LICENSE AND COLLABORATION AGREEMENT This License and Collaboration Agreement (this “Agreement”) is entered into as of September 13, 2020 (the “Effective Date”), by and between Merck Sharp & Dohme Corp., a company organized and existing under the laws...
[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED Exhibit 10.1 EXECUTION VERSION LICENSE AND COLLABORATION AGREEMENT by and between MERCK SHARP & DOHME CORP. and SEATTLE GENETICS, INC. Dated as of: September 13, 2020
Table of Contents (continued) Schedules and Exhibits Schedule 1.26: European Collaboration Territory Schedule 1.39: Cost of Goods Manufactured Schedule 1.133: SeaGen Existing CMO Agreements Schedule 1.134: SeaGen Existing In-Licenses Schedule 1.139: SeaGen Patents Schedule 1.152: SGN-LIV-1-A Schedule 1.153: SGN-LIV-1-B Schedule 1.154: SGN-LIV-1-C Schedule 2.7: Permitted Distributor Countries Schedule 2.9.2: Next Generation Compound Criteria - SGN-LIV-1-C Schedule 6.8: Certain Costs of Recalls Schedule 7.9: Certain Terms for Supply Agreements Schedule 9.6.1: Press Release Schedule 11.2: SeaGen Disclosure Schedules Schedule 11.3.1: Regulatory Documentation Schedule 13.4: [ * ] Schedule 14.7.6: Continuing Product Payment Reductions Schedule 15.3: Partnership Tax Related Provisions Exhibit A: Initial Development Plan [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
LICENSE AND COLLABORATION AGREEMENT This License and Collaboration Agreement (this “Agreement”) is entered into as of September 13, 2020 (the “Effective Date”), by and between Merck Sharp & Dohme Corp., a company organized and existing under the laws of New Jersey (“Merck”), and Seattle Genetics, Inc., a company organized and existing under the laws of Delaware (“SeaGen”). Merck and SeaGen are sometimes referred to herein individually as a “Party” and collectively as the “Parties”. RECITALS: WHEREAS, SeaGen is a global biopharmaceutical company engaged in the research, development and commercialization of biopharmaceutical products, including antibody drug conjugates, and owns or controls certain patents and other intellectual property relating to antibody drug conjugates, including SGN-LIV-1-A (as defined below, and which is also known as ladiratuzumab vedotin (LV)); WHEREAS, Merck and its Affiliates possess expertise in the research, development and commercialization of pharmaceutical products; WHEREAS, the Parties (or their respective Affiliates) are currently parties to that certain Clinical Trial Collaboration and Supply Agreement having an Effective Date of September 8, 2017 (the “CTC”) relating to the use of SeaGen’s proprietary antibody drug conjugate SGN-LIV-1-A and Merck’s proprietary product “KEYTRUDA” in concomitant or sequential use for the treatment of certain tumor types; and WHEREAS, Merck and SeaGen desire to enter into a collaboration to develop, manufacture, commercialize and otherwise jointly exploit Licensed Compounds and the Licensed Product upon the terms and conditions set forth herein, including as a monotherapy and in combination (including concomitant or sequential therapy) with other pharmaceutical products. NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants herein contained, the receipt and sufficiency of which are hereby acknowledged, Merck and SeaGen hereby agree as follows: ARTICLE 1 DEFINITIONS Whenever used in this Agreement with an initial capital letter, the terms defined in this Article 1 and elsewhere in this Agreement, and any cognates or correlatives thereof, whether used in the singular or plural, shall have the specified meanings. 1.1 “Accounting Standards” means GAAP or IAS/IFRS or equivalent standards adopted by a Party from time to time, as applicable, as consistently applied by such Party or its Affiliates in maintaining its books and records. 1.2 “Act” means, as applicable, the United States Federal Food, Drug and Cosmetic Act, 21 U.S.C. § 301 et seq., as such may be amended from time to time. -1- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.3 “Action” means any claim, cause of action or suit (whether in contract or tort or otherwise), litigation (whether at law or in equity, whether civil or criminal), arbitration or other proceedings brought or asserted by any Third Party (including any Governmental Authority) against a Party (or any other Indemnified Party). 1.4 “Affiliate” means any entity directly or indirectly controlled by, controlling, or under common control with, a Party to this Agreement, regardless of whether such entity is or becomes an Affiliate on or after the Effective Date, but only for so long as such control exists. For purposes of this definition, “control” (including, with correlative meanings, “controlled by”, “controlling” and “under common control with”) means (a) possession, direct or indirect, of the power to direct or cause direction of the management or policies of an entity (whether through ownership of securities or other ownership interests, by contract or otherwise), or (b) beneficial ownership of fifty percent (50%) or more (or the maximum ownership interest permitted by Applicable Law giving control) of the voting securities or other ownership or general partnership interest (whether directly or indirectly) or other comparable equity interests in an entity. 1.5 “Allowable Commercialization Costs” means, with respect to the Commercialization of the Licensed Product for the Territory in a given period, the sum of the following with respect to such Licensed Product in such period, but solely to the extent (a) incurred by a Party (or its Affiliate) on or after the Effective Date as a cost or expense in accordance with the applicable Party’s Accounting Standards, (b) directly attributable or reasonably allocable to the Commercialization of such Licensed Product for the Territory, including, for clarity, those that are directly attributable or reasonably allocable to the Commercialization of a Proprietary Combination pursuant to this Agreement and the Commercialization Plan (and, for clarity, costs associated with the Commercialization of a Proprietary Combination pursuant to this Agreement and the Commercialization Plan shall be fully allocated to the Licensed Product hereunder), including, for example, Promotional Materials for the Licensed Product that reference a Proprietary Combination (but excluding for clarity any Merck Proprietary Combination Outside Promotional Materials and SeaGen Proprietary Combination Outside Promotional Materials) and (c) within the scope of the activities set forth in the Commercialization Plan and in accordance with the Commercialization Budget (plus any Permitted Commercialization Overage): 1.5.1 [ * ]; 1.5.2 [ * ]; 1.5.3 [ * ]; provided that, (i) if SeaGen is [ * ], this Section 1.5.3 shall exclude [ * ], but shall include [ * ] and (ii) if Merck is [ * ], this Section 1.5.3 shall exclude [ * ], but shall include [ * ]; 1.5.4 such costs and expenses incurred [ * ]; 1.5.5 [ * ] payable as a result of [ * ]; and 1.5.6 [ * ] costs and expenses [ * ] incurred by or on behalf of [ * ] in carrying out [ * ]. -2- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.6 “Allowable Development Costs” means, with respect to the Development of the Licensed Product in a given period, the Development Costs incurred by a Party (or its Affiliate) for the Development of such Licensed Product pursuant to this Agreement, but solely to the extent (a) incurred by a Party (or its Affiliate) on or after the Effective Date as a cost or expense in accordance with the applicable Party’s Accounting Standards, (b) directly attributable or reasonably allocable to such Licensed Product (provided that, for clarity, costs associated with the Development of a Proprietary Combination pursuant to this Agreement and the Development Plan shall be fully allocated to the Licensed Product, including, for example, subject to Section 5.2.6(b), Clinical Trials for a Proprietary Combination to the extent set forth in the Development Plan), including, for example, Other Field-Based Materials for the Licensed Product that reference a Proprietary Combination (but excluding for clarity any Merck Proprietary Combination Outside Other Field-Based Materials and SeaGen Proprietary Combination Outside Other Field-Based Materials), and (c) within the scope of the activities set forth in the Development Plan and in accordance with the Development Budget (plus any Permitted Development Overage). 1.7 “Allowable Field Force FTE Costs” means the aggregate Field Force FTE Costs of a Party or its Affiliates pursuant to the Commercialization Plan that are directly attributable or reasonably allocable to Promotional activities for the Licensed Product for the Territory conducted by a Party’s (or its Affiliate’s) field force. 1.8 “Allowable Joint IP Costs” means Joint Patent Costs, Joint Trademark Costs and Joint IP Action Costs, in each case, incurred by or on behalf of a Party or its Affiliates in accordance with this Agreement. 1.9 “Allowable Promotion FTE Costs” means the aggregate Promotion FTE Costs of a Party or its Affiliates pursuant to the Commercialization Plan that are directly attributable or reasonably allocable to Promotion activities for the Licensed Product for the Territory. 1.10 “Ancillary Agreement” means any Merck Supply Agreement, SeaGen Supply Agreement, Promotion Agreement, European Collaboration Territory Distribution Agreement, Pharmacovigilance Agreement, Regulatory Agreement, [ * ], and any other agreement (including quality agreements) entered into by and between the Parties or their Affiliates specifically related to the Development, Manufacture or Commercialization of a Licensed Compound or Licensed Product. For clarity, no Third Party shall be a party to an Ancillary Agreement. 1.11 “Applicable Law” means, as applicable, (a) any United States federal, state or local law, statute, standard, ordinance, code, rule, regulation, resolution or promulgation, (b) any national, provincial, state or local or multinational law, statute, standard, ordinance, code, rule, regulation, resolution or promulgation in any country or region in the Territory outside the United States, (c) any order, writ, judgment, injunction, decree, stipulation, ruling, determination or award entered by or with any Governmental Authority in the Territory, or (d) any license, franchise, permit or similar right granted under any of the foregoing, or any similar provision having the force or effect of law, including as applicable (i) cGLPs, cGCPs and cGMPs and (ii) all applicable data protection and privacy laws, rules and regulations, including the United States Department of Health and Human Services privacy rules under the Health Insurance Portability and Accountability Act and the Health Information Technology for Economic and Clinical Health Act, -3- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
as any of the foregoing may be amended from time to time. Regarding Personal Data (as defined herein), Applicable Laws means any applicable law, rule, regulation, ordinance, directive, interpretation, judgment, or decision of any Governmental Authority in relation to data protection, privacy, restrictions on, or requirements in respect of, the processing of Personal Data of any kind, including HIPAA, General Data Protection Regulation (Regulation (EU) 2016/679) (GDPR), Brazilian General Data Protection Law (Federal Law no. 13,709/2018), the Act on the Protection of Personal Information of Japan, and any equivalent Applicable Laws in any other jurisdiction, as any of the foregoing may be amended from time to time (collectively, “Data Protection Laws”). 1.12 “Biomarker Test” means, in relation to a Licensed Compound or the Licensed Product, any diagnostic test designed to objectively measure or evaluate samples of blood, other body fluids or tissue as an indicator of biological processes, pathogenic processes or pharmacologic responses and may include next generation sequencing (NGS) tests or immunohistochemistry (IHC) tests, as applicable, in each case, to determine if a Licensed Compound or the Licensed Product may be useful for a given patient or patient population. 1.13 “Business Day” means a day other than a Saturday, Sunday, or any other day when banks are authorized or required by law to be closed in New York, New York, or Seattle, Washington. 1.14 “Calendar Quarter” means the respective periods of three (3) consecutive calendar months ending on March 31, June 30, September 30 and December 31; provided, however, that the first Calendar Quarter of the Term shall begin on the Effective Date and end on the last day of the then-current Calendar Quarter and the last Calendar Quarter of the Term shall begin on the first day of such Calendar Quarter and end on the last day of the Term. 1.15 “Calendar Year” means each successive period of twelve (12) months commencing on January 1 and ending on December 31; provided, however, that the first Calendar Year of the Term shall begin on the Effective Date and end on December 31 of the then-current Calendar Year and the last Calendar Year of the Term shall begin on the first day of such Calendar Year and end on the last day of the Term. 1.16 “CEOs” means, respectively, [ * ] (or the officer or employee of Merck then serving in a substantially equivalent capacity) or his or her designee and [ * ] (or the officer or employee of SeaGen then serving in a substantially equivalent capacity) or his or her designee, provided that any such designee must have decision-making authority on behalf of the applicable Party. 1.17 “cGCP” or “current Good Clinical Practice” means the applicable then-current standards for clinical activities for pharmaceuticals or biologicals, as set forth in the Act and any regulations or guidance documents promulgated thereunder, as amended from time to time, together with, with respect to work performed in a country other than the United States, any similar standards of good clinical practice as are required by any Regulatory Authority in such country. 1.18 “cGLP” or “current Good Laboratory Practice” means the applicable then- current standards for laboratory activities for pharmaceuticals or biologicals, as set forth in the Act -4- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
and any regulations or guidance documents promulgated thereunder, as amended from time to time, together with, with respect to work performed in a country other than the United States, any similar standards of good laboratory practice as are required by any Regulatory Authority in such country. 1.19 “cGMP” or “current Good Manufacturing Practice” means the applicable then- current standards for conducting Manufacturing activities for pharmaceuticals or biologicals (or active pharmaceutical ingredients) as are required by any applicable Regulatory Authority in the Territory. 1.20 “Change of Control” with respect to a Party, shall be deemed to have occurred if any of the following occurs after the Effective Date: (a) any Third Party “person” or “group” (as such terms are defined below) (i) is or becomes, through one or a series of transactions, the “beneficial owner” (as defined below), directly or indirectly, of the then-outstanding shares of common stock of such Party (or any direct or indirect parent entity or ultimate parent entity of such Party) representing fifty percent (50%) or more of the total then-outstanding common stock (or foreign equivalent thereof) (the “Outstanding Common Stock”), (ii) is or becomes, through one or a series of transactions, the “beneficial owner”, directly or indirectly, of shares of securities, capital stock or other interests (including partnership interests) of such Party (or any direct or indirect parent entity or ultimate parent entity of such Party) then-outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of the directors, managers or similar supervisory positions (“Outstanding Voting Stock”) of such Party (or any direct or indirect parent entity or ultimate parent entity of such Party) representing fifty percent (50%) or more of the total voting power of all Outstanding Voting Stock of such Party (or any direct or indirect parent entity or ultimate parent entity of such Party) or (iii) has the power, directly or indirectly, to elect a majority of the members of the Party’s (or any direct or indirect parent entities or ultimate parent entities of such Party) board of directors (or similar governing body); or (b) such Party (or any direct or indirect parent entity or ultimate parent entity of such Party) enters into a merger, consolidation or similar transaction with a Person (whether or not such Party (or any direct or indirect parent entity or ultimate parent entity of such Party) is the surviving entity) (a “Business Combination”), in each case, unless, following such Business Combination, (i) the individuals and entities who were the beneficial owners, respectively, of the Outstanding Common Stock and Outstanding Voting Stock of such Party (and the ultimate parent entity thereof) immediately prior to such Business Combination beneficially own, directly or indirectly, fifty percent (50%) or more of, respectively, (1) the then-outstanding shares of common stock (or foreign equivalent thereof) and (2) the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, of the corporation or other entity resulting from such Business Combination (and the ultimate parent entity thereof) and (ii) fifty percent (50%) or more of the members of the board of directors (or similar governing body) of the corporation or other entity resulting from such Business Combination (and ultimate parent entity thereof, as applicable) were members of the board of directors (or similar governing body) of such Party (or ultimate parent entity of such Party, as applicable) at the time of the execution of the initial agreement, or became members of the board -5- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
of directors of such corporation or other entity by virtue of the action of the board of directors (or similar governing body) of such Party (or ultimate parent entity), providing for such Business Combination; or (c) such Party (and its Affiliates) sells, exchanges or otherwise transfers to any Third Party, directly or indirectly (including through the transfer of shares (or other ownership interests) in Affiliates), in one or a series of transactions, the properties and assets representing all or substantially all of such Party’s total assets (together with all or substantially all of the properties and assets of its Affiliates). For the purpose of this definition of Change of Control, (x) “person” and “group” have the meanings given such terms under Sections 13(d) and 14(d) of the United States Securities Exchange Act of 1934 and the term “group” includes any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of Rule 13d-5(b)(1) under the aforesaid Act; (y) a “beneficial owner” shall be determined in accordance with Rule 13d-3 under the aforesaid Act; and (z) the terms “beneficially owned” and “beneficially own” shall have meanings correlative to that of “beneficial owner.” 1.21 “China” means the People’s Republic of China[ * ]. 1.22 “Clinical Trial” means a Phase I Clinical Trial, Phase II Clinical Trial, Phase III Clinical Trial or Phase IV Clinical Trial. 1.23 “CMC” means chemistry, manufacturing and controls. 1.24 “CMC Development” means the CMC-related Development activities related to the composition, manufacture, and specification of a Licensed Compound or the Licensed Product intended to assure the proper identification, quality, purity and strength thereof, including test method development and stability testing, process development, process improvements (improving product robustness or manufacturing efficiencies), drug substance development, process qualification, process and method validation, process scale-up, formulation development, delivery system development, QA and QC development. 1.25 “Co-Exclusive” means, as between the licensor Party and the licensee Party, a license that is exclusive to the licensee Party (with the right to grant sublicenses thereof in accordance with Section 2.6.1); provided that the licensor Party reserves full rights for itself to exploit the licensed intellectual property for the licensed purposes (with the right to grant further licenses thereof in accordance with Section 2.6.2). 1.26 “Collaboration Territory” means each of (a) the United States of America, including its territories and possessions (the “US Collaboration Territory”), and (b) (i) the countries within the European Union, (ii) the countries within the European Free Trade Association and (iii) the United Kingdom ((i), (ii) and (iii), collectively, the “European Collaboration Territory”). The countries within the European Collaboration Territory as of the Effective Date are set forth on Schedule 1.26. For clarity, (x) if a given country was a member of the European Union or the European Free Trade Association during the Term, but thereafter is no longer part of the European Union or the European Free Trade Association, as applicable, such -6- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
to those efforts and resources commonly used by such Party (or its Affiliate) for pharmaceutical products owned by it or to which it has rights (and which are not subject to co-development or co- commercialization rights of a Third Party), which product is at a similar stage in its development or product life and is of similar market potential taking into account efficacy, safety, approved labeling, the competitiveness of alternative products (the sale of which such Party and its Affiliates do not profit from) in the marketplace, the patent and other proprietary position of the product, the likelihood of regulatory approval given the Regulatory Authority involved, the profitability of the product including the amounts payable to licensors of patent or other intellectual property rights (but not including any amounts payable to or shared with the other Party or its Affiliates hereunder or under any Ancillary Agreements) and other relevant factors. With respect to Licensed Compounds and the Licensed Product, Commercially Reasonable Efforts shall be determined on a country-by-country basis for a particular Licensed Compound or for the Licensed Product, as applicable, and it is anticipated that the level of effort will be different for different markets, and will change over time, reflecting changes in the status of the applicable Licensed Compound or the Licensed Product and the market(s) involved. 1.33 “Committee” means the Joint Steering Committee (and each Subcommittee of the JSC) and the Intellectual Property Operating Committee. 1.34 “Companion Diagnostic” or “CDx” means (a) a Class III PMA-approved (or foreign equivalent) Biomarker Test that is clinically linked to a Licensed Compound or the Licensed Product to determine its applicability to a specific patient or patient population or (b) any other Biomarker Test for a Licensed Compound or the Licensed Product to determine its applicability to a specific patient or patient population, in each case, that the Parties determine to Develop hereunder pursuant to a Development Plan. 1.35 “Competing Product” means any product containing or comprising, in any form, formulation, presentation or dosage strength, any [ * ]. For clarity, any product containing or comprising [ * ]. For clarity, any product containing or comprising [ * ] are Competing Products. 1.36 “Confidential Information” means any and all confidential or proprietary information and data, including all Merck Know-How, all SeaGen Know-How, and all other scientific, pre-clinical, clinical, regulatory, manufacturing, marketing, financial and commercial information or data, whether communicated in writing or orally or by any other method, which is provided by or on behalf of one Party to the other Party in connection with this Agreement or any Ancillary Agreement. 1.37 “Control”, “Controls” or “Controlled by” means, subject to Section 16.4.2, with respect to any intellectual property right, information, documents or materials, the possession of the right (whether by ownership or license, other than pursuant to this Agreement or any Ancillary Agreement) or the ability of a Party or its Affiliate to grant access to, or a license or sublicense of, such intellectual property right, information, documents or materials as provided for herein without violating any Applicable Law or the terms of any agreement or other arrangement with any Third Party existing at the time such Party would be required hereunder to grant the other Party such access or license or sublicense. -8- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.38 “Corporate Marks” means, (a) in the case of Merck, the corporate Trademarks owned by Merck or its Affiliates as Merck may designate in writing to SeaGen from time to time (each, a “Merck Corporate Xxxx”) and (b) in the case of SeaGen, the corporate Trademarks owned by SeaGen or its Affiliates as SeaGen may designate in writing to Merck from time to time (each, an “SeaGen Corporate Xxxx”), including for the purposes of both clause (a) and (b), any translation or derivation of any of the foregoing, either alone or in combination with other words and all marks, trade dress, logos, monograms, domain name registrations and other source identifiers confusingly similar to or embodying any of the foregoing either alone or in combination with other words. 1.39 “Cost of Goods Manufactured” means the cost to produce a given quantity of Licensed Product by a Party or its Affiliate, as calculated in accordance with Schedule 1.39, including taking into account in such calculation any other capital expenditure, costs and expenses approved as Cost of Goods Manufactured under Section 3.4.2(o). 1.40 “Develop” means (a) to research, develop, analyze, test and conduct non-clinical, preclinical (including GLP Tox Studies), clinical and all other regulatory studies and trials for a Licensed Compound or the Licensed Product, as applicable, including new indications and new combinations, (b) all activities pertaining to CMC Development and formulation development (including new formulations), (c) all other activities related to securing and maintaining Marketing Authorization for a Licensed Compound or the Licensed Product, as applicable, and regulatory activities in connection therewith and (d) medical affairs activities for the Licensed Product. Development may also include the foregoing activities, if any, with respect to any Companion Diagnostic, which activities, if any, shall be set forth in the relevant Development Plan with respect to a Companion Diagnostic for a Licensed Compound or the Licensed Product, as applicable. “Developing” and “Development” shall have correlative meanings. 1.41 “Development Budget” means the budget for the Development of the Licensed Product for the Territory, as set forth in the applicable Development Plan, as the same may be amended from time to time in accordance with this Agreement. 1.42 “Development Costs” means the sum of (a) Development FTE Costs and Medical Affairs FTE Costs and (b) out-of-pocket costs and expenses, incurred by a Party or any of its Affiliates in connection with the Development of a Licensed Compound or the Licensed Product in the Territory, in each case, that are (i) incurred on or after the Effective Date, (ii) incurred as an expense in accordance with the applicable Party’s Accounting Standards of such Party and (iii) directly attributable or reasonably allocable to a Licensed Compound or the Licensed Product for the Territory, including, for clarity, those that are directly attributable or reasonably allocable to the Development of a Proprietary Combination pursuant to this Agreement and the Development Plan (and, for clarity, any such costs associated with the Development of a Proprietary Combination pursuant to this Agreement and the Development Plan shall be fully allocated to the Licensed Product hereunder), including, for example, subject to Section 5.2.6(b), Clinical Trials for a Proprietary Combination to the extent included in the Development Plan). Development Costs shall include: 1.42.1 such costs and expenses that are [ * ] activities for [ * ]; -9- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.42.2 such costs and expenses that are [ * ] activities for [ * ]; 1.42.3 such costs and expenses incurred [ * ], including the cost of [ * ]; 1.42.4 the [ * ] for use in [ * ]; 1.42.5 such costs and expenses for [ * ] such as [ * ]; 1.42.6 such costs and expenses [ * ], including [ * ]; 1.42.7 such costs and expenses [ * ], including [ * ]; 1.42.8 costs and expenses [ * ]; and 1.42.9 any [ * ] as a result of [ * ]. 1.43 “Development Data” means any data generated from Development activities hereunder with respect to a Licensed Compound or the Licensed Product, including from Development of a Proprietary Combination. 1.44 “Development FTE Cost” means, for any period, the Development FTE Rate multiplied by the number of FTEs in such period performing Development activities that are directly attributable or reasonably allocable to the Licensed Product (including for use in a Proprietary Combination) for the Territory. 1.45 “Development FTE Rate” means the rate of [ * ] for one (1) full FTE per full calendar year; provided that, starting January 1, 2021, such rate shall adjust on January 1 of each Calendar Year by [ * ]. Notwithstanding the foregoing, the Parties may mutually agree in writing on alternative Development FTE Rates for the conduct of Development activities in the Territory (which rate may be different for different regions in the Territory). 1.46 “Development Plan” shall have the meaning given to such term in Section 5.2.1 For clarity, each Development Plan shall include a Development Budget. 1.47 “Distributor” means any Third Party(ies) appointed by the Lead Distribution Party or any of its Affiliates (or their respective (sub)licensees) in accordance with the terms of this Agreement to distribute and sell Licensed Product(s), with or without packaging rights, in one or more countries in the Territory, in circumstances where such Third Party purchases its requirements of Licensed Product(s) from such Party or its Affiliates (or their respective sublicensees) but does not otherwise make any royalty or other similar payment to such Party or its Affiliates (or their respective sublicensees) with respect to such Third Party’s sale of such Licensed Product(s). For clarity, a “Distributor” shall not be considered a sublicensee for purposes of this Agreement (even if ancillary licenses are granted to such Distributor for purposes of conducting its activities (specifically, distributing and selling the Licensed Product)). 1.48 “EMA” means the European Medicines Agency and any successor Regulatory Authority having substantially the same function. -10- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.49 “European Free Trade Association” means the organization of the member states of the European Free Trade Association, as it may be constituted from time to time during the Term. 1.50 “European Union” means the organization of member states of the European Union, as it may be constituted from time to time during the Term. 1.51 “FDA” means the United States Food and Drug Administration and any successor Regulatory Authority having substantially the same function. 1.52 “Field” means any and all uses and purposes, including diagnostic, prophylactic and therapeutic uses in humans and animals. 1.53 “Field Force FTE Cost” means, for any period, the Field Force FTE Rate multiplied by the number of field force FTEs in such period conducting Promotional activities for the Licensed Product in accordance with this Agreement (and, in the Collaboration Territory, in accordance with the applicable Promotion Agreement) that are directly attributable or reasonably allocable to conducting such Promotional activities for the Licensed Product (including conducting calls for the Licensed Product, including for use in a Proprietary Combination) for the Territory by a Party’s (or its Affiliate’s) field force, but subject to any further allocation to the Licensed Product as set forth in a Promotion Agreement, as applicable. 1.54 “Field Force FTE Rate” means the rate per FTE for the Territory as set forth in the applicable Commercialization Plan or as otherwise agreed to by the Parties for the conduct of Promotional activities for the Licensed Product in accordance with this Agreement (and the applicable Promotion Agreement, if any) in the Territory by a Party’s (or its Affiliate’s) field force (which rate may be different for different regions in the Territory), as such rate may be adjusted by mutual written agreement of the Parties on an annual basis. If the Parties are unable to agree on the Field Force FTE Rate in a given Commercialization Plan, but have previously agreed to the Field Force FTE Rate in a different Commercialization Plan, then such previously agreed to Field Force FTE Rate shall be used. 1.55 “First Commercial Sale” means, with respect to the Licensed Product in a country, the first sale to a Third Party for end use or consumption of such Licensed Product in such country after receipt of all Marketing Authorizations for such Licensed Product in such country, excluding, however, any sale or other distribution for use in a Clinical Trial. 1.56 “FTE” means the equivalent of the work of one (1) individual employee full time for one (1) full calendar year (consisting of a total of [ * ] hours per calendar year) of work directly related to Development, Promotion or other Commercialization activities under this Agreement. Any person who devotes fewer than [ * ] hours per calendar year shall be treated as an FTE on a pro rata basis based upon the actual number of hours worked divided by [ * ]. 1.57 “GAAP” means accounting principles generally accepted in the United States, consistently applied. -11- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.58 “GLP Tox Study” means a pre-clinical study conducted in a species using applicable cGLP for the purposes of assessing the onset, severity, and duration of toxic effects and their dose dependency with the goal of establishing a safety profile required for a regulatory submission supporting the dosing of human subjects. For the avoidance of doubt, preliminary toxicology studies are not regarded as a GLP Tox Study. 1.59 “Governmental Authority” or “Government” means any United States (federal, state or local) government (or political subdivision thereof), or any foreign government (or political subdivision thereof), or any multinational governmental organization or authority, or any governmental authority, agency or commission, in each case, entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power, any court or tribunal (or any department, bureau or division thereof), or any governmental arbitrator or arbitral body. 1.60 “IAS/IFRS” means International Accounting Standards/International Financial Reporting Standards of the International Accounting Standards Board, consistently applied. 1.61 “Incidence” means, with respect to any type or subtype of cancer (including a separate and distinct tumor type), for the Calendar Year preceding the applicable Calendar Year for which the “Incidence” is being measured, an incidence in the US of over 10,000 patient population (taking into account all stages of the applicable type or subtype) according to the incidence published by the Surveillance, Epidemiology, and End Results (SEER) Program of the National Cancer Institute (xxxxx://xxxx.xxxxxx.xxx/) or its substitute or successor statistic program as agreed to by the Parties, to establish the size of the treatable population in the US. 1.62 “IND” means an investigational new drug application, clinical trial authorization application, or similar application or submission (including any supplements of any of the foregoing) for approval to conduct human clinical investigations of a product filed with or submitted to a Regulatory Authority in conformance with the requirements of such Regulatory Authority. 1.63 [ * ] 1.64 “Initial Merck Proprietary Product” means Merck’s (or its Affiliate’s) product pembrolizumab, a humanized anti-human PD-1 monoclonal antibody, that is primarily marketed as of the Effective Date under the tradename KEYTRUDA®, in any form, formulation, presentation or dosage strength. 1.65 “Initiated” or “Initiation” means, with respect to a Clinical Trial, the administration of the first dose of the Licensed Product being studied to the first human subject in such Clinical Trial. 1.66 “Joint IP Action Costs” means, with respect to the Licensed Product, any costs and expenses which are deemed to be “Joint IP Action Costs” pursuant to Article 12 with respect to such Licensed Product, but only to the extent such costs and expenses are incurred on or after the Effective Date. -12- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.67 “Joint Patent Costs” means any costs and expenses which are deemed to be “Joint Patent Costs” pursuant to Article 12, but only to the extent such costs and expenses are incurred on or after the Effective Date. 1.68 “Joint Program Copyright” means all Program Copyrights other than copyrights in any (a) Merck Proprietary Combination Outside Promotional Materials, Merck Proprietary Combination Outside Other Field-Based Materials, Merck Licensed Product Combination Promotional Materials, Merck Licensed Product Combination Other Field-Based Materials or other content owned by Merck as set forth in Section 12.3.4(a), and (b) SeaGen Proprietary Combination Outside Promotional Materials, SeaGen Proprietary Combination Outside Other Field-Based Materials, SeaGen Licensed Product Combination Promotional Materials, SeaGen Licensed Product Combination Other Field-Based Materials or other content owned by SeaGen as set forth in Section 12.3.4(b). 1.69 “Joint Program Know-How” means all Program Know-How that is not SeaGen Program Know-How or Merck Program Know-How. For clarity, Joint Program Know-How shall include all Program Know-How that (a) specifically relates to the use of or method of using a Licensed Compound or the Licensed Product in any Combination Therapy (including the use of or method of using the Licensed Product with a SeaGen Proprietary Product or Merck Proprietary Product in a Combination Therapy), or (b) relates to a Biomarker Test or Companion Diagnostic (this clause (b) “Biomarker Joint Program Know-How”). 1.70 “Joint Program Patents” means all Patent Rights that claim Joint Program Know- How, but that do not (subject to Section 12.4.3(b)) claim SeaGen Program Know-How or Merck Program Know-How. 1.71 “Joint Trademark Costs” means any costs and expenses that are deemed to be “Joint Trademark Costs” pursuant to Article 12, but only to the extent such costs and expenses are incurred on or after the Effective Date. 1.72 “Know-How” means any and all proprietary or confidential inventions, discoveries, developments, data (including pre-clinical, clinical and regulatory data), information, trade secrets, specifications, formulae, instructions, processes, methods, protocols, expertise and other technology, including any of the foregoing applicable to formulations, compositions or to their manufacture, development, registration, use or marketing or to methods of assaying or testing them, and all biological, chemical, pharmacological, biochemical, toxicological, pharmaceutical, physical and analytical, safety, quality control, and manufacturing data relevant to any of the foregoing. “Know-How” excludes Patent Rights, Trademarks and physical substances. 1.73 “Lead Distribution Party” means (a) with respect to the Licensed Product for sale in the US Collaboration Territory, SeaGen (unless otherwise determined by the JCC), (b) with respect to the Licensed Product for sale in the European Collaboration Territory, SeaGen (unless otherwise determined by the JCC), (c) with respect to the Licensed Product for sale in the SeaGen Territory, SeaGen (unless otherwise determined by the JCC), and (d) with respect to the Licensed Product for sale in the Merck Territory, Merck (unless otherwise determined by the JCC), in each case (a), (b), (c) and (d), except as otherwise expressly set forth in this Agreement. -13- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.74 “Lead Manufacturing Party” means, with respect to the Licensed Product, SeaGen (unless otherwise determined by the JSC or otherwise expressly set forth in this Agreement); provided that (a) where a Party acts as a second source for supply in accordance with Section 7.4.4 or otherwise takes over responsibility for Manufacturing Licensed Product in accordance with this Agreement (or the applicable Ancillary Agreement), and, as such, Manufactures the Licensed Product, such Party shall be the “Lead Manufacturing Party” with respect to the quantities of Licensed Product Manufactured by it and (b) without limiting the foregoing sub-clause (a), certain specific Manufacturing responsibilities for the Licensed Product as set forth in the Manufacturing Plan (e.g., secondary packaging and labeling) may be designated to the other Party, in which case such other Party shall be the “Lead Manufacturing Party” to the extent of such assigned responsibilities as set forth in the Manufacturing Plan. 1.75 “Lead Patent Party” means, (a) SeaGen, with respect to the SeaGen Product- Specific Patents and Joint Program Patents, and (b) Merck, with respect to the Merck Product- Specific Patents, in each case, except as otherwise expressly set forth in this Agreement. 