LICENSE AGREEMENT
Exhibit 10.2
*** INDICATES MATERIAL THAT WAS OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT WAS REQUESTED. ALL
SUCH OMITTED MATERIAL WAS FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
THIS LICENSE AGREEMENT (this “Agreement”) dated as of July 22, 2010 (the “Effective
Date”) is entered into between Medicis Pharmaceutical Corporation, a Delaware corporation with an
address at 0000 Xxxxx Xxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxx 00000 on behalf of itself and its Affiliates
(collectively, “Medicis”), and Mylan Inc., a Pennsylvania corporation with an address at 0000
Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000; Matrix Laboratories Ltd., a subsidiary of Mylan
Inc. with a principal place of business at 0-0-000/0, Xxxxxxxxx Xxxx, Xxxxxxxxxxxx 000-000 Xxxxx;
and Mylan Pharmaceuticals Inc., a West Virginia corporation with an address at 000 Xxxxxxxx Xxxxx
Xxxx, Xxxxxxxxxx, XX 00000 on behalf of themselves and their Affiliates (all collectively referred
to herein as “Mylan”).
WHEREAS, Medicis is the owner of the Patent Rights (as defined below) and has filed complaints
against Mylan in actions captioned Medicis Pharmaceutical Corp. v. Mylan Inc. et al., Case No.
09-CV-33 (LPS) (D. Del.) and Medicis Pharmaceutical Corp. v. Mylan Inc. et al., Case No. 10-CV-524
(LPS) (D. Del.) (collectively, the “Litigation”) which are pending in the United States District
Court, District of Delaware (the “Court”);
WHEREAS, to avoid the expense of further litigation the Parties desire to settle the
Litigation on the terms set forth herein; and
WHEREAS, the parties desire to settle the Litigation and Mylan desires to receive, and Medicis
desires to grant to Mylan, a royalty-bearing license under the Patent Rights to make, use, sell,
offer for sale and import Current Generic Product and Future Generic Product (as each term is
defined below), all on the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants herein
contained, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. DEFINITIONS.
1.1 “Affiliate” means, with respect to any entity, any other entity that directly
or indirectly controls, is controlled by, or is under common control with, such entity. An entity
shall be regarded as in control of another entity if it owns, or directly or indirectly controls,
at least fifty percent (50%) of the voting stock or other ownership interest of the other entity,
or if it directly or indirectly possesses the power to direct or cause the direction of the
management and policies of the other entity by any means whatsoever.
1.2 “API” shall mean the Minocycline Hydrochloride Active Pharmaceutical
Ingredient used to manufacture a Current Generic Product (as defined below) or a Future Generic
Product (as defined below).
1.3 “Business Day” shall mean any day other than a Saturday, a Sunday or a day on
which the state or federal courts located in the State of Delaware are authorized or obligated by
law or executive order to be closed.
1.4 “Confidential Information” means all non-public materials, information and data concerning
the disclosing party and its operations that is disclosed by the disclosing party to the receiving
party pursuant to this Agreement, orally or in written, electronic or tangible form, or otherwise
obtained by the receiving party through observation or examination of the disclosing party’s
operations. Confidential Information includes, but is not limited to, information about the
disclosing party’s financial condition and projections; business, marketing or strategic plans;
sales information; customer lists; price lists; databases; trade secrets; product prototypes and
designs; techniques, formulae, algorithms and other non-public process information.
Notwithstanding the foregoing, Confidential Information of a party shall not include that portion
of such materials, information and data that, and only to the extent, that the recipient can
establish by written documentation: (a) is known to the recipient as evidenced by its written
records before receipt thereof from the disclosing party, (b) is disclosed to the recipient free of
confidentiality obligations by a Third Party who has the right to make such disclosure without
obligations of confidentiality, (c) is or becomes part of the public domain through no fault of the
recipient, or (d) the recipient can reasonably establish is independently developed by persons on
behalf of recipient without the use of the information disclosed by the disclosing party.
1.5 “Current Generic Product” means ***.
1.6 “Current Solodyn Products” means the Solodyn® products listed on Exhibit A.
1.7 “Current Strengths Trigger Date” means ***:
| (a) | November ***, 2011; | ||
| (b) | ***; | ||
| (c) | ***; | ||
| (d) | ***; or | ||
| (e) | ***. |
| ***. | ||
| ***. |
1.8 “FDA” means the United States Food and Drug Administration or any successor entity thereto.
