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EXHIBIT 10.17
[Confidential treatment has been requested for portions of this exhibit. The
confidential portions have been redacted and are denoted by [**]. The
confidential portions have been separately filed with the commission.]
LICENSE AGREEMENT
This License Agreement ("Agreement") is made and entered into on this
______ day of ___________, 1995 (the "Effective Date"), by and between (a)
Ilex Oncology Inc., a Delaware corporation ("Ilex"), and (b) Xxxxxx Xxxxxxx Dow
Inc., a Delaware corporation and its subsidiaries Xxxxxxx Xxx Pharmaceuticals
Inc., a Delaware corporation, and Xxxxxx Xxxxxxx Dow France Et Cie, a French
Societe en Nom Collectif, having a business address at 16 xxx d'Ankara, 00000
Xxxxxxxxxx Xxxxx, Xxxxxx (hereinafter collectively referred to as "MMD").
W I T N E S S E T H :
WHEREAS, MMD owns and has carried out development activities with
respect to Eflornithine for cancer related indications and for the treatment of
various infections and owns patent rights and technology related thereto;
WHEREAS, Ilex is interested in developing, licensing and marketing
pharmaceutical preparations containing Eflornithine;
WHEREAS, MMD desires to grant to Ilex and Ilex desires to acquire an
exclusive license to use the Technology with the right to develop, to make,
have made, use, sell, market or otherwise commercially exploit Products within
the Territory;
NOW, THEREFORE, in consideration of the mutual premises and
obligations hereinafter set forth and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto stipulate and agree as follows:
ARTICLE 1
DEFINITIONS
1.1 "Affiliates" shall mean any Person that directly or indirectly
through one or more intermediaries controls, is controlled by, or is under
common control with the Person, but only for so long as the relationship
exists. "Control" means ownership of at least [**] of the shares of stock
entitled to vote for the election of directors in the case of a corporation,
and at least [**] of the voting power or interests in profits in the case of a
business entity other than a corporation.
1.2 "Effective Date" shall have the meaning given such term in the
first paragraph of this Agreement.
1.3 "Eflornithine" shall mean the chemical compound
a-difluoromethylornithine and its pharmaceutically acceptable salts, and
pharmaceutical preparations containing the same. Eflornithine is also known as
"2- (difluoromethyl) ornithine" and "DFMO" and "2-(difluoromethyl) - 2,5 -
diaminopentanoic acid".
1.4 "Field of Interest" shall mean all uses of Eflornithine for
the treatment of cancer and for the treatment of various infections, excluding
the treatment of Trypanosoma brucei gambiense and rhodensiense infections
("African sleeping sickness") in the Territory.
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1.5 "First Commercial Sale" shall mean the date on which Ilex or a
sublicensee first transfers title to a Licensed Patented Product or License
Product to an independent third party for monetary consideration.
1.6 "GAAP" shall mean generally acceptable accounting principles
for the United States.
1.7 "Ilex" shall mean Ilex Oncology Inc. and any of its
Affiliates.
1.8 "Licensed Patented Product" shall mean any product within the
Field of Interest which is made, used, marketed or sold in any country within
the Territory where the manufacture, use or sale of such product is covered by
at least one Valid Claim.
1.9 "Licensed Product" shall mean any product within the Field of
Interest which is made, used, marketed or sold using all or any part of the
Technology and which is not covered under "Licensed Patented Product".
1.10 "MMD" shall mean, collectively, (i) Xxxxxx Xxxxxxx Dow Inc., a
Delaware corporation, (ii) its subsidiaries Xxxxxxx Xxx Pharmaceuticals Inc., a
Delaware corporation, and Xxxxxx Xxxxxxx Dow France Et Cie, a French Societe en
Nom Collectif and (iii) each direct or indirect subsidiary of Xxxxxx Xxxxxxx
Dow Inc. and each other entity controlled by Xxxxxx Xxxxxxx Dow Inc.
1.11 "Net Sales" means the amount invoiced for sales by Ilex and
its sublicensees of Licensed Products or Licensed Patented Products in the
Territory, MINUS discounts (including discounts applicable to sales under
programs for indigents), allowances, rebates, credits, and adjustments to
customers (including but not limited to refunds for rejected or damaged goods
or out dated goods); freight, packing and insurance (to the extent included in
the invoice price); and taxes and duties (the extent included in the invoice
price). Notwithstanding the preceding sentence, if a Licensed Patented Product
or Licensed Product is sold in conjunction with or includes Royalty Bearing
Components and is not invoiced separately, Net Sales for purposes of
determining royalties payable under this Agreement shall be calculated as the
product obtained by using whichever of the following formulas is applicable:
(i) If both the Licensed Patented Product or Licensed
Product and the Royalty Bearing Components included in the combination
products are sold separately by Ilex or its sublicensees, multiplying
Net Sales of the combination products by the fraction A/(A+B), where
"A" is the invoice price during the royalty paying period in question
of the Licensed Product or Licensed Patented Product if sold
separately and "B" is the invoice price of the Royalty Bearing
Components in the combination products if sold separately.
(ii) If Section 1.11(i) does not apply, multiplying Net
Sales of such combination products by the fraction C/(C+D), where "C"
is the per unit cost of the Licensed Patented Product or Licensed
Product portion of the combination products and "D" is the per unit
cost of the Royalty Bearing Components in the combination products.
These costs shall be computed using the standard cost accounting
procedures of Ilex in accordance with GAAP.
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1.12 "Patent Rights" shall mean United States Patent and patent
applications listed in Schedule 1.12, and any and all divisions, reissues,
re-examinations, renewals, continuations, continuations-in-part, extensions,
and additions thereto, and all counterpart applications in other countries
within the Territory, and all patents, inventor's certificates, utility models
and the like issuing therefrom to the extent, but only to the extent, that they
cover the manufacture, use or sale of Eflornithine within the Field of
Interest.
