.
3. GRANT OF RIGHTS.
(1) MRC agrees to grant to the Licensee the following licenses under the
Winter Patent:
(i) a non-exclusive worldwide license to exploit the Winter Patent
commercially in any way whatsoever by the use of the Reshaping
Process in the Fields and by the commercial exploitation in the
Fields of any resulting antibodies provided always that any such
exploitation does not involve the antibodies detailed in the
Second Schedule hereto; and
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(ii) a non-exclusive sublicense under the Boss Patents to the extent
required to enable the licensee to use the Reshaping Process in
accordance with (i) above and for no other purpose.
(2) The Licensee shall not be entitled to grant sublicenses of the rights
granted to it under this Agreement except with the prior written
consent of MRC. The licensee shall use its best endeavors to ensure
that any sublicensee performs its obligations under any such
sublicense.
(3) The following arrangements shall not require the prior consent of MRC:
(i) The appointment of any person as agent or distributor to market,
sell, use or otherwise dispose of the Products in any part of
the world;
(ii) The subcontracting of the development of new Products for the
Licensee;
(iii) The subcontracting of manufacture for the Licensee of Products
or intermediates for Products.
4. PAYMENTS.
(1) IN CONSIDERATION for the non-exclusive license granted pursuant to
Clause 3.1 hereof, the Licensee shall pay to the MRC the sum of *
exclusive of Value Added Tax ("VAT") upon signature of this Agreement.
(2) IN FURTHER consideration of the licenses granted by MRC to Licensee
under this Agreement, Licensee shall pay to MRC a royalty at the rate
of * of Net Receipts and VAT thereon on all sales of Products by
Licensee or any Affiliate where the Products are either manufactured
and/or sold in a country where the Winter Patent is granted, valid and
subsisting at the date of such sale. MRC agrees to notify Licensee of
any actions or oppositions contesting validity of the Winter Patent.
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(3) If MRC licenses another party under the Winter Patent in the
fields at a lower royalty rate than is payable by Licensee by virtue
of this Agreement, or with another substantial term more favorable to
such party than the corresponding term of this Agreement, MRC will
notify Licensee of same and then Licensee shall have an option to
convert this Agreement so that the royalty rate payable thereunder, or
other corresponding term, is the same as the rate or term that applies
to the third party; provided that if the third party's license
imposes upon that party any other obligation (including any
restriction as to product or territory) which is associated with that
party's operations as patent licensee and which is more onerous than
an obligation of corresponding category on the part of Licensee under
this Agreement, then any exercise of the option by Licensee shall
operate so that Licensee assumes an obligation as patent licensee
corresponding to such other obligation of the third party, either as a
substitute in place of Licensee's obligation(s) of corresponding
category, or if there is no such obligation of corresponding
category, then as an additional obligation.
This clause sball not entitle the Licensee to a license in respect of
any of the restricted antibodies set out in Schedule 2.
(4) Licensee agrees to keep true and accurate records and books of account
containing all data necessary for the calculation of the royalties
payable to MRC under Clause 4(2). Such records and books of account
shall upon reasonable notice having been given by MRC be open at all
reasonable times during business hours for inspection by MRC or its
duly authorized representative.
(5) When sales of Products commence, Licensee shall prepare a statement in
respect of each calendar quarter of this Agreement which shall show
for the calendar quarter in question Licensee's Net Receipts on sales
by it of the Products on a country-by-country basis, details of the
quantities of Products manufactured and sold in each country and the
royalty and VAT due to MRC thereon pursuant to Clause 4(2) above. Such
statement shall be submitted to MRC within sixty (60) days of the end
of the calendar quarter of this
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Agreement or part thereof to which it relates together with a
remittance for the royalties and VAT due to MRC. If MRC shall give
notice to Licensee within thirty (30) days of the receipt of any such
statement that it does not accept the same, such statement shall be
certified by an independent certified or chartered accountant
appointed by agreement between the parties or, in default of
agreement within fourteen (14) days, by the President for the 1ime
being of the Institute of Chartered Accountants of Eng1and and
Wales in London (the parties agree that an accountant located in the
U.S. may be appointed). Licensee shall make available all books and
records required for the purpose of such certification and the
statement so certified shall be binding between the parties. The costs
of such certification shall be the responsibility of MRC if the
certification shows the original statement to have been accurate or
overpaid and otherwise shall be the responsibility of Licensee if
royalties are determined to have been underpaid by greater than two
percent (2%). Following any such certification, the parties shall
make any adjustments necessary in respect of the royalties already
paid to MRC in relation to the year in question.
