ADDENDUM TO HEXTEND AND PENTALYTE COLLABORATION AGREEMENT BETWEEN BIOTIME INC. AND SUMMIT PHARMACEUTICALS INTERNATIONAL CORPORATION
Exhibit 99.1
ADDENDUM TO HEXTEND AND PENTALYTE COLLABORATION AGREEMENT
BETWEEN
BIOTIME INC. AND SUMMIT PHARMACEUTICALS INTERNATIONAL
CORPORATION
BETWEEN
BIOTIME INC. AND SUMMIT PHARMACEUTICALS INTERNATIONAL
CORPORATION
This Addendum, dated as of December 14, 2005, adds the terms set forth below to that certain
Hextend and Pentalyte Collaboration Agreement dated December 24, 2004 (the “Co-Development
Agreement”) between BioTime Inc. (“BioTime”) and Summit Pharmaceuticals International Corporation
(“Summit”).
PREMISES
A. BioTime and Summit entered into the Co-Development Agreement for the purpose of
collaborating to obtain regulatory approval for the marketing, sale, and use BioTime products,
Hextend and PentaLyte, for certain human therapeutic uses in Japan
B. Summit has negotiated a License and Co-Development Agreement (the “Maruishi Agreement”)
with Maruishi Pharmaceutical Co., Ltd. (“Maruishi”) pursuant to which certain rights to develop,
manufacture, and market Hextend in Japan may be licensed to Maruishi. Summit has provided an
English translation copy of the Maruishi Agreement to BioTime.
C. In order for the parties to implement the Maruishi Agreement, it is necessary for Maruishi
to obtain a license to use BioTime patents, know-how, and technology.
1. Additional Definitions. All definitions contained in the Co-Development Agreement
apply in this Addendum. In addition, the following definitions shall apply.
(a) “Affiliate” means any entity controlled by, in control of, under common control with
Summit or BioTime.
(b) “Compensating Royalty” means with respect to any royalty payment period, a percentage
(determined as provided in this paragraph) of the amount (in Yen) by which the royalty payment by
Maruishi under the Maruishi Agreement was reduced pursuant to Section 7.4 of the Maruishi Agreement
or any other provision of the Maruishi Agreement, excluding a reduction under Section 3.3 arising
from the introduction of a generic Product after 10 years and the reduction under Section 11.2 if
Summit exercises the right to co-market the Product with Maruishi. The percentage shall be 40%,
except that the percentage shall be 20% if prior to Summit’s determination not to participate in
the work or cost sharing for a Phase III clinical study or the NDA filing, an event has occurred
that materially changes the market for the Product, potential net sales of the Product in the
Field, or the cost or likelihood of obtaining Regulatory Approval in the Territory, such as (i) a
Third Person obtaining Regulatory Approval to market a new competing plasma volume expander for use
in the Field, (ii) material reductions in the
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use of colloid plasma volume expanders in surgery, (iii) material reductions in the price of
competing products that would reasonable be expected to have a materially adverse effect on prices
at which the Product could be sold in the Territory, and (iv) the occurrence of adverse events or
outcomes in patients in Phase II clinical trials.
(c) “Know-How” means that proprietary technology developed by BioTime for manufacturing or
formulating Hextend, including, but not limited to: manufacturing data; formulation or production
technology; methods of synthesis, isolation and purification methods and other manufacturing
information required to manufacture Hextend; and that proprietary data developed by BioTime related
to pharmacology, toxicology, pathology, clinical data, results of clinical efficacy studies,
clinical effects and indications for use of Hextend.
(d) “Licensed Patents” means: (i) the patents and patent applications listed in Schedule I
hereto; (ii) all patents arising from applications identified in (i) and any divisions,
continuations and continuations-in-part defined in (i); (iii) any extension, renewal or reissue of
a patent identified in (i) or (ii); and (iv) any continuation or divisional of any licensed patent
application and any reissue or reexamination of any patent identified in (i) through (iii).
(e) “Licensed Trademark” means Hextend®, and any other trademark developed, acquired or
licensed by BioTime for use in connection with the sale of Hextend in the Territory
(f) “Proprietary Rights” means all of BioTime’s property rights (except Licensed Patents and
Licensed Trademarks) and interests in, to, or covering Hextend, or the manufacture or use of
Hextend, to the extent that such property rights and interests are of such legal status and nature
as to permit the same to be lawfully licensed and, without limiting the generality thereof,
specifically include unpatented inventions, ideas, data, Know-How, technology, trade secrets and
Confidential Information.