1.9 “Future Generic Product” means ***.
1.10 “Future Solodyn Products” means ***.
1.11 “Future Strengths Trigger Date” means, ***:
| (a) | ***; | ||
| (b) | ***; | ||
| (c) | ***; or | ||
| (d) | ***. |
| ***. | ||
| ***. |
1.12 “GAAP” means generally accepted accounting principles in effect in the United States from
time to time, as consistently applied by Mylan.
1.13 “Medicis NDA” means the New Drug Application #50-808 and any supplements or amendments
thereto.
1.14 “Net Sales” means ***.
1.15 “Orange Book” means the current edition (in electronic or hard copy form) of the FDA’s
publication, Approved Drug Products with Therapeutic Equivalence Evaluations, as may be amended
from time to time, and any successor publication thereto.
1.16 “Patent Rights” means ***.
1.17 “Settlement Agreement” means the Settlement Agreement entered into between Medicis and
Mylan of even date herewith.
1.18 “Third Party” means any person or entity other than Medicis or Mylan.
1.19 “United States” means the United States of America, including its territories and
possessions, but excluding direct sales into the Commonwealth of Puerto Rico.
1.20 “The ‘838 Patent” means U.S. Patent No. 5,908,838, as set forth in the duly issued Ex
Parte Reexamination Certificate on June 1, 2010.
1.21 “Valid Claim” means ***.
2. RELEASE; PATENT RIGHTS.
2.1 Releases. Mylan represents and warrants that, as of the Effective Date, it has
manufactured, used, sold, offered for sale, imported or distributed in the United States those lots
of Current Generic Product without authorization from Medicis as set forth on Schedule A (the
“Distributed Lots”), and the Distributed Lots are the only infringements of the Patent Rights by
Mylan with respect to the sale or offer for sale of Current Generic Product in the United States.
***.
2.2 Prior to Trigger Dates.
2.2.1***.
2.2.2***.
2.2.3***.
2.3 Validity of the ‘838 Patent. ***.
3. LICENSE
3.1 License Grants.
3.1.1 Subject to the terms and conditions of this Agreement, and effective on the Current
Strengths Trigger Date, Medicis hereby grants to Mylan, their Affiliates (including Mylan
Pharmaceuticals) a non-exclusive, non-transferable, non-sublicensable (except to Mylan’s
manufacturers for the manufacture of Current Generic Product and associated API exclusively for the
benefit of Mylan), royalty-bearing right and license under the Patents Rights to make, have made,
use, sell, offer for sale and import the applicable Current Generic Products and associated API in
the United States. ***.
3.1.2 Subject to the terms and conditions of this Agreement, and effective on the applicable
Future Strengths Trigger Date for each applicable Future Generic Product for which Mylan has an
approved ANDA, Medicis hereby grants to Mylan, their Affiliates (including Mylan Pharmaceuticals) a
non-exclusive, non-transferable, non-sublicensable (except to Mylan’s manufacturers for the
manufacture of Future Generic Product and associated API exclusively for the benefit of Mylan),
royalty-bearing right and license under the Patents Rights to make, have made, use, sell, offer for
sale and import in the United States the applicable Future Generic Products and associated API for
which Mylan has an approved ANDA. ***.
3.2 No Licenses. Except as otherwise provided herein, nothing in this Agreement shall
be construed as: (a) an obligation to bring or prosecute actions or suits against Third Parties for
infringement of any patent, whether within the Patent Rights or otherwise; (b) conferring a right
to use in advertising, publicity, promotion or otherwise any trademark or trade name of Medicis; or
(c) granting by implication, estoppel or otherwise, any licenses or rights under the Patent Rights
or any other patents.
4. ROYALTIES
4.1 Payment.
4.1.1 ***.
4.1.2 ***.
4.1.3 ***.
4.2 Taxes. Mylan shall be responsible for and may withhold from payments made to
Medicis under this Agreement any taxes required to be withheld by Mylan under applicable law.
Accordingly, if any such taxes are levied on such payments due hereunder (“Withholding Taxes”),
Mylan shall (i) deduct the Withholding Taxes from the payment amount, (ii) pay all applicable
Withholding Taxes to the proper taxing authority, and (iii) send evidence of the obligation
together with proof of tax payment to Medicis within *** following the applicable tax payment.