(6) Payments due under this Agreement shall be made in fu1l, provided that
in the event and to the extent that any such payment is subject to
direct taxes levied or assessed by any government authority under the
laws of the country from which payment is made and there is a relevant
treaty or other provision for the avoidance of double taxation or for
other relief in respect of tax deducted at source, Licensee shall have
the right to deduct from the payment any such taxes, provided that
Licensee shall for each such deduction furnish to MRC a certificate or
other documentary evidence executed in the matter required by the
relevant government authority to enable MRC to obtain relief from
double taxation or such other relief in respect of the tax so
deducted.
Sums are expressed in this Agreement as exclusive of VAT. MRC agrees
to provide Licensee with a VAT invoice in respect of every payment
affected by VAT.
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(7) Where MRC does not receive payment of any sums due to it within the
period specified hereunder in respect thereof interest shall accrue on
the sum outstanding at the rate of one percent (1%) per month
calculated on a daily basis without prejudice 10 MRC's right to
receive payment on the due date therefor.
5. TERM AND TERMINATION.
(1) Subject as hereinafter provided, this Agreement and the licenses
granted pursuant thereto shall continue in force in each territory
during the subsistence of the last to expire of the Winter Patent in
such territory.
(2) MRC may terminate this Agreement and the said licenses forthwith by
notice to the Licensee to that effect upon the happening of any of the
following events:
(a) if the Licensee fails to perform or observe any of the
obligations on its part to be performed or observed and if the
breach is one capable of remedy has not been remedied within
three (3) months of the giving of a notice informing the
Licensee of such breach; or
(b) if the Licensee files a voluntary petition in bankruptcy or
applies to any tribunal for a receiver, trustee or similar
officer to be appointed by any court or executive department to
liquidate or conserve the Licensee or any substantial part of its
property or assets due to insolvency or to the threat thereof or
if the Licensee suffers any trusteeship or receivership to
continue undischarged for a period of sixty (60) days or suffers
any similar procedure for the relief of distressed debtors
entered into by the Licensee voluntarily or involuntarily or if
the Licensee is otherwise divested of its assets for a period of
sixty (60) days or makes a general assignment for the benefit of
its creditors.
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(3) The Licensee may terminate this Agreement and the licenses granted
pursuant hereto by giving to MRC six (6) months notice to that
effect if the Licensee considers that substantial unlicensed
competition is seriously interfering with Licensee's exploitation of
the Reshaping Process under this Agreement and that MRC is not taking
appropriate steps to seek to prevent or reduce such un licensed
competition. Such termination shall be without prejudice to the right
of MRC to enforce the Winter Patent in the event of subseqnent
manufacture of Products by the Licensee.
(4) Termination of this Agreement or of the said licenses shall be without
prejudice to any rights of either party against the other which may
have accrued up to the date of such termination and the Licensee shall
pay to MRC the appropriate royalties hereunder on and stocks of
the Products (on which royalties have not already been paid) held at
the date of termination by the Licensee or any person engaged by the
same to manufacture the Products and shall thereafter be free to sell
such Products on which royalty has been paid.
6. WARRANTIES.
(1) MRC hereby represents and warrants that MRC owns the Winter Patent or
is otherwise authorized to license the Winter Patent to the Licensee.