1.76 “Lead Regulatory Party” means, (a) with respect to the Licensed Product in the US Collaboration Territory, SeaGen (unless otherwise determined by the JSC), (b) with respect to the Licensed Product in the European Collaboration Territory, Merck (unless otherwise determined by the JSC), (c) with respect to the Licensed Product in the SeaGen Territory, SeaGen (unless otherwise determined by the JSC), and (d) with respect to the Licensed Product in the Merck Territory, Merck (unless otherwise determined by the JSC), in each case (a), (b), (c) and (d), except as otherwise expressly set forth in this Agreement. 1.77 “Lead Study Party” means, with respect to a given Clinical Trial for the Licensed Product, the Party that is designated by the JSC as the “Lead Study Party” for such Clinical Trial as set forth in the Development Plan, in each case, except as otherwise expressly set forth in this Agreement. 1.78 “Lead Trademark Party” means, with respect to a given country in the Territory, unless otherwise determined by the JCC, the Party that is the “Lead Distribution Party” for such country, as set forth in this Agreement. 1.79 “Licensed Compound” means (a) SGN-LIV-1-A, (b) any Next Generation Compound for which Merck has delivered (or is deemed to have delivered) a Licensed Compound Notice pursuant to Section 2.9.2 or (c) any Acquired Competing Product that the non-Acquiring Competing Product Party elects to include as a “Licensed Compound” pursuant to an offer to do so from the Acquiring Competing Product Party pursuant to Section 2.9.3(c). For clarity, (i) as of the Effective Date, SGN-LIV-1-A is the only Licensed Compound; and (ii) the Parties may Develop one or more Licensed Compounds hereunder at any one time. 1.80 “Licensed Product” means a product containing or comprising a Licensed Compound, in any form, formulation, presentation or dosage strength. For clarity, (a) each Licensed Product containing or comprising the same Licensed Compound, in any form, formulation, presentation or dosage strength, including, for clarity, (i) for monotherapy use or in Combination Therapy with any product (including a Proprietary Product) or (ii) in any Combination Product, shall be considered the same Licensed Product for purposes of this -14- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Agreement [ * ]; provided that, notwithstanding the foregoing, [ * ], (b) Licensed Products shall include Combination Products (in any form, formulation, presentation or dosage strength), and (c) if there is more than one Licensed Compound hereunder (e.g., a Next Generation Compound for which Merck has delivered (or is deemed to have delivered) a Licensed Compound Notice pursuant to Section 2.9.2), then a product containing or comprising a different Licensed Compound (in any form, formulation, presentation or dosage strength) will be considered a different Licensed Product for purposes of this Agreement, but each such product will be deemed to be one of the Licensed Products hereunder. 1.81 “Licensed Product Net Revenues” means, with respect to a given Licensed Product in a given period, the sum of: (a) all Licensed Product Net Sales in such period, and (b) all net sales (calculated in the same manner as the calculation of Licensed Product Net Sales, mutatis mutandis) of such Licensed Product sold in such period to Third Parties for the Territory by each sublicensee (but excluding, for clarity, any Distributor) of each Party (and their respective Affiliates), as reported by the applicable sublicensee, as applicable, to the applicable Party (or its Affiliate), in each case (a) and (b), for such Licensed Product. 1.82 “Licensed Product Net Sales” means, with respect to Licensed Product sold to Third Parties (including to Distributors) for the Territory by a Party or its Affiliates, the gross amount invoiced (not including value added taxes, consumption taxes, sales taxes, or similar taxes) for sales of such Licensed Product for the Territory during a given period during the Term, less the following normal and customary deductions that are related to such Licensed Product sold during the Term and not otherwise deducted in computing other amounts hereunder (without duplication): [ * ] Licensed Product Net Sales shall be determined from the applicable Party’s (or its Affiliate’s) books and records maintained in accordance with the applicable Party’s (or its Affiliate’s) Accounting Standards (in each case, to the extent reasonably practicable when determining amounts at a product level) consistently applied. It is understood that any accruals of amounts reflected in Licensed Product Net Sales shall be periodically (but at least once a Calendar Quarter) trued-up by the Parties consistent with their customary practices and in accordance with the applicable Party’s Accounting Standards (to the extent reasonably practicable when determining amounts at a product level), and Licensed Product Net Sales shall be adjusted to reflect such trued-up amounts. Any of the deductions listed above that involves a payment by a Party or its Affiliates shall be taken as a deduction in the Calendar Quarter in which the payment is accrued by such entity. For purposes of determining Licensed Product Net Sales, a Licensed Product shall be deemed to be sold when invoiced. Notwithstanding the foregoing, a “sale” shall not include transfers or dispositions of such Licensed Product for pre-clinical or clinical purposes or as samples, in each case, without charge. In the event that the Licensed Compound is sold as part of a Combination Product in a country in the Territory, Licensed Product Net Sales for such Combination Product shall be calculated [ * ]. -15- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Subject to the above, Licensed Product Net Sales shall be calculated in accordance with the standard internal policies and procedures of the applicable Party and its Affiliates, which must be in accordance with the Accounting Standards. 1.83 “LIV-1” means [ * ]. 1.84 “Manufacture” or “Manufacturing” means, with respect to a compound or product (including a Licensed Compound and the Licensed Product), the receipt, handling and storage of active pharmaceutical ingredients and other materials, the manufacturing, processing, packaging and labeling, holding (including storage), quality assurance and quality control testing (including release) of such compound or product and shipping of such compound or product. Manufacturing may also include the foregoing activities, if any, with respect to any Companion Diagnostic for a Licensed Compound or the Licensed Product, which activities, if any, shall be set forth in the relevant Manufacturing Plan. 1.85 “Marketing Authorization Application” or “MAA” means a New Drug Application, Biologics License Application, Worldwide Marketing Application, Marketing Authorization Application, filing pursuant to Section 510(k) of the Act, or similar application or submission for Marketing Authorization of a product filed with a Regulatory Authority to obtain marketing approval for such product in that country or in that group of countries, or any supplements to any of the foregoing. 1.86 “Marketing Authorization” means all approvals from the relevant Regulatory Authority necessary to market and sell a product in any country or group of countries. For clarity, with respect to the Licensed Product, Marketing Authorization shall include [ * ]. 1.87 “Medical Affairs FTE Cost” means, for any period, the Medical Affairs FTE Rate multiplied by the number of medical affairs FTEs in such period performing medical affairs activities that are directly attributable or reasonably allocable to the Licensed Product (including for use in a Proprietary Combination) for the Territory. 1.88 “Medical Affairs FTE Rate” means the rate per FTE for the Territory as set forth in the applicable Development Plan or as otherwise agreed to by the Parties for the conduct of medical affairs activities for the Territory (which rate may be different for different regions in the Territory), as such rate may be adjusted by mutual written agreement of the Parties on an annual basis. If the Parties are unable to agree on the Medical Affairs FTE Rate in a given Development Plan, but have previously agreed to the Medical Affairs FTE Rate in a different Development Plan, then such previously agreed to Medical Affairs FTE Rate shall be used. 1.89 “Merck General Know-How” means any Merck Know-How other than Merck Product-Specific Know-How. 1.90 “Merck General Patents” means any Merck Patents other than Merck Product- Specific Patents. 1.91 “Merck Know-How” means all Know-How Controlled by Merck or its Affiliates as of the Effective Date or at any time thereafter until the end of the Term that is necessary or -16- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
reasonably useful for the Development, Manufacture, or Commercialization of any Licensed Compound or the Licensed Product, whether as a monotherapy or for use in any Combination Therapy, or any Companion Diagnostic, and that is either (a) Merck Program Know-How (but excluding, for clarity, Joint Program Know-How), or (b) other Know-How Controlled by Merck that Merck discloses to SeaGen and that the Parties mutually agree to use (through the JDC), and is actually used, in the Development of the Licensed Product under this Agreement (and in accordance with the Development Plan) or any Ancillary Agreement (the Know-How in this clause (b), “Other Merck Contributed Know-How”), but in each case, excluding any Acquiring Person Intellectual Property. 1.92 “Merck Patents” means all Patent Rights Controlled by Merck or its Affiliates as of the Effective Date or at any time thereafter until the end of the Term, that cover or claim, or are otherwise necessary or reasonably useful for the Development, Manufacture or Commercialization of, any Licensed Compound or the Licensed Product, whether as a monotherapy or for use in any Combination Therapy, or any Companion Diagnostic, and that are either (a) Merck Program Patents (but excluding, for clarity, Joint Program Patents), (b) other Patent Rights Controlled by Merck that claim the use or method of using a Merck Proprietary Product in a Merck Proprietary Combination that the Parties have agreed to Develop hereunder pursuant to a Development Plan or (c) other Patent Rights Controlled by Merck that claim the Other Merck Contributed Know- How; but in each case, excluding any Acquiring Person Intellectual Property. 1.93 “Merck Product-Specific Know-How” means all [ * ] Know-How that is[ * ], but excluding [ * ]. 1.94 “Merck Product-Specific Patents” means all [ * ] Patents that claim or cover (a) [ * ], or (b) any [ * ]; but excluding (in each case (a) and (b)) any [ * ] Patents that claim or cover [ * ]. 1.95 “Merck Program Know-How” means (a) all [ * ] Know-How [ * ] that is [ * ] but, for clarity, not (i) [ * ] or (ii) [ * ] (this clause (a), a “Merck Proprietary Product Program Invention”) and (b) all [ * ] Know-How that is [ * ]. 1.96 “Merck Program Patents” means all Patent Rights that claim Merck Program Know-How and do not claim SeaGen Program Know-How or Joint Program Know-How. 1.97 “Merck Proprietary Combination” means a Proprietary Combination in which a Merck Proprietary Product is the Proprietary Product. For clarity, the Proprietary Combination of the Licensed Product and the Initial Merck Proprietary Product shall be a Merck Proprietary Combination for purposes of this Agreement. 1.98 “Merck Proprietary Combination Xxxx” means the Trademarks, if any, jointly developed and agreed to by the Parties that combines a Merck Proprietary Product Xxxx and a Collaboration Xxxx for use in connection with the Merck Proprietary Combination as permitted in the Agreement. -17- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
1.99 “Merck Proprietary Product” means any product that is owned by, or exclusively or co-exclusively licensed to Merck, or any of its Affiliates, including the Initial Merck Proprietary Product, but not including any Licensed Compound or the Licensed Product. 1.100 “Merck Proprietary Product Marks” means the Trademarks of Merck or its Affiliates with respect to any Merck Proprietary Product for use in a Merck Proprietary Combination, which Merck shall designate in writing to SeaGen from time to time. 1.101 “Merck Supply Agreement” means any and all supply agreements (including related quality agreements) entered into by the Parties (or their respective Affiliates) with respect to the Manufacture and supply of Licensed Product by or on behalf of Merck (or its Affiliate) to SeaGen (or its Affiliate) for use in the Commercialization of such Licensed Product in accordance with this Agreement. Each such Merck Supply Agreement for supply shall be on terms to be mutually agreed to by the Parties in good faith. 1.102 “Merck Technology” means the Merck Patents, Merck Know-How and Merck’s (and its Affiliates’) interest in the Joint Program Patents and Joint Program Know-How. 1.103 “Merck Territory” means those portions of the Territory other than the Collaboration Territory and the SeaGen Territory. 1.104 [ * ] 1.105 “Ongoing Clinical Trials” means all Clinical Trials of the Licensed Product that have been Initiated and are ongoing by SeaGen as of the Effective Date (and are included in the Initial Development Plan (and related initial Development Budget)) [ * ]. For clarity, with respect to such Clinical Trials, (x) updates to the protocol for any such Clinical Trial are subject to the approval of the JDC in accordance with Sections 3.3.2(d) and 5.4.1; and (y) any amendment to the Development Plan (and related Development Budget) with respect thereto are subject to the approval of the JSC in accordance with Section 3.2.3(e). 1.106 “Other Field-Based Materials” means, with respect to the Licensed Product, all written, printed, electronic or graphic field-based materials [ * ] used by or on behalf of (a) either or both Parties in the Collaboration Territory, (b) SeaGen in the SeaGen Territory, or (c) Merck in the Merck Territory; in each case ((a), (b) and (c)), [ * ] for the Licensed Product (including for use as a monotherapy or in any Combination Therapy) conducted hereunder. 1.107 “Patent Rights” means any and all patents and patent applications (which for the purpose of this Agreement shall be deemed to include certificates of invention and applications for certificates of invention), including divisionals, continuations, continuations-in-part, reissues, renewals, substitutions, registrations, re-examinations, revalidations, extensions, supplementary protection certificates and the like of any such patents and patent applications, and any and all foreign equivalents of the foregoing. 1.108 “Person” means an individual, Governmental Authority, Public Official, corporation, partnership, limited liability company, trust, business trust, association, joint stock -18- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
company, joint venture, pool, syndicate, sole proprietorship, unincorporated organization or any other form of entity not specifically listed herein. 1.109 “Phase I Clinical Trial” means a human clinical trial in any country that would satisfy the requirements of 21 C.F.R. § 312.21(a). 1.110 “Phase II Clinical Trial” means a human clinical trial in any country that would satisfy the requirements of 21 C.F.R. § 312.21(b). 1.111 “Phase III Clinical Trial” means a human clinical trial in any country that would satisfy the requirements of 21 C.F.R. § 312.21(c). 1.112 “Phase IV Clinical Trial” means any human clinical trial (other than a Phase I Clinical Trial, Phase II Clinical Trial or Phase III Clinical Trial) in any country that is conducted on the Licensed Product for an indication in the Field after Marketing Authorization of the Licensed Product has been obtained from an appropriate Regulatory Authority in such country for such indication. 1.113 [ * ] 1.114 “Pricing Approval” means, with respect to any country or jurisdiction in which one or more Governmental Authorities determine or approve the pricing at which the Licensed Product will be charged to, or reimbursed by, public or private payors, the approval, agreement, determination or decision by such applicable Governmental Authority(ies) establishing the pricing and reimbursement status for such Licensed Product for any such payor or group of payors. 1.115 “Product Liability” means any liability in respect of any personal injury or death (or risk of personal injury or death) arising from, relating to or otherwise in respect of, the use or ingestion of, or exposure to, a product (including as a result of participating in a Clinical Trial), whether based on negligence, strict product liability or any other product liability theory. 1.116 “Program Copyright” means copyright in Promotional Materials (and other content) created in connection with the Development, Manufacturing and Commercialization of the Licensed Product (a) by or on behalf of a Party or its Affiliate or sublicensee in the conduct of activities under this Agreement or any Ancillary Agreement, or (b) jointly by or on behalf of the Parties or their respective Affiliates or sublicensees in the conduct of activities under this Agreement or any Ancillary Agreement. 1.117 “Program Know-How” means any and all Know-How (including Development Data) conceived, developed, generated or reduced to practice during the Term (a) by or on behalf of a Party or its Affiliate or sublicensee in the conduct of activities under this Agreement or any Ancillary Agreement, or (b) jointly by or on behalf of the Parties or their respective Affiliates or sublicensees in the conduct of activities under this Agreement or any Ancillary Agreement. For clarity, notwithstanding anything to the contrary, any and all Know-How conceived, developed, generated or reduced to practice by or on behalf of SeaGen or its Affiliates or sublicensees in the conduct of pre-clinical development activities under Section 2.9.2 with respect to Next Generation Compounds prior to Merck delivering a Licensed Compound Notice with respect to the applicable -19- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Next Generation Compound (which activities shall, for purposes of the definition of SeaGen Linker Technology at Section 1.138, be independent of the activities under this Agreement) (i) shall be solely owned by SeaGen; (ii) shall not be Program Know-How for purposes of this Agreement; and (iii) with effect from and after delivery (or deemed delivery) of a Licensed Compound Notice (if any) from Merck pursuant to Section 2.9.2, will be SeaGen Know-How for purposes of this Agreement. 1.118 “Program Patents” means the Merck Program Patents, SeaGen Program Patents and Joint Program Patents. 1.119 “Promote” means, with respect to a given country in the Territory, any activities undertaken by Merck (or its Affiliates) or SeaGen (or its Affiliates) in such country, or by both Merck (or its Affiliates) and SeaGen (or its Affiliates) in such country jointly (such joint activities in a given country, “Co-Promotion”), in each case, aimed at encouraging the use of the Licensed Product in such country, including marketing, promoting, conducting calls and details, contract administration, key account management, advertising (including educating, speaking programs and promotional symposia), but excluding any Distribution activities, Manufacturing activities or Development activities. “Promotion” shall have a correlative meaning. 1.120 “Promotion FTE Cost” means, for any period, the Promotion FTE Rate multiplied by the number of FTEs in such period performing Promotion activities that are directly attributable or reasonably allocable to the Licensed Product (including for use in a Proprietary Combination) for the Territory, but subject to any further allocation to the Licensed Product as set forth in a Promotion Agreement, as applicable. For the avoidance of doubt, Promotion FTE Costs shall exclude Field Force FTE Costs. 1.121 “Promotion FTE Rate” means the rate per FTE for the Territory as set forth in the applicable Commercialization Plan or otherwise agreed to by the Parties for the conduct of Promotion for the Territory (which rate may be different for different regions in the Territory), as such rate may be adjusted by mutual written agreement of the Parties on an annual basis. If the Parties are unable to agree on the Promotion FTE Rate in a given Commercialization Plan, but have previously agreed to the Promotion FTE Rate in a different Commercialization Plan, then such previously agreed to Promotion FTE Rate shall be used. 1.122 “Promotional Materials” means, with respect to the Licensed Product, all written, printed, electronic or graphic material (including the content of Licensed Product specific websites) used (a) by or on behalf of either or both Parties in connection with the Promotion of the Licensed Product in the Collaboration Territory conducted hereunder, (b) by or on behalf of SeaGen in connection with the Promotion of the Licensed Product in the SeaGen Territory conducted hereunder, or (c) by or on behalf Merck in connection with the Promotion of the Licensed Product in the Merck Territory conducted hereunder. Promotional Materials may include such materials for use in connection with the Promotion of the Licensed Product in a Proprietary Combination. 1.123 “Proprietary Combination” means any Combination Therapy of the Licensed Product and one or more Proprietary Product(s) as Developed by the Parties pursuant to a Development Plan following addition of such Proprietary Combination to the Development Plan -20- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
by approval of the JSC under Section 5.2.4(b) (provided that, for clarity, the Proprietary Combination of the Licensed Product and the Initial Merck Proprietary Product shall be a Proprietary Combination for purposes of this Agreement and shall not require approval by the JSC under Section 5.2.4(b)). 1.124 “Proprietary Product Party” means, with respect to a Proprietary Combination, the Party that owns or controls the Proprietary Product used in such Proprietary Combination; specifically: (a) in the case of a Merck Proprietary Combination, Merck; and (b) in the case of a SeaGen Proprietary Combination, SeaGen. 1.125 “Proprietary Product” means any SeaGen Proprietary Product or Merck Proprietary Product that the Parties agree, via the JSC under Section 5.2.4(b), to Develop pursuant to this Agreement for use in a Proprietary Combination. 1.126 “Proprietary Triple Combination Therapy” means any Combination Therapy involving the use of the Licensed Product, a Merck Proprietary Product and a SeaGen Proprietary Product, as Developed by the Parties pursuant to a Development Plan following addition of such Combination Therapy to the Development Plan by approval of the JSC under Section 5.2.4(b). 1.127 “Public Official” means (i) any officer, employee or representative of any regional, federal, state, provincial, county or municipal government or government department, agency or other division; (ii) any officer, employee or representative of any commercial enterprise that is owned or controlled by a government, including any state-owned or controlled veterinary, laboratory or medical facility; (iii) any officer, employee or representative of any public international organization, such as the African Union, the International Monetary Fund, the United Nations or the World Bank; and (iv) any person acting in an official capacity for any government or government entity, enterprise or organization identified above. 1.128 “Regulatory Authority” means any applicable Governmental Authority involved in granting approvals (including Pricing Approvals) for the manufacturing, development or marketing of a product (including the Licensed Product), including Marketing Authorizations therefor, in the Territory. 1.129 “Regulatory Documentation” means, with respect to a Licensed Compound or the Licensed Product, all submissions, documents and other correspondence submitted to applicable Regulatory Authorities in connection with the Development, Manufacture or Commercialization thereof, including INDs, XXXx and Marketing Authorizations (including product labeling and in connection with Pricing Approvals and health technology assessments) and the US Certificate of Pharmaceutical Product, and amendments and supplements thereto. 1.130 “Related Party” means, as applicable, (a) each of Merck and its Affiliates and their respective sublicensees (which term does not include Distributors) and (b) each of SeaGen and its Affiliates and their respective sublicensees (which term does not include Distributors). 1.131 “Safety Issue” means, with respect to the Licensed Product, that (a) a Regulatory Authority or safety data review board for a Clinical Trial of such Licensed Product has required termination or suspension of a Clinical Trial of such Licensed Product, (b) a Party reasonably -21- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
believes in good faith that (i) the Initiation of a Clinical Trial of such Licensed Product is not warranted, or (ii) termination or suspension of a Clinical Trial of such Licensed Product is warranted, in each case because of a material safety concern with respect to the use of such Licensed Product in such Clinical Trial; provided that such Party has provided reasonable evidence to the other Party documenting such material safety concern, or (c) a Party reasonably believes in good faith that the continued Commercialization of such marketed Licensed Product poses a material safety concern; provided that such Party has provided reasonable evidence to the other Party documenting such material safety concern. 1.132 “Sales and Marketing Expenses” means, for the Licensed Product, those costs and expenses (other than those deducted as part of the calculation of Licensed Product Net Sales) incurred by a Party or its Affiliates that are directly attributable or reasonably allocable to the market development or Promotion of such Licensed Product for the Territory consistent with the Commercialization Plan, whether before or after the First Commercial Sale of such Licensed Product. Sales and Marketing Expenses shall include: [ * ] for the [ * ] under the [ * ], including [ * ] to a [ * ] related to [ * ] and other [ * ], and [ * ] with [ * ] and [ * ] in connection with the [ * ] in connection with the [ * ] related to [ * ] and [ * ] that directly relate to the [ * ]. Sales and Marketing Expenses will specifically [ * ] for any of the [ * ] associated with [ * ] for the [ * ] without being [ * ] (other than the [ * ] that such [ * ] in this [ * ] and such other [ * ] where the applicable [ * ] and such other [ * ] with the [ * ] to this Agreement [ * ] shall be [ * ] to the [ * ] to the [ * ] are set forth in the [ * ] and in [ * ]. Sales and Marketing Expenses will also specifically exclude [ * ] such as [ * ] to the [ * ], and [ * ]. 1.133 “SeaGen Existing CMO Agreements” means those contract manufacturing agreements between SeaGen or its Affiliate and a Third Party set forth on Schedule 1.133. 1.134 “SeaGen Existing In-Licenses” means those license agreements between SeaGen or its Affiliate and a Third Party set forth on Schedule 1.134. 1.135 “SeaGen General Know-How” means any SeaGen Know-How other than SeaGen Product-Specific Know-How. 1.136 “SeaGen General Patents” means any SeaGen Patents other than SeaGen Product- Specific Patents. 1.137 “SeaGen Know-How” means all Know-How Controlled by SeaGen or its Affiliates as of the Effective Date or at any time thereafter until the end of the Term that is necessary or reasonably useful for the Development, Manufacture, or Commercialization of any Licensed Compound or the Licensed Product, whether as a monotherapy or for use in any Combination Therapy, or any Companion Diagnostic, (a) including the SeaGen Program Know- How (but excluding, for clarity, Joint Program Know-How), but (b) excluding any Acquiring Person Intellectual Property. 1.138 “SeaGen Linker Technology” means, [ * ]. 1.139 “SeaGen Patents” means all Patent Rights Controlled by SeaGen or its Affiliates as of the Effective Date or at any time thereafter until the end of the Term, that cover or claim, or -22- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
are otherwise necessary or reasonably useful for, the Development, Manufacture or Commercialization of, any Licensed Compound or the Licensed Product, whether as a monotherapy or for use in any Combination Therapy, or any Companion Diagnostic, (a) including all SeaGen Program Patents (but excluding, for clarity, Joint Program Patents), but (b) excluding any Acquiring Person Intellectual Property. The SeaGen Patents as of the Effective Date include those set forth on Schedule 1.139; provided that with respect to the SeaGen Linker Technology, Schedule 1.139 lists only those SeaGen Patents within the SeaGen Linker Technology that are relevant to SGN-LIV-1-A; provided further that SeaGen will update Schedule 1.139 to list SeaGen Patents within the SeaGen Linker Technology that are relevant to SGN-LIV-1-B, SGN-LIV-1-C or any other Next Generation Compound, respectively, upon Merck’s delivery (or deemed delivery) of a Licensed Compound Notice with respect thereto pursuant to Section 2.9.2. 1.140 “SeaGen Product-Specific Know-How” means all [ * ] Know-How that is [ * ], but excluding (a) any [ * ] (“SeaGen Linker Product-Specific Know-How”), and (b) any [ * ]. 1.141 “SeaGen Product-Specific Patents” means all [ * ] Patents that claim or cover (i) [ * ], or (ii) [ * ]; but excluding (in each case (i) and (ii)) (a) any [ * ] Patents that claim or cover [ * ] (“SeaGen Linker Product-Specific Patents”), and (b) s[ * ] Patents that claim or cover [ * ]. 1.142 “SeaGen Program Know-How” means (a) all [ * ] Know-How [ * ] but, for clarity, not (i) [ * ] or (ii) [ * ] (this clause (a), a “SeaGen Proprietary Product Program Invention”), and (b) all [ * ] Know-How that is [ * ]. 1.143 “SeaGen Program Patents” means all Patent Rights that claim SeaGen Program Know-How and do not claim Merck Program Know-How or Joint Program Know-How. 1.144 “SeaGen Proprietary Combination” means a Proprietary Combination in which a SeaGen Proprietary Product is the Proprietary Product. 1.145 “SeaGen Proprietary Combination Xxxx” means the Trademarks, if any, jointly developed and agreed to by the Parties that combines a SeaGen Proprietary Product Xxxx and a Collaboration Xxxx for use in connection with the SeaGen Proprietary Combination as permitted in the Agreement. 1.146 “SeaGen Proprietary Product” means any product that is owned by, or exclusively or co-exclusively licensed to, SeaGen or any of its Affiliates, including SeaGen’s (or its Affiliate’s) product known as [ * ], but not including any Licensed Compound (or Next Generation Compound) or the Licensed Product. 1.147 “SeaGen Proprietary Product Marks” means the Trademarks of SeaGen or its Affiliates with respect to any SeaGen Proprietary Product for use in a SeaGen Proprietary Combination, which SeaGen shall designate in writing to Merck from time to time. 1.148 “SeaGen Supply Agreement” means any and all supply agreements (including related quality agreements) entered into by the Parties (or their respective Affiliates) with respect to the Manufacture and supply of Licensed Product by or on behalf of SeaGen (or its Affiliate) to Merck (or its Affiliate) for use in the Development and Commercialization of such Licensed -23- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Product in accordance with this Agreement. Each such SeaGen Supply Agreement for supply shall be on terms to be mutually agreed to by the Parties in good faith. 1.149 “SeaGen Technology” means the SeaGen Patents, SeaGen Know-How and SeaGen’s (and its Affiliates’) interest in the Joint Program Patents and Joint Program Know-How. 1.150 “SeaGen Territory” means Canada. 1.151 “Senior Executives” means, (a) with respect to Merck, (i) the [ * ], (ii) the [ * ], (iii) the [ * ] or (v) the [ * ] (or, in each case of (a)(i), (ii), (iii), (iv) or (v), as applicable, a person in an equivalent position at Merck), as the case may be and depending on the nature of the dispute at issue, and (b) with respect to SeaGen, (i) the Chief Medical Officer, (ii) the Executive Vice President, Commercial, (iii) the Chief Technical Officer or (iv) the Senior Vice President, Intellectual Property (or, in each case of (b)(i), (ii), (iii) or (iv), as applicable, a person in an equivalent position at SeaGen), as the case may be and depending on the nature of the dispute at issue. 1.152 “SGN-LIV-1-A” means [ * ]. 1.153 “SGN-LIV-1-B” means [ * ]. 1.154 “SGN-LIV-1-C” means [ * ]. 1.155 “Subcommittees” means the JDC, JMC, JCC, the JFC and any other subcommittee of the JSC (but excluding, for clarity, the JSC itself) formed in accordance with Article 3. For clarity, the IPOC shall not be a Subcommittee. 1.156 “Sublicensee Revenues” means, with respect to the Licensed Product for the Territory, any payments (net of any VAT on such payments and any withholding tax deducted from such payments that cannot be claimed as a credit or otherwise utilized by a Party or its Affiliates) received by a Party or any its Affiliates during the Term from its or their respective Third Party (sub)licensee(s) or Distributors [ * ] for the [ * ], to the [ * ] to the [ * ] in the [ * ] or the [ * ] in the [ * ]; provided that Sublicensee Revenues shall exclude any amounts included in Licensed Product Net Sales. Notwithstanding the foregoing, the following shall apply: 1.156.1if the applicable agreement giving rise to Sublicensee Revenues includes (i) products other than the applicable Licensed Product (including any Proprietary Product), or (ii) intellectual property other than intellectual property covering or claiming the applicable Licensed Product, the Parties shall mutually agree upon a fair and reasonable allocation of the Sublicensee Revenues to the Licensed Product for the Territory, and in the event that the Parties are unable to agree, the dispute shall be resolved pursuant to Section 16.8; 1.156.2 in the case where Licensed Compound is sold as part of a Combination Product, Sublicensee Revenues for such Combination Product shall be calculated as mutually determined by the Parties prior to the time the Development commences in relation to such Combination Product in order to allocate the Sublicensee Revenues between the Licensed -24- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Definition: Section: “Acquired Competing Product” 2.9.3 “Acquiring Competing Product Party” 2.9.3 “Acquiring Person Intellectual Property” 16.4.2(a) “Acquiror PDx Product” 16.4.2(b) “Actual COGS” 7.4.5(a) “Agreement” Preamble “Alliance Manager” 3.9.1 “Anti-Corruption Laws” 8.1.5(a) “Applicable Percentage” 14.7.6(a)(i) [ * ] [ * ] “Bankruptcy Party” 14.5.1 “BBA” 15.3 “Biomarker Joint Program Know-How” 1.69 “Biosimilar Application” 12.10.3(b) “Business Combination” 1.20(b) [ * ] [ * ] [ * ] [ * ] “CMO Recovered Amounts” 13.3.3(c) “Code” 15.3 “Collaboration Marks” 12.12.1 “Commercial Milestone Event” 10.3.1 “Commercial Milestone Payment” 10.3.1 “Commercialization Cost Report” 10.4.2(a) “Commercialization Guidelines”` 3.5.2(b) “Commercialization Plan” 6.2.1 “Competitive Infringement” 12.10.1 “Continuing Party” 14.7.6(a)(ii) “Continuing Payment Term” 14.7.6(a)(iii) “Continuing Product” 14.7.6(a)(iv) “Continuing Product Payments” 14.7.6(a) “Controlling Party” 12.10.3(a)(i) “Co-Promotion” 1.119 “Core Data Sheet” 5.5.1(b) “Cost Reconciliation Report” 10.4.2(b) “Cost Reports” 10.4.2(a) “CTC” Recitals “Data Protection Laws” 1.11 “Development Cost Report” 10.4.2(a) “Development Milestone Event” 10.2.1 “Development Milestone Payment” 10.2.1 “Development Plan” 5.2.1 “Dispute” 16.8.1 “Distribution” 6.4.1 -27- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Definition: Section: “DPA” 8.3.2 “Effective Date” Preamble “Electronic Delivery” 16.18 “Estimated COGS” 7.4.5(a) “European Collaboration Territory” 1.26 “European Collaboration Territory Distribution 6.4.3 Agreement” “Excluded Claim” 16.8.2(e) “Exclusions Lists” 1.164 “Existing CDA” 16.9 “Existing DPA” 8.3.2 “Existing PDx Combination Trial” 16.4.2(b)(ii) “Existing Regulatory Materials” 4.2.2 “Existing SeaGen CMO” 7.7.2 “Financial Manager” 3.6.1 “Force Majeure” 16.3 “Global Publication Strategy” 3.3.2(a) [ * ] [ * ] “Indemnified Party” 13.5.1 “Indemnifying Party” 13.5.1 “Independent Patent Counsel” 12.5.1(b) “Infringement Action” 12.10.2(a) “Initial Commercialization Plan” 6.2.2 “Initial Development Plan” 5.2.2 “Initial Manufacturing Plan” 7.2.1 “Insolvency Event” 14.5.1 “Interim Permitted Competing Activities” 2.9.4 “IPOC” 12.1.1 “JCC” or “Joint Commercialization Committee” 3.5.1 “JDC” or “Joint Development Committee” 3.3.1 “JFC” or “Joint Finance Committee” 3.6.2 “JMC” or “Joint Manufacturing Committee” 3.4.1 “Joint Other Field-Based Materials” 6.5.2(a) “Joint Promotional Materials” 6.5.2(a) “JSC” or “Joint Steering Committee” 3.2.1 “Licensed Compound Notice” 2.9.2 “Licensee Party” 2.5.1 “Licensor Party” 2.5.1 [ * ] [ * ] “Losses” 13.1 “Manufacturing Data” 7.1.1 “Manufacturing Plan” 7.1.1 “MCI” 5.2.4(d) -28- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Definition: Section: “Merck” Preamble “Merck Agreements” 11.5.3 [ * ] [ * ] “Merck Collaboration Xxxx” 12.12.1 “Merck Continuing Combinations” 14.7.7 “Merck Corporate Xxxx” 1.38 “Merck Indemnified Parties” 13.1 “Merck Licensed Product Combination Other Field- 6.5.3(a) Based Materials” “Merck Licensed Product Combination Promotional 6.5.3(a) Materials” [ * ] [ * ] “Merck Proprietary Combination Outside Other Field- 6.5.4(a) Based Materials” “Merck Proprietary Combination Outside Promotional 6.5.4(a) Materials” “Merck Proprietary Product Program Invention” 1.95 “Milestone Event” 10.3.1 “Milestone Payment” 10.3.1 “Next Generation Compound” 2.9.2 “Next Generation Compound Notice” 2.9.2 [ * ] [ * ] “Non-Controlling Party” 12.10.3(a)(i) “Ongoing Merck Proprietary Combination Trial” 14.7.4 “Other Field-Based Materials Guidelines” 3.3.2(k) “Other Merck Contributed Know-How” 1.91 “Outstanding Common Stock” 1.20(a) “Outstanding Voting Stock” 1.20(a) “Patent Listings” 12.9.1(a) “Patent Term Extension” 12.5.1 “Party” or “Parties” Preamble “Payee” 10.7.2 “Paying Party” 10.7.2 [ * ] [ * ] “Permitted Commercialization Overage” 6.2.6(b) “Permitted Development Overage” 5.2.6(c) “Personal Data” 8.3.1 “Pharmacovigilance Agreement” 5.5.7(a) [ * ] [ * ] [ * ] [ * ] [ * ] [ * ] “Pricing Guidelines” 3.5.2(g) “Promotion” 1.120 -29- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Definition: Section: “Promotion Agreement” 6.6.1(b) “Promotional Materials Guidelines” 3.5.2(c) “Proprietary Product Regulatory Documentation” 5.5.5(a) “Recall” 6.8.1(a) [ * ] [ * ] “Recalling Party” 6.8.1(b) “Recoupment Amount” 14.7.6(a)(v) “Regional Commercialization Sub-Plan” 6.2.4 “Regulatory Agreement” 5.5.8 “Regulatory Plan” 5.5.2(a) “Relevant Infringement IP” 12.10.2(a)(i) “Relevant Linker Infringement IP” 12.10.2(a)(i) “Restricted Employee” 11.6 “Revenue Reconciliation Report” 10.4.2(d) “Revenue Report” 10.4.2(c) “Reversion Product” 14.7.5(e) “SeaGen” Preamble “SeaGen Acquiror” 16.4.2(b) “SeaGen Agreements” 11.4.3 [ * ] [ * ] “SeaGen Combo Patent” 2.2.3 “SeaGen Continuing Combinations” 14.7.5(e) “SeaGen Collaboration Xxxx” 12.12.1 “SeaGen Corporate Xxxx” 1.38 “SeaGen Disclosure Schedules” 11.2 “SeaGen Indemnified Parties” 13.2 “SeaGen Licensed Product Combination Other Field- 6.5.3(b) Based Materials” “SeaGen Licensed Product Combination Promotional 6.5.3(b) Materials” “SeaGen Linker Product-Specific Know-How” 1.140 “SeaGen Linker Product-Specific Patents” 1.141 [ * ] [ * ] [ * ] [ * ] [ * ] [ * ] “SeaGen Product-Specific Technology” 11.2.3 “SeaGen Proprietary Combination Outside Other 6.5.4(b) Field-Based Materials” “SeaGen Proprietary Combination Outside 6.5.4(b) Promotional Materials” “SeaGen Proprietary Product Program Invention” 1.142 “Sensitive Information” 16.4.2(b)(i) [ * ] [ * ] -30- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Definition: Section: [ * ] [ * ] [ * ] [ * ] “Shared Liability Action” 13.3.1(a) [ * ] [ * ] “Soliciting Party” 11.6 “Tax Partnership” 15.1 “Term” 14.1 [ * ] [ * ] “Trademark Clearance Party” 12.12.1 “Transition Lead” 4.2.3 “Transition Plan” 4.2.3 [ * ] [ * ] [ * ] [ * ] “US Collaboration Territory” 1.26 ARTICLE 2 OVERVIEW OF COLLABORATION; LICENSE GRANTS 2.1 Overview of Collaboration. The Parties intend and have agreed to undertake a collaboration under this Agreement to Develop and Manufacture the Licensed Compounds, and Develop, Manufacture and Commercialize the Licensed Product, including as a monotherapy as well as for use in any Combination Therapy, in each case, as more particularly described herein. 2.2 License Grants to Merck. Subject to the terms and conditions of this Agreement, the following shall apply: 2.2.1 Grants under SeaGen Technology for use with the Licensed Compounds and the Licensed Product. SeaGen shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to Merck a Co-Exclusive (with SeaGen and its Affiliates) right and license, with the right to grant sublicenses through multiple tiers (subject to Section 2.6), under the SeaGen Technology to research, develop (including Develop), make (including Manufacture), have made (including have Manufactured), import, use, sell and offer to sell (including Commercialize) and otherwise exploit the Licensed Compounds and the Licensed Product, whether as a monotherapy or for use in any Combination Therapy, and any Companion Diagnostic, in the Field in the Territory in accordance with this Agreement, which license shall be payment-bearing pursuant to Section 10.4.2 during the Term with respect to the Licensed Product. For clarity, the foregoing license grant, with respect to the Licensed Product for use in a Combination Therapy or Combination Products, as applicable, or any Companion Diagnostic, only extends to those Combination Therapies and Combination Products and Companion Diagnostics, in each case, that the Parties have mutually agreed, via the JSC, to Develop pursuant to a Development Plan. In particular, the foregoing license grant, with respect to the Licensed Product for use in a Combination Therapy with any SeaGen Proprietary Product, is only for use with those SeaGen Proprietary Combinations that the Parties have mutually agreed, via the JSC, to Develop pursuant to a Development Plan, and, in such case, (a) is limited to the right for Merck and (subject to Section 2.6) its Affiliates and sublicensees to (i) conduct those -31- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Development activities for the applicable SeaGen Proprietary Combination that are assigned to Merck pursuant to a Development Plan, including, as applicable, if Merck is the Lead Regulatory Party, submitting Regulatory Documentation for a label indication for the Licensed Product for use in the SeaGen Proprietary Combination, and (ii) Promote and otherwise Commercialize the Licensed Product for use in the SeaGen Proprietary Combination, in each case ((i) and (ii)), solely in accordance with this Agreement, and (b) excludes the right for Merck and its Affiliates and sublicensees to (i) Develop any SeaGen Proprietary Product (other than the Development of the use of a SeaGen Proprietary Product in the corresponding SeaGen Proprietary Combination in accordance with the Development Plan and this Agreement), or (ii) Manufacture, Promote or otherwise Commercialize any SeaGen Proprietary Product (other than the Promotion or other Commercialization of the Licensed Product for use in the applicable SeaGen Proprietary Combination in accordance with this Agreement). In addition, SeaGen shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to Merck a right of reference to any INDs, XXXx, Marketing Authorizations and other Regulatory Documentation for the Licensed Product that are Controlled by SeaGen or any of its Affiliates, which right of reference shall be solely for use in connection with Merck and its Affiliates’ and sublicensees’ Development, Manufacture and Commercialization of the Licensed Product, including as a monotherapy as well as for use in any Combination Therapy, in the Field for the Territory in accordance with this Agreement. At the request of Merck, SeaGen shall provide to Merck a cross-reference letter or similar communication to the applicable Governmental Authority to effectuate such right of reference. 2.2.2 Grant under SeaGen Corporate Marks, SeaGen Collaboration Marks and SeaGen Proprietary Product Marks for use with the Licensed Product. SeaGen shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to Merck a fully-paid, royalty-free right and license (which license shall be (x) non- exclusive with respect to the SeaGen Corporate Marks and SeaGen Proprietary Product Marks, and (y) Co-Exclusive (with SeaGen and its Affiliates) with respect to the SeaGen Collaboration Marks), with the right to grant sublicenses through multiple tiers (subject to Section 2.6), to use (a) the SeaGen Corporate Marks, the SeaGen Collaboration Marks and the SeaGen Proprietary Product Marks in Promotional Materials and Other Field-Based Materials for the Licensed Product, (b) the SeaGen Collaboration Marks in the packaging and labeling for the Licensed Product, and (c) any Program Copyright owned by SeaGen or its Affiliate, in each case of (a), (b) and (c), solely for the purposes of Promoting and otherwise Commercializing the Licensed Product in the Field in the Territory (including Promoting the Licensed Product for use in any Combination Therapy or Combination Product, or with any Companion Diagnostic, in each case, that the Parties have mutually agreed, via the JSC, to Develop pursuant to a Development Plan), in all cases solely in accordance with this Agreement (provided, however, that notwithstanding the foregoing, (i) the SeaGen Proprietary Product Marks and (ii) any Program Copyrights for the SeaGen Proprietary Combinations, may only be used for Promoting and otherwise Commercializing the Licensed Product solely for use in the applicable SeaGen Proprietary Combination in accordance with this Agreement and as approved by SeaGen); provided that such rights shall be exercised in accordance with the Promotional Materials Guidelines and Other Field-Based Materials Guidelines and, with respect to the SeaGen Corporate Marks and SeaGen Proprietary Product Marks, SeaGen quality standards and branding guidelines established by SeaGen (which are consistently applied) as notified by SeaGen to Merck from time to time. In all cases, SeaGen or its Affiliate shall remain -32- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