1.13 "Royalty Bearing Components" shall mean all components,
devices or products which are sold in conjunction with or are included as a
part of a Licensed Patented Product or Licensed Product and for which either
(i) Ilex must license and pay a royalty to an unrelated third party or (ii)
Ilex owns a patent covering the component, device or product in the appropriate
country where such component, product or device is sold.
1.14 "Sub-Territory One" means, collectively, the territory
comprised of Canada and those countries included within the European Economic
Community.
1.15 "Sub-Territory Two" means, collectively, the territory
comprised of Mexico, the Central American countries and the South American
countries.
1.16 "Sub-Territory Three" means, collectively, the territory
comprised of Australia, New Zealand, Japan and the Asian Pacific Rim countries
other than Japan.
1.17 "Technology" shall mean and includes the Patent Rights
together with all copyrights, information, data, improvements, know-how, trade
secrets, processes, formulas, drawings, writings, notes, records, compilations,
methods, techniques, products, procedures, preparations, usage information or
materials, pre-clinical and clinical trial data, IND's listed on Schedule 8.1
hereto relating to the treatment of cancer, whether or not patentable, to the
extent owned by MMD.
1.18 "Territory" shall mean the entire world.
1.19 "Valid Claim" shall mean a claim of an unexpired patent or
patent application in the Patent Rights which has not lapsed or been abandoned
or declared invalid or unenforceable by a court or other body with appropriate
authority or administrative agency, from which no appeal can be or is taken.
ARTICLE 2
GRANT OF EXCLUSIVE LICENSE
2.1 Subject to the terms and conditions hereof, effective as of
the Effective Date, MMD hereby grants to Ilex an exclusive license, with a
right to sub-license and xxx for infringement, to use the Technology in the
Field of Interest to develop, make and have made, use, sell and market and
otherwise commercially exploit Licensed Products and Licensed Patented Products
in the Territory.
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2.2 Subject to and in accordance with the arrangements existing
and being negotiated between MMD and the World Health Organization ("WHO"), and
subject to a mutually acceptable agreement between MMD and WHO, MMD grants a
non- exclusive, royalty free right to Ilex to supply bulk License Product or
Licensed Patent Product to WHO at Ilex's cost for use in the treatment of late
stage Trypanosoma brucei gambiense and rhodensiense infections ("African
sleeping sickness").
ARTICLE 3
CONSIDERATION
3.1 In consideration of the grant of the licenses specified in
Article 2, Ilex agrees to pay MMD the following nonrefundable, noncreditable
payments:
(i) $[**] upon execution of this Agreement.
(ii) $[**] upon filing of the first New Drug
Application ("NDA") with the United States Food and Drug
Administration ("FDA") for the Licensed Patented Product or Licensed
Product.
(iii) $[**] upon FDA approval of the first NDA filed for
the Licensed Patented Product or Licensed Product.
(iv) $[**] upon the first anniversary of FDA approval
of the first NDA filed for the Licensed Patented Product or Licensed
Product.
(v) $[**] on the second anniversary of FDA approval of
the first NDA filed for the Licensed Patented Product or Licensed
Product.
(vi) $[**] upon receipt of final marketing approval for
the Licensed Patented Product or Licensed Product in Canada and in at
least three European countries included within Sub-Territory One.
(vii) $[**] upon receipt of final marketing approval for
the Licensed Patented Product or Licensed Product in any country
included within Sub-Territory Two.
(viii) $[**] upon receipt of final marketing approval for
the Licensed Patented Product or Licensed Product in any country
included within Sub-Territory Three.
3.2 In consideration of the grant of the exclusive license
specified in Section 2.1, Ilex also agrees to pay MMD a royalty of:
(i) [**] of the Net Sales received for Licensed
Patented Product.
(ii) [**] of Net Sales received for a Licensed Product;
provided, however, such royalty on a Licensed Product shall be reduced
to [**] in each country when the first unlicensed generic competitor
begins sales in such country; and provided, further, that such
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royalty shall only be payable for a period of 15 years from the First
Commercial Sale of a Licensed Product or Licensed Patented Product.
3.3 No multiple royalty shall be payable to MMD because any
Licensed Patented Product or Licensed Product is covered by more than one
patent or uses more than one aspect of the Technology.
3.4 In the event that Ilex is required to pay a royalty to a third
party other than an Affiliate of Ilex in order to make, have made, use, sell,
market or otherwise commercially exploit Licensed Product or License Patent
Product in any country in the Territory because of a third party patent in such
country which dominates a Licensed Product or a Licensed Patented Product,
[**] of such third party royalty shall be creditable against royalty due MMD
hereunder in such country by reducing up to [**] of the amount of royalty paid
to MMD hereunder by [**] of the amount so paid to the third party. In the
event Ilex is unable to credit the entire creditable amount of royalty paid to
any such third party in any given calendar year hereunder, the remaining
uncredited portion such third party royalty shall be credited against royalty
due for five years after such calendar year or the termination of this
Agreement, whichever occurs first.
ARTICLE 4
DEVELOPMENT PLAN; DILIGENCE
4.1 Ilex will prepare and implement a development plan as follows:
(i) within 12 months after the Effective Date, Ilex will
prepare and provide to MMD a detailed plan for obtaining government
approvals for the commercialization of the Licensed Patented Product
in such major countries within Territory as Ilex shall determine in
the exercise of its business judgment;
(ii) during the course of Ilex's development of the
Licensed Patented Product, Ilex may revise the development plan as it
may deem necessary in the exercise of its reasonable business and
scientific judgment, and Ilex will promptly advise MMD of any major
revisions to the development plan; and
(iii) the development plan will provide for concentration
of initial efforts in the United States.