(g) “Subsidiary” means a corporation, a limited liability company, or any other entity that is
wholly owned by Summit or BioTime, either directly or through one or more other such entities that
are wholly owned by Summit or BioTime.
(h) “Third Person” means any natural person, corporation, partnership, limited partnership,
limited liability company, trust, association or other entity other than Summit, a Subsidiary, an
Affiliate, or BioTime.
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2. Grant of License.
(a) BioTime hereby grants to Summit a license to use Licensed Patents, Licensed Trademarks,
and Proprietary Rights to develop, manufacture and sell Hextend in the Territory only for human
therapeutic use in the Field. As used in this Addendum, “develop” and “development” means
conducting laboratory and clinical studies and obtaining Regulatory Approval of the Product.
(b) Summit shall have the right to sublicense its rights under this Addendum to Maruishi
pursuant to the Mariushi Agreement. Summit and Maruishi shall not sublicense or assign to any
other Third Person the Licensed Patents, Licensed Trademarks, and Proprietary Rights, or any other
rights granted by BioTime under this Addendum.
3. Restrictions.
(a) Summit agrees not to use or permit Maruishi to use any Licensed Patents, Licensed
Trademarks, and Proprietary Rights for any use other than the development, manufacture, and sale of
Hextend in the Territory. Summit will not sell and will not permit Maruishi or any Subsidiary or
Affiliate to sell Hextend outside the Territory. If Hextend is sold by Summit, Maruishi or any of
their respective Subsidiaries to a Third Person that intends to resell the Product, Summit will
require such Third Person to agree not to resell the Product outside the Territory. If Summit or
any of its Subsidiaries or other Affiliates becomes informed of a violation of that agreement by
the Third Person, Summit will notify BioTime of such violation, and Summit will take reasonable
means to enforce the Third Person’s agreement, including by discontinuing or requiring Maruishi to
discontinue sales to such Third Person if the sales outside the Territory compete with sales made
by BioTime or any of BioTime’s licensees.
(b) Summit agrees that it, its Subsidiaries, and other Affiliates will not challenge or
contest the validity of any Licensed Patent or any claim under any Licensed Patent, or BioTime’s
ownership of Proprietary Rights, or BioTime’s ownership or registration of any Licensed Trademark.
(c) BioTime retains all rights to Licensed Patents, Proprietary Rights, Licensed Trademarks,
and the Products for any purpose not expressly licensed to Summit under this Addendum.
4. Maruishi Agreement.
(a) Summit shall not amend, modify, terminate, or supplement the Maruishi Agreement, or waive
any material right under the Maruishi Agreement, without the prior written approval of BioTime.
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5. Patent and Trademark Marking
(a) Summit shall label or xxxx the Product container or package made by or on behalf of Summit
with the patent number or numbers of any issued or pending Licensed Patents. The content, form,
location and language used for such marking shall be in accordance with the laws and practices of
the Territory and in accordance with Summit’s marketing preferences.
(b) If Summit uses a Licensed Trademark they shall include such symbols or indications of
trademark registration or non-registration as may be comparable under Japanese law to the symbols
® and ™ used in the United States and a statement that the Licensed Trademark is
licensed from BioTime.
(c) Summit shall use good faith efforts to obtain Maruishi’s compliance with paragraphs (a)
and (b) of this section with respect to Maruishi’s use of Licensed Patents, and Licensed Trademarks
and labeling of the Product. Nothing in this section requires Summit or Maruishi to use Licensed
Trademarks in marketing the Product in the Territory.
6. Royalties and Revenues
(a) The payments made by Maruishi under Section 3.2 of the Maruishi Agreement are to be used
to cover Product development costs and will not be treated as revenues to be shared between BioTime
and Summit under the Co-Development Agreement.
(b) For each royalty payment period under the Maruishi Agreement as to which the royalty
payable by Maruishi has been reduced pursuant to Section 7.4 of the Maruishi Agreement or any other
provision of the Maruishi Agreement, excluding a reduction under Section 3.3 arising from the
introduction of a generic Product after 10 years and the reduction under Section 11.2 if Summit
exercises the right to co-market the Product with Maruishi, Summit shall pay to BioTime the
Compensating Royalty. No Compensating Royalty shall be paid if the Maruishi royalty is reduced by
more than four percentage points as a result of an amendment or modification of the Maruishi
Agreement implemented to maintain Maruishi’s participation in the development or marketing of the
Product.