the owner of the SeaGen Corporate Marks, SeaGen Collaboration Marks and SeaGen Proprietary Product Marks (and of all trademark rights therein and all trademark registrations and applications therefor) and the goodwill pertaining thereto. Should Merck (or its Related Parties) acquire any ownership rights in any SeaGen Corporate Xxxx, SeaGen Collaboration Xxxx or SeaGen Proprietary Product Xxxx, Merck shall (and shall procure that its Related Parties will), and hereby does, assign any such rights to SeaGen (or its applicable Affiliate), to the extent legally permissible, and, to the extent not legally permissible, waive such rights. 2.2.3 Grant under SeaGen Technology for use with Merck Proprietary Products in a Merck Proprietary Combination. SeaGen shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to Merck a fully-paid, royalty- free, Co-Exclusive (with SeaGen and its Affiliates) right and license, with the right to grant sublicenses through multiple tiers (subject to Section 2.6), under any SeaGen Patent that claims or covers the applicable Merck Proprietary Combination (each such SeaGen Patent, a “SeaGen Combo Patent”) and under any SeaGen Know-How that is necessary or reasonably useful for the applicable Merck Proprietary Combination, to seek and obtain regulatory approval for, import, use, sell and offer to sell (including Commercialize) and otherwise exploit the applicable Merck Proprietary Product for use in the corresponding Merck Proprietary Combination. In addition, SeaGen shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to Merck a right of reference to any INDs, XXXx, Marketing Authorizations and other Regulatory Documentation for any Licensed Product that are Controlled by SeaGen or any of its Affiliates, which right of reference shall be for use in connection with the applicable Merck Proprietary Product for use in the corresponding Merck Proprietary Combination in the Field for the Territory. At the request of Merck, SeaGen shall provide to Merck a cross-reference letter or similar communication to the applicable Governmental Authority to effectuate such right of reference. For clarity, the foregoing license grant and right of reference only extends to those Merck Proprietary Combinations that the Parties have mutually agreed, via the JSC, to Develop pursuant to a Development Plan. 2.2.4 Grant under SeaGen Corporate Marks and SeaGen Collaboration Marks for use with Merck Proprietary Products in a Merck Proprietary Combination. Subject to Section 6.5.4, SeaGen shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to Merck a fully-paid, royalty-free right and license (which license shall be (x) non-exclusive with respect to the SeaGen Corporate Marks, and (y) Co- Exclusive (with SeaGen and its Affiliates) with respect to the SeaGen Collaboration Marks), with the right to grant sublicenses through multiple tiers (subject to Section 2.6), to use (a) the SeaGen Corporate Marks and the SeaGen Collaboration Marks, and (b) any Program Copyright owned by SeaGen or its Affiliate, in each case of (a) and (b), in Merck Proprietary Combination Outside Promotional Materials and Merck Proprietary Combination Outside Other Field-Based Materials for Merck Proprietary Products for the purposes of promoting the Merck Proprietary Products solely for use in a Merck Proprietary Combination in the Field in the Territory; provided that such rights shall be exercised in accordance with the quality standards and branding guidelines established by SeaGen (which are consistently applied) as notified by SeaGen to Merck from time to time. In all cases, SeaGen or its Affiliate shall remain the owner of the SeaGen Corporate Marks and SeaGen Collaboration Marks (and of all trademark rights therein and all trademark registrations and applications therefor) and the goodwill pertaining thereto. Should Merck (or its -33- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Related Parties) acquire any ownership rights in any SeaGen Corporate Xxxx or SeaGen Collaboration Xxxx, Merck shall (and shall procure that its Related Parties will), and hereby does, assign any such rights to SeaGen (or its applicable Affiliate), to the extent legally permissible, and, to the extent not legally permissible, waive such rights. 2.3 License Grants to SeaGen. Subject to the terms and conditions of this Agreement, the following shall apply: 2.3.1 Grants under Merck Technology for use with the Licensed Compounds and the Licensed Product. Merck shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to SeaGen a Co-Exclusive (with Merck and its Affiliates) right and license, with the right to grant sublicenses through multiple tiers (subject to Section 2.6), under the Merck Technology to research, develop (including Develop), make (including Manufacture), have made (including have Manufactured), import, use, sell and offer to sell (including Commercialize) and otherwise exploit the Licensed Compounds and the Licensed Product, whether as a monotherapy or for use in any Combination Therapy, and any Companion Diagnostic, in the Field in the Territory in accordance with this Agreement, which license shall be payment-bearing pursuant to Section 10.4.2 during the Term with respect to the Licensed Product. For clarity, the foregoing license grant, with respect to the Licensed Product for use in a Combination Therapy or Combination Products, as applicable, or any Companion Diagnostic, only extends to those Combination Therapies and Combination Products and Companion Diagnostics, in each case, that the Parties have mutually agreed, via the JSC, to Develop pursuant to a Development Plan. In particular, the foregoing license grant, with respect to the Licensed Product for use in a Combination Therapy with any Merck Proprietary Product, is only for use with those Merck Proprietary Combinations that the Parties have mutually agreed, via the JSC, to Develop pursuant to a Development Plan, and, in such case, (a) is limited to the right for SeaGen and (subject to Section 2.6) its Affiliates and sublicensees to (i) conduct those Development activities for the applicable Merck Proprietary Combination that are assigned to SeaGen pursuant to a Development Plan, including, as applicable, if SeaGen is the Lead Regulatory Party, submitting Regulatory Documentation for a label indication for the Licensed Product for use in the Merck Proprietary Combination, and (ii) Promote and otherwise Commercialize the Licensed Product for use in the Merck Proprietary Combination, in each case ((i) and (ii)), solely in accordance with this Agreement, and (b) excludes the right for SeaGen and its Affiliates and sublicensees to (i) Develop any Merck Proprietary Product (other than the Development of the use of a Merck Proprietary Product in the corresponding Merck Proprietary Combination in accordance with the Development Plan and this Agreement), or (ii) Manufacture, Promote or otherwise Commercialize any Merck Proprietary Product (other than the Promotion or other Commercialization of the Licensed Product for use in the applicable Merck Proprietary Combination in accordance with this Agreement). In addition, Merck shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to SeaGen a right of reference to any INDs, XXXx, Marketing Authorizations and other Regulatory Documentation for the Licensed Product that are Controlled by Merck or any of its Affiliates, which right of reference shall be solely for use in connection with SeaGen and its Affiliates’ and sublicensees’ Development, Manufacture and Commercialization of the Licensed Product, including as a monotherapy as well as for use in any Combination Therapy, in the Field for the Territory in accordance with this Agreement. At the -34- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
request of SeaGen, Merck shall provide to SeaGen a cross-reference letter or similar communication to the applicable Governmental Authority to effectuate such right of reference. 2.3.2 Grant under Merck Corporate Marks, Merck Collaboration Marks and Merck Proprietary Product Marks for use with the Licensed Product. Merck shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to SeaGen a fully-paid, royalty-free right and license (which license shall be (x) non-exclusive with respect to the Merck Corporate Marks and Merck Proprietary Product Marks, and (y) Co- Exclusive (with Merck and its Affiliates) with respect to the Merck Collaboration Marks), with the right to grant sublicenses through multiple tiers (subject to Section 2.6), to use (a) the Merck Corporate Marks, the Merck Collaboration Marks and the Merck Proprietary Product Marks in Promotional Materials and Other Field-Based Materials for the Licensed Product, (b) the Merck Collaboration Marks in the packaging and labeling for the Licensed Product, and (c) any Program Copyright owned by Merck or its Affiliate, in each case of (a), (b) and (c), solely for the purposes of Promoting and otherwise Commercializing the Licensed Product in the Field in the Territory (including Promoting the Licensed Product for use in any Combination Therapy or Combination Product, or with any Companion Diagnostic, in each case, that the Parties have mutually agreed, via the JSC, to Develop pursuant to a Development Plan), in all cases solely in accordance with this Agreement (provided, however, that notwithstanding the foregoing, (i) the Merck Proprietary Product Marks and (ii) any Program Copyrights for the Merck Proprietary Combinations, may only be used for Promoting and otherwise Commercializing the Licensed Product solely for use in the applicable Merck Proprietary Combination in accordance with this Agreement and as approved by Merck); provided that such rights shall be exercised in accordance with the Promotional Materials Guidelines and Other Field-Based Materials Guidelines and, with respect to the Merck Corporate Marks and Merck Proprietary Product Marks, Merck quality standards and branding guidelines established by Merck (which are consistently applied) as notified by Merck to SeaGen from time to time. In all cases, Merck or its Affiliate shall remain the owner of the Merck Corporate Marks, Merck Collaboration Marks and Merck Proprietary Product Marks (and of all trademark rights therein and all trademark registrations and applications therefor) and the goodwill pertaining thereto. Should SeaGen (or its Related Parties) acquire any ownership rights in any Merck Corporate Xxxx, Merck Collaboration Xxxx or Merck Proprietary Product Xxxx, SeaGen shall (and shall procure that its Related Parties will), and hereby does, assign any such rights to Merck (or its applicable Affiliate), to the extent legally permissible, and, to the extent not legally permissible, waive such rights. 2.4 No Implied Licenses; Retained Rights. 2.4.1 Except as expressly provided herein, nothing in this Agreement grants either Party or vests in either Party any right, title or interest in or to the Know-How, Patent Rights, Confidential Information, Trademarks or other intellectual property of the other Party (either expressly or by implication or estoppel), other than the licenses and rights expressly granted hereunder and the assignments expressly made hereunder. 2.4.2 SeaGen hereby expressly retains (on behalf of itself and its Affiliates) the right, title and interest in and to the SeaGen Technology to (i) conduct its and their Development, Manufacturing and Commercialization activities for the Licensed Compounds and the Licensed -35- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Product as are allocated to SeaGen under the applicable Development Plan, Manufacturing Plan and Commercialization Plan, in accordance with this Agreement, and (ii) practice such SeaGen Technology outside the scope of the license grant in Section 2.2.1 for products other than Licensed Compounds and Licensed Products (subject to the terms and conditions of this Agreement, including Section 2.9). Merck hereby expressly retains (on behalf of itself and its Affiliates) the right, title and interest in and to the Merck Technology to (i) conduct its and their Development, Manufacturing and Commercialization activities for the Licensed Compounds and the Licensed Product as are allocated to Merck under the applicable Development Plan, Manufacturing Plan and Commercialization Plan, in accordance with this Agreement, and (ii) practice such Merck Technology outside the scope of the license grant in Section 2.3.1 for products other than Licensed Compounds and Licensed Products (subject to the terms and conditions of this Agreement, including Section 2.9). 2.5 Third Party In-License Agreements. 2.5.1 Generally. The licenses granted under Sections 2.2 and 2.3 may include certain rights licensed by a Third Party to the license-granting party (or its Affiliate) (the “Licensor Party”) under Third Party In-License Agreements. Any sublicense of Third Party intellectual property rights granted by the Licensor Party pursuant to Sections 2.2 and 2.3 to the other Party (the “Licensee Party”) shall be subject to the terms and conditions of the Third Party In-License Agreement applicable to sublicensees under which such sublicense is granted, subject to Section 2.5.2. 2.5.2 New Third Party In-License Agreements After Effective Date. During the Term, without the approval of the JSC, neither Party nor any of its Affiliates may enter into any Third Party In-License Agreement with respect to any intellectual property rights that will be used for the Development, Commercialization or Manufacture of the Licensed Compounds or the Licensed Product hereunder; provided that, for clarity, the foregoing shall not apply to a Party with respect to intellectual property related to any of its Proprietary Products for use in a Proprietary Combination to the extent that all costs and expenses under any such license agreement are borne by such Party. For the avoidance of doubt, any license or other similar agreement between a Party (or its Affiliate) and a Third Party pursuant to which such Party (or its Affiliates) obtains a license or similar right in any Know-How or Patent Right that was entered into in violation of the provisions of this Section 2.5.2 shall not be a “Third Party In-License Agreement” for purposes of this Agreement, unless the other Party approves in writing the inclusion of such license or other similar agreement as a “Third Party In-License Agreement”, in such other Party’s discretion. 2.5.3 Third Party In-License Agreements as of the Effective Date. As of the Effective Date, the SeaGen Existing In-Licenses are the only Third Party In-License Agreements. No amounts paid or payable by either Party under any other license or other similar agreement between a Party (or its Affiliate) and a Third Party, in existence as of the Effective Date, pursuant to which such Party (or its Affiliates) has obtained a license or similar right in any Know-How or Patent Right shall be deemed to be a “Third Party Payment” for purposes of this Agreement, unless the other Party approves in writing the inclusion of such license or other similar agreement as a “Third Party In-License Agreement”, in such other Party’s discretion, in which case (a) such license or similar agreement shall thereafter be a “Third Party In-License Agreement” hereunder -36- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
and (b) the applicable payments pursuant to such Third Party In-License Agreement made thereafter shall be included hereunder as “Third Party Payments” (to the extent such payments otherwise fall within the definition of “Third Party Payments”). 2.6 Sublicense Rights by Licensee; Further Grants of Licenses by Licensor. 2.6.1 Sublicenses by Licensee. Each Party may grant sublicenses (through multiple tiers) of the license to it under Section 2.2 or 2.3 to any Affiliates and Third Parties; provided, however, that (a) each such sublicense is consistent with the applicable terms of this Agreement, (b) each such sublicense terminates upon the termination (but not upon expiration) of this Agreement (except to the extent that the license under which such sublicense was granted survives such termination), and (c) with respect to any sublicenses to a Third Party, a sublicense to a Third Party to (i) Develop the Licensed Compounds or the Licensed Product must be approved by the JSC (or otherwise expressly set forth in the Development Plan), (ii) Manufacture the Licensed Compounds or the Licensed Product must be approved by the JSC (or otherwise expressly set forth in the Manufacturing Plan) or (iii) Commercialize the Licensed Product in any of the Collaboration Territory, China, Brazil or Japan (or any country or region in any of the foregoing) must be approved by the JSC (or otherwise expressly set forth in the Commercialization Plan), in each case of this clause (c), prior to entering into any such license agreement with a Third Party; provided, however, that no such consent shall be required pursuant to this clause (c) for any sublicense, in whole or in part, to a Third Party contractor (e.g., a contract research organization or a contract manufacturer) to carry out activities hereunder on behalf of the applicable Party in accordance with this Agreement (including, in all cases, Section 2.7). In no event shall any sublicense granted pursuant to Section 2.2 or 2.3 diminish, reduce or eliminate any of the obligations of the sublicensing Party under this Agreement. Any sublicense granted pursuant to Section 2.2 or 2.3 shall be subject to, and consistent with, the applicable terms and conditions of this Agreement and shall require each sublicensee to comply with all applicable terms and conditions of this Agreement (including, for clarity, Section 12.3). Notwithstanding the foregoing, the applicable Party may grant sublicenses (through multiple tiers) of the license to it under Section 2.2.3 and 2.2.4 to any Affiliates or Third Parties without consent or approval of the other Party to the extent that the applicable sublicensee obtains rights or licenses to such Party’s Proprietary Product, as applicable, and solely in connection with such Party’s Proprietary Product for use in the applicable Proprietary Combination. 2.6.2 Further License Grants by Licensor to Co-Exclusive IP. Subject to the terms and conditions of this Agreement, with respect to any Co-Exclusive licenses granted by a Party to the other Party pursuant to Section 2.2 or 2.3, as applicable, the Party that is the license grantor party shall have the same rights to grant additional licenses under such Co-Exclusively licensed intellectual property (within the scope of the license grants to the licensee Party) as the licensee party would have to grant sublicenses of such intellectual property in accordance with Section 2.6.1, mutatis mutandis (i.e., the license grantor Party may only grant such further licenses to the extent permitted under and in compliance with Section 2.6.1 as if such license grantor Party were the licensee granting a sublicense). For clarity, subject to the terms and conditions of this Agreement (including Section 2.9), the grant of a Co-Exclusive license to the other Party as set forth herein shall not restrict the license grantor Party from exploiting such Co-Exclusively -37- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
licensed intellectual property, including by granting licenses, outside the scope of the license grants to the licensee Party. 2.7 Use of Subcontractors. Each Party shall have the right to engage Third Party subcontractors to perform its rights and obligations hereunder with respect to the Licensed Compounds and the Licensed Product hereunder (provided that such engagement is consistent with the Development Plan, Manufacturing Plan, Commercialization Plan, and the applicable Merck Supply Agreement or SeaGen Supply Agreement, as applicable); provided that (a) neither Party shall have the right to use a contract sales force to Promote the Licensed Product in the Collaboration Territory, unless specifically set forth in the Commercialization Plan, (b) neither Party shall have the right to use a Distributor to distribute or sell the Licensed Product unless (i) approved by the JSC, (ii) specifically set forth in the Commercialization Plan or (iii) for a country set forth on Schedule 2.7, (c) neither Party shall have the right to use a Third Party contract manufacturer to Manufacture any Licensed Compound or the Licensed Product unless specifically set forth in the Manufacturing Plan (or, in the case of SeaGen, is an existing contract manufacturer engaged by SeaGen pursuant to a SeaGen Existing CMO Agreement to Manufacture any Licensed Compound or the Licensed Product (or any component thereof) as of the Effective Date, but subject to 7.7) and (d) neither Party shall have the right to use a contract research organization to perform any material activities with respect to the Development of a Licensed Compound or the Licensed Product unless specifically set forth in the Development Plan. Subject to Section 13.3.3, in no event shall any subcontracting hereunder diminish, reduce or eliminate any of the obligations of the subcontracting Party hereunder, and any such subcontracting shall be subject and to and consistent with, the applicable terms and conditions of this Agreement and shall require each such subcontractor to comply with all applicable terms and conditions of this Agreement (including, for clarity, Section 12.3). Subject to Section 13.3.3, any act or omission of a Party’s Third Party subcontractor in the performance of activities hereunder shall constitute the act or omission of such Party for purposes of this Agreement. 2.8 No Outside Development, Manufacture or Commercialization of Licensed Compounds and the Licensed Product. 2.8.1 Notwithstanding anything to the contrary contained herein, but subject to Sections 2.8.2 and 2.9.2, unless and until this Agreement expires or is terminated, during the Term, neither Merck nor SeaGen shall, and each of Merck and SeaGen shall cause their respective Affiliates not to, directly or indirectly, by itself or with or through any Third Party, Develop, Manufacture or Commercialize any Licensed Compound or the Licensed Product, including as a monotherapy or for use in any combination (including concomitant or sequential therapy) with other products, or grant a Third Party any rights to do so, except as permitted under, and in accordance with, this Agreement and the Development Plan, Manufacturing Plan, and Commercialization Plan, as applicable. 2.8.2 Subject to Section 2.4.1, Section 2.9 (with respect to Competing Products), and Article 9, as applicable: (a) nothing contained herein shall prohibit or otherwise restrict in any way a Party or its Affiliates, itself or with or through any Third Parties, from researching, developing, using, importing, exporting, making, having made, offering to sell or selling any of its Proprietary Products, and (b) nothing herein shall grant a Party (or any of its Affiliates) any right -38- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
to research, develop, use, import, export, make, have made, offer to sell or sell the other Party’s Proprietary Products or to determine any prices or reimbursements or to share in any revenues with respect thereto, and (c) each Party and its Affiliates retain all rights to develop (including seeking regulatory approval for) and commercialize (including determining pricing and reimbursement for) its Proprietary Products, and nothing contained herein shall limit a Party’s and its Affiliate’s rights to develop (including seeking regulatory approval for) or commercialize (itself or with or through any Third Parties) any of its Proprietary Products anywhere in the Territory; provided that, in each case ((a), (b) and (c)), the Development, Manufacture and Commercialization of the Licensed Product for use in any combination (including concomitant or sequential use) with any Proprietary Product, including in any Proprietary Combination, shall be subject to the provisions of this Agreement. In addition, subject to Section 2.4.1, Section 2.9 (with respect to Competing Products), and Article 9, nothing contained herein shall prohibit or otherwise restrict in any way SeaGen or its Affiliates, itself or with or through any Third Parties, from researching, developing, using, importing, exporting, making, having made, offering to sell or selling any payload or linker component of any Licensed Compound or the Licensed Product, in each case, alone or as components in other products but excluding the use thereof in any Licensed Compound, Licensed Product or Competing Product. 2.9 Exclusivity. 2.9.1 Exclusivity. During the Term, neither Party (nor any of its Affiliates) will (and such Party will ensure that its Affiliates do not) [ * ]. Notwithstanding the foregoing, the provisions of this Section 2.9.1 will not apply to, and a Party and its Affiliates will not be prohibited under this Section 2.9.1 from, (i) clinically developing, selling or otherwise commercializing the Licensed Compounds and the Licensed Product in accordance with this Agreement (including the Development Plan, Manufacturing Plan and Commercialization Plan, as applicable), (ii) granting rights to Third Party sublicensees and subcontractors to clinically develop, sell or otherwise commercialize the Licensed Compounds and the Licensed Product in accordance with this Agreement (including Sections 2.6 and 2.7), (iii) with respect to Merck (and its Affiliates), from and after the [ * ] year anniversary of the Effective Date, carrying out activities (alone or with any Third Party) to [ * ], and (iv) without limiting the foregoing clause (iii), with respect to Merck (and its Affiliates), from and after the [ * ] year anniversary of the Effective Date, carrying out activities (alone or with any Third Party) to [ * ]. 2.9.2 SeaGen Pre-Clinical Research of Competing Products. Notwithstanding Section 2.9.1, and subject to Section 2.9.3 and Section 5.2.4(a), SeaGen and its Affiliates (itself, but not with or through any Third Party) may conduct, at its cost, pre-clinical development (prior to GLP Tox Studies) of a Competing Product (including SGN-LIV-1-B and SGN-LIV-1-C) for purposes of identifying alternative or “next generation” compounds to potentially be included as a Licensed Compound under this Agreement (each such Competing Product, a “Next Generation Compound”), subject to the remainder of this Section 2.9.2. SeaGen shall use Commercially Reasonable Efforts to pre-clinically develop (prior to GLP Tox Studies) each of SGN-LIV-1-B and SGN-LIV-1-C. SeaGen shall update the JSC by providing a summary overview of such activities for each Next Generation Compound on a quarterly basis (and any other reasonable information requested by the JSC with respect thereto) and shall consider in good faith any comments of Merck with respect to such activities. SeaGen shall notify -39- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Merck in writing of any Next Generation Compound that SeaGen or its Affiliate pre-clinically develops (and in all cases, prior to initiating any GLP Tox Study for such Next Generation Compound) that it reasonably believes is suitable for further Development in GLP Tox Studies, such notice including all data generated from the pre-clinical development, including all data supporting or establishing SeaGen’s belief that the Next Generation Compound is suitable for further Development in GLP Tox Studies (each, a “Next Generation Compound Notice”). Merck shall have [ * ] days from receipt of the Next Generation Compound Notice to notify SeaGen in writing if Merck desires to include such Next Generation Compound Candidate as a “Licensed Compound” under this Agreement (“Licensed Compound Notice”). During such [ * ] day period, SeaGen shall use reasonable efforts to answer Merck’s questions with respect to such Next Generation Compound, including, if applicable, providing additional information necessary or reasonably useful for Merck to decide whether to include such Next Generation Compound hereunder as a “Licensed Compound”. If Merck timely provides SeaGen with a Licensed Compound Notice, then the Next Generation Compound that is the subject of such Licensed Compound Notice shall be included as a “Licensed Compound” hereunder as of the date of such notice. Notwithstanding the foregoing, with respect to SGN-LIV-1-C, if Merck does not issue a Licensed Compound Notice within [ * ] days from receipt of the Next Generation Compound Notice for SGN-LIV-1-C, but the Next Generation Compound Notice for SGN-LIV-1-C includes sufficient data (as determined by the JSC) showing that SGN-LIV-1-C has met the “Criteria for Go to GLP Tox Studies” set forth in part 1 of Schedule 2.9.2, then unless the Parties mutually agree otherwise, Merck shall be deemed to have issued a Licensed Compound Notice for SGN- LIV-1-C, and SGN-LIV-1-C shall be included as a “Licensed Compound” hereunder, as of the date of expiration of such [ * ] day period. For clarity, in all cases, SeaGen and its Affiliates (itself or with or through any Third Party) shall have no right to, and shall not, conduct any GLP Tox Studies or any clinical development or commercialization of any Next Generation Compound unless and until Merck provides a Licensed Compound Notice with respect to the applicable Next Generation Compound, and in such case, such GLP Tox Studies and any further Development and Commercialization thereof shall be conducted under and in accordance with this Agreement, including the applicable Development Plan and Commercialization Plan. 2.9.3 Acquired Competing Products. If after the Effective Date, (i) a Party (or any of its Affiliates) acquires any Third Party (or business or assets of a Third Party) (by merger, purchase of assets, stock acquisition or otherwise) and, as a result of such transaction, obtains rights (via ownership or otherwise) to a Competing Product, or (ii) a Party is acquired by a Third Party (by merger, purchase of assets, stock acquisition or otherwise, including as a result of a Change of Control with a Person who (itself or any of its affiliates) owns or controls a Competing Product) that owns or controls a Competing Product immediately prior to such transaction, and, as a result of such transaction under the preceding sub-clause (i) or (ii), such Party (or any of its Affiliates) (the “Acquiring Competing Product Party”) would be in breach of the provisions of Section 2.9.1 (such Competing Product, an “Acquired Competing Product”), then such Acquiring Competing Product Party (and its Affiliates) will not be deemed to be in breach of Section 2.9.1 so long as such Acquiring Competing Product Party (and its Affiliates, as applicable) no later than [ * ] months following such transaction, undertakes at least one of the following: (a) sells, transfers and assigns to a Third Party all of the Acquiring Competing Product Party’s (and its Affiliates’) rights to such Acquired Competing Product -40- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
(provided that, for the avoidance of doubt, the Acquiring Competing Product Party may continue to retain an economic interest therein (e.g., upfront payments, milestone payments, royalties, etc.)); (b) ceases and terminates the activities with respect to the Acquired Competing Product during the Term which are in breach of the provisions of Section 2.9.1; (c) within [ * ] months following the consummation of the applicable acquisition transaction, offers in writing to the other Party to include such Acquired Competing Product as a “Licensed Compound” under this Agreement (on financial terms to be discussed, in addition to the sharing of future Allowable Development Costs, Allowable Commercialization Costs and Allowable Joint IP Costs, as set forth herein, if such Acquired Competing Product is included as a Licensed Compound hereunder), in which case such other Party shall have [ * ] days following receipt of such written offer to notify the Acquiring Competing Product Party in writing if it desires to so include such Acquired Competing Product, and if such other Party so notifies the Acquiring Competing Product Party in writing that such Acquired Competing Product should be included as a “Licensed Compound” hereunder, then the Acquired Competing Product will thereafter automatically be a “Licensed Compound” for purposes of this Agreement, and the Parties shall enter into an amendment to this Agreement to so include such Acquired Competing Product as a “Licensed Compound” hereunder; provided that if such other Party does not so notify the Acquiring Competing Product Party that the Acquired Competing Product should be included under this Agreement within such time period, then the Acquired Competing Product Party shall complete a different applicable alternative under this clause 2.9.3 with respect to such Acquired Competing Product no later than [ * ] months following the consummation of the applicable acquisition transaction; or (d) solely with respect to Merck as the Acquiring Competing Product Party, Merck provides notice of termination of this Agreement in accordance with Section 14.2 at least [ * ] months prior to expiration of such [ * ]-month period. 2.9.4 Interim Activities for Acquired Competing Products. For clarity, the Acquiring Competing Product Party will not be in breach of its obligations under Section 2.9.1 with respect to an Acquired Competing Product as long as the Acquiring Competing Product Party complies with the provisions of Section 2.9.3; provided that, during the [ * ] month period during which the Acquiring Competing Product Party is permitted to undertake the alternatives set forth in Section 2.9.3, the Acquiring Competing Product Party shall be permitted to continue to conduct the development, manufacturing and commercialization of the Acquired Competing Product (the “Interim Permitted Competing Activities”) so long as (a) such Interim Permitted Competing Activities will be conducted separately from any activities conducted under this Agreement, including the maintenance of separate lab notebooks and records; (b) no personnel or contractors of the Acquiring Competing Product Party or any of its Affiliates who have conducted activities pursuant to this Agreement shall be involved in any Interim Permitted Competing Activities; (c) the Acquiring Competing Product Party shall establish reasonable firewall protections and safeguards (that are reasonably acceptable to the other Party) designed to ensure that the Interim Permitted Competing Activities are segregated from the activities conducted hereunder; (d) the Acquiring Competing Product Party shall not use (or permit to be used) in the conduct of any Interim Permitted Competing Activities any Confidential Information of the other Party, -41- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Development Data or Program Know-How, and the Acquiring Competing Product Party shall ensure that none of the foregoing are provided to or otherwise disclosed to any Person that is involved in the conduct of any Interim Permitted Competing Activities; and (e) the conduct of the Interim Permitted Competing Activities do not delay or otherwise inhibit the conduct of the Acquiring Competing Product Party’s obligations hereunder or the conduct of activities under any Development Plan, Manufacturing Plan or Commercialization Plan. 2.9.5 Combination Therapies. (a) [ * ]. For clarity, during the Term, [ * ] shall be [ * ] (b) [ * ]. Notwithstanding anything to the contrary (including Section 5.2.4(b)) hereunder, but subject to Section 3.2.4(b)(vi), after the [ * ] anniversary of the Effective Date, if SeaGen proposes a Clinical Trial for use of the Licensed Product in combination (including concomitant or sequential therapy) with a [ * ] (alone or in further combination with one or more other products approved for the applicable tumor type) for consideration by the JSC under Section 5.2.4(b), and such Clinical Trial for such combination is not approved to be included in the Development Plan by Merck through the JSC within [ * ] days following SeaGen’s request, then SeaGen (or its Affiliates) may carry out such Clinical Trial (alone or with any Third Party) for the Licensed Product for use in combination (including concomitant or sequential therapy) with such [ * ] (such Clinical Trial, a [ * ] and such combination therapy, a [ * ]), provided that (i) SeaGen (and its Affiliates), as applicable, [ * ] and (ii) SeaGen (and its Affiliates) [ * ]. Notwithstanding anything to the contrary hereunder, Section [ * ] shall apply[ * ]. For purposes of [ * ]. ARTICLE 3 GOVERNANCE 3.1 Committees. The Parties shall establish a Joint Steering Committee and appropriate Subcommittees to oversee the Development, Manufacture and Commercialization of Licensed Compounds and the Licensed Product, as more particularly described in this Article 3. Notwithstanding the foregoing, with respect to the Licensed Compounds and the Licensed Product, and the Development, Manufacturing and Commercialization thereof, each Party shall retain the rights, powers and discretion granted to it under this Agreement and the Ancillary Agreements and no such rights, powers or discretion shall be delegated to or vested in the JSC or any Subcommittee unless such delegation or vesting of rights is expressly provided for in this Agreement or the Ancillary Agreements or the Parties expressly so agree in writing. Notwithstanding anything to the contrary in this Agreement, in no circumstances shall the JSC (including pursuant to Section 3.2.4(b)) or any Subcommittee have any power to amend, modify or waive compliance with this Agreement or any Ancillary Agreements. The Parties hereby agree and acknowledge that, for purposes of efficiency, if agreed to by the Parties, one or more (or all) of each Party’s representatives appointed to the JSC (or any of the other Subcommittees) hereunder may also be appointed by such Party to any committee under any other collaboration agreement(s) between the Parties (or their respective Affiliates), and, in such case, meetings of such committees shall be coordinated to discuss the applicable issues under the various collaboration agreement(s). 3.2 Joint Steering Committee. -42- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