4.3 Audit Rights. On no less than *** notice from Medicis, Mylan shall make available
for inspection during normal business hours by an independent auditor selected by Medicis and
reasonably acceptable to Mylan all records, books of account, information and data concerning the
calculation of Net Sales pursuant to this Agreement for the purpose of an audit to determine the
accuracy of the reports delivered and amounts paid by Mylan pursuant to Section 4.1. Upon
reasonable belief of discrepancy or dispute, Medicis’ external auditors shall be entitled to take
copies or extracts from such records, books of account, information and data (but only to the
extent related to the contractual obligations set out in this Agreement) during any review or
audit. Medicis shall be solely responsible for its costs in making any such audit, unless Medicis
identifies a discrepancy in favor of Mylan in the calculation of the Net Sales and royalties paid
to Medicis under this Agreement in any calendar year from those properly payable for that calendar
year of *** or greater, in which event Mylan shall be solely responsible for the reasonable cost of
such audit and pay Medicis any underpayment.
5. TERM AND TERMINATION.
5.1 Term. Subject to Section 5.2, this Agreement shall expire on the expiration of
the last to expire of the Patent Rights; provided, however, that if there are no valid, issued
patents within the Patent Rights, but there are at such time pending patent applications within the
Patent Rights, then subject to the terms and conditions of this Agreement, the term of this
Agreement shall continue for the pendency of such pending patent applications.
5.2 Termination for Cause. Either party may terminate this Agreement upon or after
the material breach of any material provision of this Agreement by the other party if the other
party has not cured such breach within *** after receipt of express written notice thereof by the
non-breaching party. ***.
5.3 Termination for Challenge. ***.
5.4 Effect of Expiration or Termination. Expiration or termination of this Agreement
shall not relieve the parties of any obligation accruing prior to such expiration or termination,
and the provisions of Sections 1, 2.1, 2.2.3, 2.3, 5.2, 5.4, 6, 7, 8 and 9 shall survive the
expiration or termination of this Agreement. No other provisions shall survive expiration or
termination of this Agreement.
6. CONFIDENTIALITY.
6.1 Confidentiality. Except as otherwise provided for in the Settlement Agreement,
until the expiration or earlier termination of this Agreement, and for a period of *** following
the expiration or earlier termination hereof or thereof, except with respect to any
Confidential Information constituting a trade secret in which case the receiving party’s
obligation continues in perpetuity, provided such receiving party has been informed as to the
status of such Confidential Information as a trade secret, each party shall maintain in confidence
all Confidential Information disclosed by the other party and the terms of this Agreement, and
shall not use, grant the use of or disclose to any Third Party the Confidential Information of the
other party other than as expressly permitted hereby. Each party shall notify the other promptly
upon discovery of any unauthorized use or disclosure of the other party’s Confidential Information
or the terms of this Agreement.
6.2 Permitted Disclosures. Either party may disclose Confidential Information of the
disclosing party (a) on a need-to-know basis, to such party’s directors, officers and employees to
the extent such disclosure is reasonably necessary in connection with such party’s activities as
expressly authorized by this Agreement, and (b) to those agents and consultants, and contract
manufacturers who need to know such information to accomplish the purposes of this Agreement
(collectively, “Permitted Recipients”); provided such Permitted Recipients are bound to maintain
such Confidential Information in confidence at least to the same extent as set forth in Section
6.1.
6.3 Litigation and Governmental Disclosure. Each party may disclose Confidential
Information of the other party to the extent such disclosure is reasonably necessary for
prosecuting or defending litigation or complying with a court order or applicable law, governmental
regulations or investigation, provided that if a party is required by court order, law or
regulation (except for disclosure requested or required by the I.R.S.) to make any such disclosure
of the other party’s Confidential Information it will give reasonable advance notice to the other
party of such disclosure requirement and will use good faith efforts to assist such other party to
secure a protective order or confidential treatment of such Confidential Information required to be
disclosed.
6.4 Return of Confidential Information. Upon expiration or termination of this
Agreement for any reason, the Receiving Party, upon receipt of a written request from the
Disclosing Party, shall return to the Disclosing Party all copies of the Confidential Information
received from the Disclosing Party hereunder, , or, in its discretion, destroy all such copies and
certify to such destruction, provided, however, that the Receiving Party’s legal counsel may retain
one copy of such Confidential Information in a secure location solely for purposes of determining
the Receiving Party’s continuing obligations under this Agreement.