(c) If Summit or any of its Subsidiaries or Affiliates sells the Product, the net sales shall
be shared in the manner provided in Section 6(b) of the Co-Development Agreement.
(d) Summit shall deliver to BioTime a copy of each report from Maruishi showing the
computation of the royalty paid by Maruishi. Summit shall deliver the report to BioTime within ten
business days after Summit receives the report from Maruishi.
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(e) In each fiscal year, the period from April 1st to September 30th
shall be called the 1st Half and the period from October 1st to March
31st of the next calendar year shall be called the 2nd Half. If Summit or
any of its Subsidiaries or Affiliates sells any Product, Summit shall send written reports
containing (i) the amount of net sales during the Half shown in both yen and unit amounts and
shall remit 40% of the net sales amount to BioTime by January 31st of the next calendar
year for the 1st Half and by July 31st of the same calendar year for the
2nd Half. All payments shall be paid in United States dollars or Japanese yen.
(f) BioTime and its accountants may audit the accounting documents of Summit related to net
sales, royalties, and other revenues from the Product or the Licensed Patents and Licensed
Trademarks. The audit may be conducted at any time within 2 years from the time the relevant
calculation was made. BioTime shall bear the expense of such audit, in principle, but Summit shall
bear the expense of the audit if the audit discloses that Summit has underpaid any royalty by an
amount of 5% or more with respect to any Half period.
7. Termination of License.
(a) The licenses granted in the Addendum shall terminate as follows:
| (i) | Upon the bankruptcy or the insolvency of Maruishi except that the license granted to Summit (but not the sublicense to Maruishi) shall remain in effect if the Co-Development Agreement or the licenses are not otherwise terminated under clauses (iv) or (v) of this Section 7(a); | ||
| (ii) | Upon termination of the Co-Development Agreement; | ||
| (iii) | Upon termination of the Maruishi Agreement, except that the license granted to Summit (but not the sublicense to Maruishi) shall remain in effect if the Co-Development Agreement or the licenses are not otherwise terminated under clauses (iv) or (v) of this Section 7(a). | ||
| (iv) | Upon the breach of, or default in the performance of, any material provision of the Maruishi Agreement by Summit or Maruishi if the breach or default is not cured within sixty (60) days after written notice thereof to Summit; or | ||
| (v) | Upon the breach of, or default in the performance of, any material provision of this Addendum, if the breach or default is not cured within sixty (60) days after written notice thereof to Summit. |
(b) If the Maruishi Agreement or sublicense is terminated and the license to Summit remains in
effect, Summit shall endeavor to find a sublicensee to manufacture and market the Product in the
Territory in place of Maruishi on terms
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acceptable to BioTime. Although Summit expects that it would seek a new licensee on terms
comparable to the terms of the Maruishi Agreement, the parties recognize that a new licensee may
require different terms. If such a new sublicensee is found, the Co-Development Agreement
(including this Addendum) shall be amended as appropriate and agreed by the parties to reflect the
terms of the new sublicense.
(c) Upon the expiration or termination of the licenses granted under this Addendum, Summit,
Maruishi, and their respective Subsidiaries, Affiliates, and any sublicensees shall immediately
cease all use of Licensed Patents, Licensed Trademarks, Proprietary Rights, and Confidential
Information, and shall discontinue the manufacture and sale of the Product, except that Licensed
Trademarks may be used for a period of 180 days exclusively for the purpose of selling inventory of
Product on hand on the date the licenses terminated.
8. Assignment. The Co-Development Agreement (including this Addendum) may not be
assigned or otherwise transferred, nor may any right or obligations hereunder be assigned or
transferred, by either party without the prior written consent of the other party; provided,
however, that either party may, without such consent of the other party, assign the Co-Development
Agreement and its rights and obligations hereunder to its Affiliate (provided that each party shall
assure performance by its Affiliate) or in connection with the transfer or sale of all or
substantially all of its assets related to the Co-development Agreement or the business relating
thereto, or in the event of its merger or consolidation or change in control or similar
transaction.
| SUMMIT PHARMACEUTICALS | BIOTIME, INC. | |||||||
| INTERNATIONAL CORPORATION | ||||||||
By:
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By: | |||||||
Name:
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Name: | |||||||
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