(e) review, discuss and approve (i) any amendments to the Development Plan (including the Development Budget), including the Regulatory Plan contained therein (and also including, for clarity, any matter requiring the approval of the JSC under Section 5.2.4), (ii) the initial Commercialization Plan (including the Commercialization Budget) and any amendments thereto, and (iii) the initial Manufacturing Plan (including the Manufacturing Data) and any amendments thereto; (f) review, discuss and approve any Regional Commercialization Sub- Plans and any amendments thereto (provided that the approval of Regional Commercialization Sub-Plans for the SeaGen Territory and the Merck Territory shall be limited to approval for consistency with the applicable approved Commercialization Plan (but allowing for differences in regional and local factors to be addressed) and the Commercialization Budget); (g) review, discuss and approve the Commercialization Guidelines and any amendments thereto for the Licensed Product; (h) review, discuss and approve [ * ] following the receipt of Marketing Authorization, [ * ], for such country; (i) discuss and determine, consistent with Section 4.1.1, which Party shall be the Lead Study Party for a given Clinical Trial of the Licensed Product (and, for clarity, a Party may be the Lead Study Party for a given Clinical Trial notwithstanding the use of resources, assistance or services of Third Parties (as permitted in accordance with this Agreement) or the other Party in connection with such Clinical Trial); (j) discuss and determine (i) [ * ]; (k) discuss and determine whether to put in place a second source supply (including by a Third Party or by a Party) for the Licensed Compound and for the Licensed Product in accordance with Section 7.4.4; (l) approve the licensing of any intellectual property from a Third Party in order to gain rights to use such Third Party’s intellectual property in the Development, Manufacture or Commercialization of a Licensed Compound or Licensed Product under this Agreement in accordance with Section 2.5.2; (m) approve the grant of sublicenses with respect to the Development, Manufacture and Commercialization of the Licensed Product as set forth in Section 2.6; (n) discuss and agree on any patient assistance program (or the like) for the Licensed Product for the Territory; (o) establish such additional Subcommittees with respect to Licensed Compounds and the Licensed Product as it deems necessary to achieve the objectives and intent of this Agreement (including, if determined by the JSC, (x) separate Subcommittees for separate therapeutic areas (e.g., separate JDCs, JCCs and JMCs per therapeutic area), (y) separate regional commercial Subcommittees for the Commercialization of the Licensed Product in different -44- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Product, SeaGen Proprietary Product or Third Party product) in the Development Plan must be approved in writing by each of the Parties, and any dispute with respect thereto shall [ * ]; provided, however, the Development of the Licensed Product for use in Combination Therapy [ * ] is hereby deemed to be mutually approved by the Parties as of the Effective Date. If the Parties mutually agree to include the Development of the Licensed Product for use in Combination Therapy with a Merck Proprietary Product or SeaGen Proprietary Product, as applicable, then the following shall apply: (1) if the Parties approve the Development of the Licensed Product for use in Combination Therapy with a SeaGen Proprietary Product, then in the event of a dispute with respect to matters related to the [ * ]; and (2) if the Parties approve the Development of the Licensed Product for use in Combination Therapy with a Merck Proprietary Product, then in the event of a dispute with respect to matters related to the [ * ]; (iii) with respect to matters related to the Commercialization of the Licensed Product for the Territory (including the Commercialization Plan and any amendments thereto and any Regional Commercialization Sub-Plan and any amendments thereto), subject to Section 3.2.4(b)(iv) and 3.2.4(b)(vi), such dispute shall [ * ] and will [ * ] (and, for clarity, except as otherwise set forth in [ * ], if such matter is [ * ], then [ * ]; provided however that, subject to Section 3.2.4(b)(iv) and 3.2.4(b)(vi), (x) with respect to a dispute related to the contents of a Regional Commercialization Sub-Plan for the SeaGen Territory, SeaGen shall have final decision- making authority with respect to such dispute, provided that in all cases the contents of such Regional Commercialization Sub-Plan are consistent with the Commercialization Plan (including the Commercialization Budget) as applied to the SeaGen Territory and (y) with respect to a dispute related to the contents of a Regional Commercialization Sub-Plan for the Merck Territory, Merck shall have final decision-making authority with respect to such dispute, provided that in all cases the contents of such Regional Commercialization Sub-Plan are consistent with the Commercialization Plan (including the Commercialization Budget) as applied to the Merck Territory; (iv) if the Licensed Product is being Commercialized hereunder for use in a Proprietary Combination, then with respect to matters related to any Promotional Materials and Other Field-Based Materials for the Licensed Product to the extent related to the Proprietary Product or Proprietary Combination (including any information related to the Proprietary Product contained therein), but subject always to the Promotional Materials Guidelines and the Other Field-Based Materials Guidelines, [ * ]; (v) with respect to all other matters related to a Licensed Compound or the Licensed Product for the Territory within the purview of the JSC (including (A) the Manufacturing Plan, and any amendments thereto, or (B) any dispute regarding entering into a Third Party In-License Agreement as set forth in Section 2.5.2), subject to Section 3.2.4(b)(vi), such dispute shall [ * ] and will [ * ] (and, for clarity, if such matter is [ * ] then [ * ]; (vi) notwithstanding the provisions of Sections 3.2.4(b)(i), 3.2.4(b)(iii) and 3.2.4(b)(v), (A) if a Party reasonably and in good faith believes that there is a -46- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
number of representatives of each of Merck and SeaGen. Each Party may replace one or more of its JDC representatives at any time in its sole discretion upon written notice to the other Party. If agreed by the JDC, the JDC may invite non-members to participate in the discussions and meetings of the JDC; provided that such participants are under obligations of confidentiality consistent with this Agreement and shall have no voting authority at the JDC. The JDC shall be co-chaired by representatives of each Party. The role of the co-chairpersons shall be to convene and preside at meetings of the JDC, to prepare and circulate agendas and to ensure the preparation of minutes (all such responsibilities to alternate between each Party’s co-chairperson on an annual basis), but the co-chairpersons shall have no additional powers or rights beyond those held by the other JDC representatives. 3.3.2 Specific Responsibilities of the JDC. In addition to its general responsibilities, with respect to Licensed Compounds and the Licensed Product, the JDC shall, subject to the terms of this Agreement, in particular: (a) discuss, prepare and approve for submission to the JSC amendments to the Development Plan (including the Development Budget and the Regulatory Plan); (b) review and update quarterly financial forecasts for Development of the Licensed Product (including timing of expenditures) to endeavor to ensure actual and anticipated expenditure is within the approved Development Budget for the relevant Calendar Year and make recommendations to the JSC for approval of any variances before additional expenditures are incurred; (c) create, implement and review the overall strategy for Development of the Licensed Product (including the Regulatory Plan) and the design and objectives of all Clinical Trials and non-clinical studies conducted under the Development Plan; (d) review and approve the protocols for all Clinical Trials conducted under the Development Plan and any material amendments thereto (including any amendments which would change the primary endpoint of such Clinical Trial, dosage or similar matters); provided that such review and approval shall be conducted within a timeframe that does not unduly delay any Clinical Trial; (e) review and discuss the Next Generation Compound Notices and related data; (f) decide timing for filing or withdrawal of any registration application or any submission to conduct investigative studies for the Licensed Product, including any IND or MAA; (g) oversee the conduct of any Clinical Trial under the Development Plan, including discuss, coordinate and share information regarding operational activities associated with such Clinical Trials, including study feasibility, study-specific key opinion leader (KOL) engagement, country and site selection, site contracting, use of contract research organizations (including preparation of guidelines with respect to the use of contract research -49- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
organizations) or the resources of the other Party, site opening and enrollment (including steps to effectively address over or under enrollment); (h) oversee the forecasting of quantities of Licensed Product required for Clinical Trials for incorporation into the Manufacturing Plan and Development Plan; (i) discuss and agree on the overall regulatory filing strategy for obtaining Marketing Authorizations for the Licensed Product for the Territory and for maintaining such Marketing Authorizations (including post-approval commitments), including overseeing the strategy for submission and maintenance of the registration dossiers (including XXXx) for the Licensed Product; (j) review, discuss, coordinate and approve Phase IV Clinical Trials, local clinical evaluations and outcomes research activities, including the allocation of budgeted resources thereto (to the extent applicable) and the priorities thereof (subject to consultation with the JCC regarding funding decisions) for the Licensed Product; (k) (i) review and discuss, in consultation with the JCC, medical affairs activities for the Licensed Product, including field-based medical education activities by either Party, use of medical liaisons and grant-based medical education programs for Licensed Product, medical affairs materials to be used by the Parties, plans for investigator-initiated studies, and grant plans; and (ii) discuss, prepare and approve guidelines specifying the content of the Other Field- Based Materials (including, for clarity, with respect to medical liaison and other medical affairs activities) with respect to use of the Licensed Product as a monotherapy or in any Combination Therapy (the “Other Field-Based Materials Guidelines”) and any amendments thereto; provided that the Proprietary Product Party will determine the content of the Other Field-Based Materials Guidelines relating to its Proprietary Product; (l) discuss and approve plans for development of Companion Diagnostics, if any, specifically for use in connection with any Licensed Compound or the Licensed Product; (m) review, discuss and approve, in consultation with the JCC, strategies for distribution of Licensed Product for “compassionate use” or as free goods; (n) review, discuss, coordinate and approve a global publication strategy for the Licensed Products (including a strategy for the publication of Development Data developed under this Agreement from the conduct of Clinical Trials for the Licensed Products) (“Global Publication Strategy”); (o) discuss, coordinate and approve a strategy for the Development of the Licensed Product for use in a Combination Therapy with pharmaceutical product(s) other than the Initial Merck Proprietary Product (including testing and conducting Clinical Trials for the Licensed Product for use in a Combination Therapy with [ * ]) reasonably in advance of loss of patent exclusivity with respect to the composition of matter of the Initial Merck Proprietary Product; -50- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
(c) oversee implementation of each Manufacturing Plan for Licensed Compounds and the Licensed Product; (d) with respect to the Manufacturing activities of the Lead Manufacturing Party prior to the JSC’s approval of the initial Manufacturing Plan, review, discuss and approve any matter related to the Manufacture of a Licensed Compound or the Licensed Product that would otherwise have been be set forth in the Manufacturing Plan (prior to the Lead Manufacturing Party commencing the applicable Manufacturing activity); (e) review forecasts provided in the Commercialization Plan for the Licensed Product and oversee development of, and discuss and agree on, logistical strategies, including capacity planning and appropriate inventory levels of Licensed Compounds and the Licensed Product to maintain consistency with the forecasts; (f) establish a sales and operations planning team to coordinate the Parties’ supply activities; (g) oversee the conduct of the CMC Development for Licensed Compounds and the Licensed Product, and facilitate the flow of information between the Parties with respect to CMC Development; (h) oversee development of, and recommend to JSC for approval, strategies for second sourcing for the Manufacture of Licensed Compounds and the Licensed Product; (i) discuss, prepare and approve (in coordination with the JDC) for submission to the JSC proposed annual and interim amendments to CMC Development activities within the Development Plan, if any; (j) discuss and oversee (in coordination with the JDC) CMC regulatory-related activities and maintenance of regulatory submissions, including INDs and XXXx, for the Licensed Product to ensure regulatory compliance and timely management of responses to any Regulatory Authority queries pre- and post-approval as well as during regulatory review processes; (k) oversee the preparation for and reviewing responses to regulatory inspections related to the Manufacture of the Licensed Product, including the development of policies and procedures therefor; (l) oversee and monitor all QA- and QC-related matters concerning the Licensed Product; (m) discuss and approve any Manufacturing sites or testing sites proposed to be established following the Effective Date for the Licensed Compounds or the Licensed Product; provided, however, that in performing such review and approval, the JMC shall take into consideration any then-existing supply or quality agreements established with Third Party -52- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
credentials, experience and knowledge in the commercialization of products similar to the Licensed Product for their specific role within the JCC, and having sufficient seniority within the applicable Party to make decisions arising within the scope of the JCC’s responsibilities and being duly authorized under their respective company’s internal governance procedures to make the decisions or carry out the activities given to them under this Agreement. The JCC may change its size from time to time by mutual, unanimous consent of its members; provided that the JCC shall consist at all times of an equal number of representatives of each of Merck and SeaGen. Each Party may replace one or more of its JCC representatives at any time in its sole discretion upon written notice to the other Party. If agreed by the JCC, the JCC may invite non-members to participate in the discussions and meetings of the JCC; provided that such participants are under obligations of confidentiality consistent with this Agreement and shall have no voting authority at the JCC. The JCC shall be co-chaired by representatives of each Party. The role of the co- chairpersons shall be to convene and preside at meetings of the JCC, to prepare and circulate agendas and to ensure the preparation of minutes (all such responsibilities to alternate between each Party’s co-chairperson on an annual basis), but the co-chairpersons shall have no additional powers or rights beyond those held by the other JCC representatives. 3.5.2 Specific Responsibilities of the Joint Commercialization Committee. In addition to its general responsibilities, with respect to Licensed Compounds and the Licensed Product, the Joint Commercialization Committee shall, subject to the terms of this Agreement, in particular: (a) discuss, prepare and approve for submission to the JSC the initial Commercialization Plan (including the Commercialization Budget) and amendments thereto for the Licensed Product; (b) discuss, prepare and approve for submission to the JSC guidelines (including the Pricing Guidelines), policies and procedures to be followed by the Parties in connection with the Commercialization of the Licensed Product and any amendments thereto (collectively, the “Commercialization Guidelines”); (c) discuss, prepare and approve guidelines specifying the content of the Promotional Materials (including, for clarity, with respect to the Promotion of the Licensed Product as a monotherapy or for use in any Combination Therapy) (the “Promotional Materials Guidelines”) and any amendments thereto; provided that the Proprietary Product Party will determine the content of the Promotional Materials Guidelines relating to its Proprietary Product; (d) review revenue forecasts and review the Commercialization Budget (including timing of expenditures) for the Territory at least on a quarterly basis to endeavor to ensure actual and anticipated spend is within the approved Commercialization Budget; (e) review and discuss the Commercialization activities of SeaGen and Merck with respect to the Licensed Product for the Territory and coordinate the Commercialization activities of Merck and SeaGen with respect to the Licensed Product Promoted under this Agreement in the Territory, including pre- and post-launch activities and any other Promotion activities by the Parties for the Licensed Product in the Territory; -54- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
for any such matters. Each Party may designate a replacement Financial Manager for such Party in its sole discretion by notice in writing to the other Party. 3.6.2 Composition of the Joint Finance Committee. Within [ * ] days after the Effective Date, the Parties shall establish a committee to coordinate financial matters with respect to Licensed Compounds and the Licensed Product and to support the JSC, the JDC, the JCC and the JMC in connection therewith (the “JFC” or “Joint Finance Committee”). Each Party shall initially appoint [ * ] employees of such Party or its Affiliates as representatives to the JFC, with each Party’s representatives having appropriate technical credentials, experience and knowledge for their specific role within the JFC, and having sufficient seniority within the applicable Party to make decisions arising within the scope of the JFC’s responsibilities and being duly authorized under their respective company’s internal governance procedures to make the decisions or carry out the activities given to them under this Agreement. The JFC may change its size from time to time by mutual, unanimous consent of its members; provided that the JFC shall consist at all times of an equal number of representatives of each of Merck and SeaGen. Each Party may replace one or more of its JFC representatives at any time in its sole discretion upon written notice to the other Party. If agreed by the JFC, the JFC may invite non-members to participate in the discussions and meetings of the JFC; provided that such participants are under obligations of confidentiality consistent with this Agreement and shall have no voting authority at the JFC. The JFC shall be co-chaired by representatives of each Party. The role of the co-chairpersons shall be to convene and preside at meetings of the JFC, to prepare and circulate agendas and to ensure the preparation of minutes (all such responsibilities to alternate between each Party’s co-chairperson on an annual basis), but the co-chairpersons shall have no additional powers or rights beyond those held by the other JFC representatives. 3.6.3 Specific Responsibilities of the JFC. In addition to its general responsibilities, with respect to Licensed Compounds and the Licensed Product, the JFC shall, subject to the terms of this Agreement and subject to the oversight of the JSC, in particular: (a) work with the JSC and the other Subcommittees to assist in financial, budgeting and planning matters as required, including assisting in the preparation of budgets and annual and long term plans with respect to the Licensed Product; (b) recommend, for approval by the JSC, procedures, formats and timelines consistent with this Agreement for reporting financial data as well as additional or alternative reporting procedures concerning financial aspects of the collaboration with respect to the Licensed Product; (c) prepare such reports on financial matters as are approved by the JSC for the implementation of the financial aspects of the collaboration with respect to the Licensed Product; (d) coordinate audits of financial data where appropriate and required or allowed by this Agreement with respect to the Licensed Product; -56- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Development Plan to include GLP Tox Studies for such Licensed Compound. In addition, in the event that Merck provides (or is deemed to have provided) a Licensed Compound Notice pursuant to Section 2.9.2 for SGN-LIV-1-C such that SGN-LIV-1-C is included as a “Licensed Compound” hereunder, then, upon successful completion of such GLP Tox Studies for SGN-LIV-1-C (as determined by the JSC; provided that, with respect to SGN-LIV-1-C, GLP Tox Studies for SGN- LIV-1-C shall have been successfully completed if the JSC determines that the data from the GLP Tox Studies for SGN-LIV-1-C shows that SGN-LIV-1-C has met the “Criteria of Go to Phase I Clinical Evaluation” set forth in part 2 of Schedule 2.9.2), unless otherwise agreed by both Parties, each Party shall be deemed to have agreed to initiate at least one (1) Phase I Clinical Trial for SGN-LIV-1-C (which Phase I Clinical Trial would have as its aim, unless otherwise determined by the JDC, to [ * ]) and the JSC will promptly (and within [ * ] days after first presentation of the final results of such successful GLP Tox Studies to the JSC), amend the Development Plan to include at least one (1) Phase I Clinical Trial therefor, the design of and protocol for which Phase I Clinical Trial shall be mutually agreed by the Parties via the JDC in accordance with Section 3.3.2(c) and 3.3.2(d), respectively. (b) In the event that a Party desires to develop (i) a Licensed Compound or the Licensed Product for any Combination Therapy with, or as a Combination Product with, (A) a product of a Third Party or (B) a Merck Proprietary Product or (C) a SeaGen Proprietary Product (including, in each case ((A), (B) and (C)), marketed products or pipeline products), or (ii) any Companion Diagnostic for a Licensed Compound or the Licensed Product, such Party may propose including such Combination Therapy, Combination Product or Companion Diagnostic in the Development Plan, but such proposal shall be included only if agreed to by the JSC. With respect to any development for use in a Combination Therapy or as a Combination Product with a product of a Third Party or development of a Companion Diagnostic of a Third Party, the Parties, through the JSC, shall discuss and agree upon any agreements to be entered into with the applicable Third Party for use of such Third Party’s product in combination or in connection with the Licensed Product; provided that any such agreement with such Third Party shall be subject to the approval of the JSC. With respect to any development for use in a Proprietary Triple Combination Therapy, the Parties shall, in good faith prior to the time Development commences in relation to such Proprietary Triple Combination Therapy, discuss in good faith and mutually agree upon any additional terms or other amendments to this Agreement with respect to the proposed Development and Commercialization of the Licensed Product for use in such Proprietary Triple Combination Therapy [ * ]. (c) For clarity, in the event that (i) a Next Generation Compound is included as a Licensed Compound pursuant to Section 2.9.2 or an Acquired Competing Product is included as a Licensed Compound pursuant to Section 2.9.3(c), or (ii) a Combination Therapy (including any Proprietary Combination), Combination Product or Companion Diagnostic is approved by the JSC pursuant to Section 5.2.4(b) for inclusion in the Development Plan; then, in each case (i) and (ii), any further Development activities with respect to such Licensed Compound or for such Licensed Product for use in such Combination Therapy or as a Combination Product, or such Companion Diagnostic, as applicable, shall be in accordance with the Development Plan as approved by the JSC and the other terms and conditions of this Agreement. -63- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
or (e) for internal research purposes (provided that Merck may not so use Development Data that is a SeaGen Proprietary Product Program Invention and SeaGen may not so use Development Data that is a Merck Proprietary Product Program Invention); provided, however, that the foregoing restrictions shall no longer apply to any Development Data that becomes available to the public. 5.3.3 Study Reports. The Lead Study Party (as the sponsor) for a given Clinical Trial for the Licensed Product pursuant to a Development Plan shall provide the other Party with an electronic draft of the final study report for such Clinical Trial as soon as reasonably practicable after completion of the Clinical Trial, for such other Party to provide comments to the Lead Study Party, which comments shall be provided within [ * ] days of receipt of the draft of such final study report. The Lead Study Party shall consider in good faith such comments and, at either Party’s reasonable request, the Parties shall meet in person or via teleconference within ten (10) Business Days after the Lead Study Party’s receipt of such comments to discuss such comments in good faith. The Lead Study Party shall provide the other Party with a copy of the final study report for a given study promptly after such final study report is available. In the event that a given Clinical Trial under the Development Plan is for a Proprietary Combination, the Lead Study Party shall not include any statements in the study report relating to the applicable Proprietary Product which have not been approved by the applicable Proprietary Product Party, unless otherwise required by Applicable Law. 5.3.4 Records. Each Party shall maintain (and shall cause its Affiliates and subcontractors performing Development activities with respect to the Licensed Product to maintain) records, in sufficient detail and in good scientific manner appropriate for patent and regulatory purposes, which shall fully and properly reflect all work done and results achieved in the performance of the Development of the Licensed Product. Each Party shall have the right, during normal business hours and upon reasonable (and, in any event, not less than thirty (30) days’) prior written notice, not more than once per Calendar Year (unless for cause), to inspect all such records of the other Party (which may be redacted for information that is not related to this Agreement, including, (a) with respect to records of Merck and its Affiliates, redactions for information specific to the Merck Proprietary Product and not related to a Merck Proprietary Combination, and (b) with respect to records of SeaGen and its Affiliates, redactions for information specific to the SeaGen Proprietary Product and not related to a SeaGen Proprietary Combination or specific to the SeaGen Linker Technology that is not relevant for the Licensed Product or a Licensed Compound) to the extent reasonably requested for the purposes of this Agreement. Such records and the information disclosed therein shall be maintained in confidence in accordance with Section 9.1. 5.3.5 Data Integrity. Each Party agrees that it shall carry out all Development activities for the Licensed Product and collect and record any data generated therefrom in compliance with Applicable Law and in a manner consistent with the following: (a) data will be generated using sound scientific techniques and processes, (b) data will be accurately recorded in accordance with good scientific practices by persons conducting research hereunder, (c) data will be analyzed appropriately without bias in accordance with good scientific practices, and (d) data and results will be stored securely and in a manner that can be easily retrieved. 5.4 Lead Study Party; Conduct of Clinical Trials. -66- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
5.4.1 With respect to a Clinical Trial of Licensed Product to be conducted pursuant to the Development Plan, the Lead Study Party shall prepare and submit to the JDC for review, discussion and approval in accordance with Section 3.3.2(d) the protocol (and any material amendments thereto) for any such Clinical Trial. 5.4.2 The Lead Study Party for a Clinical Trial shall have operational control of all applicable Development activities (provided that such activities are consistent with the Development Plan and this Agreement) and shall act as the sponsor of such Clinical Trial. The Lead Study Party shall be responsible for obtaining all necessary approvals and clearances, including IRB approvals, INDs and other regulatory approvals and customs clearances necessary for the conduct of such Clinical Trials, in each case, in accordance with this Agreement, and the Lead Study Party shall ensure that all such approvals and clearances are obtained prior to initiating performance of the applicable Clinical Trial. The Lead Study Party shall ensure that the Clinical Trial is performed in accordance with the protocol and all Applicable Laws, including cGCPs. 5.4.3 The Lead Study Party shall be responsible for selecting the Clinical Trial sites and clinical trial investigators for the Development activities and entering into clinical trial agreements in connection therewith. The clinical trial agreements shall require the Clinical Trial sites to comply with all Applicable Laws and will contain provisions in accordance with industry standards, including those relating to confidentiality, data and results, intellectual property and publications; provided that, in all cases, such agreement shall require that all Know-How specifically related to the Licensed Product (or any Proprietary Product), including improvements or modifications thereof, shall be assigned to the Lead Study Party (and thereafter subject to further assignment as between the Parties as provided for herein). 5.4.4 The Lead Study Party shall prepare and obtain the patient informed consent forms for the Clinical Trials as part of the Development activities, which shall comply with Applicable Law. The Lead Study Party shall ensure that all patient authorizations and consents in connection with the Clinical Trials permit, in accordance with Applicable Law, sharing of clinical trial data with the other Party in accordance with this Agreement. 5.5 Regulatory and Safety Responsibility for the Licensed Product. 5.5.1 Approval of XXXx and Core Data Sheet. (a) MAA. The JDC in collaboration with the JMC shall review and approve (1) the contents of each MAA for the Licensed Product in the Collaboration Territory, and (2) the CMC components of any MAA for the Licensed Product in the Territory. If the CMC components of any MAA for the Licensed Product have previously been approved as set forth above, the Lead Regulatory Party may submit such components (or subset thereof) to the applicable Regulatory Authorities without seeking additional approval; provided that if any material changes are made to such components or additional CMC information is required to be submitted together with such components, approval under this Section 5.5.1(a) shall be required. (b) Core Data Sheet. Merck will lead the preparation and update of the Core Data Sheet for the Licensed Product, in consultation with SeaGen. The initial Core Data Sheet and any changes to the Core Data Sheet shall be agreed between the Parties. In the event -67- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
that the Parties cannot agree upon the content of the Core Data Sheet or any changes thereto, either Party may escalate the matter as follows: (i) if such matter relates to safety labelling, either Party (through the Alliance Managers) may elect to formally submit such issue to Merck’s [ * ] (or a person in an equivalent position at Merck) and SeaGen’s [ * ] (or a person in an equivalent position at SeaGen) for resolution; and (ii) for all other such matters, and for any matter not resolved as provided in the foregoing clause (i) within [ * ] Business Days after formal submission of such matter under the foregoing clause (i) for resolution, either Party may elect to submit such issue to the JSC for final resolution in accordance with Section 3.2.4. The Lead Regulatory Party in the applicable country shall be responsible for creating and updating the local product information for the Licensed Product in the applicable country; provided that the Lead Regulatory Party shall submit such information to the JDC for approval by the JDC if any material deviations are made from the Core Data Sheet. Any changes to the local product information required by Applicable Laws or a Governmental Authority shall be communicated by the applicable Party to the JDC in a timely manner. For purposes of this Agreement, “Core Data Sheet” means a document setting forth information relating to safety, efficacy, indications, dosing, pharmacology, and other information concerning the Licensed Product. 5.5.2 Lead Regulatory Party. (a) The regulatory strategy for the Licensed Product in the Territory shall be governed by the applicable portion of the Development Plan related to regulatory matters (the “Regulatory Plan”). The Regulatory Plan shall only be amended upon approval by the JSC. The Lead Regulatory Party with respect to a given country in the Territory shall be responsible for, and shall use Commercially Reasonable Efforts to, conduct the activities pursuant to the Regulatory Plan for the applicable Licensed Product in such country, which shall include the Parties’ plan for filing XXXx for the applicable Licensed Product in such country, including any supplements and amendments thereto. (b) The applicable Lead Regulatory Party shall be responsible for taking the lead with all interactions with Regulatory Authorities (meetings, telephone, etc.) in a given country in the Territory and for other regulatory matters related to the Licensed Product in such country in the Territory [ * ]. To the extent permitted by the applicable Regulatory Authority and Applicable Law, the non-Lead Regulatory Party shall be entitled to have [ * ] to the [ * ] with [ * ] in the [ * ] for the Licensed Product and (ii)] to the extent [ * ] for the [ * ] (and in each case, [ * ], the Lead Regulatory Party shall provide notice to the other Party sufficiently in advance of any such meeting or interaction unless such advance notice is not possible due to the urgency of the situation, in which case the Lead Regulatory Party shall inform the other Party of the content of such a meeting as soon as reasonably possible after the meeting has taken place). (c) Subject to Section 5.5.1(b) with respect to the Core Data Sheet, the Lead Regulatory Party for a country shall also be responsible for preparing all Regulatory Documentation for the applicable Licensed Product in such country in the Territory [ * ]. The non- Lead Regulatory Party shall have the right to review and comment upon (which comments shall be made in a timely manner and shall be considered in good faith by the Lead Regulatory Party) all material Regulatory Documentation for the Licensed Product in the Territory (which material Regulatory Documentation shall be provided by the Lead Regulatory Party to the other Party -68- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
reasonably prior to submission thereof). The Lead Regulatory Party shall promptly provide to the non-Lead Regulatory Party a copy of (i) all material correspondence from any Regulatory Authority for the Licensed Product, and (ii) final material Regulatory Documentation submitted to a Regulatory Authority for the Licensed Product after submission thereof. Without limiting the foregoing, if the non-Lead Regulatory Party receives any material correspondence from a Regulatory Authority from a Regulatory Authority for the Licensed Product, it shall promptly provide copies thereof to the other Party. (d) The Lead Regulatory Party for a country in the Territory shall also be responsible, in accordance with this Agreement, for submitting and thereafter maintaining (including all routine maintenance) all (subject to Section 5.5.3) investigational study applications (including INDs) and all registration dossiers (including XXXx) and all Marketing Authorizations related to the applicable Licensed Product in such country in the Territory (including with respect to Pricing Approvals and health technology assessments for the Licensed Product, as applicable), and all such INDs, XXXx and Marketing Authorizations (including with respect to Pricing Approvals and health technology assessments for the Licensed Product, as applicable) shall be in the name of the Lead Regulatory Party (or its Affiliate or sublicensee, or if required under Applicable Law in a given country, a local Distributor). The Lead Regulatory Party shall not withdraw (and shall cause its Affiliates not to withdraw) any Marketing Authorization for the Licensed Product in the Territory without the prior consent of the JSC. (e) The Lead Regulatory Party for a country in the Territory shall also be responsible, in accordance with this Agreement, for activities to support the registration of the Licensed Product, including post-marketing surveillance programs, in accordance with the Development Plan. (f) With respect to Pricing Approvals and health technology assessments for the Licensed Product, the following shall apply to the extent permitted by Applicable Law and the applicable Regulatory Authority: (i) The Lead Regulatory Party shall seek to obtain Pricing Approvals for the Licensed Product from the applicable Regulatory Authorities, [ * ]; provided, however, that [ * ] in the event that the [ * ] then, before doing so[ * ] shall [ * ] and shall [ * ] with respect thereto, however, [ * ]. (ii) The Parties hereby agree and acknowledge that the foregoing provisions of this Section 5.5.2 do not give the non-Lead Regulatory Party the right to receive, review and comment on Regulatory Documentation or other correspondence with Regulatory Authorities with respect to, or attend meetings or other interactions with Regulatory Authorities in connection with, [ * ]; provided, however, that in lieu thereof, (w), the Lead Regulatory Party shall provide to the JCC [ * ], (x) the Lead Regulatory Party shall provide periodic updates to the JCC on [ * ], (y) the Lead Regulatory Party [ * ] shall provide to the non-Lead Regulatory Party’s [ * ], and (z) the Lead Regulatory Party shall provide to the JCC a copy of all final Pricing Approvals (and any amendments thereto) for the Licensed Product promptly following receipt from the applicable Regulatory Authority. Notwithstanding the foregoing provisions of this Section -69- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