4.2 Ilex will use its reasonable efforts to accomplish the
following:
(i) file a United States NDA with the FDA for the
Licensed Patented Product within 72 months after the Effective Date;
(ii) file, directly or through sublicensees, applications
for marketing approval of the Licensed Patented Product in Canada and
in at least three major market European countries included in
Sub-Territory One within 24 months after FDA approval of the NDA for
the Licensed Patented Product, whether filed by individual country or
pursuant to a multi-country CPMP filing (for purposes of this
subclause "major market European countries" means any of France,
Germany, Italy, Spain and the United Kingdom);
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(iii) file, directly or through sublicensees, applications
for marketing approval of the Licensed Patented Product in at least
one country in Sub-Territory Two within 36 months after FDA approval
of the NDA for the Licensed Patented Product; and
(iv) file, directly or through sublicensees, applications
for marketing approval of the Licensed Patented Product in at least
one country in Sub-Territory Three within 48 months after FDA approval
of the NDA for the Licensed Patented Product.
4.3 If Ilex does not make a filing for marketing approval in a
particular sub-Territory as specified in Section 4.2(i), (ii), (iii) and (iv)
(other than as a result of a breach by MMD of its material obligations
hereunder, in which case the period for such filing shall be extended so long
as such breach continues), Ilex may pay to MMD, on or before date specified for
such filing, the payment corresponding to its receipt of marketing approval for
such sub- Territory as set out in Section 3.1(iii), (vi), (vii) and (viii),
respectively, and on MMD's receipt of such payment, the date specified for such
filing shall be extended for a period of 12 months. Any payment made under
this Section 4.3 of the fees set out under Section 3.1(iii), (vi), (vii) and
(viii) in connection with a 12-month extension under this Section 4.3 shall
constitute advance payment of such fees and no further payments shall
thereafter be required under Section 3.1(iii), (vi), (vii) and (viii) upon
Ilex's actual receipt of the relevant marketing approval.
4.4 If Ilex does not make a filing for marketing approval in a
particular sub-Territory within 12 months after the expiration of the
respective time periods specified in Section 4.2(i), (ii), (iii) and (iv)
(after giving full effect to any applicable extension of any such time period
pursuant to Section 4.3), then MMD may elect to terminate this Agreement with
respect to the affected sub-Territory by giving Ilex written notice thereof
within 90 days after the expiration of such 12-month period (provided that if
the delay in making the filing is caused by a breach by MMD of its material
obligations hereunder, then the period for such filing shall be extended so
long as such breach continues). If MMD does not, for whatever reason, so elect
to terminate this Agreement with respect to an affected sub-Territory within
such 90-day period, such right to terminate shall lapse as to the affected
sub-Territory. If MMD does properly elect to terminate this Agreement as to an
affected sub-Territory within such 90-day period, MMD will have a royalty-free
right to obtain and use data generated by Ilex hereunder in such terminated
sub-Territory.
4.5 Ilex will provide MMD with annual written reports of its
progress in developing and marketing the Licensed Patented Product until final
marketing approval for the Licensed Patented Product has been received for
United States, the United Kingdom, France, Germany, Italy, Canada and Japan.
The first such report will be provided 12 months after the Effective Date.
ARTICLE 5
ACCOUNTING AND RECORDS
5.1 Ilex shall keep and maintain and shall cause all its
sublicensees to keep and maintain records of sales and deductible expenses made
pursuant to the license granted hereunder. Such records shall be open to
inspection at any reasonable time within three years after the royalty period
to which such records relate, by an independent certified accountant or an
internal MMD auditor selected by MMD and approved by Ilex, which approval shall
not be unreasonably withheld. The accountant shall have the right to examine
the records which relate to the computation of the royalties
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to be paid under this Agreement and report the findings of such examination of
records to MMD solely to the extent of reporting the accuracy of the reports
and payments made by Ilex, including the amount of any discrepancy, if any.
Such examination, however, shall not occur more than one time per year. A copy
of any report provided to MMD by the accountant shall be given concurrently to
Ilex. Any accountant so selected shall sign, at Ilex's request, an appropriate
agreement with Ilex to keep confidential all information obtained as a result
of such examination of records. MMD shall pay all costs of such examination;
provided, however, if the examination by the accountant reveals an underpayment
by Ilex by more than [**]% of the amount actually owing to MMD during any three
month reporting period, then the entire cost of the examination by the
accountant shall be paid by Ilex.
5.2 Within 60 days after March 31, June 30, September 30 and
December 31 of each year during the term of this Agreement following
commencement of sales of a Licensed Product or Licensed Patented Product, Ilex
shall prepare and deliver to MMD a true and accurate report, giving such
particulars of the business conducted by Ilex and its sublicensees during the
preceding three month period as is required to make the calculations required
hereunder.
5.3 With each such report delivered, Ilex shall pay to MMD all
amounts, if any, due under this Agreement. If no payments are due, Ilex shall
so report.
5.4 All payments required in this Agreement shall be paid in
United States dollars to the address applicable under Section 15.9 of this
Agreement or to such other place as the party receiving payment may reasonably
designate consistent with applicable laws and regulations.
5.5 Royalty on any sales subject to royalty in any country outside
the United States shall be calculated on Net Sales in such country as expressed
in United States dollars in accordance with Ilex's standard accounting
procedures used for Ilex's reporting of income to its stockholders and for
other external reporting, which shall comply with GAAP.
5.6 Ilex and its sublicensees shall use their best efforts to
convert the royalty or other payments due MMD on sales in any country to United
States dollars; provided, however, that if conversion to and transfer of United
States dollars cannot be made in any country for any reason, at the election of
Ilex or its sublicensee (as applicable), payment of royalty (i) may be made in
the currency of the country in which such sales are made and deposited in MMD's
name in a bank designated by MMD in any such country; or (ii) the obligation of
Ilex or its sublicensees to pay royalty on such Net Sales shall be suspended
until such conversion and transfer of all funds by Ilex or its sublicensees
becomes possible.