(2) MRC hereby represents and warrants that MRC is entitled or
authorized to grant a license or sublicense under the Boss Patents to
the limited extent needed for effectively licensing Licensee to use
the Reshaping Process without hindrance due to rights conferred by the
Boss Patents.
(3) Nothing in this Agreement or in any licenses to be granted pursuant
thereto shall be construed as a representation or warranty that any of
the said patents are valid or that any manufacture, use, sale or other
disposal of the Products is not an infringement of any patents or
other rights not vested in MRC.
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(4) Licensee sha11 promote the sale of the Products and shall use
reasonable endeavors consistent with Licensee's reasonable business
plans to meet the market demand therefore.
7. INFRINGEMENT.
If Licensee becomes aware of a suspected infringement of the Winter Patent,
it sha1l notify MRC giving full particulars thereof. If the alleged
infringement consists of any act which (if done by Licensee) would be
within the scope of the licenses granted under this Agreement, MRC and
Licensee shall (within a reasonable time of the said notification) consult
together with a view to agreeing upon a course of action to be pursued.
Where utilised by the Licensee to produce Products from mammalian
cells. If Licensee should be sued for infringing the Winter Patent or Boss
Patents/and not be in breach of Licensee's obligations under this
Agreement, then MRC agrees to indemnify and hold Licensee harmless from
and against any claims, damages, expenses, or other liabilities which might
result or be incurred.
8. WAIVER.
The waiver by MRC or Tanox of any breach, default or omission in the
performance or observance of any of the terms of this Agreement by the
other shall not be deemed to be a waiver of any other such breach, default
or omission.
9. NOTICES.
Any notice, consent or other communication authorized or required to be
given hereunder or for the purposes hereof shall be in writing and be
deemed to be duly given to MRC if left at or sent by recorded delivery or
registered post addressed to its principal office and to Licensee if left
at or sent by recorded delivery or registered post to its principal place
of business. Any such notice, consent or other communication if served by
post shall be deemed to have been given at the time when it would have been
received in due course of the post.
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10. LAW AND JURISDICTION.
This Agreement is to be read and construed in accordance with and governed
by the laws of England so far as the subject matter allows and the parties
hereby submit to the jurisdiction of the English courts in relation to any
dispute arising out of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in the manner legally binding upon them by causing authorized
representatives to sign this Agreement
MEDICAL RESEARCH COUNCIL TANOX BIOSYSTEMS, INC.
By: /s/ X. X. XXXX By: /s/ XXXXX X. XXXXX
Name: X. X. Xxxx Xxxxx X. Xxxxx, President
Title: Head of Industrial
Liaison Group
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SCHEDULE 1
INVENTORS Xxxxxxx Xxxx Winter (Medical Research Council)
APPLICATION/PATENTEE Xxxxxxx Xxxx Winter (Medical Research Council)
TITLE Recombinant DNA Products and Methods
PRIORITY APPLICATION
APPLICATION NUMBER UK PA 8607679 27.03.86
FINAL APPLICATION
APPLICATION NUMBER
(PUBLICATION DATE) (DATE OF PUBLICATION)
TERRITORY *(PATENT NUMBER) (DATE OF GRANT)
--------- ------------------ ---------------------
U.K ................................ 8707252 26.03.87
(GB 2188638A) (7.10.87)
Europe ............................. 870302620.7 26.03.87
(Austria, Be1gium,
France, W. Germany,
Greece, Italy, Luxembourg,
Netherlands, Spain,
Sweden, Switzerland, U.K.)
Canada ............................. 533071 26.03.86
U.S.A .............................. 903776 04.09.86
Japan .............................. 73970/87 27.03.87
SCHEDULE 2
ANTIBODY EXCLUDED FROM THE LICENSE
1. All antibodies to alpha tumor necrosis factor having an association constant
greater than l0 (6th power) L/mole.
*