correspondence submitted to Regulatory Authorities with respect to a Proprietary Product Party’s Proprietary Product for use in a Proprietary Combination (and, for clarity, shall not apply with respect to submissions, documents and other correspondence submitted to Regulatory Authorities for the Licensed Product itself for use in the Proprietary Combination, which shall be governed by the foregoing provisions of this Section 5.5). (a) Notwithstanding the foregoing provisions of this Section 5.5, the applicable Proprietary Product Party shall be responsible for preparing all submissions, documents and other correspondence submitted to applicable Regulatory Authorities for such Proprietary Product Party’s Proprietary Products for use in a Proprietary Combination in the Territory, including INDs, XXXx and Marketing Authorizations (including product labeling and including in connection with pricing/reimbursement approvals and health technology assessments), in each case, for the Proprietary Product, and amendments and supplements thereto (collectively, the “Proprietary Product Regulatory Documentation”). (b) The applicable Proprietary Product Party shall (i) promptly provide to the other Party a copy of those portions of all material correspondence from any Regulatory Authority with respect to Proprietary Product Regulatory Documentation to the extent specifically pertaining to the Licensed Compound or Licensed Product (but excluding pricing/reimbursement approvals and health technology assessments for the Proprietary Product, as applicable), (ii) promptly provide to the other Party a copy of those portions of final material Proprietary Product Regulatory Documentation that specifically pertain to Licensed Compound or Licensed Product after submission thereof (but excluding pricing/reimbursement approvals and health technology assessments for the Proprietary Product, as applicable) and (iii) keep the other Party informed regarding all material regulatory matters that specifically pertain to the Licensed Compound or the Licensed Product for use in the applicable Proprietary Combinations (but excluding pricing/reimbursement-related and health technology assessment-related submissions, communications and approvals, in each case, for the Proprietary Product, as applicable). (c) For clarity, notwithstanding Section 5.5.2(b), the non-Proprietary Product Party shall not be entitled to have representatives present at meetings or other interactions with Regulatory Authorities for the other Party’s Proprietary Products; provided, however, that the Proprietary Product Party shall provide updates to the other Party with respect to such meetings or other material interactions with Regulatory Authorities to the extent specifically pertaining to the Licensed Compound or the Licensed Product (but excluding pricing/reimbursement-related and health technology assessment-related meetings or other interactions, in each case, for the Proprietary Product, as applicable). (d) Except as expressly set forth in the foregoing provisions of this Section 5.5.5, the non-Proprietary Product Party shall have no right to review or receive any regulatory documentation with respect to any of the Proprietary Product Party’s Proprietary Products. 5.5.6 Components of Proprietary Combinations Sold Separately. For the avoidance of doubt, with respect to a Proprietary Combination, the Parties expect and intend for the Licensed Product and the applicable Proprietary Product in such Proprietary Combination to -71- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
be priced and sold separately, and, as between the Parties, the applicable Proprietary Product Party shall have the sole right, in its discretion (unless and solely to the extent the applicable Proprietary Combination is a Combination Product hereunder, in which case the Parties will discuss in good faith and mutually agree on how to handle establishing the terms and conditions relating to the sale of such Combination Product), to sell its Proprietary Product and establish any terms and conditions relating to the sale thereof, including the price (including discounts, rebates and other forms of price concessions), which activities with respect to such Proprietary Product shall be deemed to be outside the scope of this Agreement (and, for clarity, the Proprietary Product Party shall not be required to share with the non-Proprietary Product Party any pricing information (including any information with respect to Pricing Approvals and health technology assessments for its Proprietary Product) with respect to such Proprietary Product Party’s Proprietary Products). 5.5.7 Safety Reporting. (a) Within [ * ] days after the Effective Date, the Parties (or their respective Affiliates) shall initiate negotiations to enter into a pharmacovigilance agreement for the Licensed Product (the “Pharmacovigilance Agreement”) for exchanging adverse event and other safety information relating to the Licensed Product worldwide. In the event of any inconsistency between the terms of this Agreement and the Pharmacovigilance Agreement, the terms of this Agreement shall prevail and govern, except to the extent such conflicting terms relating directly to the pharmacovigilance responsibilities of the Parties (including the exchange of safety data), in which case the terms of the Pharmacovigilance Agreement shall prevail and govern. (b) SeaGen (or its Affiliate) shall provide Merck an electronic copy to include [ * ] for all legacy data of applicable adverse events for the Licensed Product that is within SeaGen’s (or its Affiliate’s) possession, for inclusion in Merck’s safety database for the Licensed Product. (c) Upon receipt and completion of processing of all legacy data as set forth in the foregoing clause (b), Merck will assume the role of global safety database holder for the Licensed Product. SeaGen may continue to hold a mirror safety database for the Licensed Product. (d) Each Party hereto agrees to notify the other Party of any information of which such Party becomes aware concerning any adverse events with respect to the Licensed Product. All serious adverse events shall be exchanged as a processed case (on a CIOMS-1 form in English) within [ * ] calendar days of receipt and all non-serious adverse events shall be exchanged as a processed case (on a CIOMS-1 form in English) within [ * ] calendar days of receipt. Adverse events with respect to the Licensed Product from Clinical Trials that are drug- related, fatal and life threatening shall be exchanged (on a CIOMS-1 form in English) within [ * ] calendar days. The Pharmacovigilance Agreement shall ensure that adverse event and other safety information is exchanged according to a schedule that will permit each Party to comply with Applicable Law, including any local regulatory requirements. (e) It is understood and agreed that these safety reporting requirement provisions are based on the policies and procedures of the Parties and regulatory reporting -72- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
consistent with Sections 6.4, 6.5 and 6.6. For clarity, the Commercialization Plan may also include activities with respect to the Commercialization of a Companion Diagnostic. Both Parties shall have the right to propose to the JCC additional Commercialization activities with respect to the Licensed Product not then part of the applicable Commercialization Plan. In the event of any inconsistency between the Commercialization Plan and this Agreement, the terms of this Agreement shall prevail. 6.2.2 Initial Commercialization Plan. The initial Commercialization Plan (including Commercialization Budget) for the Licensed Product shall be prepared jointly by the Parties and submitted to the JCC for its review (and ultimately submitted to the JSC for its review and approval) at least [ * ] prior to the anticipated issuance of the first Marketing Authorization by a Regulatory Authority for such Licensed Product (each, an “Initial Commercialization Plan”). The Initial Commercialization Plan for the Licensed Product shall be effective from the date approved by the JSC until amended and updated by the JCC, and approved by the JSC, in accordance with this Agreement. For the avoidance of doubt, no Commercialization of the Licensed Product in the Territory shall occur unless and until the JSC approves the Initial Commercialization Plan with respect thereto. 6.2.3 Amendments to Commercialization Plan. On an annual basis, or more often as the Parties may deem appropriate, the JCC shall prepare proposed amendments to the then-current Commercialization Plan for the Licensed Product and the corresponding Commercialization Budget, for approval of the JSC no later than [ * ] of each Calendar Year. Such amended Commercialization Plan shall cover the applicable period as set forth therein and shall contain corresponding updates to the Commercialization Budget included therein, which shall appropriately itemize the costs and expenses separately for each Commercialization activity for the applicable Licensed Product, to the extent practicable. Such updated and amended Commercialization Plan shall reflect any changes, reallocation of resources with respect to, or additions to the then-current Commercialization Plan. In addition, the JCC may prepare amendments to the Commercialization Plan and corresponding allocation of the Commercialization Budget for the JSC’s approval from time to time during the Calendar Year in order to reflect changes in such plan and budget, in each case, in accordance with the foregoing. Once approved by the JSC, the amended Commercialization Plan (and Commercialization Budget) shall become effective for the applicable period on the date approved by the JSC (or such other date as the JSC shall specify). Any JSC-approved amended Commercialization Plan (and Commercialization Budget) for the Licensed Product shall supersede the previous Commercialization Plan (and Commercialization Budget) for such Licensed Product for the applicable period. Notwithstanding the foregoing, in the event that the JSC does not approve a given amended Commercialization Plan (or Commercialization Budget, as applicable) for the Licensed Product, then the then-current Commercialization Plan and Commercialization Budget (for the preceding Calendar Year) for such Licensed Product, as applicable, shall be deemed to be automatically renewed for the upcoming Calendar Year. 6.2.4 Regional Commercialization Plans. Following the preparation of the Commercialization Plan for a given Calendar Year, no later than [ * ] of each applicable Calendar Year, (a) SeaGen, for the SeaGen Territory, (b) Merck, for the Merck Territory, and (c) the Parties jointly, for the Collaboration Territory, shall prepare regional commercialization plans with -74- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
additional details related to the Commercialization of the applicable Licensed Product in the SeaGen Territory, Merck Territory or Collaboration Territory, as applicable (each, a “Regional Commercialization Sub-Plan”), for submission to and review by the JCC, and approval by the JSC (provided that, with respect to the Regional Commercialization Sub-Plan for the Merck Territory and the SeaGen Territory, such approval by the JSC shall only be for consistency with the overall approved Commercialization Plan for the applicable Calendar Year, but allowing for differences in regional and local factors to be addressed). In all cases, the Party(ies) preparing a given Regional Commercialization Sub-Plan shall ensure that such Regional Commercialization Sub-Plan is consistent with the Commercialization Plan (including Commercialization Budget) for the applicable Calendar Year, and the Party(ies) preparing a given Regional Commercialization Sub-Plan may (but shall not be required to) further break down such Regional Commercialization Sub-Plan on a country-by-country basis. In addition, the Party that prepared the applicable Regional Commercialization Sub-Plan (or either Party for the Regional Commercialization Sub- Plan for the Collaboration Territory) may propose amendments to a given Regional Commercialization Sub-Plan from time to time during the Calendar Year in order to reflect changes in such plan, and shall submit such proposed amendments to the JSC for review and approval (provided that, with respect to the Regional Commercialization Sub-Plan for the Merck Territory and the SeaGen Territory, such approval by the JSC shall only be for consistency with the overall approved Commercialization Plan, but allowing for differences in regional and local factors to be addressed). Once approved by the JSC, the applicable Regional Commercialization Sub-Plan (and any amendments thereto) shall become effective for the applicable period on the date approved by the JSC (or such other date as the JSC shall specify). Any JSC-approved amended Regional Commercialization Sub-Plan for the Licensed Product shall supersede the previous Regional Commercialization Sub-Plan for the applicable region for such Licensed Product for the applicable period. Notwithstanding the foregoing, in the event that the JSC does not approve a Regional Commercialization Sub-Plan for the Licensed Product for a given Calendar Year for a given region, then (a) any portion (if any) of the Regional Commercialization Sub-Plan for such Licensed Product for such Calendar Year for such region that is approved by the JSC shall be deemed to be the Regional Commercialization Sub-Plan for such Licensed Product for such Calendar Year for such region, and (b) if no such portion is so approved, there shall be no Regional Commercialization Sub-Plan for such Licensed Product for such Calendar Year for such region (provided that, for clarity, in each case ((a) and (b)), the overall Commercialization Plan for such Licensed Product for such Calendar Year shall continue to apply with respect to the applicable region). In the event of a conflict between the Commercialization Plan and a given Regional Commercialization Sub-Plan, the Commercialization Plan shall control. 6.2.5 Commercialization Responsibilities. Subject to the terms and conditions of this Agreement (including Section 10.4), each Party shall use Commercially Reasonable Efforts to conduct the Commercialization of the Licensed Product in accordance with the then-approved Commercialization Plan (and the applicable Regional Commercialization Sub-Plan, if applicable) and shall use Commercially Reasonable Efforts to do so within the corresponding Commercialization Budget allocations. 6.2.6 Commercialization Costs; Costs in Excess of the Commercialization Budget. -75- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
the terms and conditions of sale of the Licensed Product to customers in the applicable countries, including any terms and conditions relating to the price at which the Licensed Product will be sold to customers (including discounts, rebates and other forms of price concessions); provided that, in connection therewith, the following shall apply: (a) subject to Applicable Law, the Lead Distribution Party shall not [ * ]; (b) in those countries where Regulatory Authorities issue Pricing Approvals for the Licensed Product, such pricing decisions and terms and conditions shall in all cases comply with all applicable Pricing Approvals from the applicable Regulatory Authorities in the country of sale as may be obtained by the Lead Regulatory Party as set forth in Section 5.5.2; and (c) such pricing decisions and terms and conditions shall, to the extent permitted by Applicable Law, also [ * ] (but subject in all cases to Section 6.4.2(b) if applicable, which shall control in the event of a conflict); provided, however, that in the event that the [ * ] then, before doing so, [ * ] shall [ * ] and shall [ * ] with respect thereto, however, [ * ], but subject in all cases to Section 6.4.2(b). 6.4.3 Distribution Model in the European Collaboration Territory. Given that SeaGen is the Lead Distribution Party and Merck is the Lead Regulatory Party in the European Collaboration Territory, prior to the launch of the Licensed Product in the European Collaboration Territory, the Parties (or their respective Affiliates) shall negotiate in good faith and enter into a distribution agreement for the Licensed Product in the European Collaboration Territory (the “European Collaboration Territory Distribution Agreement”) for Merck to appoint SeaGen as the distributor of the Licensed Product in the European Collaboration Territory and to allocate and coordinate certain additional specific rights and responsibilities between the Parties with respect to the Licensed Product with the goal of ensuring that SeaGen can exercise its rights and perform its obligations as the Lead Distribution Party and Merck can exercise its rights and perform its obligations as the Lead Regulatory Party in the European Collaboration Territory. 6.5 Promotional Materials; Other Field-Based Materials. 6.5.1 General. Subject to Sections 6.5.2 and 6.5.3, the Party allocated the applicable task pursuant to the Commercialization Plan for a given country in the Territory, shall be responsible for preparing the Promotional Materials and the Other Field-Based Materials for the applicable Licensed Product (including, for clarity, any such Promotional Materials and Other Field-Based Materials for the Licensed Product for use in any Combination Therapy) in such country. All Promotional Materials shall comply with the Promotional Materials Guidelines, all Other Field-Based Materials shall comply with the Other Field-Based Materials Guidelines, and all Promotional Materials and all Other Field-Based Materials shall also, in each case, be consistent with the Commercialization Guidelines and the Commercialization Plan. The Party that prepares the applicable Promotional Materials or Other Field-Based Materials shall be responsible for ensuring that such Promotional Materials or Other Field-Based Materials comply with Applicable Law. -77- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
6.5.2 Materials other than Proprietary Combination Materials. (a) Subject to Section 6.5.3, with respect to Promotional Materials or Other Field-Based Materials, as applicable, for the Collaboration Territory, the Parties shall reasonably cooperate and coordinate in connection with the preparation of such Promotional Materials and Other Field-Based Materials, as applicable (such Promotional Materials for the Collaboration Territory, the “Joint Promotional Materials” and such Other Field-Based Materials for the Collaboration Territory, the “Joint Other Field-Based Materials”). The Party responsible for preparing Joint Promotional Materials or Joint Other Field-Based Materials, as applicable, shall provide proposed versions of such Joint Promotional Materials or Joint Other Field-Based Materials to the other Party for review and approval, in particular, for compliance with Applicable Law and the Promotional Materials Guidelines or Other Field-Based Materials Guidelines, as applicable. Neither Party shall use any Promotional Materials to Promote the Licensed Product in the Collaboration Territory other than Joint Promotional Materials that have been reviewed and approved by the other Party as aforesaid; provided that for clarity, each Party shall have the right to Promote the Licensed Product to the approved labeling for such Licensed Product in accordance with Applicable Laws. Neither Party shall use any other field based materials [ * ] to conduct the applicable field-based activities [ * ] for the Licensed Product in the Collaboration Territory other than Joint Other Field-Based Materials that have been reviewed and approved by the other Party as aforesaid. (b) Subject to Section 6.5.3, unless otherwise set forth in the Commercialization Plan, SeaGen, with respect to the SeaGen Territory, and Merck, with respect to the Merck Territory, shall be responsible for preparing the local Promotional Materials and local Other Field-Based Materials, as applicable, for the SeaGen Territory and Merck Territory, respectively; provided that, in each case, unless otherwise agreed to by the JCC, such local Promotional Materials and local Other Field-Based Materials shall be based on the Joint Promotional Materials and Joint Other Field-Based Materials with such changes as may be reasonably required to translate such materials into local language and to otherwise comply with local requirements, guidelines and customs in the applicable country (provided that, in all cases, such materials shall comply with the Promotional Materials Guidelines or Other Field-Based Materials Guidelines, as applicable). The Party that prepares the applicable local Promotional Materials or local Other Field-Based Materials shall be responsible for ensuring that such Promotional Materials or Other Field-Based Materials comply with Applicable Law. 6.5.3 Proprietary Combination Materials for use under this Agreement. Notwithstanding the foregoing provisions of this Section 6.5 or any other provision of this Agreement: (a) With respect to the Promotion and other field-based activities for the Licensed Product for use in a Merck Proprietary Combination to be conducted by the Parties hereunder, Merck shall lead the preparation of the Promotional Materials and Other Field-Based Materials, including preparing all revisions, updates and translations thereof, as applicable, for the Licensed Product for use in a Merck Proprietary Combination (such Promotional Materials, the “Merck Licensed Product Combination Promotional Materials” and such Other Field-Based Materials, the “Merck Licensed Product Combination Other Field-Based Materials”) -78- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
throughout the Territory, in each case, in consultation with SeaGen. All Merck Licensed Product Combination Promotional Materials and Merck Licensed Product Combination Other Field-Based Materials shall comply with the Promotional Materials Guidelines and Other Field-Based Materials Guidelines, respectively, and, in each case, be consistent with the Commercialization Guidelines and the Commercialization Plan. Merck shall ensure that the Merck Licensed Product Combination Promotional Materials and Merck Licensed Product Combination Other Field-Based Materials comply with Applicable Law. Merck shall provide the proposed versions of such Merck Licensed Product Combination Promotional Materials or Merck Licensed Product Combination Other Field-Based Materials [ * ] to SeaGen for review and comment, in particular for compliance with Applicable Law and the Promotional Materials Guidelines or Other Field-Based Materials Guidelines, as applicable, and Merck shall [ * ] by SeaGen. Notwithstanding anything to the contrary contained herein, nothing contained herein shall be deemed to grant to SeaGen (and its Affiliates) any right to promote any Merck Proprietary Product (whether as a standalone product or in combination with any other product); provided that, for clarity, SeaGen shall have the right to Promote the Licensed Product for use in a Merck Proprietary Combination in accordance with this Agreement and the applicable Commercialization Plan. (b) With respect to the Promotion and other field-based activities for the Licensed Product for use in a SeaGen Proprietary Combination to be conducted by the Parties hereunder, SeaGen shall lead the preparation of the Promotional Materials and Other Field-Based Materials, including preparing all revisions, updates and translations thereof, as applicable, for the Licensed Product for use in a SeaGen Proprietary Combination (such Promotional Materials, the “SeaGen Licensed Product Combination Promotional Materials” and such Other Field-Based Materials, the “SeaGen Licensed Product Combination Other Field-Based Materials”) throughout the Territory, in each case, in consultation with Merck. All SeaGen Licensed Product Combination Promotional Materials and SeaGen Licensed Product Combination Other Field- Based Materials shall comply with the Promotional Materials Guidelines and Other Field-Based Materials Guidelines, respectively, and, in each case, be consistent with the Commercialization Guidelines and the Commercialization Plan. SeaGen shall ensure that the SeaGen Licensed Product Combination Promotional Materials and SeaGen Licensed Product Combination Other Field-Based Materials comply with Applicable Law. SeaGen shall provide the proposed versions of such SeaGen Licensed Product Combination Promotional Materials or SeaGen Licensed Product Combination Other Field-Based Materials [ * ] to Merck for review and comment, in particular for compliance with Applicable Law and the Promotional Materials Guidelines or Other Field-Based Materials Guidelines, as applicable, and SeaGen shall [ * ] by Merck. Notwithstanding anything to the contrary contained herein, nothing contained herein shall be deemed to grant to Merck (and its Affiliates) any right to promote any SeaGen Proprietary Product (whether as a standalone product or in combination with any other product); provided that, for clarity, Merck shall have the right to Promote the Licensed Product for use in a SeaGen Proprietary Combination in accordance with this Agreement and the applicable Commercialization Plan. 6.5.4 Proprietary Combination Materials for use Outside this Agreement. Notwithstanding the foregoing provisions of this Section 6.5 or any other provision of this Agreement: -79- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
8.1.4 Each Party acknowledges that no employee of the other Party or its Affiliates shall have authority to give any direction, either written or oral, relating to the making of any commitment by such Party or its agents to any Third Party in violation of the terms of this or any other provision of this Agreement. 8.1.5 Each Party will: (a) in connection with its activities under or in connection with this Agreement strictly comply with the OECD Anti-Bribery Convention on combating bribery of foreign public officials in international business transactions, the United States Foreign Corrupt Practices Act of 1977, the United Kingdom Xxxxxxx Xxx 0000 and any other equivalent Applicable Law in the Territory for the prevention of fraud, corruption, racketeering, money laundering and terrorism, in each case as may be amended from time to time (such Applicable Law, the “Anti- Corruption Laws”), including such Party’s own internal policies in connection therewith. Each Party shall require any Affiliates, contractors, subcontractors, distributors or other persons or entities that provide services to such Party in connection with this Agreement to comply with such Party’s obligations under this Section; (b) not, in the performance of this Agreement, directly or indirectly, make any payment, or offer or transfer anything of value, or agree or promise to make any payment or offer or transfer anything of value, to a Public Official or any other Third Party with the purpose of influencing decisions related to either Party or its business in a manner that would violate Anti- Corruption Laws; and (c) no later than [ * ], or shall provide details of any exception to the foregoing; and maintain records (financial and otherwise) and supporting documentation related to the subject matter of this Agreement in order to document or verify compliance with the provisions of this Section 8.1.5 and upon request of the other Party, up to [ * ] per year and upon reasonable advance notice, shall provide the other Party or its representative with access to such records for purposes of verifying compliance with the provisions of this Section 8.1.5. 8.1.6 In connection with this Agreement, each Party has implemented and agrees to maintain and enforce a compliance and ethics program designed to prevent and detect violations of Applicable Law, including the Federal Food, Drug, and Cosmetic Act (21 U.S.C. § 301 et seq.), the Public Health Service Act (42 U.S.C. § 201 et seq.), the Anti-Kickback Statute (42 U.S.C. § 1320a-7b), Civil Monetary Penalty Statute (42 U.S.C. § 1320a-7a), the False Claims Act (31 U.S.C. § 3729 et seq.) and anti-corruption Applicable Law, throughout its operations (including subsidiaries) and the operations of its contractors and subcontractors that have responsibility for products, payments or services provided under this Agreement. Merck agrees to comply with Merck’s internal code of conduct for such program and SeaGen agrees to comply with SeaGen’s internal code of conduct for such program. The Alliance Managers will facilitate discussions and the sharing of information and experiences between the Parties respective compliance and ethics organizations, as part of which SeaGen will provide updates relating to the development of its anti- bribery and corruption compliance program. 8.1.7 In connection with this Agreement, each Party has implemented, and will maintain and enforce, a system of internal accounting controls designed to ensure the making and -92- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
keeping of accurate books, records, and accounts with respect to any products, payments or services provided under this Agreement. In connection with this Agreement, each Party has implemented and will at all times during the Term maintain an adequate internal audit program, and will conduct periodic internal audits in each case in accordance with its established policies and procedures to ensure compliance with applicable legal requirements and the terms of this Agreement. 8.1.8 With respect to the activities contemplated under this Agreement: (a) each Party has been and will, for the Term, be in compliance with all Applicable Law relating to international trade, including economic sanctions, import and export controls and customs procedures; and (b) neither Party has, on its own behalf or in acting on behalf of any other Person, engaged and will not for the Term engage, directly or indirectly, in any transactions, or otherwise deal with, except to the extent permissible under applicable United States law or other Applicable Law, any country or Person targeted by United States or other relevant economic sanctions Applicable Law, including any Person designated on the Specially Designated Nationals List in connection with any activities related to the services under this Agreement. 8.1.9 Each Party agrees that it will not use (and will cause its Affiliates and Third Party contractors not to use) any Person (including any employee, officer, director or Third Party contractor) who is (or has been) on the Exclusions Lists, or who is (or has been) in Violation, in the performance of any activities hereunder or under any Ancillary Agreement. Each Party certifies to the other Party that, as of the Effective Date, it has screened itself, and its officers and directors (and its Affiliates and Third Party contractors (acting in connection with this Agreement) and their respective officers and directors) against the Exclusions Lists and that it has informed the other Party in writing whether it, or any of its officers or directors (or any of its Affiliates or any of their respective officers and directors) has been in Violation. After the Effective Date, each Party will notify the other Party in writing immediately if any such Violation occurs or comes to its attention. 8.1.10 SeaGen and Merck shall (a) track and collect financial disclosure information from all “clinical investigators” involved in the clinical trials hereunder and (b) prepare and submit the certification or disclosure of the same in accordance with all Applicable Law, including Part 54 of Title 21 of the United States Code of Federal Regulations (Financial Disclosure by Clinical Investigators) and related FDA Guidance Documents. Prior to the initiation of clinical activities hereunder, SeaGen and Merck shall determine, in writing, whether each Party shall track and collect separate certification or disclosure forms for each of Merck and SeaGen or use one (1) “combined” certification or disclosure form for both Merck and SeaGen. For purposes of this Section 8.1.10, the term “clinical investigators” shall have the meaning set forth in Part 54.2(d) of Title 21 of the United States Code of Federal Regulations. 8.1.11 The Lead Study Party (as the sponsor) for a given Clinical Trial hereunder will be responsible for reporting payments and other transfers of value made to health care professionals (e.g., investigators, steering committee members, data monitoring committee members, consultants) in connection with the Clinical Trial in accordance with reporting -93- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
9.2 Permitted Disclosure. Notwithstanding the provisions of Section 9.1, a receiving Party shall be permitted to disclose the Confidential Information of the disclosing Party to the extent such Confidential Information: 9.2.1 is disclosed to Governmental Authorities in order to (a) obtain or maintain Patent Rights in relation to the Licensed Compounds, Licensed Product or Companion Diagnostics in accordance with the terms hereof or (b) obtain or maintain approval to (i) conduct Clinical Trials for the Licensed Product or Companion Diagnostics or (ii) market the Licensed Product or Companion Diagnostics; provided that (in each case ((a) or (b)), such disclosure may be only to the extent reasonably necessary to obtain or maintain such Patent Rights or approval in accordance with the provisions of this Agreement; provided that, to the extent practicable, the disclosing Party shall notify the other Party prior to making such disclosure; provided, further, that this Section 9.2.1 shall not permit (A) SeaGen to disclose any Confidential Information of Merck specific to any Merck Proprietary Product that is not specifically related to a Merck Proprietary Combination; and (B) Merck to disclose any Confidential Information of SeaGen specific to any SeaGen Proprietary Product that is not specifically related to a SeaGen Proprietary Combination; 9.2.2 is deemed necessary by a Party to be disclosed to its Related Parties, agent(s), consultant(s), or other Third Parties for the Development, Manufacture or Commercialization of Licensed Compounds or the Licensed Product for the Territory, or for such Person to determine their interest in performing such activities, in accordance with this Agreement on the condition that such Related Parties, agent(s), consultant(s), or other Third Parties agree to be bound by confidentiality and non-use obligations that are no less stringent than those confidentiality and non-use obligations contained in this Agreement; provided, however, that the term of confidentiality for any Third Party shall be no less than [ * ] years; provided, further, that this Section 9.2.2 shall not permit the non-Proprietary Product Party to disclose any Confidential Information of the Proprietary Product Party that is specific to such Proprietary Product Party’s Proprietary Product but not specifically related to a Proprietary Combination; 9.2.3 with respect to the Proprietary Product Party, is disclosed to governmental or other regulatory agencies in order to (a) obtain or maintain Patent Rights in relation to the Proprietary Party’s Propriety Products for use in a Proprietary Combination in accordance with Article 12 or (b) obtain or maintain approval to (i) conduct Clinical Trials for the Proprietary Party’s Proprietary Products for use in a Proprietary Combination or (ii) market such Party’s Proprietary Products for use in a Proprietary Combination; provided that (in each case (a) and (b)), such disclosure may be only to the extent reasonably necessary to obtain or maintain such Patent Rights or approval; 9.2.4 with respect to each Proprietary Product Party, is deemed necessary by such Proprietary Product Party to be disclosed to its Related Parties, agent(s), consultant(s), or other Third Parties for the development, manufacture or commercialization of such Party’s Proprietary Products for use in a Proprietary Combination for the Territory, or for such Person to determine their interest in performing such activities, in accordance with this Agreement on the condition that such Related Parties, agent(s), consultant(s), or other Third Parties agree to be bound by confidentiality and non-use obligations that are no less stringent than those confidentiality and -96- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Development Milestone Development Milestone Event Payment (in U.S. Dollars) 8. [ * ] [ * ] 9. [ * ] [ * ] 10. [ * ] [ * ] 11. [ * ] [ * ] 12. [ * ] [ * ] 13. [ * ] [ * ] 14. [ * ] [ * ] 15. [ * ] [ * ] 16. [ * ] [ * ] 17. [ * ] [ * ] 18. [ * ] [ * ] 19. [ * ] [ * ] 20. [ * ] [ * ] 21. [ * ] [ * ] 22. [ * ] [ * ] With respect to the Development Milestone Events the following shall apply: (a) With respect to Development Milestones Events [ * ], if a given [ * ], then Development Milestone Event [ * ] will be deemed achieved as of [ * ] and the corresponding Development Milestone Payment shall be due and payable by Merck. (b) if Development Milestone Event [ * ] is skipped and not paid, but Development Milestone Event [ * ] is subsequently achieved [ * ], then upon achievement of Development Milestone Event [ * ], Development Milestone Event [ * ] will be deemed achieved and the corresponding Development Milestone Payment shall be due and payable by Merck with the Development Milestone Payment corresponding to Development Milestone Event 3. (c) if Development Milestone Event [ * ] is skipped and not paid, but Development Milestone Event [ * ] is subsequently achieved [ * ], then upon achievement of -101- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
of this Agreement, the JFC will notify the Parties within [ * ] days after the end of the Calendar Quarter during which a given milestone event described below in this Section 10.3.1 (each, a “Commercial Milestone Event” and together with any Development Milestone Event, each, a “Milestone Event”) was first achieved by the Parties under this Agreement after the Effective Date with respect to the first Licensed Product to achieve the applicable Commercial Milestone Event, and Merck shall thereafter pay the applicable amounts set forth below associated with the applicable Commercial Milestone Event in accordance with Section 10.3.2 (each, a “Commercial Milestone Payment” and together with any Development Milestone Payment, each, a “Milestone Payment”): Commercial Milestone Event Commercial Milestone [ * ] Payment (in U.S. Dollars) 1. [ * ] [ * ] 2. [ * ] [ * ] 3. [ * ] [ * ] 4. [ * ] [ * ] 5. [ * ] [ * ] 6. [ * ] [ * ] Each of the foregoing Commercial Milestone Events in this Section 10.3.1 shall be payable a maximum of one (1) time as set forth in the foregoing chart regardless of the number of times the applicable Commercial Milestone Event was achieved (i.e., a maximum of [ * ] Commercial Milestone Payments may be made pursuant to this Section 10.3.1), and no Commercial Milestone Payment shall be due hereunder for any subsequent or repeated achievement of a given Commercial Milestone Event ([ * ]). For the avoidance of doubt, the maximum amount payable by Merck pursuant to this Section 10.3.1 is One Billion Seven Hundred Fifty Million Dollars ($1,750,000,000), assuming that each of the Commercial Milestone Events in this Section 10.3.1 were achieved. For clarity, (a) [ * ], including for [ * ], (b) subject to the foregoing sub-clause (a) of [ * ] shall [ * ] and (c) if [ * ], then the [ * ] for [ * ] shall be [ * ]. 10.3.2 Invoice and Payment of Commercial Milestone Payments. Following delivery of notification by the JFC to the Parties that the applicable Commercial Milestone Event has been achieved by the Parties pursuant to this Agreement, SeaGen shall invoice Merck for the applicable Commercial Milestone Payment, and Merck shall pay such Commercial Milestone Payment within [ * ] days after receipt of the invoice therefor. Each Commercial Milestone Payment is non-refundable and non-creditable. 10.4 Sharing of Costs and Revenues for Licensed Compounds and the Licensed Product Generally. 10.4.1 Generally. With respect to Licensed Compounds and the Licensed Product, (a) on a worldwide basis, the Parties shall share all Allowable Development Costs on the basis of fifty percent (50%) to Merck and fifty percent (50%) to SeaGen; (b) on a worldwide basis, -103- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