5.7 If any country limits the royalty rate or amount payable from
Ilex to MMD on account of Net Sales of Licensed Products or Licensed Patented
Products in such country, the royalty payable hereunder shall not exceed the
maximum amount payable under applicable laws, regulations or administrative
rulings of such country.
5.8 All income taxes assessed or imposed against or required to be
withheld from royalty payments due MMD shall be deducted from amounts payable
hereunder and shall be paid to appropriate fiscal or tax authorities on behalf
of MMD. Tax receipts received by Ilex evidencing payment of such taxes shall
be forwarded to MMD.
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ARTICLE 6
WARRANTIES, REPRESENTATIONS, INDEMNITY AND INSURANCE
6.1 MMD represents and warrants to Ilex;
(i) That it is the owner of the Technology; that the use
of the Technology does not infringe any patent or intellectual
property right belonging to MMD (other than those licensed hereunder)
or any third party nor has it been misappropriated nor is there any
misuse by MMD of trade secrets, know-how or confidential information
of another; and that there is no claim or action pending or, to MMD's
knowledge, threatened against MMD relating to the Technology;
(ii) That other than the grants set forth herein or on
Schedule 8.1 hereto, the Technology is free and clear of all liens,
mortgages, assignments, encumbrances, pledges, options, restrictions
or licenses on the Technology.
6.2 That it is a corporation duly organized and validly exists
under the state of Delaware and is qualified to do business and is in good
standing in all of the states as the nature of its business and properties
require;
(i) that it has all necessary right, power and authority
to enter into this Agreement and to grant the licenses provided
herein; that it has duly and validly executed and delivered this
Agreement and that this Agreement constitutes a valid and binding
obligation of MMD enforceable in accordance with its terms; and that
it is not and will not be a party to any agreements or commitments
with any third party which conflicts in a material respect with this
Agreement.
6.3 Ilex represents and warrants to MMD:
(i) That it is a corporation duly organized under the
laws in the state of Delaware and is qualified to do business in good
standing in all states as the nature of its business and properties
require;
(ii) That it has all necessary right, power and authority
to enter into this Agreement; that its execution, delivery and
performance of this Agreement and the consideration herein set forth
have been duly authorized by all necessary corporate action; and that
it has duly and validly executed and delivered this Agreement and that
this Agreement constitutes a valid and binding obligation of Ilex
enforceable in accordance with its terms.
6.4 Ilex agrees to indemnify and hold MMD and its officers,
employees, agents and representatives harmless from any liabilities, costs and
expenses (including attorney's fees and expenses), obligations or causes of
action arising out of or related to any breach of the representations and
warranties made by Ilex herein.
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6.5 MMD agrees to indemnify and hold Ilex and its officers,
employees, agents and representatives harmless from any liabilities, costs and
expenses (including attorney's fees and expenses), obligations or causes of
action arising out of or related to any breach of the representations and
warranties made by MMD herein.
6.6 Ilex agrees to protect, defend, indemnify and hold MMD and its
officers, employees, agents and representatives harmless from and against, and
to pay any and all losses, liabilities, claims, demands, causes of action,
lawsuits, or other proceedings (whether in contract, tort, strict liability or
otherwise), fines, assessments, damages or any other amounts of whatever nature
which MMD or its officers, employees, agents and representatives may sustain or
incur, including all attorney's fees and court costs, as a consequence of any
third party's (including, but not limited to, Ilex's officers, directors,
employees, agents, consultants, representatives or servants) claims and demands
arising from the use, testing, operation, sale or manufacture of the
Technology, the Licensed Products or the Licensed Patented Products by Ilex or
its sub-licensees.
6.7 In seeking indemnification under Section 6.6, MMD shall
promptly notify Ilex in writing of any such claim, lawsuit, loss or cause of
action for which indemnity is sought and MMD shall permit Ilex to control any
litigation in the settlement of any such claim, lawsuit, loss, or cause of
action. MMD shall cooperate fully in every proper way in the defense and
settlement thereof. After MMD has received notice of Ilex's election to assume
the defense of said action, then Ilex will not be liable to MMD under Section
6.6 for any legal of other expenses subsequently incurred by MMD in connection
with the defense thereof unless: (i) MMD, in any action, has reasonably
concluded that there may be a legal defenses available to it which are
different from or additional to those available to Ilex, in which case MMD
shall have the right to select separate counsel to assume said legal defenses
and to otherwise participate in the defense of said action on behalf of MMD; or
(ii) Ilex has authorized the employment of counsel at the expense of Ilex. MMD
shall also have the right at its own expense to be represented by counsel of
its own choice in any such proceeding, provided that Ilex has control over the
defense.
6.8 During the term of this Agreement, Ilex will maintain general
liability and products liability insurance coverage as follows: (i) as to
general liability insurance, coverage in an aggregate amount of at least [**]
at all times during the term of this Agreement, and (ii) as to products
liability insurance, coverage in an aggregate amount of at least [**] at
all times during which clinical studies are conducted involving Eflornithine,
which coverage shall be increased to an aggregate amount of at least [**]
upon the commencement of marketing of Eflornithine. Ilex shall obtain
appropriate riders or endorsement to add MMD as an additional named insured and
to require the carrier to provide MMD with no less than 30 days written notice
of any change in the terms of coverage of the policy or its cancellation.
ARTICLE 7
PROTECTION OF PROPERTY RIGHTS
7.1 MMD shall pay all costs incident to the filing, prosecution,
issuance and maintenance of all Patent Rights in the Territory.
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7.2 MMD agrees to prosecute with good faith and due diligence all
such patent applications and to take all actions necessary to maintain and
enforce the Patent Rights and proprietary rights in and to the Technology.