6.5 Publicity. Except as expressly authorized hereunder and in the Settlement
Agreement, neither party shall make any publicity releases, interviews or other dissemination of
information concerning this Agreement or its terms, or either party’s performance hereunder, to
communication media, financial analysts or others without the prior written approval of the other
party, which approval shall not be unreasonably withheld, delayed or conditioned. Notwithstanding
anything to the contrary in this Agreement, the parties understand and agree that either party,
may, if so required, disclose some or all of the information included in this Agreement or other
Confidential Information of the other party (a) in order to comply with its obligations under the
law, including the United States Securities Act of 1933 and the United States Securities Exchange
Act of 1934 and The Drug Price Competition and Patent Term Restoration Act of 1984, as amended by
The Medicare Prescription Drug, Improvement and
Modernization Act of 2003; (b) in order to comply with the listing standards or agreements of
any national or international securities exchange or The NASDAQ Stock Market or New York Stock
Exchange or other similar laws of a governmental authority; (c) to respond to an inquiry of a
governmental authority or regulatory authority as required by law; or (d) in a judicial,
administrative or arbitration proceeding. In any such event the party making such disclosure shall
(i) provide the other party with as much advance notice as reasonably practicable of the required
disclosure, (ii) cooperate with the other party in any attempt to prevent or limit the disclosure,
and (iii) limit any disclosure to the specific purpose at issue. In connection with any filing of
a copy of this Agreement with the Securities and Exchange Commission, the filing party shall
endeavor to obtain confidential treatment of economic and trade secret information, and shall keep
the other party informed as the planned filing (including, but not limited to providing the other
party with the proposed filing reasonably in advance of making the planned filing) and consider the
requests of the other party regarding such confidential treatment.
7. REPRESENTATIONS AND WARRANTIES.
7.1 Representations. Each party hereby represents and warrants as of the Effective
Date to the other party that (a) the person executing this Agreement is authorized to execute this
Agreement; (b) this Agreement is legal and valid and the obligations binding upon such party are
enforceable by their terms; and (c) the execution, delivery and performance of this Agreement does
not conflict with any agreement, instrument or understanding, oral or written, to which such party
may be bound, nor violate any law or regulation of any court, governmental body or administrative
or other agency having jurisdiction over it.
7.2 Disclaimer of Warranties. Except for those warranties set forth in Section 7.1,
neither party makes any warranty, written, oral, express or implied, with respect to this
Agreement. ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT HEREBY ARE
DISCLAIMED BY BOTH PARTIES.
7.3 Limitation of Liability. WITH THE EXCEPTION OF DAMAGES RESULTING FROM A PARTY’S
BREACH OF ITS CONFIDENTIALITY OBLIGATIONS UNDER THIS AGREEMENT OR ITS OBLIGATIONS UNDER SECTION 8
(INDEMNIFICATION), OR A BREACH BY MYLAN OF SECTION 2.1, UNDER NO CIRCUMSTANCES SHALL EITHER PARTY
BE LIABLE FOR LOSS OF USE OR PROFITS OR OTHER COLLATERAL, SPECIAL, CONSEQUENTIAL, INCIDENTAL OR
PUNITIVE DAMAGES IN CONNECTION WITH THIS AGREEMENT, WHETHER SUCH CLAIMS ARE FOUNDED IN TORT OR
CONTRACT.
7.4 Equitable Relief Against Mylan. ***.
7.5 ***.
8. INDEMNIFICATION.
8.1 ***.
8.2 ***.
8.3 Obligations. A party which intends to claim indemnification under this Section 8
(the “Indemnified Party”) shall promptly notify the other party (the “Indemnifying Party”) in
writing of any claim, demand, action, or other proceeding in respect of which the Indemnified Party
intends to claim such indemnification; provided, however, that failure to provide such notice
within a reasonable period of time shall not relieve the Indemnifying Party of any of its
obligations hereunder except to the extent the Indemnifying Party is prejudiced by such failure.
The Indemnified Party shall permit the Indemnifying Party, at its discretion, to settle any such
action, claim or other matter. Notwithstanding the foregoing, the Indemnifying Party shall not
enter into any settlement that would adversely affect the Indemnified Party’s rights hereunder, or
impose any obligations on the Indemnified Party in addition to those set forth herein, in order for
it to exercise such rights, without the Indemnified Party’s prior written consent, which shall not
be unreasonably withheld or delayed. No such action, claim or other matter shall be settled
without the prior written consent of the Indemnifying Party, which shall not be unreasonably
withheld or delayed. The Indemnified Party shall reasonably cooperate with the Indemnifying Party
and its legal representatives in the investigation and defense of any claim, demand, action, or
other proceeding covered by the indemnification obligations of this Section 8. The Indemnified
Party shall have the right, but not the obligation, to be represented in such defense by counsel of
its own selection and at its own expense.
9. GENERAL PROVISIONS.
9.1 Notices. All notices hereunder shall be delivered by facsimile (confirmed by
overnight delivery), or by overnight delivery with a reputable overnight delivery service, to the
following address of the respective parties:
| If to Medicis: | Medicis Pharmaceutical Corporation | |||
| 0000 Xxxxx Xxxxxx Xxxx | ||||
| Xxxxxxxxxx, Xxxxxxx 00000 | ||||
| Attn: Chief Executive Officer | ||||
| Facsimile: 480-291-5175 | ||||
| with a copy to: | Medicis Pharmaceutical Corporation | |||
| 0000 Xxxxx Xxxxxx Xxxx | ||||
| Xxxxxxxxxx, Xxxxxxx 00000 | ||||
| Attn: General Counsel | ||||
| Facsimile: 000-000-0000 | ||||
| If to Mylan: | Mylan Inc. | |||
| 0000 Xxxxxxxxx Xxxxx, | ||||
| Xxxxxxxxxx, Xxxxxxxxxxxx00000 | ||||
| Attn: General Counsel | ||||
| Facsimile: 000-000-0000 |
| With a copy to: | Xxxxxxx Coie LLP | |||
| 000 Xxxxxxxxxx Xxxxxx X.X., Xxxxx 000 | ||||
| Xxxxxxxxxx, X.X. | ||||
| 00000-0000 | ||||
| Attn: Xxxxxxx Xxxxxxxxxx | ||||
| Facsimile: 000-000-0000 |
Notices shall be effective on the day of receipt. A party may change its address listed above
by notice to the other party given in accordance with this Section 9.1.
9.2 Entire Agreement. The parties hereto acknowledge that this Agreement sets forth
the entire agreement and understanding of the parties and supersedes all prior written or oral
agreements or understandings with respect to the subject matter hereof. No modification of any of
the terms of this Agreement, or any amendments thereto, shall be deemed to be valid unless in
writing and signed by an authorized agent or representative of both parties hereto. No course of
dealing or usage of trade shall be used to modify the terms and conditions herein. This Agreement
shall be binding on each of Mylan and Medicis and their respective permitted successors and
assigns.
9.3 Waiver. None of the provisions of this Agreement shall be considered waived by
any party hereto unless such waiver is agreed to, in writing, by authorized agents of such party.
The failure of a party to insist upon strict conformance to any of the terms and conditions hereof,
or failure or delay to exercise any rights provided herein or by law shall not be deemed a waiver
of any rights of any party hereto.
9.4 Obligations to Third Parties. Each party warrants and represents that this
Agreement does not conflict with any contractual obligations, expressed or implied, undertaken with
any Third Party.
9.5 Assignment. ***.
9.6 Governing Law. ***.
9.7 Severability. If any term or provision of this Agreement shall for any reason be
held invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other term or provision hereof, and this Agreement shall be
interpreted and construed as if such term or provision, to the extent the same shall have been held
to be invalid, illegal or unenforceable, had never been contained herein.
9.8 Headings, Interpretation. The headings used in this Agreement are for convenience
only and are not part of this Agreement.
9.9 Attorneys’ Fees. The prevailing party shall be entitled to attorneys’ fees and
its litigation or related expenses in any suit or proceeding with respect to the interpretation or
enforcement of this Agreement.
9.10 Counterparts. The Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be executed by their
duly-authorized representatives effective as of the Effective Date.
| MYLAN INC. | MEDICIS PHARMACEUTICAL CORPORATION | |||||
| By: | By: | |||||
| Name: | Name: | |||||
| Title: | Title: | |||||
| MATRIX LABORATORIES LTD. | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| MYLAN PHARMACEUTICALS INC. | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
EXHIBIT A
Current Solodyn Products
| PRODUCT | NDC | |
Solodyn 45mg
|
99207-0460-[All] | |
Solodyn 90mg
|
99207-0461-[All] | |
Solodyn 135mg
|
99207-0462-[All] |
EXHIBIT B
Patent Rights
| Issued Patents (all U.S.) | Pending Applications (all U.S.) | |
| *** | *** |
SCHEDULE A
Distributed Lots
***