the Parties shall share all Allowable Joint IP Costs on the basis of fifty percent (50%) to Merck and fifty percent (50%) to SeaGen; (c) on a worldwide basis, the Parties shall share all Allowable Commercialization Costs on the basis of fifty percent (50%) to Merck and fifty percent (50%) to SeaGen; and (d) on a worldwide basis, the Parties shall share Licensed Product Net Sales and Sublicensee Revenues, in each case, received pursuant to this Agreement, on the basis of fifty percent (50%) to Merck and fifty percent (50%) to SeaGen, in each case ((a), (b), (c) and (d)), which shall be paid as set forth in Section 10.4.2. Notwithstanding the financial definitions herein, the Parties acknowledge and agree that no cost or expense, and no revenues, shall be included in the Allowable Development Costs, Allowable Commercialization Costs or Allowable Joint IP Costs, or in the calculation of Cost of Goods Manufactured or Licensed Product Net Sales or Sublicensee Revenues, if inclusion therein would result in a duplication or double-counting of the same cost or expense or the same revenue. 10.4.2 Calculation and Payment of Shared Costs and Revenues. During the Term, the following shall apply: (a) Within [ * ] days after the end of each Calendar Quarter, each Party shall provide to the other Party and the Financial Managers, in a format to be mutually agreed by the Financial Managers, (i) a detailed, activity-based statement of its (and its Affiliates’) Allowable Development Costs and Allowable Joint IP Costs, including an itemized breakdown of the calculation of Development FTE Costs included in the Allowable Development Costs (each, a “Development Cost Report”), and (ii) a detailed, activity-based statement of its (and its Affiliates) Allowable Commercialization Costs (each, a “Commercialization Cost Report” and, together with the corresponding Development Cost Report, the “Cost Reports”), including an itemized breakdown of the calculation of each element of Allowable Commercialization Costs (including Sales and Marketing Expenses, Allowable Promotion FTE Costs, Allowable Field Force FTE Costs, Cost of Goods Manufactured and Third Party Payments), in each case of (i) and (ii), to the extent incurred in such Calendar Quarter (or a good faith estimate of any portions thereof where actuals are not known as of such time). The Costs Reports shall be in a format to be agreed upon by the Financial Managers. To the extent that any such Allowable Development Costs, Allowable Joint IP Costs or Allowable Commercialization Costs reported pursuant to this Section 10.4.2(a), were estimated, the relevant Party shall provide actual cost information with the next Calendar Quarter’s quarterly Development Cost Report or Commercialization Cost Report, as applicable, and the provisions of Section 10.4.2(b) shall apply to properly allocate between the Parties any amount by which such actual costs exceeded or were less than the estimated costs. For clarity, Allowable Development Costs, Allowable Joint IP Costs and Allowable Commercialization Costs for each Calendar Quarter may include accruals/estimates, and those accruals/estimates will be trued up to actual costs each Calendar Quarter as part of the cost reporting for the following Calendar Quarter. (b) Within [ * ] days after the end of each Calendar Quarter, the Financial Managers shall provide to Merck, SeaGen and the JSC a written report (each, a “Cost Reconciliation Report”) setting forth, in a format to be mutually agreed by the Financial Managers, the calculations of (i) the Allowable Development Costs and Allowable Joint IP Costs, and each Party’s share of such Allowable Development Costs and Allowable Joint IP Costs, and (ii) the Allowable Commercialization Costs and each Party’s share of such Allowable -104- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Commercialization Costs. Such Cost Reconciliation Report shall include for such Calendar Quarter, the (A) total Allowable Development Costs, total Allowable Joint IP Costs and total Allowable Commercialization Costs incurred by each Party, and each Party’s respective proportionate share thereof, and (B) the net payment due from one Party to the other Party in accordance with Section 10.4.1. Each Party shall promptly following receipt of each Cost Reconciliation Report issue an invoice to the other Party for any such net payment due to such Party from such other Party in accordance with Section 10.4.1. Any net payment owed from one Party to the other Party shall be paid within [ * ] days following receipt of such invoice; provided that if a Party disputes an amount provided in such Cost Reconciliation Report, then such disputed amount shall be reviewed by the JSC (provided, however, that in the event that the JSC is unable to resolve the issue, either Party shall have the right to have an independent auditor examine the applicable records in order to resolve such issue pursuant to Section 10.6, which determination shall be binding on the Parties absent manifest error), and any net payment owed with respect to the undisputed amounts shall be paid within such [ * ] day period (and the disputed amount, if determined to be owed, shall be paid within [ * ] Business Days of resolution of the dispute). If requested by Merck or SeaGen, any invoices or other supporting documentation for any payments to a Third Party that individually exceed [ * ] shall be promptly provided. (c) Within [ * ] days after the end of each Calendar Quarter, each Party shall provide to the other Party and the Financial Managers, in a format to be mutually agreed by the Financial Managers, (i) a detailed statement of its (and each of its Affiliate’s) Licensed Product Net Sales with respect to the applicable Licensed Product for the Territory (including the calculation thereof, including a breakdown of Licensed Product Net Sales (and the calculation thereof)) and (ii) a detailed statement of Sublicensee Revenues for such Calendar Quarter with respect to the applicable Licensed Product for the Territory, as well as details of any adjustments to be made to the amounts submitted in the previous Calendar Quarter in the previous Revenue Report (each, a “Revenue Report”). The Revenue Report shall be in a format to be agreed upon by the Financial Managers. (d) Within [ * ] days after the end of each Calendar Quarter, the Financial Managers shall provide to Merck, SeaGen and the JSC a written report (each, a “Revenue Reconciliation Report”) setting forth, in a format to be mutually agreed by the Financial Managers prior to the First Commercial Sale of Licensed Product in the Territory, (i) the total Licensed Product Net Sales and Sublicensee Revenues for the applicable Licensed Product for the Territory, the amount of Licensed Product Net Sales and Sublicensee Revenues for the applicable Licensed Product for the Territory recognized by each Party, and each Party’s share of such Licensed Product Net Sales and Sublicensee Revenues for the applicable Licensed Product for the Territory, and (ii) the net payment due from one Party to the other Party in accordance with Section 10.4.1. Each Party shall promptly following receipt of each Revenue Reconciliation Report issue an invoice to the other Party for any such net payment due to such Party from such other Party in accordance with Section 10.4.1. Any net payment owed from one Party to the other Party shall be paid within [ * ] days following receipt of such invoice; provided that if a Party disputes an amount provided in such Revenue Reconciliation Report, then such disputed amount shall be reviewed by the JSC (provided, however, that in the event that the JSC is unable to resolve the issue, then either Party shall have the right to have an independent auditor examine the applicable records in order to resolve such issue pursuant to Section 10.6, which determination -105- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
shall be binding on the Parties absent manifest error), and any net payment owed with respect to the undisputed amounts shall be paid within such [ * ] day period (and the disputed amount, if determined to be owed, shall be paid within [ * ] Business Days of resolution of the dispute). (e) For planning purposes, at least [ * ] days prior to the end of a given Calendar Quarter, each Party shall report to the other Party and the Financial Managers its non- binding estimated Sublicensee Revenues, Allowable Development Costs, Allowable Joint IP Costs, Allowable Commercialization Costs and, with effect from First Commercial Sale, Licensed Product Net Sales, in each case, for the current Calendar Quarter (which shall be based on the estimated actual amounts for the [ * ] months of such Calendar Quarter and the forecasted amounts for the last month of such Calendar Quarter); provided that, for clarity, the Parties shall not be required to reconcile such estimates with the actual amounts. (f) All costs and expenses and revenues pursuant to this Section 10.4.2 shall be recorded and reported consistent with such Party’s Accounting Standards, consistently applied, and shall be reported in U.S. Dollars (with currency conversions as set forth in Section 10.5). (g) The Financial Managers may determine to consolidate the Cost Reconciliation Report and Revenue Reconciliation Report in order to result in one net payment by the applicable Party. In addition, if agreed to by the Parties (such agreement not to be unreasonably withheld, conditioned or delayed), the Parties shall have the right to reconcile amounts within the Cost Reconciliation Report and Revenue Reconciliation Report at the local country level, on a case-by-case basis; provided that any such amounts shall not also be counted in Section 10.4.1 in order to avoid duplication. (h) The Parties acknowledge and agree that the Cost of Goods Manufactured, the Development FTE Rates, Medical Affairs FTE Rates, Promotion FTE Rates and Field Force FTE Rates represent fair market value for the provision of the applicable services for which such amounts are paid and represent arms’-length negotiated amounts. The Development FTE Rates, Medical Affairs FTE Rates, Promotion FTE Rates and Field Force FTE Rates shall be reviewed annually by the Parties and may be adjusted by mutual written agreement of the Parties to the extent the Parties mutually determine that an adjustment is necessary to comply with the arm’s-length standard under Applicable Law. (i) Notwithstanding anything to the contrary set forth herein, (i) when calculating the Parties’ Allowable Commercialization Costs, Allowable Development Costs and Allowable Joint IP Costs, any amount of, or in respect of, recoverable VAT incurred by each Party (or its Affiliates) in respect of any item of expenditure or cost that forms a component of such calculations shall be excluded and (ii) when calculating Licensed Product Net Sales and Sublicensee Revenues, any amount of, or in respect of, VAT in respect of any item of revenue that forms a component of such calculations shall be excluded. (j) Each Party shall consider in good faith other reasonable procedures proposed by the other Party for sharing applicable financial information hereunder in order to permit each Party to close its books periodically in a timely manner. -106- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
forth a complete and accurate list of the SeaGen Patents (including all application number and filing dates, registration numbers and dates, jurisdictions and owner(s)). SeaGen (and its Affiliates) do not own or control (through license or otherwise) any (A) Patent Rights other than those Patent Rights included within the SeaGen Patents and set forth on Schedule 1.139 or (B) any Know-How other than the Know-How included within the SeaGen Know-How, in each case of (A) and (B), that is necessary or reasonably useful to Develop, Manufacture or Commercialize the Licensed Compound or Licensed Product (for clarity, in the form the Licensed Compound and the Licensed Product exist as of the Effective Date). 11.2.4 SeaGen has obtained from each inventor of the SeaGen Patents that are listed on Schedule 1.139 and indicated on Schedule 1.139 as being owned by SeaGen or any of its Affiliates agreements that have assigned to SeaGen or its Affiliate each such inventor’s entire right, title and interest in and to the applicable SeaGen Patents, and, to SeaGen’s Knowledge, each such agreement is valid and enforceable. 11.2.5 Neither SeaGen nor any of its Affiliates has granted any Third Party, and neither SeaGen nor any of its Affiliates is under any obligation to grant any Third Party any right to research, develop, manufacture or commercialize any Licensed Compound, Licensed Product or Competing Product (including any rights or licenses under the SeaGen Technology to research, develop, manufacture or commercialize any Licensed Compound, Licensed Product or any Competing Product), other than (i) the rights granted to SeaGen’s Third Party contract manufacturers to manufacture the Licensed Compound, Licensed Product and Next Generation Compounds on behalf of SeaGen and (ii) the rights granted to SeaGen’s Third Party contract research organizations to conduct development activities on behalf of SeaGen with respect to the Licensed Compound, Licensed Product and Next Generation Compounds. 11.2.6 Neither SeaGen nor any of its Affiliates is subject to, or bound by, any exclusivity provisions, non-compete provisions or other similar types of provisions or obligations pursuant to any agreement with a Third Party or otherwise that would limit or restrict in any way SeaGen or any of its Affiliates from researching, developing, making, having made, importing, using, selling, offering to sell or otherwise exploiting the Licensed Compound or Licensed Product as set forth herein, or granting the rights to Merck to do so as set forth herein. 11.2.7 To SeaGen’s knowledge, the use or other exploitation of the SeaGen Product-Specific Technology, as contemplated under this Agreement, (i) does not and will not infringe any valid, enforceable and unexpired issued Patent Right of any Third Party or misappropriate any Know-How or other intellectual property of any Third Party and (ii) does not and will not infringe the claims of any published Third Party patent application if such claims were validly issued in their current form. To SeaGen’s knowledge, the use, Development, Manufacture and Commercialization of the Licensed Compound or Licensed Product, in each case, as contemplated under this Agreement, (a) does not and will not infringe any valid, enforceable and unexpired issued Patent Right of any Third Party or misappropriate any Know-How or other intellectual property of any Third Party and (b) does not and will not infringe the claims of any published Third Party patent application if such claims were validly issued in their current form. -111- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
11.2.8 There is no (a) actual claim, litigation, demand, suit, proceeding, arbitration, inquiry, investigation or other legal action, whether civil, criminal, administrative or regulatory, pending, or, to SeaGen’s knowledge, threatened in writing by any Third Party against SeaGen or any of its Affiliates or (b) judgment or settlement against or owed by SeaGen or any of its Affiliates, in each case ((a) or (b)), in connection with the SeaGen Technology or Licensed Compound or Licensed Product, including any of the foregoing that is (i) alleging that the issued patents in the SeaGen Patents are invalid or unenforceable, or the patent applications in the SeaGen Patents will, upon issuance, be invalid or unenforceable, (ii) alleging that the conception, development, generation, reduction to practice, disclosing, copying, making, assigning or licensing of the SeaGen Technology or the practice thereof infringes or would infringe any Patent Rights of any Person or misappropriates or would misappropriate any Know-How or other intellectual property right of any Person, or (iii) relating to any design defect, failure to warn or product liability claim or action for the Licensed Compound or Licensed Product. As used in this section, “proceeding” excludes those pertaining to prosecution of Patent Rights (and communications attendant thereto) between SeaGen (or its Affiliate) and the relevant Governmental Authority without participation of a Third Party contestant or challenger. 11.2.9 Schedule 1.134 sets forth a complete and accurate list of all agreements between SeaGen (or its Affiliate) and a Third Party entered into prior to the Effective Date pursuant to which SeaGen (or its Affiliate) Controls any Patent Rights or Know-How included within the SeaGen Patents or SeaGen Know-How (other than (i) agreements with SeaGen’s (or its Affiliate’s) employees and agreements with independent contractors and service providers entered into in the ordinary course of SeaGen’s (or its Affiliate’s) business, in each case, pursuant to which such employee, independent contractor or service provider, as applicable, assigns its right, title and interest to such Patent Rights and Know-How to SeaGen (or its Affiliate), and (ii) agreements entered into in the ordinary course of business with service providers under which SeaGen (or its Affiliate) is granted customary licenses to the provider’s proprietary technology). SeaGen has provided Merck with true, correct and complete copies of all SeaGen Existing In-Licenses. Neither SeaGen nor its Affiliates are in breach or default under any SeaGen Existing In-License, nor, to SeaGen’s knowledge, is any counterparty thereto in breach of any SeaGen Existing In-License, and neither SeaGen nor its Affiliates have received any written notice of breach or default with respect to any SeaGen Existing In-License. The SeaGen Existing In-Licenses are in full force and effect. There are no terms or conditions in any SeaGen Existing In-License (or any other agreement between SeaGen or any of its Affiliates and a Third Party) that (a) would prevent Merck from exercising, or otherwise conflict with, the rights and licenses granted to Merck under this Agreement, including with respect to the prosecution, maintenance, enforcement or defense of any SeaGen Product-Specific Technology, or (b) would require SeaGen or any of its Affiliates to grant any Third Party rights under any Program Know-How or Program Patents. 11.2.10Except pursuant to the SeaGen Existing In-Licenses set forth on Schedule 1.134, neither SeaGen nor any of its Affiliates are subject to any payment obligations to Third Parties as a result of the execution or delivery of this Agreement, or as a result of the grant or exercise of any of the rights or licenses granted to Merck under this Agreement. 11.2.11Schedule 1.133 sets forth a complete and accurate list of all agreements between SeaGen (or its Affiliate) and a Third Party entered into prior to the Effective Date and in -112- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
sufficient seniority and expertise in the prosecution, maintenance, enforcement and defense of Patent Rights or Trademarks to participate on the IPOC, and (b) to be duly authorized under their respective company’s internal governance procedures to carry out the activities given to them under this Agreement. The IPOC may change its size from time to time by mutual, unanimous consent of its members; provided that the IPOC shall consist at all times of an equal number of representatives of each of Merck and SeaGen. Each Party may replace one or more of its IPOC representatives at any time in its sole discretion upon written notice to the other Party. If agreed by the IPOC, the IPOC may invite non-members to participate in the discussions and meetings of the IPOC (e.g., trademark specialists from the Parties); provided that such participants are under obligations of confidentiality consistent with this Agreement. 12.1.2 No-Decision Making Authority. The Parties hereby agree and acknowledge that the IPOC shall be a forum for review and robust discussion with respect to the intellectual property matters under the purview of the IPOC, and for making recommendations to the Parties with respect thereto, but the IPOC shall not have specific decision-making authority. 12.1.3 Specific Responsibilities of the Intellectual Property Operating Committee. In addition to its general responsibilities, the IPOC shall, subject to the terms of this Agreement, in particular: (a) discuss issues relating to inventorship or ownership of Program Know-How in accordance with the terms of Section 12.3; (b) discuss, develop and coordinate strategies for obtaining, maintaining, defending and enforcing patent protection for the Joint Program Patents, SeaGen Product-Specific Patents and Merck Product-Specific Patents under this Agreement; (c) facilitate cooperation between the Parties pursuant to Section 12.4.3; (d) discuss, develop and coordinate strategies in connection with the selection, adoption, use, registration and enforcement of the Collaboration Marks; and (e) serve as a forum for the prompt disclosure of all material issues relating to the intellectual property that is the subject of this Agreement. 12.1.4 Meetings. The IPOC will meet on a Calendar Quarterly basis (or more or less frequently as the Parties may otherwise mutually agree), with the location for such meetings to be determined by the IPOC. The IPOC may meet in person or, alternatively, the IPOC may meet by means of teleconference, videoconference or other similar communications equipment. Each Party will bear the expense of its respective IPOC members’ participation in IPOC meetings. The IPOC shall be responsible for keeping reasonably detailed written minutes of all meetings of the IPOC. 12.1.5 Duration of the IPOC. The IPOC shall endure for the Term, and if mutually agreed to by the Parties, after the end of the Term (for such period of time as agreed to by the Parties). -117- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Agreement for a SeaGen Proprietary Combination, and the Program Copyrights in the content therein, in each case, shall be owned solely by SeaGen or any of its Affiliates, as applicable. 12.3.5 Jointly Owned Intellectual Property. Subject to the rights and licenses granted to each Party hereunder and in the Ancillary Agreements, (a) Joint Program Know-How, Joint Program Patents and Joint Program Copyrights shall be owned jointly by Merck and SeaGen and (b) subject to the terms and conditions of this Agreement, including Section 2.9 and Article 9, each Party shall have the right to use and exercise Joint Program Know-How, the Joint Program Patents and Joint Program Copyrights, and grant licenses under its interest in Joint Program Know- How, Joint Program Patents and Joint Program Copyrights, as it deems appropriate without the consent of (and if any such consent is required, such consent is hereby granted), or any obligation to, the other Party, including any duty to account. 12.3.6 Assignment. Each Party shall (and shall cause its Affiliates to), and hereby does, for no additional consideration (and the rights and obligations of the Parties as set forth in this Agreement is deemed sufficient consideration), assign all rights worldwide to the Program Know-How, Program Patents and Program Copyrights to the other Party to effectuate the ownership thereof as set forth in the foregoing provisions of Sections 12.3.2, 12.3.3, 12.3.4 and 12.3.5. Each Party shall reasonably assist the other in recording and perfecting such other Party’s rights in and to such Program Know-How and Program Patents. 12.4 Filing, Prosecution and Maintenance of Patent Rights. 12.4.1 Prosecution and Maintenance of SeaGen Product-Specific Patents, Joint Program Patents and Merck Product-Specific Patents. The Lead Patent Party shall have the right, but not the obligation, to prepare, file, prosecute and maintain the SeaGen Product- Specific Patents, Joint Program Patents and Merck Product-Specific Patents, as applicable, worldwide; provided that with respect to Joint Program Patents, such preparation, filing, prosecution and maintenance shall be done through outside counsel mutually agreed to by the Parties. The Lead Patent Party shall keep the other Party reasonably informed of all material steps with regard to the preparation, filing, prosecution and maintenance of the SeaGen Product-Specific Patents, Joint Program Patents and Merck Product-Specific Patents, as applicable, including by providing such other Party with a copy of material communications to and from any patent authority in the Territory regarding such SeaGen Product-Specific Patents, Joint Program Patents or Merck Product-Specific Patents, as applicable, and the other Party shall be copied on all material correspondence with the Lead Patent Party’s patent counsel with respect thereto. The Lead Patent Party shall provide the other Party drafts of any material filings or responses to be made to such patent authorities in the Territory in advance of submitting such filings or responses so as to allow for a reasonable opportunity for such other Party to review and comment thereon, and the Lead Patent Party shall consider in good faith and discuss the requests and suggestions of such other Party with respect to such Lead Patent Party’s drafts and with respect to strategies for filing and prosecuting the SeaGen Product-Specific Patents, Joint Program Patents or Merck Product- Specific Patents, as applicable, in the Territory. The Lead Patent Party shall consult with the other Party reasonably prior to (but at least [ * ] days prior to) taking or failing to take any substantive action (including making any filings) with respect to the SeaGen Product-Specific Patents, Joint Program Patents or Merck Product-Specific Patents, as applicable, including any action that would -119- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
materially affect the scope or validity of rights under any patent applications or patents within the SeaGen Product-Specific Patents, Joint Program Patents or Merck Product-Specific Patents, as applicable (such as substantially narrowing or canceling any claim without reserving the right to file a continuing or divisional patent application, abandoning any patent or not filing or perfecting the filing of any patent application in any country). In the event that the Lead Patent Party decides not to prepare, file, prosecute or maintain a SeaGen Product-Specific Patent, Joint Program Patent or Merck Product-Specific Patent, as applicable, in a country in the Territory, the Lead Patent Party shall provide reasonable prior written notice to the other Party of such intention (which notice shall, in any event, be given no later than [ * ] days prior to the next deadline for any action that may be taken with respect to such Patent Right in such country), the other Party shall thereupon have the option, in its sole discretion, to assume the control and direction of the preparation, filing, prosecution and maintenance of such SeaGen Product-Specific Patent, Joint Program Patent or Merck Product-Specific Patent, as applicable; provided, however, that (a) with respect to any Merck Product-Specific Patent, if Merck determines in good faith that SeaGen’s prosecution and maintenance of such Merck Product-Specific Patent is reasonably likely to have a material adverse impact on Merck’s overall relevant Patent Rights portfolio, then SeaGen shall not have any right to direct such prosecution and maintenance; and (b) with respect to any SeaGen Product-Specific Patent, if SeaGen determines in good faith that Merck’s prosecution and maintenance of such SeaGen Product-Specific Patent is reasonably likely to have a material adverse impact on SeaGen’s overall relevant Patent Rights portfolio, then Merck shall not have any right to direct such prosecution and maintenance. Upon such other Party’s written exercise of such option, such other Party shall assume the responsibility and control for the preparation, filing, prosecution and maintenance of such SeaGen Product-Specific Patent, Joint Program Patent or Merck Product- Specific Patent, as applicable, and shall thereafter be the Lead Patent Party with respect thereto. In such event, the original Lead Patent Party shall promptly provide the new Lead Patent Party with the appropriate documents for such transfer of responsibility and control and reasonably cooperate with such new Lead Patent Party in such country as provided under Section 12.4.3. 12.4.2 Costs of Prosecution and Maintenance of SeaGen Product-Specific Patents, Joint Program Patents and Merck Product-Specific Patents. All out-of-pocket costs and expenses (including, for clarity, amounts paid to outside counsel in connection with the preparation, filing, prosecution and maintenance of the applicable Patent Rights) actually and reasonably incurred by a Party or its Affiliates in connection with the preparation, filing, prosecution and maintenance of SeaGen Product-Specific Patents, Joint Program Patents or Merck Product-Specific Patents in accordance with Section 12.4.1 shall be deemed to be “Joint Patent Costs”. 12.4.3 Cooperation. (a) The Parties agree to cooperate fully in the preparation, filing, prosecution and maintenance of the SeaGen Product-Specific Patents, Joint Program Patents and Merck Product-Specific Patents. Cooperation shall include the Parties (A) executing all papers and instruments, or requiring its employees or contractors to execute such papers and instruments, so as to enable the other Party to apply for and to prosecute the SeaGen Product-Specific Patents, Joint Program Patents or Merck Product-Specific Patents, as applicable, in the Territory, to the extent provided for in this Agreement, and (B) promptly informing the other Party of any matters -120- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Specific Patent, Joint Program Patent or Merck Product-Specific Patent shall be a Patent Right for which the Parties desire to obtain a Patent Term Extension in respect of the Licensed Product, and the Party that is the Lead Patent Party for such Patent Right shall apply for such Patent Term Extension. The Parties shall reasonably cooperate, including the applicable patent holder taking such actions as are required under any Applicable Law, in connection with the foregoing. Notwithstanding the provisions of 3.2.4, if the JSC is unable to agree on which SeaGen Product- Specific Patents, Joint Program Patents or Merck Product-Specific Patents, if any, shall be a Patent Right for which the Parties will seek to obtain a Patent Term Extension in respect of the Licensed Product, as applicable, within [ * ] Business Days after the JSC first considers the issue, then the following shall apply: (a) Either Party (through the Alliance Managers) may elect to formally submit such issue to the Parties’ applicable Senior Executives for resolution. In the event that the Senior Executives are unable to resolve a given issue referred to the Senior Executives within [ * ] Business Days after the dispute is formally submitted to the Senior Executives for resolution, then either Party may elect (through the Alliance Managers) to formally submit such issue to the Parties’ respective [ * ] for resolution. (b) In the event that the [ * ] are unable to resolve a given issue referred to the [ * ] within [ * ] Business Days after the dispute is formally submitted to the [ * ] for resolution, then either Party may elect to submit such issue to a patent counsel jointly selected by the Parties (provided that such selection shall not be unreasonably withheld, conditioned or delayed) who (and whose firm, if applicable) (i) is not, and was not at any time during the [ * ] years prior to such dispute, an employee, consultant, legal advisor, officer or director of, and does not have any conflict of interest with respect to, either Party; (ii) has at least [ * ] years’ experience practicing patent law in the life sciences industry; and (iii) possesses expertise with respect to antibody drug conjugates (an “Independent Patent Counsel”). Such Independent Patent Counsel shall determine which SeaGen Product-Specific Patents, Joint Program Patents or Merck Product- Specific Patents, if any, shall be a Patent Right for which the Parties will seek to obtain a Patent Term Extension in respect of the Licensed Product, taking into account all relevant factors (including the impact on the exploitation of the Licensed Product and any material adverse impact on a Party’s overall relevant intellectual property portfolio), and such Independent Patent Counsel’s determination shall be binding upon the Parties. Expenses of the Independent Patent Counsel shall be “Joint Patent Costs”; provided, in each case, (a) and (b), that if a shorter period of time is necessary to take the action that is the subject of the matter requiring resolution, including in order to comply with applicable statutory requirements for seeking a Patent Term Extension or to avoid any loss of rights, the Parties shall modify the time periods set forth in clauses (a) and (b) so as to permit the taking of such action within such shorter period of time. 12.5.2 Notwithstanding the foregoing, (a) SeaGen (and its Affiliates) shall [ * ] and (b) Merck (and its Affiliates) shall [ * ]. 12.5.3 All out-of-pocket costs and expenses actually and reasonably incurred by a Party or its Affiliates in connection with obtaining any such Patent Term Extensions with respect -122- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
the United States Patient Protection and Affordable Care Act, or implementing FDA regulations and guidance applicable to the approval or manufacture of any biosimilar product or interchangeable product), or otherwise becomes aware that such a Biosimilar Application has been submitted to a Regulatory Authority for marketing authorization (such as in an instance described in 42 U.S.C. § 262(l)(2)), the remainder of this Section 12.10.3 shall apply. Such Party shall promptly, but in any event within [ * ] Business Days, notify the other Party. The owner of the relevant Patents shall then seek permission to view the Biosimilar Application, information regarding the process or processes used to manufacture the product that is the subject of the Biosimilar Application, and related confidential information from the filer of the Biosimilar Application if necessary under 42 U.S.C. § 262(l)(1)(B)(iii). If either Party receives any equivalent or similar communication or notice in the United States or any other jurisdiction, the Party receiving such communication or notice shall within five (5) Business Days notify the other Party of such communication or notice to the extent permitted by Applicable Laws. Regardless of the Party that is the “reference product sponsor”, as defined in 42 U.S.C. § 262(l)(1)(A), for purposes of such Biosimilar Application: (i) [ * ] (the “Controlling Party” and [ * ] the “Non- Controlling Party”, provided, however, that [ * ]) shall discuss and agree in good faith upon an appropriate strategy with respect to such Biosimilar Application and all actions taken with respect to such Biosimilar Action, if any, shall be consistent with such strategy (as may be revised from time to time by prior written agreement of the Parties hereunder). (ii) The Controlling Party shall have the first right to designate the outside counsel and in-house counsel who shall receive confidential access to the Biosimilar Application, information regarding the process or processes used to manufacture the product that is the subject of the Biosimilar Application, and any related confidential information pursuant to 42 U.S.C. § 262(l)(1)(B)(ii), provided that any such outside counsel shall be consented to in writing by the Non-Controlling Party, such consent not to be unreasonably withheld, conditioned or delayed. Notwithstanding the foregoing, if the Controlling Party is not permitted, pursuant to Applicable Law, to make such designations (or take any other action as set forth in this Section 12.10.3) due to the fact that the Controlling Party is not the Lead Regulatory Party or the holder of the applicable Patent Rights, as applicable, then the Non-Controlling Party shall make such designations (or take such other actions as set forth in this Section 12.10.3) at the reasonable direction of the Controlling Party. (iii) In each case, after consulting with the Non-Controlling Party and subject to the then-current strategy agreed upon between the Parties under clause (i) above, the Controlling Party shall have the right to [ * ]. If the Non-Controlling Party is required pursuant to Applicable Law to execute any of these tasks it shall do so in accordance with the then-current strategy agreed upon between the Parties under clause (i) above and in coordination with the Controlling Party. The Controlling Party shall have the right to [ * ]. (iv) The Controlling Party shall have the right, after consulting with the Non-Controlling Party and subject to the then-current strategy agreed upon between the Parties under clause (i) above, [ * ] in any other jurisdiction outside of the United States. If the Non-Controlling Party is required by Applicable Law to execute any of these tasks, it shall do so -129- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
in accordance with Controlling Party’s reasonable instructions, subject to the then-current strategy agreed upon between the Parties under clause (i) above. (v) The Non-Controlling Party shall cooperate with the Controlling Party’s reasonable requests in connection with the foregoing activities to the extent required or permitted by Applicable Law. The Controlling Party shall notify the Non-Controlling Party of any such lists or communications promptly after they are made. (vi) Each Party shall within [ * ] Business Days after receiving any notice of commercial marketing provided by the filer of a Biosimilar Application pursuant to 42 U.S.C. § 262(l)(8)(A), notify the other Party thereof. To the extent permitted by Applicable Law, and subject to clause (i) above, the Controlling Party shall have the first right, but not the obligation, to seek an injunction against such commercial marketing as permitted pursuant to 42 U.S.C. § 262(l)(8)(B) and to file an action for patent infringement, provided that [ * ]. Except as otherwise provided in this Section 12.10.3, any such action shall be subject to the terms and conditions of Sections 12.10.2, 12.10.4 and 12.10.5. (vii) The Parties recognize that procedures other than those set forth above in this Section 12.10.3 may apply with respect to Biosimilar Applications. In the event that the Parties determine that certain provisions of Applicable Laws in the United States or in any other country in the Territory apply to actions taken by the Parties with respect to Biosimilar Applications under this Section 12.10.3 in such country, the Parties shall comply with any such Applicable Laws in such country (and any relevant and reasonable procedures established by Parties) in exercising their rights and obligations with respect to Biosimilar Applications under this Section 12.10.3 in a manner to effectuate the intent of this Section 12.10.3. (b) As used herein, the term “Biosimilar Application” means an application or submission filed with a Regulatory Authority for Marketing Authorization of a pharmaceutical or biological product claimed to be biosimilar or interchangeable to the Licensed Product or otherwise relying on the approval of such Licensed Product, including, for example, an application filed under 42 U.S.C. § 262(k). 12.10.4 Cooperation and Settlement. The Parties agree to cooperate fully in any Infringement Action for a Competitive Infringement with respect to any Relevant Infringement IP or Relevant Linker Infringement IP, as applicable, pursuant to Sections 12.10.2(a), 12.10.2(b) and 12.10.3. If a Party brings such an Infringement Action, [ * ]. Neither Party shall settle any Infringement Action of any Relevant Infringement IP or Relevant Linker Infringement IP, as applicable, in accordance with Sections 12.10.2(a), 12.10.2(b) and 12.10.3 with respect to a Competitive Infringement [ * ]. Without limiting the foregoing, the Party commencing the litigation pursuant to Sections 12.10.2(a), 12.10.2(b) and 12.10.3 with respect to any Relevant Infringement IP or Relevant Linker Infringement IP, as applicable, shall provide the other Party with copies of all pleadings and other documents filed with the court. 12.10.5 Recovery. Except as otherwise agreed by the Parties in connection with a cost sharing arrangement, any recovery realized as a result of an Infringement Action with respect to any Relevant Infringement IP or Relevant Linker Infringement IP, as applicable, brought pursuant to Sections 12.10.2(a), 12.10.2(b) and 12.10.3 (whether by way of settlement or -130- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