7.3 In the event that MMD decides:
(i) not to file any continuing applications in Patent
Rights; or
(ii) not to continue prosecution of a patent application
in Patent Rights to issuance; or
(iii) not to maintain (or to abandon) any patent or patent
application in Patent Rights;
in any country, MMD shall timely notify Ilex in writing in order that Ilex may
file said application or continue said prosecution or maintenance of such
patent application at its own expense. Ilex shall be entitled to credit its
reasonable out-of-pocket expenses of filing, prosecuting and maintaining such
patent or patent application against one- half of the royalty due under Section
3.2(i) with respect to such country.
7.4 MMD agrees to keep Ilex fully informed of prosecutions
pursuant to this Article 7 including submitting to Ilex copies of all official
actions and responses thereto.
7.5 The parties hereto agree to use all reasonable efforts to keep
confidential the confidential information in the Technology together with any
and all documentation and other physical manifestations or embodiments
including the same, except to the extent such information is or becomes:
(i) at the time of its disclosure or thereafter becomes
part of the public domain without fault of the receiving party; or
(ii) was in the possession of the receiving party or its
Affiliates prior to disclosure by the disclosing party and was not
acquired directly or indirectly from any third party under obligation
of confidentiality to the disclosing party; or
(iii) subsequent to disclosure, is obtained from a third
party not subject to a contractual or fiduciary obligation for
confidentiality to the disclosing party or its Affiliates; or
(iv) is required to be disclosed by the receiving party
pursuant to a court order or is information which Ilex believes is
necessary for it to disclose in order for it to carry out its
obligations hereunder, in which cases Ilex will use its reasonable
efforts to limit such disclosure to that required by law and to
maintain confidentiality of the disclosed information to the extent
reasonably practical.
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7.6 The provisions of Section 7.5 shall not, in any event, prevent
or inhibit disclosure by Ilex of such information as Ilex may, in its
reasonable judgment, deem necessary or appropriate to implement this Agreement,
including disclosure of information to regulatory agencies or to consultants,
investigators, contractors, licensees, sublicensees, investors and joint
venturers of Ilex or to responsible prescribers and purchasers of Eflornithine;
provided that, where reasonably practical, Ilex shall require that any person
to whom disclosure of confidential information is made be obligated to maintain
the confidentiality thereof.
7.7 In the event of a required disclosure under Section 7.5(vi)
above, the party subject to such legally required disclosure shall give the
other party advance notice of the information affected and shall use its
reasonable efforts to maintain confidentiality to the extent reasonably
practical. Such required disclosure shall not operate to release the
disclosing party from its obligations of confidentiality with respect to the
information so disclosed except to the extent of permitting said required
disclosure to be made as required, and to the extent such required disclosure
results in the information entering the public domain.
7.8 It is understood that information in the Technology applicable
to applications of the Technology outside of the Field of Interest is
information which MMD remains free to license to third parties (including the
WHO) outside the Field of Interest, and nothing herein shall be deemed to
prevent or inhibit MMD from disclosing such information in connection with
licensing or other transactions outside the Field of Interest; provided that
MMD shall take reasonable steps to ensure that confidential information which
relates to the application of the Technology in the Field of Interest remains
confidential and, where reasonably practical, MMD shall require that any person
to whom disclosure of confidential information is made be expressly obligated
to maintain the confidentiality thereof.
7.9 MMD shall provide Ilex notice of, and an opportunity to
discuss, the possibility of Ilex's direct or indirect participation in any
proposed licensing of the Technology by MMD to third parties outside the Field
of Interest.
ARTICLE 8
TRANSFER OF TANGIBLE MATERIAL
8.1 MMD will transfer to Ilex all technology, know how and data
available to MMD and which relates to and is reasonably necessary or useful for
Ilex (or a reasonably skilled manufacturer and developer of pharmaceuticals) to
develop Eflornithine in the Field of Interest, including, without limitation,
copies of documents listed in Schedule 8.1 and third party information which
MMD is free to disclose (as indicated on Schedule 8.1). This transfer shall
include information on MMD's process technology for the chemical manufacture of
Eflornithine, formulation technology, clinical trial data, data in MMD's
Investigational New Drug Application ("IND"), all in the Field of Interest, and
preclinical data required for development of Eflornithine in the Field of
Interest. It is understood that two formulations were developed by MMD for
clinical trials, oral solutions and injectable solutions. MMD will also
request its contract formulator, Xxxxxx Pharmacal, to work with Ilex, at Ilex's
request. Such information and documentation will be made available to Ilex on
a mutually acceptable schedule; provided, however, said transfer of information
shall be accomplished within 30 days after the Effective Date.
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8.2 In addition to assistance in the transfer of technology, MMD
will provide Ilex with technical assistance in chemical manufacturing of
Eflornithine in a total amount of up to 16 person days at mutually agreed times
and locations during the first one year period following the Effective Date.
8.3 Ilex understands that MMD has discontinued its development of
Eflornithine. The information documents in the Technology are in accordance
with the standards of data collection used by MMD as of the dates the data
therein was obtained. MMD's interpretations and conclusions drawn therefrom
were made in good faith and in the exercise of MMD's scientific judgment as of
the dates of the documents contained therein. Ilex understands that not all
the health registration fields are current or active, and that the Eflornithine
manufacturing know how is that previously used by MMD to produce Eflornithine
in its manufacturing site at the batch sizes and in the equipment used at said
site, and that it may not be directly applicable to other manufacturing
contexts without further work. Ilex also understands that such information
will not be sufficient without further research and development by Ilex to
obtain health authority approval to commercialize Eflornithine in the Field of
Interest. Ilex is relying on its own evaluation of the information provided to
its affiliate, IDD, and the other information transferred or provided to Ilex
hereunder and on its own medical and scientific expertise in using the same in
its development and commercialization of Eflornithine.
8.4 MMD will transfer to Ilex, for use as clinical supplies for
clinical development, its entire supply of Eflornithine oral solution, mutually
agreed amounts of bulk Eflornithine compound and Eflornithine injection
solution, excluding supplies necessary for MMD to fulfill its existing
obligations and commitments with WHO and the National Cancer Institute, and to
meet requests for humanitarian aid for Trypanosomiasis treatment, less the 50
grams of bulk Eflornithine transferred to Ilex prior to the date hereof. The
supply to be delivered to Ilex shall be the equivalent of at least 100 Kg of
Eflornithine and shall meet the specifications in MMD's IND No. 18,911
submitted to the FDA on June 24, 1981 for oral Eflornithine for activity
against tumor growth.
8.5 To the extent permitted by law or regulation, MMD will allow
Ilex to cross-reference MMD's IND's and NDA's and corresponding foreign
regulatory files for Eflornithine in support of Ilex's IND's (and corresponding
foreign regulatory filings in the Territory) for Eflornithine in the Field of
Interest. To the extent permitted by law or regulation, MMD will transfer to
Ilex those Eflornithine IND's which are entirely within the Field of Interest.
Some Eflornithine regulatory filings are inactive and some African filings
outside the Field of Interest have been sent to WHO.
8.6 Each party agrees to promptly report to the other party any
adverse reactions or any side effects which are observed with Eflornithine,
whether or not a causal connection is believed likely, so that the other party
may comply with its reporting obligations to FDA or other regulatory agencies.
The parties will develop a mutually agreed procedure for exchanging such
reports.
8.7 Up to an aggregate maximum payment of $[**], Ilex will
reimburse MMD for its out-of-pocket costs for the following:
(i) the transfer of technology, know-how and data as
provided under Sections 8.1 and 8.2 of this Agreement;
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(ii) the transfer of existing supplies of Eflornithine
clinical supplies under Section 8.4;
(iii) any other mutually agreed upon actions required of
MMD under this Agreement; and
(iv) MMD's fully absorbed standard cost of producing the
Eflornithine clinical supply material transferred to Ilex in
accordance with Section 8.1 and including the 50 grams of bulk
Eflornithine transferred to Ilex prior to the date hereof.
8.8 MMD or its Affiliates shall pay the cost of packaging and
shipping supplies of Eflornithine pursuant to Section 8.4 to Ilex at its
location in San Antonio, Texas. Title and risk of loss shall pass to Ilex upon
delivery.
8.9 Within 60 days after receipt, Ilex shall inspect each shipment
of Eflornithine supplies. Any goods which have not been rejected in writing
within such 60-day period shall be deemed accepted by Ilex. If any portion
thereof does not conform to the specifications referred to in Section 8.4, Ilex
shall, within 60 days of receipt of this shipment, notify MMD in writing of
such condition. Thereafter, MMD shall have 60 days to examine any rejected
materials. If MMD agrees that the rejected material does not meet the
applicable specifications, Ilex shall be entitled to a refund of that portion
of the purchase price paid per kilogram, valued at MMD's full absorbed standard
cost as set forth in Section 8.7(iv) above, to MMD corresponding to the
rejected quantity of material.
8.10 Ilex shall inspect for obvious damage or defects, such as
deformed, unsealed, or otherwise visibly damaged containers, etc. as soon as
reasonably practical after receipt of any shipment.
8.11 If the parties disagree as to whether or not the rejected
material met specifications when delivered, the rejected material shall be
analyzed by an independent laboratory agreed upon by the parties. The
determination of such laboratory shall be final and binding, and the party
found to have been in error shall bear the cost of the services of the
independent laboratory. If MMD is determined to have been in error, Ilex shall
be entitled to a refund of the purchase price per kilogram of rejected
Eflornithine supplies valued at MMD's full absorbed standard cost set forth in
Section 8.7(iv) above.
8.12 MMD warrants that, at the time of delivery to Ilex hereunder,
(i) the Eflornithine clinical supplies supplied by it hereunder shall meet the
specifications therefor referred to in Section 8.4 and shall have been
manufactured to be suitable for clinical testing, i.e., in compliance with
applicable Good Manufacturing practices regulations in effect at the time of
manufacture; and (ii) MMD shall convey good title to the goods supplied
hereunder free from any lawful security interest, lien or encumbrance. MMD'S
WARRANTIES SET FORTH IN THIS SECTION 8.12 ARE ITS EXCLUSIVE WARRANTIES TO ILEX
WITH RESPECT TO THE CLINICAL SUPPLIES, AND ARE GIVEN AND ACCEPTED IN LIEU OF
ANY AND ALL OTHER WARRANTIES, EXPRESSED OR IMPLIED, INCLUDING, WITHOUT
LIMITATION, ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.
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8.13 The parties agree that under no circumstances will MMD be
obligated to manufacture additional quantities of Eflornithine or any other
material.
ARTICLE 9
DEFENSE OF INFRINGEMENT CLAIMS
9.1 If a claim or action is asserted that Ilex's manufacture, use
or sale of Licensed Patented Product or Licensed Product in the Field of
Interest infringes upon the patent rights of a third party in the Territory,
which patent has a claim or claims which dominate a patent in the MMD Patent
Rights licensed hereunder, then Ilex will give prompt written notice to MMD of
any third party formal complaint, answer or other request for judicial or
administrative relief or action (a "Suit") with respect thereto, and MMD shall
have the right to conduct the defense of any such Suit and Ilex may participate
at its option and expense. MMD shall advise Ilex in writing, within 90 days
after Ilex's notice, whether it intends to defend such Suit at its expense.
During such 90-day period, Ilex may, in consultation with MMD, take such action
as it deems necessary to defend against such Suit. If MMD elects not to so
defend or to otherwise dispose of such Suit, Ilex may defend such Suit. Ilex
shall be permitted to credit against one-half the royalties payable to MMD
under Section 3.2 with respect to Net Sales in the country where such Suit is
prosecuted, for reasonable out-of-pocket costs of defending such Suit during
the time such Suit or appeal based thereon is pending or undecided and for a
period of five years after the expiration of rights to continue such an appeal.
ARTICLE 10
PROSECUTION OF INFRINGEMENT CLAIMS
10.1 If MMD becomes aware of any infringement or potential
infringement of any of the Technology in the Field of Interest by third parties
in the Territory, then MMD shall promptly notify Ilex in writing of all details
available with respect to such infringement. If, in the sole judgment of Ilex,
such infringement is or reasonably threatens to be material, Ilex, at its
expense, shall have the right to (a) obtain a discontinuance of said infringing
operations; or (b) bring Suit itself against the third party, bringing such
Suit in the name of Ilex or, if required by the law of the forum, in the name
of MMD or joining MMD as a party plaintiff. If Ilex brings Suit in its own
name, MMD agrees to execute such legal papers as are necessary and to take such
other action, at Ilex's expense, as required for the prosecution of such Suit
as may be requested by Ilex. Ilex shall be entitled to receive and retain all
recoveries from such Suit. The prosecution, settlement or abandonment of any
Suit under this Section 10.1 shall be at Ilex's discretion, provided that Ilex
shall not have any right to surrender any of MMD's rights to the Technology.
In the event of infringement of any of the Technology in the Field of Interest
by third parties in the Territory, Ilex may elect to pay royalties under
Section 3.2(ii) with respect to Net Sales of Licensed Patented Product in the
country in which such unlicensed infringement occurs until such time as the
unlicensed infringement ceases, which payment shall be in lieu of any royalties
otherwise payable under Section 3.2(i) during such period with respect to such
Net Sales.
ARTICLE 11
INDEPENDENT CONTRACTOR STATUS
11.1 It is agreed that the relationship of Ilex to MMD in the
performance of this Agreement is as an independent contractor and that Ilex is
not an agent of MMD. Ilex agrees to
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refrain from representing itself as being the agent of MMD in performing or
acting pursuant to this Agreement. Ilex shall not have the power or authority
to bind or otherwise commit MMD and shall not attempt to do so.
ARTICLE 12
TERM AND TERMINATION
12.1 Subject to the terms and conditions of this Agreement, this
Agreement and the licenses granted under Article 2 shall continue until the
later of (i) the expiration of the last of the Patent Rights to expire and (ii)
15 years after the First Commercial Sale; at which time, all rights licensed to
Ilex in Article 2 shall be deemed to be converted to a fully paid, exclusive,
irrevocable, royalty free license of the Technology in the Territory to make,
have made, use, sell and have sold Licensed Products and Licensed Patented
Products incorporating, utilizing, or otherwise commercially exploiting the
Technology in the Field of Interest.
12.2 This Agreement shall be terminated automatically in any one or
more of the following circumstances:
(i) in the event that the assets of Ilex are seized or
attached, in conjunction with any action against them by any third
party, and such seizure or attachment is not abated within 90 days; or
(ii) in the event that Ilex is dissolved, or that a sale
of all or substantially all of the assets of Ilex pursuant to a
liquidation not approved in writing by MMD is made.
12.3 MMD may terminate this Agreement if Ilex fails to perform any of
its material obligations under this Agreement and fails to remedy said breach
within 30 days (or such additional period as may be reasonably necessary to
remedy such failure, provided that Ilex diligently pursues such remedy) after
being given written notice of the specific failure or default and termination
by MMD.
12.4 Ilex, upon 90 days prior written notice to MMD, may terminate
this Agreement with or without cause.
12.5 In the event this Agreement is terminated under Sections 12.2,
12.3 or 12.4:
(i) Ilex shall have 120 days to complete the manufacture
and 240 days to complete sale or license of any Licensed Patented
Products and Licensed Products in stock or in the course of
manufacture at the time of termination, all subject, however, to
payments of royalty and accounting as provided herein, even if such
royalty obligations arise from transactions subsequent to the
effective date of termination;
(ii) Ilex's obligation to pay royalties and its obligation
to keep records and to allow a final audit will survive any
termination; and
(iii) Except as expressly provided herein, no party
hereunder shall be discharged or relieved from any liability or
obligation existing prior to such termination.
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ARTICLE 13
GOVERNMENTAL REGULATIONS
13.1 The parties will cooperate to obtain all governmental and
regulatory approvals required in the Territory to enable this Agreement to
become effective, and to enable any payment hereunder be made and any other
obligation to be observed or performed. Ilex shall be responsible for
obtaining approvals and fulfilling all governmental formalities with respect to
exportation/importation of the Technology or FDA regulation; provided, however,
upon Ilex's request, MMD will provide all reasonable assistance in obtaining
approvals and for fulfilling all governmental formalities. Ilex will not
knowingly export or re-export, directly or indirectly, any Technology or other
information or technical data or the direct product of such Technology received
from MMD or its Affiliates in violation of any governmental regulations which
may be applicable, including the provisions of the United States Export Control
Regulations, 15 C.F.R. Part 768 et seq.
ARTICLE 14
ASSIGNMENT AND LICENSING
14.1 Except in connection with the sale of substantially all of the
assets related to its Eflornithine business, neither MMD nor Ilex may assign or
attempt to assign any rights under this Agreement without the prior written
approval of the other, which approval will not be unreasonably withheld. Ilex
may, however, sublicense its rights under the Agreement without any prior
approval by MMD; provided, however, Ilex shall remain responsible for the
payment of royalties on sublicensee sales and performance by sublicensees of
applicable obligations hereunder.
ARTICLE 15
MISCELLANEOUS
15.1 All claims, disputes, controversies and other matters in
question arising out of or relating to this Agreement shall be settled in
accordance with the provisions of Schedule 15.1 attached hereto, and judgment
may be entered upon the arbitration award in any court having jurisdiction
thereof. Notwithstanding the foregoing, either party may seek in-term
injunctive from any court of competent jurisdiction.
15.2 Without further consideration, MMD hereby agrees to execute
and deliver, and MMD agrees to cause its officers, employees, and agents to
execute and deliver, such other instruments and to take such other action as
Ilex hereunder may reasonably request to more effectively convey and transfer
to and vest in Ilex, and to put Ilex in possession of, the rights granted
hereunder, and to assist Ilex in the recordation of same as necessary, all in
such form and substance as Ilex may reasonably request and at its expense.
15.3 This Agreement shall be binding upon and shall inure to the
benefit of the legal representatives, successors and permitted assigns and
licensees of the parties hereto.
15.4 This Agreement shall be deemed to have been made under, and
shall be construed and interpreted in accordance with the laws of the State of
Texas. No conflicts-of-law rule or law which might refer such construction and
interpretation to the laws of another state, republic, or country shall be
considered.
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15.5 All parties hereby especially agree in contract that neither
party intends to violate any public policy, statutory or common law, rule,
regulation, treaty or decision of any government agency or executive body
thereof of any country or community or association of countries; that if any
word, sentence, paragraph or clause or combination thereof of this Agreement is
found, by a court or executive body with judicial powers having jurisdiction
over this Agreement or any of its parties hereto, in a final unappealed order
to be in violation of any such provision in any country or community or
association of countries, such words, sentences, paragraphs or clauses or
combination shall be inoperative in such country or community or association of
countries, and the remainder of this Agreement shall remain binding upon the
parties hereto.
15.6 The terms and conditions herein contained constitute the
entire agreement between the parties and supersede all previous communications
whether oral or written between the parties hereto with respect to the subject
matters hereof, and no previous agreement or understanding varying or extending
the same shall be binding upon either party hereto.
15.7 The parties covenant and agree that if either party fails or
neglects for any reason to take advantage of any of the terms provided for the
termination of this Agreement or if either party, having the right to declare
this Agreement terminated, shall fail to do so, any such failure or neglect by
either party shall not be a waiver or be deemed or be construed to be a waiver
of any cause for the termination of this Agreement subsequently arising, or as
a waiver of any of the terms, covenants or conditions of this Agreement or of
the performance thereof. None of the terms, covenants and conditions of this
Agreement may be waived by either party except by its written consent.
15.8 No amendment or modification to this Agreement shall be
effective unless it is in writing and signed by duly authorized representatives
of all parties.
15.9 All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if delivered personally,
mailed by certified mail (return receipt requested) or sent by reputable
overnight delivery service, cable, telegram, facsimile transmission or telex to
the parties at the following addresses or at such other addresses as shall be
specified by the parties by like notice:
IF TO ILEX:
Ilex Oncology Inc.
00000 Xxxxxxx Xxxxx
Xxx Xxxxxxx, Xxxxx 00000-0000
Telephone: 000 000-0000
Facsimile: 000 000-0000
Attention: President
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IF TO MMD:
Xxxxxx Xxxxxxx Dow Inc.
0000 Xxxx Xxxxxxx
Xxxxxx Xxxx, XX 00000-0000
Telephone: 000 000-0000
Facsimile: 000 000-0000
Attention: Vice President - Operations
Xxxxxx Xxxxxxx Dow Inc.
0000 Xxxx Xxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000-0000
Telephone: 000 000-0000
Facsimile: 000 000-0000
Attention: General Patent Counsel
15.10 The parties acknowledge that each party and its counsel have
received and revised this Agreement and that normal rules of construction to
the effect that any ambiguities are to be resolved against the drafting party
shall not be employed in the interpretation of this Agreement or any amendments
or exhibits thereto.
[Signatures on Next Page]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
multiple originals by their duly authorized officers and representatives.
XXXXXX XXXXXXX DOW, INC.
By
----------------------------------
Name
--------------------------------
Title
-------------------------------
XXXXXXX XXX PHARMACEUTICALS INC.
By
----------------------------------
Name
--------------------------------
Title
-------------------------------
XXXXXX XXXXXXX DOW FRANCE ET CIE
By
----------------------------------
Name
--------------------------------
Title
-------------------------------
ILEX ONCOLOGY INC.
By
----------------------------------
Xxxxxxx X. Love,
President and CEO
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SCHEDULE 1.12
PATENT RIGHTS
UNITED STATES PATENTS AND PATENT APPLICATIONS
MMD PATENT NO./ SUBJECT/TITLE ISSUE DATE/ EXPIRATION
DOCKET NO. APPLICATION SERIAL FILING DATE
NO.
M8830 4,413,141 2-(DIFLUROMETHYL) -2,5- 11/1/83 11/1/00
DIAMINOPENTANOLIC ACID
M883AE SN 403531 METHOD OF CONTROLLING TUMOR GROWTH Filed 3/14/95 NA
RATE
M1281G SN 358649 USE OF ODC INHIBITORS, DECARBAZINE, Filed NA
AND INTERFERON IN THE TREATMENT OF 12/19/94
MALIGNANT MELANOMA
M1076A 4,399,151 METHOD OF INHIBITING THE GROWTH OF 8/16/83 8/16/00
PROTOZOA
35155B 5,002,879 TREATMENT OF TUMORS WITH AUTOLOGOUS 3/26/1991 3/26/08
LAK CELL, INTERLEUKIN-2 AND AN
XXXXXXXXX XXXXXXXXXXXXX XXXXXXXXX
00000X 4,499,072 IMPROVED PROCESS FOR TREATING 2/12/85 2/12/02
DISEASES WITH ODC INHIBITORS
(conjunctive therapy with
Interferon)
FOREIGN PATENTS AND PATENT APPLICATIONS
Foreign Patents and Applications Listed in the Attached Computer
Printouts for MMD Docket
Numbers M883 and M883A (three pages independently
numbered 1-3), M1076 (three pages
pages independently numbered 1-3) and M1281
(three pages independently numbered 1-3)
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