(the “Indemnifying Party”) of the commencement of any Action for which indemnification may be sought or, if earlier, upon the assertion of any such Action by a Third Party (it being understood and agreed, however, that the failure by an Indemnified Party to give notice of an Action as provided in this Section 13.5.1 shall not relieve the Indemnifying Party of its indemnification obligation under this Agreement, except and only to the extent that such Indemnifying Party is actually prejudiced as a result of such failure to give notice). 13.5.2 Within [ * ] after delivery of such notification, the Indemnifying Party may, upon written notice thereof to the Indemnified Party, assume control of the defense of such Action using counsel reasonably satisfactory to the Indemnified Party. If the Indemnifying Party does not assume control of such defense, the Indemnified Party shall control such defense. The assumption of a defense by the Indemnifying Party shall not be deemed an admission that the Indemnifying Party has an obligation to defend, indemnify or hold harmless an Indemnified Party from and against any Loss from an Action. If the Indemnifying Party assumes and conducts the defense of an Action as provided above, and if it is ultimately determined pursuant to Section 16.8 that the Indemnifying Party was not obligated to indemnify, defend, or hold harmless an Indemnified Party from and against any Loss from such Action, the Indemnified Party shall reimburse the Indemnifying Party for any and all reasonable and verifiable out-of-pocket costs and expenses (including reasonable attorneys’ and experts’ fees, costs and expenses) incurred by the Indemnifying Party in connection with defending such Action and all other Losses paid by the Indemnifying Party on behalf of the Indemnified Party in connection with such Action, and if such determination is the result of an arbitration proceeding initiated by the Indemnifying Party pursuant to Section 16.8, then the Indemnified Party also shall reimburse the Indemnifying Party for all of the reasonable and verifiable out-of-pocket costs and expenses (including reasonable attorneys’ and experts’ fees, costs and expenses and costs and expenses of the arbitration) incurred by the Indemnifying Party in connection with such arbitration proceeding. 13.5.3 The Party not controlling such defense may participate therein at its own expense; provided that if the Indemnifying Party assumes control of such defense and the Indemnified Party reasonably concludes, based on advice from counsel, that the Indemnifying Party and the Indemnified Party have conflicting interests with respect to such action, suit, proceeding or claim, the Indemnifying Party shall be responsible for the reasonable fees, costs and expenses of counsel to the Indemnified Party solely in connection therewith; provided, further, however, that in no event shall the Indemnifying Party be responsible for the fees, costs and expenses of more than one counsel in any one jurisdiction for all Indemnified Parties. 13.5.4 The Party controlling such defense shall keep the other Party advised of the status of such Action and the defense thereof and shall consider in good faith recommendations made by the other Party with respect thereto. 13.5.5 The Indemnified Party shall not agree to any settlement of such Action without the prior written consent of the Indemnifying Party, which shall not be unreasonably withheld, conditioned or delayed. The Indemnifying Party shall not agree to any settlement of such Action or consent to any judgment in respect thereof that does not include a complete and unconditional release of the Indemnified Party (and the other Merck Indemnified Parties or SeaGen Indemnified Parties, as applicable) from all liability with respect thereto or that imposes any -137- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
(a) Subject to Section 14.7.4, in the event of termination of this Agreement for any reason, the Parties shall work together in good faith following such termination in order to effect, as soon as reasonably practicable (but in any event within [ * ] months) following the effective date of termination, an orderly wind-down or transition in accordance with Sections 14.7.3(b) and 14.7.5 of the ongoing Development, Manufacture and Commercialization responsibilities with respect to the Licensed Product from Merck to SeaGen with respect to those Development, Manufacture and Commercialization activities being performed by Merck hereunder for the Licensed Product as of the date of such termination; provided that (i) except if this Agreement is terminated by Merck under Section 14.2 or by SeaGen pursuant to Section 14.4.2 for Merck’s material breach, or as otherwise provided in Section 14.7.3(b) or 14.7.5, SeaGen shall reimburse Merck for any costs and expenses incurred by Merck (or any of its Affiliates) in connection therewith, and (ii) except as expressly set forth in Section 14.7.5, Merck shall not be required to grant any assignments, rights or licenses to any intellectual property or to any other assets or materials of Merck or any of its Affiliates in connection therewith. (b) Notwithstanding the provisions of Section 14.7.1, the licenses granted to Merck hereunder shall survive during such transition period in order for Merck (and its Related Parties), prior to completion of such transition, to: (i) unless Merck or SeaGen elects to continue the applicable Clinical Trial under Section 14.7.4 or 14.7.5(b), subject to compliance with Applicable Law (including taking into account patient safety), wind-down any ongoing Clinical Trials that were being conducted by Merck (or any of its Related Parties ) as the Lead Study Party with respect to the Licensed Product hereunder at the time of such termination (provided that (A) the costs of winding-down such Clinical Trials shall be Allowable Development Costs and be shared between the Parties in accordance with Section 10.4, mutatis mutandis and (B) the provisions of Section 5.3 shall apply to any and all Development Data generated from such Clinical Trials after the effective date of termination, mutatis mutandis); (ii) solely if this Agreement is terminated after the first commercial sale of the Licensed Product in any country where Merck is the Lead Distribution Party, Distribute and otherwise Commercialize any remaining inventory (including Licensed Product Manufactured pursuant to Section 14.7.3(b)(iv)) of the Licensed Product hereunder for such country; provided that, all activities with respect to such Distribution and Commercialization of the Licensed Product shall be done in accordance with the applicable terms and conditions of this Agreement, mutatis mutandis, and the Parties shall continue to share the costs and expenses with respect to such Distribution and other Commercialization of such inventory in accordance with Section 10.4, mutatis mutandis, and shall share the Licensed Product Net Sales from the sale of such inventory in accordance with Section 10.4, mutatis mutandis; (iii) solely with respect to those countries where Merck is the Lead Regulatory Party, to continue to undertake such Development activities for the Licensed Product designated to Merck as the Lead Regulatory Party, during such transition period, as applicable; provided that all such activities shall be done in accordance with the applicable terms and conditions of this Agreement, mutatis mutandis, and the Parties shall continue to share the -142- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
costs and expenses with respect to such activities in accordance with Section 10.4, mutatis mutandis; and (iv) if Merck is the Lead Manufacturing Party, to finish any Manufacturing of any work-in-progress of Licensed Product; provided that all such activities shall be done in accordance with the applicable terms and conditions of this Agreement, mutatis mutandis, in which case, the Parties shall continue to share the costs and expenses with respect to such activities in accordance with Section 10.4, mutatis mutandis; provided that, for clarity, Merck shall have no obligation to undertake such activities in the foregoing clauses (ii) or (iv) of this Section 14.7.3(b), as applicable. 14.7.4 Election by Parties to Continue Ongoing Conduct of Clinical Trials for Merck Proprietary Combinations under a Clinical Trial Agreement. In the event of termination of this Agreement for any reason, notwithstanding the provisions of Section 14.7.3 or 14.7.5(b), with respect to any Clinical Trial of the Licensed Product for use in a Merck Proprietary Combination that has been Initiated and is ongoing as of the effective date of termination (any such Clinical Trial, an “Ongoing Merck Proprietary Combination Trial”), the following shall apply: (a) With respect to each Ongoing Merck Proprietary Combination Trial, either Party may elect, on a Clinical Trial-by-Clinical Trial basis, to continue the conduct of such Ongoing Merck Proprietary Combination Trial pursuant to Section 14.7.4(c) and will provide written notice to the other Party of its election before the effective date of termination or within the [ * ] period immediately thereafter. (b) With respect to any Ongoing Merck Proprietary Combination Trial that neither Merck nor SeaGen elected to continue pursuant to Section 14.7.4(a) and that is being conducted by Merck (or any of its Related Parties on its behalf) as the Lead Study Party, SeaGen will make an election under Section 14.7.5(b) as to whether to transfer to SeaGen, wind-down or for Merck to continue the applicable Clinical Trial, in each case, in accordance with Section 14.7.5(b). (c) With respect to each Ongoing Merck Proprietary Combination Trial for which Merck or SeaGen elects to continue pursuant to Section 14.7.4(a) (on a Clinical Trial- by-Clinical Trial basis), the Parties will negotiate in good faith a clinical trial collaboration agreement between the Parties (provided that if the Parties are unable to agree on such clinical trial collaboration agreement within [ * ] days after the effective date of termination, then the Parties shall use the CTC as the form of such clinical trial collaboration agreement, with such changes as may be necessary to reflect that a different Clinical Trial is being conducted, and also to reflect any potential different roles of the Parties with respect to such Clinical Trial (based on the allocation of such roles under this Agreement) as compared to the CTC) with respect to the continued conduct by the applicable Lead Study Party of such Clinical Trial until completion (other than in the event of a Safety Issue) in accordance with the Development Plan in effect as of the effective date of termination; provided that, for clarity, pending the execution of the clinical trial collaboration agreement, (i) the conduct of such Clinical Trials shall continue in accordance with the terms and conditions of this Agreement (including, for clarity, with respect to sharing of -143- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
permissible under Applicable Law and commercially feasible, Merck shall, and shall cause its Related Parties to, at SeaGen’s cost (provided that if this Agreement is terminated by Merck under Section 14.2 or by SeaGen pursuant to Section 14.4.2 for Merck’s material breach, then SeaGen shall not be required to reimburse Merck for such costs) transfer the conduct of such Clinical Trial to SeaGen (or its designees), and SeaGen shall assume any and all liability for the conduct of such transferred Clinical Trial after the effective date of such transfer (except to the extent arising prior to the transfer date or from any willful misconduct or negligent act or omission by Merck or its Related Parties or their respective employees, agents and contractors), (ii) to the extent permissible under Applicable Laws (and taking into account patient safety matters), Merck shall wind-down the applicable Clinical Trial in accordance with Section 14.7.3 or (iii) to the extent that a given Clinical Trial may not be transferred to SeaGen under the foregoing clause (i) pursuant to Applicable Law (and if clause (ii) is not elected with respect to such Clinical Trial), Merck shall, at SeaGen’s cost, continue such Clinical Trial until completion (provided that Merck may discontinue such Clinical Trial for Safety Issues). In furtherance of the foregoing, notwithstanding the provisions of Section 14.7.1, the licenses granted to Merck hereunder shall survive solely to the extent necessary for Merck (and its Related Parties) to finish, transition or otherwise wind- down such Clinical Trials, as applicable. If such costs are to be borne by SeaGen as set forth in this Section 14.7.5(b), then SeaGen shall pay Merck for the costs of such activities, which costs shall be paid by SeaGen to Merck within [ * ] days after receipt of an invoice and supporting documentation therefor. Notwithstanding the foregoing, in the event of termination of this Agreement by Merck under Section 14.2, with respect to any Ongoing Merck Proprietary Clinical Trial under the Development Plan for a Merck Proprietary Combination with the Initial Merck Proprietary Product that has been Initiated prior to the effective date of termination and that will continue after the effective date of termination pursuant to this Section 14.7.5(b), Merck shall continue to supply the Initial Merck Proprietary Product, at Merck’s cost, for use in each such Clinical Trial in accordance with (and for the quantities set forth in) the Development Plan as in existence as of the effective date of termination of this Agreement. (c) Trademarks. Subject to compliance with Applicable Laws, to the extent it is legally permitted to do so, Merck shall transfer to SeaGen, at SeaGen’s cost (provided that if this Agreement is terminated by Merck under Section 14.2 or by SeaGen pursuant to Section 14.4.2 for Merck’s material breach, then SeaGen shall not be required to reimburse Merck for such costs), any Merck Collaboration Marks (including all applications therefor), in each case, that are owned by Merck or its Affiliate and that are solely and exclusively for the Licensed Product (but excluding any of the foregoing that are related to any Combination Product that is co-formulated with any Merck Proprietary Product, which shall be addressed under a separate agreement between the Parties as set forth in Section 14.7.5(g)), and solely as they exist as of the effective date of termination (and, following such transfer, such Merck Collaboration Marks shall thereafter be deemed to be SeaGen Collaboration Marks). (d) Inventory. Merck shall transfer to SeaGen the remaining inventory of Licensed Product (including work-in-progress) owned by, and in the possession of, Merck (or its Affiliate), and, (i) solely if such Licensed Product was manufactured by or on behalf of Merck or its Affiliate, SeaGen shall pay to Merck the Cost of Goods Manufactured of such inventory (and work-in-progress) plus the costs of transportation to SeaGen, or (ii) solely if such Licensed Product was manufactured by or on behalf of SeaGen and paid for by Merck under a SeaGen Supply -145- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Agreement, SeaGen shall pay to Merck the price for such inventory (and work-in-progress) paid by Merck to SeaGen under such SeaGen Supply Agreement plus the costs of transportation to SeaGen (provided that, in each case ((i) and (ii)) if any of the foregoing amounts have already been included in the calculation of Allowable Development Costs or Allowable Commercialization Costs and shared equally between the Parties hereunder (for example, the Cost of Goods Manufactured of any clinical supplies of the Licensed Product that were already included as Allowable Development Costs) then SeaGen shall only be required to pay for the remaining half of the applicable costs in the foregoing clauses (i) and (ii) pursuant to this Section 14.7.5(d)), which costs shall be paid by SeaGen to Merck within [ * ] days after receipt of an invoice therefor. (e) Licenses. Merck shall, and effective upon termination of this Agreement hereby does, grant, on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant), to SeaGen under [ * ] the “Reversion Product”) and necessary for SeaGen to continue the Development and Commercialization of the Reversion Product, in each case, with a right to grant and authorize sublicenses through multiple tiers, a non-exclusive, perpetual, irrevocable, royalty-free, fully paid-up, license to import, use, sell, offer to sell and otherwise commercialize the Reversion Product in the Field for the Territory, [ * ] to the [ * ], pursuant to this Agreement, [ * ] has [ * ] or has [ * ] for the [ * ] or [ * ], the “SeaGen Continuing Combinations”). In addition, the licenses and provisions set forth in Section 2.3.2 shall survive with respect to the use of the Reversion Product in the SeaGen Continuing Combinations, but solely for SeaGen to use those Promotional Materials and packaging and labeling for the SeaGen Continuing Combinations existing as of the effective date of termination to promote and commercialize the SeaGen Continuing Combination (and for no other purposes) and subject to the terms and conditions set forth in Section 2.3.2, mutatis mutandis. In addition, Merck shall, and effective upon termination of this Agreement hereby does, grant, on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant), to SeaGen a fully-paid, royalty-free, Co-Exclusive (with Merck and its Affiliates) right and license, with the right to grant sublicenses through multiple tiers (subject to Section 2.6), under [ * ], to seek and obtain regulatory approval for, import, use, sell and offer to sell (including Commercialize) and otherwise exploit the applicable Licensed Product for use in the corresponding SeaGen Continuing Combination. In furtherance of the foregoing, Merck shall, and hereby does, grant on behalf of itself and its Affiliates (and hereby causes its Affiliates to grant) to SeaGen a right of reference to any INDs, XXXx and Marketing Authorizations for the Reversion Product that are Controlled by Merck or any of its Affiliates as of the effective date of termination, which right of reference shall be for use in connection with the Reversion Product for use in the SeaGen Continuing Combinations in the Field for the Territory. At the request of SeaGen, Merck shall provide to SeaGen a cross-reference letter or similar communication to the applicable Governmental Authority to effectuate such right of reference. (f) Transition of Contracts. Merck shall, at SeaGen’s cost (provided that if this Agreement is terminated by Merck under Section 14.2 or by SeaGen pursuant to Section 14.4.2 for Merck’s material breach, then SeaGen shall not be required to reimburse Merck for such costs), assign (to the extent assignable and without penalty to Merck or its Affiliate), upon request of SeaGen within [ * ] days after the effective date of termination, any agreements with Third Party subcontractors and vendors (including Distributors) that are solely and exclusively for the Licensed Product to Develop, Manufacture or otherwise Commercialize the Licensed Product; provided that, to the extent any such Third Party agreement is not assignable to SeaGen, Merck -146- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
collectively the “SeaGen Acquiror”), [ * ], then notwithstanding anything to the contrary contained herein (including Section 4.1) or in any Ancillary Agreement, the following shall apply: (i) Sensitive Information. Following the consummation of any such Change of Control of SeaGen, SeaGen and its Affiliates (including the SeaGen Acquiror) shall [ * ] implement reasonable procedures [ * ] to restrict access to [ * ] (collectively, the “Sensitive Information”)[ * ]. Without limiting the foregoing, from and after the consummation of the Change of Control, [ * ]; and (ii) [ * ]. With respect to any [ * ], such [ * ] shall be performed in accordance with this Agreement [ * ]; provided that, in connection therewith (and notwithstanding anything to the contrary contained herein), the following shall apply: (A) with respect to any [ * ], Merck shall [ * ] and in the event that Merck [ * ], the Parties shall [ * ] in good faith [ * ], as soon as reasonably practicable, [ * ]; (B) notwithstanding the provisions of [ * ] Merck shall [ * ]; provided that [ * ] shall not (x) [ * ] without the consent of [ * ], or (y) [ * ] without the consent of [ * ] unless [ * ]; and (C) notwithstanding the foregoing provisions of this Section 16.4.2(b)(ii) or anything to the contrary contained herein, Merck shall [ * ] in which case such [ * ] and the provisions of [ * ] shall apply (in lieu of the provisions of this Section 16.4.2(b)(ii)) with respect to [ * ]. (iii) [ * ]. Notwithstanding anything to the contrary contained herein [ * ] but subject to [ * ] from and after the consummation of such Change of Control [ * ], Merck shall [ * ]; provided that, in connection therewith, the following shall apply: (A) such [ * ] shall not be [ * ]. Merck shall be [ * ] (and, except for [ * ] as set forth in the following clause (C), if applicable, SeaGen shall [ * ]; (B) prior to [ * ], Merck shall [ * ]; (C) if SeaGen is [ * ], SeaGen shall [ * ]; provided that Merck shall [ * ] (but, for clarity, such [ * ] shall not be [ * ]; (D) Merck shall have [ * ]; provided that, [ * ] only the [ * ] (or such other [ * ]) shall be [ * ]; (E) SeaGen shall [ * ] for the [ * ]; (F) Merck shall [ * ]; provided that, notwithstanding the foregoing, Merck shall [ * ], in each case, [ * ]. Any [ * ] shall, as between the Parties, [ * ] and shall be [ * ] (and the [ * ] shall be [ * ]); provided that such [ * ] shall be deemed to be [ * ]; -153- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
(G) Merck shall [ * ]; provided that [ * ] shall [ * ] any such [ * ] for [ * ]; and (H) notwithstanding the provisions of [ * ] upon [ * ] SeaGen shall [ * ] and Merck shall [ * ]. For clarity, (1) [ * ] shall be deemed to be a [ * ] (notwithstanding that [ * ] and that such [ * ]), (2) the Parties hereby agree and acknowledge that the [ * ] shall apply to [ * ] notwithstanding that [ * ], and (3) Merck [ * ] as set forth in [ * ]. (iv) [ * ]. From and after the consummation of such Change of Control, (A) SeaGen shall [ * ] any [ * ], in each case, for the [ * ] and (B) the [ * ] of such [ * ], as applicable, in the foregoing clause (A) shall [ * ]. For clarity, SeaGen shall [ * ] in accordance with this Agreement; provided that such [ * ] shall be [ * ] in accordance with Applicable Laws. (v) [ * ]. Notwithstanding anything to the contrary contained herein [ * ] but subject to [ * ] from and after the consummation of such Change of Control during the remainder of the Term, SeaGen shall [ * ]; provided that, in connection therewith, the following shall apply: (A) such [ * ] shall not be [ * ]. SeaGen shall be [ * ] (and, except for [ * ] as set forth in the following clause (C), if applicable, Merck shall [ * ]; (B) prior to [ * ] SeaGen shall [ * ]; (C) if Merck is [ * ], Merck shall [ * ]; provided that SeaGen shall [ * ] (but, for clarity, such [ * ] shall not be [ * ]; (D) SeaGen shall have [ * ]; provided that, i[ * ] only the [ * ] (or such other [ * ]) shall be [ * ]; (E) Merck shall [ * ] for the [ * ]; (F) SeaGen shall [ * ]; provided that, notwithstanding the foregoing, SeaGen shall [ * ], in each case, [ * ]. Any [ * ] shall, as between the Parties, [ * ] and shall be [ * ] (and the [ * ] shall be [ * ]); provided that such [ * ] shall be deemed to be [ * ]; and (G) SeaGen shall [ * ]; provided that [ * ] shall [ * ] any such [ * ] for [ * ]. For clarity, (1) [ * ] shall be deemed to be a [ * ] (notwithstanding that [ * ] and that such [ * ]), (2) the Parties hereby agree and acknowledge that [ * ] shall apply to [ * ] notwithstanding that [ * ], and (3) SeaGen [ * ] as set forth in Section 2.4.2, mutatis mutandis. (vi) [ * ]. From and after the consummation of such Change of Control, (A) Merck shall [ * ] any [ * ], in each case, for the [ * ] and (B) the [ * ] of such [ * ], as applicable, in the foregoing clause (A) shall [ * ]. For clarity, Merck shall [ * ] in accordance with this Agreement; provided that [ * ] shall be [ * ] in accordance with Applicable Laws. -154- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
if to Merck, to: Merck Sharp & Dohme Corp. 0000 Xxxxxxxxx Xxxx Xxxx Xxxxxxxxxx, XX 00000-0000 Attention: Office of Secretary Email: [ * ] with a copy to: Merck Sharp & Dohme Corp. 0000 Xxxxxxxxx Xxxx Xxxx Mail Stop K-1-4161 Xxxxxxxxxx, XX 00000 Attention: SVP, Corporate Development or to such other address(es) as the Party to whom notice is to be given may have furnished to the other Party in writing in accordance herewith. This Section 16.6 is not intended to govern the day-to-day business communications necessary between the Parties in performing their obligations under the terms of this Agreement. 16.7 Applicable Law. This Agreement shall be governed by and construed in accordance with the Applicable Law of the State of New York, United States, and the patent law of the United States without reference to any rules of conflict of laws or renvoi that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. The United Nations Convention on Contracts for the International Sale of Goods (CISG) of 11 April 1980 shall not be applicable. 16.8 Dispute Resolution. 16.8.1 The Parties shall negotiate in good faith and use reasonable efforts to settle any dispute, controversy or claim arising from or related to this Agreement or any Ancillary Agreement, including the formation, existence, validity, enforceability, performance, interpretation, breach, or termination hereof or thereof (a “Dispute”). If the Parties do not fully resolve any such Dispute within [ * ] after a party first notifies the other Party of such Dispute, and a Party wishes to pursue the matter, then, except as otherwise set forth herein, each such Dispute that is not an “Excluded Claim” (as defined below) shall be finally resolved in accordance with Section 16.8.2; provided, however, that, notwithstanding the foregoing, any decisions that are subject to the final decision-making authority of a given Party (or mutual agreement of the Parties, as applicable) or the JSC, as expressly set forth in this Agreement, including Section 3.2.4(b), will not be subject to the provisions of this Section 16.8 so long as such decisions are made in accordance with this Agreement. 16.8.2 Executive Review; Arbitration. (a) In the event the Parties have not resolved such Dispute within such [ * ] as set forth in Section 16.8.1 and such Disputed has not previously been submitted to the Senior Executives or [ * ] for resolution, then either Party (through the Alliance Managers) may elect to formally submit such issue to the Parties’ applicable Senior Executives for resolution. In -156- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
the event that the Senior Executives are unable to resolve a given issue referred to the Senior Executives in accordance with this Section [ * ] after the dispute is formally submitted to the Senior Executives for resolution, then either Party (through the Alliance Managers) may elect to formally submit such issue to the Parties’ respective [ * ] for resolution. (b) In the event that the Parties’ respective [ * ] are unable to resolve a given issue referred to the [ * ] in accordance with Section 16.8.2(a) within [ * ] after the dispute is formally submitted to the [ * ] for resolution, then either Party may submit such Dispute to be finally settled by arbitration administered in accordance with the procedural rules of the American Arbitration Association (“AAA”) in effect at the time of submission, as modified by this Section 16.8.2(a). The arbitration will be governed by the Applicable Laws of the state of New York. The arbitration will be heard and determined by three (3) arbitrators who are retired judges or attorneys with at least ten (10) years of relevant experience in the pharmaceutical industry, each of whom will be impartial and independent. Each Party will appoint one (1) arbitrator and the third (3rd) arbitrator will be selected by the two (2) Party-appointed arbitrators, or, failing agreement within thirty (30) days following appointment of the second arbitrator, by AAA. Such arbitration will take place in New York, New York. The arbitration award so given will be a final and binding determination of the dispute, will be fully enforceable in any court of competent jurisdiction, and will not include any damages expressly prohibited by Section 13.6. Fees, costs and expenses of arbitration are to be divided by the Parties in the following manner: Merck will pay for the arbitrator it chooses, SeaGen will pay for the arbitrator it chooses, and the Parties will share payment for the third arbitrator. Except in a proceeding to enforce the results of the arbitration or as otherwise required by Applicable Law, neither Party nor any arbitrator may disclose the existence, content or results of any arbitration hereunder without the prior written consent of both Parties (each such consent not to be unreasonably withheld, delayed or conditioned). In no event shall an arbitration be initiated after the date when commencement of a legal or equitable proceeding based on the dispute, controversy or claim would be barred, consistent with Section 16.7, by the applicable New York statute of limitations. (c) Either Party may apply to the arbitrators for interim injunctive relief until the arbitration award is rendered or the controversy is otherwise resolved. Either Party also may, without waiving any remedy under this Agreement, seek from any court having jurisdiction any injunctive or provisional relief necessary to protect its rights or property pending the arbitration award. (d) The Parties agree that, in the event of a good faith dispute over the nature or quality of performance under this Agreement, neither Party may terminate this Agreement until final resolution of the dispute through arbitration or other judicial determination, and any cure period shall commence thereafter. The Parties further agree that any payments made pursuant to this Agreement pending resolution of the dispute shall be promptly refunded if an arbitrator determines that such payments are not due. (e) As used in this Section 16.8, the term “Excluded Claim” means a dispute, controversy or claim that concerns (i) the validity or infringement of a patent, trademark, copyright or trade secret, or (ii) any antitrust, anti-monopoly or competition Applicable Law or -157- [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 1.26 European Collaboration Territory [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 1.39 Cost of Goods Manufactured “Cost of Goods Manufactured” shall mean the fully allocated cost of manufacturing the Licensed Product or Licensed Compound, calculated in a manner that is consistent with the Lead Manufacturing Party’s standard practices for its products, consistently applied and in accordance with Accounting Standards, and consisting of the following components: [ * ] {2 pages omitted} [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 1.133 SeaGen Existing CMO Agreements [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 1.134 SeaGen Existing In-Licenses [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 1.139 SeaGen Patents (see attached) [ * ] {30 pages omitted} [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 1.152 SGN-LIV-1-A [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 1.153 SGN-LIV-1-B [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 1.154 SGN-LIV-1-C [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 2.7 Permitted Distributor Countries [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 2.9.2 Next Generation Compound Criteria - SGN-LIV-1-C [ * ] {2 pages omitted} [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 6.8 Certain Costs of Recalls [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 7.9 Certain Terms for Supply Agreements (see attached) [ * ] {11 pages omitted} [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 9.6.1 Press Release (see attached) [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Seattle Genetics and Merck Announce Two Strategic Oncology Collaborations Companies to Co-Develop and Co-Commercialize Seattle Genetics’ Antibody-Drug Conjugate Ladiratuzumab Vedotin Globally; Merck to Acquire $1 Billion Equity Stake in Seattle Genetics Common Stock Companies Enter Exclusive License and Co-Development Agreement to Accelerate Global Reach of TUKYSA for HER2-Postive Cancers in Regions Outside the United States, Canada and Europe Seattle Genetics to Host Conference Call Today at 9:00 a.m. ET BOTHELL, Wash. and KENILWORTH, N.J. – September 14, 2020 – Seattle Genetics, Inc. (Nasdaq: SGEN) and Merck (NYSE: MRK), known as MSD outside the United States and Canada, today announced two new strategic oncology collaborations. The companies will globally develop and commercialize Seattle Genetics’ ladiratuzumab vedotin, an investigational antibody-drug conjugate (ADC) targeting LIV-1, which is currently in phase 2 clinical trials for breast cancer and other solid tumors. The collaboration will pursue a broad joint development program evaluating ladiratuzumab vedotin as monotherapy and in combination with Merck’s anti-PD-1 therapy KEYTRUDA® (pembrolizumab) in triple-negative breast cancer, hormone receptor-positive breast cancer and other LIV-1-expressing solid tumors. Under the terms of the agreement, Seattle Genetics will receive a $600 million upfront payment and Merck will make a $1.0 billion equity investment in 5.0 million shares of Seattle Genetics common stock at a price of $200 per share. In addition, Seattle Genetics is eligible for progress-dependent milestone payments of up to $2.6 billion. Separately, Seattle Genetics has granted Merck an exclusive license to commercialize TUKYSA® (tucatinib), a small molecule tyrosine kinase inhibitor, for the treatment of HER2-positive cancers, in Asia, the Middle East and Latin America and other regions outside of the U.S., Canada and Europe. Seattle Genetics will receive $125 million from Merck as an upfront payment and is eligible for progress- dependent milestones of up to $65 million. “Collaborating with Merck on ladiratuzumab vedotin will allow us to accelerate and broaden its development program in breast cancer and other solid tumors, including in combination with Merck’s KEYTRUDA, while also positioning us to leverage our U.S. and European commercial operations,” said Xxxx Xxxxxxx, Ph.D., President and Chief Executive Officer of Seattle Genetics. “The strategic [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
The financial impact of these collaborations is not included in Seattle Genetics’ 2020 guidance. Seattle Genetics Conference Call Details Seattle Genetics’ management will host a conference call to discuss these collaborations today at 6:00 a.m. Pacific Time (PT); 9:00 a.m. Eastern Time (ET). The event will be simultaneously webcast and available for replay from the Seattle Genetics website at xxx.xxxxxxxxxxxxxxx.xxx, under the Investors section. Investors may also participate in the conference call by calling 000-000-0000 (domestic) or x0 000-000-0000 (international). The conference ID is 10147850. About Ladiratuzumab Vedotin Ladiratuzumab vedotin is a novel investigational ADC targeted to LIV-1. Most metastatic breast cancers express LIV-1, which also has been detected in several other cancers, including lung, head and neck, esophageal and gastric. Ladiratuzumab vedotin utilizes Seattle Genetics’ proprietary ADC technology and consists of a LIV-1-targeted monoclonal antibody linked to a potent microtubule-disrupting agent, monomethyl auristatin E (MMAE) by a protease-cleavable linker. This novel ADC is designed to bind to LIV-1 on cancer cells and release the cell-killing agent into target cells upon internalization. Ladiratuzumab vedotin may also cause antitumor activity through other mechanisms, including activation of an immune response by induction of immunogenic cell death. About TUKYSA (tucatinib) TUKYSA is an oral, small molecule tyrosine kinase inhibitor (TKI) of HER2, a protein that contributes to cancer cell growth. TUKYSA in combination with trastuzumab and capecitabine was approved by the U.S. Food and Drug Administration (FDA) in April 2020 for adult patients with advanced unresectable or metastatic HER2-positive breast cancer, including patients with brain metastases, who have received one or more prior anti-HER2-based regimens in the metastatic setting. In addition, TUKYSA received approval in Canada, Singapore, Australia and Switzerland under the Project Orbis initiative of the FDA Oncology Center of Excellence that provides a framework for concurrent submission and review of oncology products among international partners. A marketing application is under review in the European Union. TUKYSA is being evaluated in several ongoing clinical trials and additional studies are planned. Current trials include the following: • HER2CLIMB-02: a randomized, double-blind phase 3 trial evaluating TUKYSA in combination with T-DM1 (trastuzumab emtansine; Kadcyla®) versus T-DM1 in first- and second-line metastatic HER2-positive breast cancer. • CompassHER2 RD: a randomized, double-blind phase 3 trial of TUKYSA in combination with T-DM1 versus T-DM1 in the adjuvant breast cancer setting for patients at high risk of relapse. • MOUNTAINEER: a pivotal phase 2 trial evaluating TUKYSA in combination with trastuzumab (Herceptin®) in metastatic HER2-positive colorectal cancer. • MOUNTAINEER-02: a randomized phase 2/3 trial evaluating TUKYSA in combination with trastuzumab, ramucirumab and paclitaxel versus ramucirumab and paclitaxel in second-line metastatic HER2-positive gastric or gastroesophageal junction adenocarcinoma (GEC). • Gastrointestinal cancers: a phase 1 trial evaluating TUKYSA in combination with trastuzumab and oxaliplatin-based chemotherapy in metastatic HER2-positive colorectal, gastric/ gastroesophageal junction and gallbladder cancers. For additional information, visit xxx.xxxxxxxxxxxxxx.xxx. [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
in serum creatinine was 32% within the first 21 days of treatment with TUKYSA. The serum creatinine increases persisted throughout treatment and were reversible upon treatment completion. Consider alternative markers of renal function if persistent elevations in serum creatinine are observed. Drug Interactions • Strong CYP3A or Moderate CYP2C8 Inducers: Concomitant use may decrease TUKYSA activity. Avoid concomitant use of TUKYSA. • Strong or Moderate CYP2C8 Inhibitors: Concomitant use of TUKYSA with a strong CYP2C8 inhibitor may increase the risk of TUKYSA toxicity; avoid concomitant use. Increase monitoring for TUKYSA toxicity with moderate CYP2C8 inhibitors. • CYP3A Substrates: Concomitant use may increase the toxicity associated with a CYP3A substrate. Avoid concomitant use of TUKYSA where minimal concentration changes may lead to serious or life-threatening toxicities. If concomitant use is unavoidable, decrease the CYP3A substrate dosage. • P-gp Substrates: Concomitant use may increase the toxicity associated with a P-gp substrate. Consider reducing the dosage of P-gp substrates where minimal concentration changes may lead to serious or life-threatening toxicity. Use in Specific Populations • Lactation: Advise women not to breastfeed while taking TUKYSA and for at least 1 week after the last dose. • Renal Impairment: Use of TUKYSA in combination with capecitabine and trastuzumab is not recommended in patients with severe renal impairment (CLcr < 30 mL/min), because capecitabine is contraindicated in patients with severe renal impairment. • Hepatic Impairment: Reduce the dose of TUKYSA for patients with severe (Child-Xxxx C) hepatic impairment. For more information, please see the full Prescribing Information for TUKYSA here. About KEYTRUDA® (pembrolizumab) Injection, 100 mg KEYTRUDA is an anti-PD-1 therapy that works by increasing the ability of the body’s immune system to help detect and fight tumor cells. KEYTRUDA is a humanized monoclonal antibody that blocks the interaction between PD-1 and its ligands, PD-L1 and PD-L2, thereby activating T lymphocytes which may affect both tumor cells and healthy cells. Merck has the industry’s largest immuno-oncology clinical research program. There are currently more than 1,200 trials studying KEYTRUDA across a wide variety of cancers and treatment settings. The KEYTRUDA clinical program seeks to understand the role of KEYTRUDA across cancers and the factors that may predict a patient's likelihood of benefitting from treatment with KEYTRUDA, including exploring several different biomarkers. Selected KEYTRUDA® (pembrolizumab) Indications Melanoma KEYTRUDA is indicated for the treatment of patients with unresectable or metastatic melanoma. KEYTRUDA is indicated for the adjuvant treatment of patients with melanoma with involvement of lymph node(s) following complete resection. [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Non-Small Cell Lung Cancer KEYTRUDA, in combination with pemetrexed and platinum chemotherapy, is indicated for the first-line treatment of patients with metastatic nonsquamous non-small cell lung cancer (NSCLC), with no EGFR or ALK genomic tumor aberrations. KEYTRUDA, in combination with carboplatin and either paclitaxel or paclitaxel protein-bound, is indicated for the first-line treatment of patients with metastatic squamous NSCLC. KEYTRUDA, as a single agent, is indicated for the first-line treatment of patients with NSCLC expressing PD-L1 [tumor proportion score (TPS) ≥1%] as determined by an FDA-approved test, with no EGFR or ALK genomic tumor aberrations, and is stage III where patients are not candidates for surgical resection or definitive chemoradiation, or metastatic. KEYTRUDA, as a single agent, is indicated for the treatment of patients with metastatic NSCLC whose tumors express PD-L1 (TPS ≥1%) as determined by an FDA-approved test, with disease progression on or after platinum-containing chemotherapy. Patients with EGFR or ALK genomic tumor aberrations should have disease progression on FDA-approved therapy for these aberrations prior to receiving KEYTRUDA. Small Cell Lung Cancer KEYTRUDA is indicated for the treatment of patients with metastatic small cell lung cancer (SCLC) with disease progression on or after platinum-based chemotherapy and at least 1 other prior line of therapy. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials. Head and Neck Squamous Cell Cancer KEYTRUDA, in combination with platinum and fluorouracil (FU), is indicated for the first-line treatment of patients with metastatic or with unresectable, recurrent head and neck squamous cell carcinoma (HNSCC). KEYTRUDA, as a single agent, is indicated for the first-line treatment of patients with metastatic or with unresectable, recurrent HNSCC whose tumors express PD-L1 [combined positive score (CPS) ≥1] as determined by an FDA-approved test. KEYTRUDA, as a single agent, is indicated for the treatment of patients with recurrent or metastatic head and neck squamous cell carcinoma (HNSCC) with disease progression on or after platinum-containing chemotherapy. Classical Hodgkin Lymphoma KEYTRUDA is indicated for the treatment of adult and pediatric patients with refractory classical Hodgkin lymphoma (cHL), or who have relapsed after 3 or more prior lines of therapy. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. Primary Mediastinal Large B-Cell Lymphoma [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
KEYTRUDA is indicated for the treatment of adult and pediatric patients with refractory primary mediastinal large B-cell lymphoma (PMBCL), or who have relapsed after 2 or more prior lines of therapy. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials. KEYTRUDA is not recommended for treatment of patients with PMBCL who require urgent cytoreductive therapy. Urothelial Carcinoma KEYTRUDA is indicated for the treatment of patients with locally advanced or metastatic urothelial carcinoma (mUC) who are not eligible for cisplatin-containing chemotherapy and whose tumors express PD-L1 [combined positive score (CPS) ≥10], as determined by an FDA-approved test, or in patients who are not eligible for any platinum-containing chemotherapy regardless of PD-L1 status. This indication is approved under accelerated approval based on tumor response rate and duration of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials. KEYTRUDA is indicated for the treatment of patients with locally advanced or metastatic urothelial carcinoma (mUC) who have disease progression during or following platinum-containing chemotherapy or within 12 months of neoadjuvant or adjuvant treatment with platinum-containing chemotherapy. KEYTRUDA is indicated for the treatment of patients with Bacillus Xxxxxxxx-Xxxxxx (BCG)- unresponsive, high-risk, non-muscle invasive bladder cancer (NMIBC) with carcinoma in situ (CIS) with or without papillary tumors who are ineligible for or have elected not to undergo cystectomy. Microsatellite Instability-High or Mismatch Repair Deficient Cancer KEYTRUDA is indicated for the treatment of adult and pediatric patients with unresectable or metastatic microsatellite instability-high (MSI-H) or mismatch repair deficient (dMMR) • solid tumors that have progressed following prior treatment and who have no satisfactory alternative treatment options, or • colorectal cancer that has progressed following treatment with fluoropyrimidine, oxaliplatin, and irinotecan. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. The safety and effectiveness of KEYTRUDA in pediatric patients with MSI-H central nervous system cancers have not been established. Microsatellite Instability-High or Mismatch Repair Deficient Colorectal Cancer KEYTRUDA is indicated for the first-line treatment of patients with unresectable or metastatic MSI-H or dMMR colorectal cancer (CRC). Gastric Cancer KEYTRUDA is indicated for the treatment of patients with recurrent locally advanced or metastatic gastric or gastroesophageal junction (GEJ) adenocarcinoma whose tumors express PD-L1 (CPS ≥1) as determined by an FDA-approved test, with disease progression on or after two or more prior lines of therapy including fluoropyrimidine- and platinum-containing chemotherapy and if appropriate, HER2/neu-targeted therapy. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Esophageal Cancer KEYTRUDA is indicated for the treatment of patients with recurrent locally advanced or metastatic squamous cell carcinoma of the esophagus whose tumors express PD-L1 (CPS ≥10) as determined by an FDA-approved test, with disease progression after one or more prior lines of systemic therapy. Cervical Cancer KEYTRUDA is indicated for the treatment of patients with recurrent or metastatic cervical cancer with disease progression on or after chemotherapy whose tumors express PD-L1 (CPS ≥1) as determined by an FDA-approved test. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. Hepatocellular Carcinoma KEYTRUDA is indicated for the treatment of patients with hepatocellular carcinoma (HCC) who have been previously treated with sorafenib. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. Xxxxxx Cell Carcinoma KEYTRUDA is indicated for the treatment of adult and pediatric patients with recurrent locally advanced or metastatic Xxxxxx cell carcinoma (MCC). This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. Renal Cell Carcinoma KEYTRUDA, in combination with axitinib, is indicated for the first-line treatment of patients with advanced renal cell carcinoma (RCC). Tumor Mutational Burden-High KEYTRUDA is indicated for the treatment of adult and pediatric patients with unresectable or metastatic tumor mutational burden-high (TMB-H) [≥10 mutations/megabase (mut/Mb)] solid tumors, as determined by an FDA-approved test, that have progressed following prior treatment and who have no satisfactory alternative treatment options. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. The safety and effectiveness of KEYTRUDA in pediatric patients with TMB-H central nervous system cancers have not been established. Cutaneous Squamous Cell Carcinoma KEYTRUDA is indicated for the treatment of patients with recurrent or metastatic cutaneous squamous cell carcinoma (cSCC) that is not curable by surgery or radiation. Selected Important Safety Information for KEYTRUDA Immune-Mediated Pneumonitis KEYTRUDA can cause immune-mediated pneumonitis, including fatal cases. Pneumonitis occurred in 3.4% (94/2799) of patients with various cancers receiving KEYTRUDA, including Grade 1 (0.8%), 2 (1.3%), 3 (0.9%), 4 (0.3%), and 5 (0.1%). Pneumonitis occurred in 8.2% (65/790) of NSCLC patients receiving KEYTRUDA as a single agent, including Grades 3-4 in 3.2% of patients, and occurred more frequently in patients with a history of prior thoracic radiation (17%) compared to those without (7.7%). Pneumonitis occurred in 6% (18/300) of HNSCC patients receiving KEYTRUDA as a single agent, [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
including Grades 3-5 in 1.6% of patients, and occurred in 5.4% (15/276) of patients receiving KEYTRUDA in combination with platinum and FU as first-line therapy for advanced disease, including Grades 3-5 in 1.5% of patients. Monitor patients for signs and symptoms of pneumonitis. Evaluate suspected pneumonitis with radiographic imaging. Administer corticosteroids for Grade 2 or greater pneumonitis. Withhold KEYTRUDA for Grade 2; permanently discontinue KEYTRUDA for Grade 3 or 4 or recurrent Grade 2 pneumonitis. Immune-Mediated Colitis KEYTRUDA can cause immune-mediated colitis. Colitis occurred in 1.7% (48/2799) of patients receiving KEYTRUDA, including Grade 2 (0.4%), 3 (1.1%), and 4 (<0.1%). Monitor patients for signs and symptoms of colitis. Administer corticosteroids for Grade 2 or greater colitis. Withhold KEYTRUDA for Grade 2 or 3; permanently discontinue KEYTRUDA for Grade 4 colitis. Immune-Mediated Hepatitis (KEYTRUDA) and Hepatotoxicity (KEYTRUDA in Combination With Axitinib) Immune-Mediated Hepatitis KEYTRUDA can cause immune-mediated hepatitis. Hepatitis occurred in 0.7% (19/2799) of patients receiving KEYTRUDA, including Grade 2 (0.1%), 3 (0.4%), and 4 (<0.1%). Monitor patients for changes in liver function. Administer corticosteroids for Grade 2 or greater hepatitis and, based on severity of liver enzyme elevations, withhold or discontinue KEYTRUDA. Hepatotoxicity in Combination With Axitinib KEYTRUDA in combination with axitinib can cause hepatic toxicity with higher than expected frequencies of Grades 3 and 4 ALT and AST elevations compared to KEYTRUDA alone. With the combination of KEYTRUDA and axitinib, Grades 3 and 4 increased ALT (20%) and increased AST (13%) were seen. Monitor liver enzymes before initiation of and periodically throughout treatment. Consider more frequent monitoring of liver enzymes as compared to when the drugs are administered as single agents. For elevated liver enzymes, interrupt KEYTRUDA and axitinib, and consider administering corticosteroids as needed. Immune-Mediated Endocrinopathies KEYTRUDA can cause adrenal insufficiency (primary and secondary), hypophysitis, thyroid disorders, and type 1 diabetes mellitus. Adrenal insufficiency occurred in 0.8% (22/2799) of patients, including Grade 2 (0.3%), 3 (0.3%), and 4 (<0.1%). Hypophysitis occurred in 0.6% (17/2799) of patients, including Grade 2 (0.2%), 3 (0.3%), and 4 (<0.1%). Hypothyroidism occurred in 8.5% (237/2799) of patients, including Grade 2 (6.2%) and 3 (0.1%). The incidence of new or worsening hypothyroidism was higher in 1185 patients with HNSCC (16%) receiving KEYTRUDA, as a single agent or in combination with platinum and FU, including Grade 3 (0.3%) hypothyroidism. Hyperthyroidism occurred in 3.4% (96/2799) of patients, including Grade 2 (0.8%) and 3 (0.1%), and thyroiditis occurred in 0.6% (16/2799) of patients, including Grade 2 (0.3%). Type 1 diabetes mellitus, including diabetic ketoacidosis, occurred in 0.2% (6/2799) of patients. Monitor patients for signs and symptoms of adrenal insufficiency, hypophysitis (including hypopituitarism), thyroid function (prior to and periodically during treatment), and hyperglycemia. For adrenal insufficiency or hypophysitis, administer corticosteroids and hormone replacement as clinically indicated. Withhold KEYTRUDA for Grade 2 adrenal insufficiency or hypophysitis and withhold or discontinue KEYTRUDA for Grade 3 or Grade 4 adrenal insufficiency or hypophysitis. Administer [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
hormone replacement for hypothyroidism and manage hyperthyroidism with thionamides and beta- blockers as appropriate. Withhold or discontinue KEYTRUDA for Grade 3 or 4 hyperthyroidism. Administer insulin for type 1 diabetes, and withhold KEYTRUDA and administer antihyperglycemics in patients with severe hyperglycemia. Immune-Mediated Nephritis and Renal Dysfunction KEYTRUDA can cause immune-mediated nephritis. Nephritis occurred in 0.3% (9/2799) of patients receiving KEYTRUDA, including Grade 2 (0.1%), 3 (0.1%), and 4 (<0.1%) nephritis. Nephritis occurred in 1.7% (7/405) of patients receiving KEYTRUDA in combination with pemetrexed and platinum chemotherapy. Monitor patients for changes in renal function. Administer corticosteroids for Grade 2 or greater nephritis. Withhold KEYTRUDA for Grade 2; permanently discontinue for Grade 3 or 4 nephritis. Immune-Mediated Skin Reactions Immune-mediated rashes, including Xxxxxxx-Xxxxxxx syndrome (SJS), toxic epidermal necrolysis (TEN) (some cases with fatal outcome), exfoliative dermatitis, and bullous pemphigoid, can occur. Monitor patients for suspected severe skin reactions and based on the severity of the adverse reaction, withhold or permanently discontinue KEYTRUDA and administer corticosteroids. For signs or symptoms of SJS or TEN, withhold KEYTRUDA and refer the patient for specialized care for assessment and treatment. If SJS or TEN is confirmed, permanently discontinue KEYTRUDA. Other Immune-Mediated Adverse Reactions Immune-mediated adverse reactions, which may be severe or fatal, can occur in any organ system or tissue in patients receiving KEYTRUDA and may also occur after discontinuation of treatment. For suspected immune-mediated adverse reactions, ensure adequate evaluation to confirm etiology or exclude other causes. Based on the severity of the adverse reaction, withhold KEYTRUDA and administer corticosteroids. Upon improvement to Grade 1 or less, initiate corticosteroid taper and continue to taper over at least 1 month. Based on limited data from clinical studies in patients whose immune-related adverse reactions could not be controlled with corticosteroid use, administration of other systemic immunosuppressants can be considered. Resume KEYTRUDA when the adverse reaction remains at Grade 1 or less following corticosteroid taper. Permanently discontinue KEYTRUDA for any Grade 3 immune-mediated adverse reaction that recurs and for any life-threatening immune-mediated adverse reaction. The following clinically significant immune-mediated adverse reactions occurred in less than 1% (unless otherwise indicated) of 2799 patients: arthritis (1.5%), uveitis, myositis, Guillain-Barré syndrome, myasthenia gravis, vasculitis, pancreatitis, hemolytic anemia, sarcoidosis, and encephalitis. In addition, myelitis and myocarditis were reported in other clinical trials, including classical Hodgkin lymphoma, and postmarketing use. Treatment with KEYTRUDA may increase the risk of rejection in solid organ transplant recipients. Consider the benefit of treatment vs the risk of possible organ rejection in these patients. Infusion-Related Reactions KEYTRUDA can cause severe or life-threatening infusion-related reactions, including hypersensitivity and anaphylaxis, which have been reported in 0.2% (6/2799) of patients. Monitor patients for signs and symptoms of infusion-related reactions. For Grade 3 or 4 reactions, stop infusion and permanently discontinue KEYTRUDA. Complications of Allogeneic Hematopoietic Stem Cell Transplantation (HSCT) [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Immune-mediated complications, including fatal events, occurred in patients who underwent allogeneic HSCT after treatment with KEYTRUDA. Of 23 patients with cHL who proceeded to allogeneic HSCT after KEYTRUDA, 6 (26%) developed graft-versus-host disease (GVHD) (1 fatal case) and 2 (9%) developed severe hepatic xxxx-occlusive disease (VOD) after reduced-intensity conditioning (1 fatal case). Cases of fatal hyperacute GVHD after allogeneic HSCT have also been reported in patients with lymphoma who received a PD-1 receptor–blocking antibody before transplantation. Follow patients closely for early evidence of transplant-related complications such as hyperacute graft-versus-host disease (GVHD), Grade 3 to 4 acute GVHD, steroid-requiring febrile syndrome, hepatic xxxx-occlusive disease (VOD), and other immune-mediated adverse reactions. In patients with a history of allogeneic HSCT, acute GVHD (including fatal GVHD) has been reported after treatment with KEYTRUDA. Patients who experienced GVHD after their transplant procedure may be at increased risk for GVHD after KEYTRUDA. Consider the benefit of KEYTRUDA vs the risk of GVHD in these patients. Increased Mortality in Patients With Multiple Myeloma In trials in patients with multiple myeloma, the addition of KEYTRUDA to a thalidomide analogue plus dexamethasone resulted in increased mortality. Treatment of these patients with a PD-1 or PD-L1 blocking antibody in this combination is not recommended outside of controlled trials. Embryofetal Toxicity Based on its mechanism of action, KEYTRUDA can cause fetal harm when administered to a pregnant woman. Advise women of this potential risk. In females of reproductive potential, verify pregnancy status prior to initiating KEYTRUDA and advise them to use effective contraception during treatment and for 4 months after the last dose. Adverse Reactions In KEYNOTE-006, KEYTRUDA was discontinued due to adverse reactions in 9% of 555 patients with advanced melanoma; adverse reactions leading to permanent discontinuation in more than one patient were colitis (1.4%), autoimmune hepatitis (0.7%), allergic reaction (0.4%), polyneuropathy (0.4%), and cardiac failure (0.4%). The most common adverse reactions (≥20%) with KEYTRUDA were fatigue (28%), diarrhea (26%), rash (24%), and nausea (21%). In KEYNOTE-002, KEYTRUDA was permanently discontinued due to adverse reactions in 12% of 357 patients with advanced melanoma; the most common (≥1%) were general physical health deterioration (1%), asthenia (1%), dyspnea (1%), pneumonitis (1%), and generalized edema (1%). The most common adverse reactions were fatigue (43%), pruritus (28%), rash (24%), constipation (22%), nausea (22%), diarrhea (20%), and decreased appetite (20%). In KEYNOTE-054, KEYTRUDA was permanently discontinued due to adverse reactions in 14% of 509 patients; the most common (≥1%) were pneumonitis (1.4%), colitis (1.2%), and diarrhea (1%). Serious adverse reactions occurred in 25% of patients receiving KEYTRUDA. The most common adverse reaction (≥20%) with KEYTRUDA was diarrhea (28%). In KEYNOTE-189, when KEYTRUDA was administered with pemetrexed and platinum chemotherapy in metastatic nonsquamous NSCLC, KEYTRUDA was discontinued due to adverse reactions in 20% of 405 patients. The most common adverse reactions resulting in permanent discontinuation of KEYTRUDA were pneumonitis (3%) and acute kidney injury (2%). The most common adverse reactions (≥20%) with [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
KEYTRUDA were nausea (56%), fatigue (56%), constipation (35%), diarrhea (31%), decreased appetite (28%), rash (25%), vomiting (24%), cough (21%), dyspnea (21%), and pyrexia (20%). In KEYNOTE-407, when KEYTRUDA was administered with carboplatin and either paclitaxel or paclitaxel protein-bound in metastatic squamous NSCLC, KEYTRUDA was discontinued due to adverse reactions in 15% of 101 patients. The most frequent serious adverse reactions reported in at least 2% of patients were febrile neutropenia, pneumonia, and urinary tract infection. Adverse reactions observed in KEYNOTE-407 were similar to those observed in KEYNOTE-189 with the exception that increased incidences of alopecia (47% vs 36%) and peripheral neuropathy (31% vs 25%) were observed in the KEYTRUDA and chemotherapy arm compared to the placebo and chemotherapy arm in KEYNOTE-407. In KEYNOTE-042, KEYTRUDA was discontinued due to adverse reactions in 19% of 636 patients with advanced NSCLC; the most common were pneumonitis (3%), death due to unknown cause (1.6%), and pneumonia (1.4%). The most frequent serious adverse reactions reported in at least 2% of patients were pneumonia (7%), pneumonitis (3.9%), pulmonary embolism (2.4%), and pleural effusion (2.2%). The most common adverse reaction (≥20%) was fatigue (25%). In KEYNOTE-010, KEYTRUDA monotherapy was discontinued due to adverse reactions in 8% of 682 patients with metastatic NSCLC; the most common was pneumonitis (1.8%). The most common adverse reactions (≥20%) were decreased appetite (25%), fatigue (25%), dyspnea (23%), and nausea (20%). Adverse reactions occurring in patients with SCLC were similar to those occurring in patients with other solid tumors who received KEYTRUDA as a single agent. In KEYNOTE-048, KEYTRUDA monotherapy was discontinued due to adverse events in 12% of 300 patients with HNSCC; the most common adverse reactions leading to permanent discontinuation were sepsis (1.7%) and pneumonia (1.3%). The most common adverse reactions (≥20%) were fatigue (33%), constipation (20%), and rash (20%). In KEYNOTE-048, when KEYTRUDA was administered in combination with platinum (cisplatin or carboplatin) and FU chemotherapy, KEYTRUDA was discontinued due to adverse reactions in 16% of 276 patients with HNSCC. The most common adverse reactions resulting in permanent discontinuation of KEYTRUDA were pneumonia (2.5%), pneumonitis (1.8%), and septic shock (1.4%). The most common adverse reactions (≥20%) were nausea (51%), fatigue (49%), constipation (37%), vomiting (32%), mucosal inflammation (31%), diarrhea (29%), decreased appetite (29%), stomatitis (26%), and cough (22%). In KEYNOTE-012, KEYTRUDA was discontinued due to adverse reactions in 17% of 192 patients with HNSCC. Serious adverse reactions occurred in 45% of patients. The most frequent serious adverse reactions reported in at least 2% of patients were pneumonia, dyspnea, confusional state, vomiting, pleural effusion, and respiratory failure. The most common adverse reactions (≥20%) were fatigue, decreased appetite, and dyspnea. Adverse reactions occurring in patients with HNSCC were generally similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy, with the exception of increased incidences of facial edema and new or worsening hypothyroidism. In KEYNOTE-087, KEYTRUDA was discontinued due to adverse reactions in 5% of 210 patients with cHL. Serious adverse reactions occurred in 16% of patients; those ≥1% included pneumonia, pneumonitis, pyrexia, dyspnea, GVHD, and herpes zoster. Two patients died from causes other than [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
disease progression; 1 from GVHD after subsequent allogeneic HSCT and 1 from septic shock. The most common adverse reactions (≥20%) were fatigue (26%), pyrexia (24%), cough (24%), musculoskeletal pain (21%), diarrhea (20%), and rash (20%). In KEYNOTE-170, KEYTRUDA was discontinued due to adverse reactions in 8% of 53 patients with PMBCL. Serious adverse reactions occurred in 26% of patients and included arrhythmia (4%), cardiac tamponade (2%), myocardial infarction (2%), pericardial effusion (2%), and pericarditis (2%). Six (11%) patients died within 30 days of start of treatment. The most common adverse reactions (≥20%) were musculoskeletal pain (30%), upper respiratory tract infection and pyrexia (28% each), cough (26%), fatigue (23%), and dyspnea (21%). In KEYNOTE-052, KEYTRUDA was discontinued due to adverse reactions in 11% of 370 patients with locally advanced or metastatic urothelial carcinoma. Serious adverse reactions occurred in 42% of patients; those ≥2% were urinary tract infection, hematuria, acute kidney injury, pneumonia, and urosepsis. The most common adverse reactions (≥20%) were fatigue (38%), musculoskeletal pain (24%), decreased appetite (22%), constipation (21%), rash (21%), and diarrhea (20%). In KEYNOTE-045, KEYTRUDA was discontinued due to adverse reactions in 8% of 266 patients with locally advanced or metastatic urothelial carcinoma. The most common adverse reaction resulting in permanent discontinuation of KEYTRUDA was pneumonitis (1.9%). Serious adverse reactions occurred in 39% of KEYTRUDA-treated patients; those ≥2% were urinary tract infection, pneumonia, anemia, and pneumonitis. The most common adverse reactions (≥20%) in patients who received KEYTRUDA were fatigue (38%), musculoskeletal pain (32%), pruritus (23%), decreased appetite (21%), nausea (21%), and rash (20%). In KEYNOTE-057, KEYTRUDA was discontinued due to adverse reactions in 11% of 148 patients with high-risk NMIBC. The most common adverse reaction resulting in permanent discontinuation of KEYTRUDA was pneumonitis (1.4%). Serious adverse reactions occurred in 28% of patients; those ≥2% were pneumonia (3%), cardiac ischemia (2%), colitis (2%), pulmonary embolism (2%), sepsis (2%), and urinary tract infection (2%). The most common adverse reactions (≥20%) were fatigue (29%), diarrhea (24%), and rash (24%). Adverse reactions occurring in patients with MSI-H or dMMR CRC were similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy. Adverse reactions occurring in patients with gastric cancer were similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy. Adverse reactions occurring in patients with esophageal cancer were similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy. In KEYNOTE-158, KEYTRUDA was discontinued due to adverse reactions in 8% of 98 patients with recurrent or metastatic cervical cancer. Serious adverse reactions occurred in 39% of patients receiving KEYTRUDA; the most frequent included anemia (7%), fistula, hemorrhage, and infections [except urinary tract infections] (4.1% each). The most common adverse reactions (≥20%) were fatigue (43%), musculoskeletal pain (27%), diarrhea (23%), pain and abdominal pain (22% each), and decreased appetite (21%). [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Adverse reactions occurring in patients with hepatocellular carcinoma (HCC) were generally similar to those in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy, with the exception of increased incidences of ascites (8% Grades 3-4) and immune-mediated hepatitis (2.9%). Laboratory abnormalities (Grades 3-4) that occurred at a higher incidence were elevated AST (20%), ALT (9%), and hyperbilirubinemia (10%). Among the 50 patients with MCC enrolled in study KEYNOTE-017, adverse reactions occurring in patients with MCC were generally similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy. Laboratory abnormalities (Grades 3-4) that occurred at a higher incidence were elevated AST (11%) and hyperglycemia (19%). In KEYNOTE-426, when KEYTRUDA was administered in combination with axitinib, fatal adverse reactions occurred in 3.3% of 429 patients. Serious adverse reactions occurred in 40% of patients, the most frequent (≥1%) were hepatotoxicity (7%), diarrhea (4.2%), acute kidney injury (2.3%), dehydration (1%), and pneumonitis (1%). Permanent discontinuation due to an adverse reaction occurred in 31% of patients; KEYTRUDA only (13%), axitinib only (13%), and the combination (8%); the most common were hepatotoxicity (13%), diarrhea/colitis (1.9%), acute kidney injury (1.6%), and cerebrovascular accident (1.2%). The most common adverse reactions (≥20%) were diarrhea (56%), fatigue/asthenia (52%), hypertension (48%), hepatotoxicity (39%), hypothyroidism (35%), decreased appetite (30%), palmar-plantar erythrodysesthesia (28%), nausea (28%), stomatitis/mucosal inflammation (27%), dysphonia (25%), rash (25%), cough (21%), and constipation (21%). Adverse reactions occurring in patients with TMB-H cancer were similar to those occurring in patients with other solid tumors who received KEYTRUDA as a single agent. Adverse reactions occurring in patients with cSCC were similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy. Lactation Because of the potential for serious adverse reactions in breastfed children, advise women not to breastfeed during treatment and for 4 months after the final dose. Pediatric Use There is limited experience in pediatric patients. In a trial, 40 pediatric patients (16 children aged 2 years to younger than 12 years and 24 adolescents aged 12 years to 18 years) with various cancers, including unapproved usages, were administered KEYTRUDA 2 mg/kg every 3 weeks. Patients received KEYTRUDA for a median of 3 doses (range 1–17 doses), with 34 patients (85%) receiving 2 doses or more. The safety profile in these pediatric patients was similar to that seen in adults; adverse reactions that occurred at a higher rate (≥15% difference) in these patients when compared to adults under 65 years of age were fatigue (45%), vomiting (38%), abdominal pain (28%), increased transaminases (28%), and hyponatremia (18%). Please see Prescribing Information for KEYTRUDA (pembrolizumab) at xxxxx://xxx.xxxxx.xxx/xxxxxxx/xxx/xx_xxxxxxxxx/x/xxxxxxxx/xxxxxxxx_xx.xxx and Medication Guide for KEYTRUDA at xxxxx://xxx.xxxxx.xxx/xxxxxxx/xxx/xx_xxxxxxxxx/x/xxxxxxxx/xxxxxxxx_xx.xxx About Seattle Genetics Seattle Genetics, Inc. is a global biotechnology company that discovers, develops and commercializes [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
transformative cancer medicines to make a meaningful difference in people’s lives. ADCETRIS® (brentuximab vedotin) and PADCEV® (enfortumab vedotin-ejfv) use the company’s industry-leading antibody-drug conjugate (ADC) technology. ADCETRIS is approved in certain CD30-expressing lymphomas, and PADCEV is approved in certain metastatic urothelial cancers. TUKYSA® (tucatinib), a small molecule tyrosine kinase inhibitor, is approved in certain HER2-positive metastatic breast cancers. The company is headquartered in the Seattle, Washington area, with locations in California, Switzerland and the European Union. For more information on our robust pipeline, visit xxx.xxxxxxxxxxxxxxx.xxx and follow @SeattleGenetics on Twitter. Merck’s Focus on Cancer Our goal is to translate breakthrough science into innovative oncology medicines to help people with cancer worldwide. At Merck, the potential to bring new hope to people with cancer drives our purpose and supporting accessibility to our cancer medicines is our commitment. As part of our focus on cancer, Merck is committed to exploring the potential of immuno-oncology with one of the largest development programs in the industry across more than 30 tumor types. We also continue to strengthen our portfolio through strategic acquisitions and are prioritizing the development of several promising oncology candidates with the potential to improve the treatment of advanced cancers. For more information about our oncology clinical trials, visit xxx.xxxxx.xxx/xxxxxxxxxxxxxx. About Merck For more than 125 years, Merck, known as MSD outside of the United States and Canada, has been inventing for life, bringing forward medicines and vaccines for many of the world’s most challenging diseases in pursuit of our mission to save and improve lives. We demonstrate our commitment to patients and population health by increasing access to health care through far-reaching policies, programs and partnerships. Today, Merck continues to be at the forefront of research to prevent and treat diseases that threaten people and animals – including cancer, infectious diseases such as HIV and Ebola, and emerging animal diseases – as we aspire to be the premier research-intensive biopharmaceutical company in the world. For more information, visit xxx.xxxxx.xxx and connect with us on Twitter, Facebook, Instagram, YouTube and LinkedIn. Forward Looking Statements for Seattle Genetics Certain of the statements made in this press release are forward looking, such as those, among others, relating to Seattle Genetics’ sale of shares of its common stock to Merck, receipt of upfront payments and potential receipt of milestone payments under the ladiratuzumab vedotin and TUKYSA collaborations and potential royalty payments under the TUKYSA collaboration; the potential to broaden and advance the development of ladiratuzumab vedotin and TUKYSA and accelerate the availability of TUKYSA to additional cancer patients around the world; as well as any other statements that are not historical fact. Actual results or developments may differ materially from those projected or implied in these forward- looking statements. Factors that may cause such a difference include, without limitation, risks and uncertainties related to: the completion of the sale of Seattle Genetics common stock to Merck including the ability to obtain clearance under the HSR Act; Seattle Genetics’ ability to maintain the ladiratuzumab vedotin and TUKYSA collaborations, including the risk that if Merck were to breach or terminate either collaboration, Seattle Genetics would not obtain the anticipated financial and other benefits of the collaboration and the development and/or commercialization of ladiratuzumab vedotin or TUKYSA could be delayed, perhaps substantially; the possibility that Seattle Genetics and Merck may not be successful in their development efforts under either collaboration and that, even if successful, Seattle Genetics and Merck may be unable to successfully commercialize ladiratuzumab vedotin and TUKYSA; and the duration and severity of the COVID-19 pandemic and resulting global economic, financial, and healthcare system disruptions. More information about the risks and uncertainties faced by Seattle Genetics is [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
contained under the caption “Risk Factors” included in the company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020 filed with the Securities and Exchange Commission. Seattle Genetics disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Forward-Looking Statement of Merck & Co., Inc., Kenilworth, N.J., USA This news release of Merck & Co., Inc., Kenilworth, N.J., USA (the “company”) includes “forward- looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based upon the current beliefs and expectations of the company’s management and are subject to significant risks and uncertainties. There can be no guarantees with respect to pipeline products that the products will receive the necessary regulatory approvals or that they will prove to be commercially successful. If underlying assumptions prove inaccurate or risks or uncertainties materialize, actual results may differ materially from those set forth in the forward-looking statements. Risks and uncertainties include but are not limited to, general industry conditions and competition; general economic factors, including interest rate and currency exchange rate fluctuations; the impact of the global outbreak of novel coronavirus disease (COVID-19); the impact of pharmaceutical industry regulation and health care legislation in the United States and internationally; global trends toward health care cost containment; technological advances, new products and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approval; the company’s ability to accurately predict future market conditions; manufacturing difficulties or delays; financial instability of international economies and sovereign risk; dependence on the effectiveness of the company’s patents and other protections for innovative products; and the exposure to litigation, including patent litigation, and/or regulatory actions. The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the company’s 2019 Annual Report on Form 10-K and the company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site (xxx.xxx.xxx). ### CONTACTS: Seattle Genetics Investors: Xxxxx Xxxxxxxx, 000-000-0000 xxxxxxxxx@xxxxxx.xxx Media: Xxxxxxx Xxxxx, 000-000-0000 xxxxxx@xxxxxx.xxx Merck Investors: Xxxxx Xxxxxxxxxx, 000-000-0000 [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Xxxxx.xxxxxxxxxx@xxxxx.xxx Media: Xxx Xxxxxx, 000-000-0000 Xxxxxx.xxxxxx@xxxxx.xxx [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 11.2 SeaGen Disclosure Schedules [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 11.3.1 Regulatory Documentation [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 13.4 [ * ] (See Attached) [ * ] {4 pages omitted} [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 14.7.6 Continuing Product Payment Reduction The provisions of this Schedule 14.7.6 shall only apply [ * ]. (a) Generic Product. If in a particular Calendar Quarter during the Continuing Payment Term in a given country, one or more Third Parties is or are selling a Generic Product in the Field in a country and the aggregate net sales of the [ * ] Continuing Product sold by the Continuing Parties (which net sales shall be calculated in a manner consistent with the definition of “Licensed Product Net Sales” hereunder, mutatis mutandis) in such country during such Calendar Quarter (or any Calendar Quarter thereafter) are less than [ * ] percent ([ * ]%) of the average quarterly aggregate net sales of the Continuing Product (which net sales shall be calculated in a manner consistent with the definition of “Licensed Product Net Sales”, mutatis mutandis) sold by the Continuing Parties in such country over the [ * ] immediately prior to the Calendar Quarter during which the first such Generic Product was sold in such country (the “Generic Reduction Trigger”), then in such case the Applicable Percentage for calculation of the Continuing Product Payment for such Continuing Product in such country during the Continuing Payment Term shall, commencing with such Calendar Quarter in which the Generic Reduction Trigger occurred and thereafter for the remainder of the Continuing Payment Term in such country, be reduced by [ * ] percent ([ * ]%) of the amount otherwise payable under Section 14.7.6, subject to clause (c) of this Schedule 14.7.6. For purposes of the foregoing, “Generic Product” means with respect to a Continuing Product, a product: (A) with the same pharmaceutically active ingredient(s); (B) that has obtained Marketing Authorization (excluding Pricing Approval) from the applicable Regulatory Authority by means of a procedure for establishing equivalence to the Continuing Product or otherwise in reliance on data generated for the Continuing Product; and (C) is legally marketed in such country by or under the authority of an entity other than the Continuing Party. (b) Third Party Payments. If any Continuing Party believes that it is necessary or reasonably useful to obtain a license or similar rights to intellectual property rights of a Third Party or Third Parties in order for such Continuing Party to Develop, Manufacture or Commercialize the Continuing Product (“Third Party License(s)”), then SeaGen shall have the right to credit [ * ] ([ * ]%) percent of [ * ] actually paid by any Continuing Party with respect to the Continuing Product under any such Third Party License(s) against Continuing Product Payments otherwise payable hereunder with respect to units of Continuing Product subject to such payment obligations under such Third Party License. Subject to clause (c) of this Schedule 14.7.6, such credit against Continuing Product Payments payable hereunder shall be allocated as follows: (a) [ * ] percent ([ * ]%) of [ * ] payable under a Third Party License with respect the Continuing Product shall be creditable against Continuing Product Payments payable under Section 14.7.6 with respect to units of the Continuing Product; and (b) [ * ] percent ([ * ]%) of [ * ] shall be creditable against Continuing Product Payments payable under Section 14.7.6 with respect units of the Continuing Product. Notwithstanding the foregoing, if SeaGen is not able to fully credit any of the amounts paid by any Continuing Party in a given Calendar Quarter, then SeaGen shall be entitled to carry forward such right of credit to future Calendar Quarters with respect to such excess amount and continue applying such credit on a Calendar Quarterly basis thereafter until fully utilized. [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
(c) Royalty Floor. The reductions in clauses (a) and (b) of this Schedule 14.7.6 are cumulative, provided that in no event shall the Applicable Percentage applicable to net sales of the Continuing Product (which net sales shall be calculated in a manner consistent with the definition of “Licensed Product Net Sales”, mutatis mutandis) sold by any Continuing Party in such country during any Calendar Quarter in the Continuing Payment Term on a country-by-country basis, fall below (as a result of the reductions in clauses (a) and (b) of this Schedule 14.7.6) a rate that is [ * ] percent ([ * ]%) of the Applicable Percentage rates otherwise payable pursuant to Section 14.7.6. Notwithstanding the foregoing, if SeaGen is not able to fully utilize any of the reductions or credits in clauses (a) and (b) of this Schedule 14.7.6 in a given Calendar Quarter as a result of the foregoing limitation, then SeaGen shall be entitled to carry forward such reduction or credit to future Calendar Quarters with respect to such excess amount and continue applying such reduction or credit on a Calendar Quarterly basis thereafter until fully utilized. [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Schedule 15.3 Partnership Tax Related Provisions [ * ] {7 pages omitted} [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Annex 1 to Schedule 15.3 Initial Capital Accounts [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED
Exhibit A Initial Development Plan [ * ] [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED