CONFIDENTIAL TREATMENT
REDACTED VERSION
PRODUCT DEVELOPMENT AND LICENSE AGREEMENT
THIS PRODUCT DEVELOPMENT AND LICENSE AGREEMENT (together with all exhibits and
schedules, the "Agreement"), dated as of June 22, 2005 ( the "Effective Date")
by and between ELITE LABORATORIES, INC., a corporation organized and existing
under the laws of Delaware, and having its principal place of business at 000
Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 ("ELITE") and PLIVA, INC., a corporation
organized and existing under the laws of New Jersey, and having its principal
place of business at 00 Xxxxx Xxxx Xxxxxx, Xxxx Xxxxxxx, XX 00000 ("PLIVA").
RECITALS:
PLIVA is engaged in the development, manufacturing, marketing and distribution
of generic pharmaceutical products in the Territory (as defined below) and
possesses qualified marketing and distribution systems and organizations to
enable it to effectively promote, market and distribute such products throughout
the Territory;
ELITE is the owner of Know-How (as defined below) and other proprietary
technology relative to the Product (as defined below);
ELITE and PLIVA desire to further develop and market the Product in the
Territory; and
Elite desires to grant to PLIVA the exclusive right to purchase, market, promote
and distribute the Product in the Territory under PLIVA's label, and PLIVA
desires to accept and exercise the right, all upon such terms and conditions as
are set forth in this agreement.
ELITE and PLIVA agree as follows:
1. DEFINITIONS
The following terms as used in this Agreement shall have the meanings
set forth in this Article:
1.1. "AFFILIATE" shall mean any corporation, firm, partnership or
other entity, which owns or controls, is owned or controlled
by, or is under common control with, PLIVA or ELITE, as the
case may be. The term "control" means the ownership, directly
or indirectly, of at least fifty percent (50%) of the equity
or voting power of the owned or controlled entity.
1.2. "APPLICABLE LAW" shall mean the United States Food, Drug and
Cosmetic Act of 1938, as may be amended from time to time, and
the regulations
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and guidelines promulgated pursuant thereto, as amended from
time to time, and all other laws, regulations, rules and
guidelines of any governmental authority in the Territory
pertaining to the development, manufacture, packaging,
labeling, storage, distribution, marketing, sale or intended
use of the Product.
1.3. "CGMP" shall mean all applicable good manufacturing practices,
including but not limited to current "good manufacturing
practices" and any other methods used for the manufacturing,
testing, validation, labeling, packaging, storage, shipment
and installation of any and all pharmaceutical products,
equipment and related materials to ensure that such products
and materials meet the legal requirements for safety and
effectiveness as established by the United States Food and
Drug Administration ("FDA") or comparable governmental
authority in any country outside the United States where the
Product is distributed under this Agreement, including,
specifically, without limitation, Title 21, Part 211 of the
United States Code of Federal Regulations.
1.4. "CONFIDENTIAL INFORMATION" shall mean any information
pertaining to the Product from time to time communicated by or
on behalf of the disclosing party, including, without
limitation, trade secrets, Know-How, pricing, costs,
suppliers, licensees, customer information, patent rights,
scientific, technical, commercial and medical product
development information, manufacturing, methods, processes and
production, contractual arrangements, results, discoveries and
inventions, procedures and forms, financial and other business
information, forecasts, strategies and other data, whether of
a written, oral or visual nature.
1.5. "COST OF GOODS" shall mean (i) ELITE's fully absorbed direct
and indirect cost of manufacturing, labeling and packaging the
Product, including without limitation the cost of all active
pharmaceutical ingredients, materials, and components included
in the Product, plus (ii) [*]
1.6. "COMMERCIALIZATION", "COMMERCIALIZING", or "COMMERCIALIZE"
shall mean all activities relating to manufacture, promotion,
distribution, marketing and sale of the Product in the
Territory.
1.7. "ED-COSTS" shall mean the fees, costs and expenses incurred by
Elite in meeting its obligations pursuant to Section 2.1 and
Section 2.2(a) plus any amount paid to outside counsel by
ELITE in procuring the freedom to operate opinion provided for
in Section 4.2.
1.8. "FIELD" shall mean treatment of [*].
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1.9. "KNOW-HOW" shall mean all technology, data, information,
processes and methods necessary or useful in the production,
testing, registration or marketing of the Product.
1.10. "LICENSEE" shall mean the recipient of a license granted by
ELITE to Commercialize the Product in the Territory. PLIVA
shall be the designated and exclusive Licensee hereunder for
the Territory.
1.11. "MARKETING AUTHORIZATION" shall mean the final approval of all
regulatory authorities necessary to market the Product in a
particular country in the Territory, including as applicable
pricing and reimbursement approval and all other approvals
required in a particular country in the Territory for the
marketing, distribution and sale of the Product in the Field
in the normal course of business.
1.12. "NET PROFIT" shall mean the Price LESS the Cost of Goods.
1.13. "PD-COSTS" shall mean the fees, costs and expenses incurred by
PLIVA in connection with the Studies plus the milestones
actually paid to ELITE pursuant to Section 5.2 plus any amount
paid to outside counsel by PLIVA in procuring the freedom to
operate opinion provided for in Section 4.2.
1.14. "PRICE" shall mean the sales price paid by third parties to
PLIVA for Product, less only the following deductions to the
extent actually incurred, all determined in accordance with
generally accepted accounting principles:
(1) customs and excise duties or other sales taxes (but,
for the avoidance of doubt not income or corporation
tax), directly related to the sale of the Product;
(2) costs incurred by PLIVA in respect of transport,
shipping and insurance costs; and industry standard
or mandatory discounts or rebates related to the sale
of the Product, including, without limitation, any
credit in respect of any Federal or state Medicaid,
Medicare or similar program; and
(3) amounts repaid or credited by PLIVA, consistent with
its ordinary or customary business practices for
similar products, by reason of the rejection or
return of goods and allowances, including trade,
quantity and cash discounts and any other
adjustments, including those granted on account of
price or shelf stock adjustments, billing errors,
rejected goods, damaged goods, recalls, returns,
rebates, chargebacks, reimbursements, similar
payments granted or given to wholesalers or other
distributors, buying groups, health care insurance
carriers or other institutions.
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1.15. "PRODUCT" shall mean [*] that is approved by FDA as AB rated
as bioequivalent to [*] (the "REFERENCED DRUG"), for use in
the Field and which meets the specifications set forth in the
ANDA to be filed pursuant to this Agreement (the
"SPECIFICATIONS").
1.16. "TERM" shall have the meaning set forth in Section 12 hereof.
1.17. "TERRITORY" shall mean the [*].
2. PRODUCT DEVELOPMENT
2.1. ELITE shall be responsible for Product formulation, methods
development and validation.
2.2. ELITE shall obtain and submit to PLIVA, for PLIVA's review and
approval (such approval not to be unreasonably withheld,
conditioned or delayed), a proposal or proposals, including
costs, from a third party to conduct pilot and pivotal
bioequivalence studies for the Product to evidence
bioequivalence to the Referenced Drug in accordance with study
plan protocols to be agreed to by ELITE and PLIVA (the
"STUDIES"). Following its approval, PLIVA shall engage such
third party to conduct the Studies, and the cost of all
Studies shall be borne by PLIVA.
(a) ELITE shall complete any additional formulation work,
if necessary, complete process development and
scale-up, including in-process controls and all
necessary stability studies with respect to the
Product, and manufacture Product biobatches
reasonably required to conduct such Studies.
2.3. Each of ELITE and PLIVA agrees that, during the Term, except
for the Studies contemplated hereunder, neither it nor any of
its Affiliates will conduct clinical studies for any other
generic version of [*], whether for itself or any third party,
for distribution or sale in the Territory.
2.4. ELITE and PLIVA shall each have the right to discontinue the
Studies at any time prior to completion of such Studies upon
three (3) days' prior written notice to the other party, if
ELITE or PLIVA, as the case may be, reasonably believes that
health and safety issues may arise.
2.5. ELITE shall inform PLIVA of any changes in the Product
development plan. ELITE shall use commercially reasonable
efforts to assure PLIVA
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that the Product shall be available to PLIVA to market at the
time agreed to by ELITE and PLIVA in writing pursuant to this
Agreement.
2.6. ELITE shall perform its obligations in this Section 2 in
accordance with Applicable Laws.
3. REGULATORY FILINGS
Following successful completion of the pivotal biostudy for the
Product, ELITE shall be responsible for the preparation, filing and
prosecution with the FDA of an abbreviated New Drug Application
("ANDA") for the Product. The ANDA shall be in the name of ELITE. ELITE
shall bear the cost of the ANDA preparation, filing and prosecution.
Each party shall reasonably cooperate with the other party in
connection with the preparation of the ANDA. Each party shall have the
right to review and comment upon any and all prepared applications and
filings prior to submission to the relevant governmental authorities.
4. INTELLECTUAL PROPERTY OWNERSHIP, MAINTENANCE AND DEFENSE
4.1. INTELLECTUAL PROPERTY. All rights, title and interest in and
to all intellectual property rights relating to the Product,
including without limitation, inventions, discoveries,
creations, information, data, reports, results, and/or
improvements to any Confidential Information, Know-How, study
inventions, regulatory filings, patent rights, processes,
techniques, and any improvements, modifications, alterations
thereto and patents issuing thereon made during the Term
hereof whether in connection with the Study or otherwise
("Intellectual Property Rights") are and shall, in all events,
be the sole and exclusive property of ELITE. PLIVA shall take
such actions, and execute and deliver such documents, as may
be reasonably requested from time to time by ELITE, at ELITE's
expense, to perfect ELITE's Intellectual Property Rights.
ELITE grants to PLIVA and PLIVA accepts, during the Term, an
exclusive, non-transferable license to ELITE's Intellectual
Property Rights to allow PLIVA to offer for sale the Product
in the Territory. PLIVA may not grant any sublicense to
ELITE's Intellectual Property Rights without ELITE's prior
written consent, which consent may be granted or withheld in
ELITE's sole discretion.
4.2. FREEDOM TO OPERATE. PLIVA and ELITE shall, under a joint
defense agreement, obtain, within 120 days of the effective
date, a "freedom to operate" opinion from outside counsel with
respect to the manufacture, use and sale of the Product in
each country in the Territory. Either party shall have the
right to terminate this Agreement with respect to a country if
not satisfied with the opinion(s) for such country by
notifying the other party in writing within 30 days of receipt
of the opinion. The obligations of each party accrued to
through the Effective Date of any such notice,
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including the obligation to reimburse for costs incurred,
shall survive termination of this Agreement.
4.3. DEFENSE OF PRODUCT. PLIVA and ELITE shall be responsible for,
and shall share equally the cost of, defending the Product and
the parties hereto against any lawsuits in accordance with the
terms and conditions of Article 7.
5. FINANCIAL TERMS
5.1. PAYMENTS. For all Product supplied to PLIVA under this
Agreement ELITE shall invoice PLIVA, referencing in each
invoice the purchase order(s), if any, to which the invoice
relates, the Cost of Goods and the quantity of units of
Product shipped. PLIVA shall pay each invoice within forty
five (45) days of the invoice date. Any late payments or
underpayments under this Agreement shall bear interest at the
prime rate from the initial due date until payment in full.
5.2. MILESTONES. PLIVA shall pay to Elite the following milestones
payments:
a) [*] simultaneously with the execution and delivery of
this Agreement, or, if later, on the thirtieth day
following delivery by ELITE of the legal opinion
described in Section 4.2 of this Agreement (unless
the Agreement has theretofore been terminated under
Section 4.2).
b) [*] upon (i) completion of a successful pivotal
bioequivalence study where the Product meets the FDA
guidelines for bioequivalence, and (ii) submission to
and acceptance by the FDA of the ANDA for the
Product.
c) [*] upon FDA approval of the Product.
5.3 PROFIT SHARE.
(a) Within forty five (45) days following the end of each calendar quarter
during the Term following the first commercial sale of the Product
hereunder, PLIVA shall provide ELITE with a detailed statement for such
period showing for all Product sold by PLIVA during such period the
number of units sold, the Price for those units, and the Net Profit for
such period. PLIVA shall pay to ELITE a percentage of the Net Profit
for such period within fifteen (15) days of delivery to ELITE of the
statement showing such calculation.
(b) The percentage payable to ELITE shall be determined as follows.
(1) Within thirty (30) days of FDA approval of the Product, ELITE
shall provide to PLIVA a detailed statement of the ED-Costs
and PLIVA shall provide to ELITE a detailed statement of the
PD-Costs.
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(2) If the ED-Costs exceed the PD-Costs, then ELITE shall be
entitled to recover the amount by which the ED-Costs exceed
the PD-Costs.
(3) If the PD-Costs exceed the ED-Costs, then PLIVA shall be
entitled to recover the amount by which the PD-Costs exceed
the PD-Costs.
(4) The Party entitled to recover the amount of the difference
shall receive or retain, as the case may be, [*] of the Net
Profit until such amount is recovered. Thereafter, the Parties
shall [*].
5.4 AUDIT; INSPECTION. Within one hundred eighty (180) days
following the close of each calendar year during the Term and
for a period of twenty four months following expiration or
earlier termination of this Agreement, upon the request of a
party ("Requesting Party") the other party shall provide the
Requesting Party's accountants, at Requesting Party's sole
cost and expense, with access, during regular business hours
and upon reasonable prior written notice, and subject to the
confidentiality undertakings contained in Section 10 of this
Agreement, to the other party's books and records relating to
the Product in the Field in the Territory solely for purposes
of verifying costs and expenses and Net Profit in connection
with this Agreement, and for verifying the accuracy of the
calculations hereunder for the calendar year then ended and
for the two calendar years prior thereto. If any such
verification shows any underpayment or overpayment, a
correcting payment or a refund shall be made within thirty
(30) days of completion of such verification and submission of
the results thereof, with details of the calculations included
therein. In the event such verification shows an underpayment
of more than [*] was made by the Requesting Party to the other
party, the other party will be required to pay for the costs
reasonably incurred by Requesting Party in connection with its
inspection.
6. MANUFACTURE, SUPPLY AND COMMERCIALIZATION OF PRODUCT
6.1 During the Term, and on and subject to the terms and
conditions of this Agreement, ELITE shall manufacture and
supply or, with PLIVA's prior written consent (such consent
not to be unreasonably withheld, conditioned or delayed),
subcontract the manufacture and supply of, the Product in the
Territory exclusively to PLIVA for resale by PLIVA in the
Territory, in such quantities and at such times as are
specified in the purchase orders placed by PLIVA pursuant to
this Agreement. PLIVA shall purchase its requirements of
Product for resale in the Territory exclusively from ELITE.
6.2 ELITE will supply the Product to PLIVA in finished form,
labeled in accordance with the ANDA, and packaged ready for
resale in accordance with Section 6.5 (d) hereof. ELITE shall
manufacture, store and ship the PRODUCT to PLIVA, and PLIVA
shall store, ship, market and distribute the PRODUCT in
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the Territory, in accordance with cGMPs, Applicable Laws, the
Specifications, and the terms and conditions of this
Agreement.
6.3 The Product to be supplied by ELITE to PLIVA hereunder shall
bear PLIVA's label. ELITE shall provide to PLIVA a sample of
the printed labeling and packaging for the Product for PLIVA's
approval. ELITE shall label and package all Product in
accordance with the ANDA, cGMPs, and the applicable
requirements of the FDA. PLIVA grants to ELITE a limited
license to use PLIVA's trademarks for purposes of packaging
and labeling Product as described in this section.
6.4 PLIVA shall diligently market and promote the Product in the
Territory, using such commercially reasonable efforts to
maximize Product sales and Net Manufacturing Profits. PLIVA
shall devote such marketing efforts to the Product as it would
exert for products of its own with comparable market size and
profit potential under comparable competitive conditions. At
least once per calendar quarter PLIVA shall provide to ELITE,
in writing, an outline of PLIVA's sales expectations for the
Product for the upcoming three calendar quarters.
6.5 (a) At least one hundred twenty (120) days prior to the
anticipated launch date of the Product in the
Territory, and thereafter at least thirty days prior
to each calendar quarter during the Term, PLIVA shall
provide ELITE with a written forecast of PLIVA's
estimated Product requirements for each of the
following four calendar quarters. The forecasts will
be non-binding, except as provided below.
(b) PLIVA shall make all Product purchases hereunder by
submitting firm purchase orders to ELITE. Each such
purchase order shall be in writing and shall specify
the quantity of Product ordered (which shall be in
batch size, or multiples thereof) and the requested
delivery date(s). Purchase orders shall be placed at
least ninety days before the desired delivery date.
Each purchase order shall be subject to ELITE's
acceptance, in whole or in part. In the event of a
conflict between the terms and conditions of any
purchase order and this Agreement, the terms and
conditions of this Agreement shall prevail.
(c) In each calendar quarter, PLIVA shall be obligated to
place purchase orders for a quantity of Product
constituting at least seventy five percent of the
estimated quantity for that quarter as contained in
the forecast provided in the previous quarter.
(d) All Product supplied under this Agreement shall be
delivered FOB ELITE's manufacturing site. PLIVA shall
pay all freight, insurance and other charges
applicable to the sale and transport of the Product
to PLIVA's facilities. Title and risk of loss and
damages to Product shall pass to PLIVA upon delivery
to PLIVA's designated carrier.
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(e) If a shipment of Product of any portion thereof fails
to conform to the applicable Specifications, then
PLIVA shall have the right to reject such
nonconforming shipment of Product or the
nonconforming portion thereof, as the case may be.
PLIVA shall give written notice to ELITE of its
rejection within fifteen days of PLIVA's receipt of
the Product, specifying the grounds for such
rejection. The nonconforming Product shall be held
for ELITE's disposition, or shall be returned to
ELITE, as directed by ELITE in writing. Nonconforming
Product shall be returned to ELITE within ten (10)
business days of ELITE's so directing. ELITE shall
replace each nonconforming shipment of Product, or
the nonconforming portion thereof, with conforming
Product as soon as reasonably practicable after
receipt of notice or rejection thereof. If ELITE
disputes any claim of nonconforming Product and the
parties cannot resolve the dispute within thirty
days, then the dispute shall be subject to the
dispute resolution provisions of Section 17 hereof.
(f) ELITE and PLIVA each agree to notify the other within
twenty-four (24) hours of any serious and unexpected
adverse reactions reported to either of them
resulting from the use of the Product (whether inside
or outside of the Territory). ELITE and PLIVA shall
each notify the other promptly of any other
complaints or adverse reactions from third parties
reported to either of them resulting from use of the
Product sold under PLIVA's label.
(g) (i) In the event either party believes it may be
necessary to conduct a recall, field correction,
market withdrawal, stock recovery, or other similar
action with respect to any Product sold by ELITE to
PLIVA under this Agreement (a "RECALL"), ELITE and
PLIVA shall consult with each other as to how best to
proceed, it being understood and agreed that the
final decision as to any Recall of any Product shall
be made by ELITE; provided, however, that PLIVA shall
not be prohibited hereunder from taking any action
that it is required to take by applicable law. (ii)
In the event the Recall of the Product is solely as a
result of (1) the manufacture, supply, storage, or
distribution by ELITE of Product; (2) a breach by
ELITE of its representations, warranties or
obligations under this Agreement; or (3) the grossly
negligent or intentionally wrongful act of ELITE or
its representatives, then ELITE shall bear all costs
and expenses of such Recall, including, without
limitation expenses related to communications and
meetings with all required regulatory agencies,
expenses of replacement stock (not including
backorder reimbursement), the cost of notifying
customers and costs associated with shipment of
Product being recalled from customers and shipment of
an equal amount of replacement Product to those
customers (collectively, "RECALL COSTS"). In all
other events, PLIVA shall bear all of the Recall
Costs.
7. INDEMNIFICATION
7.1 INFRINGEMENT CLAIMS. ELITE and PLIVA shall be jointly
responsible for searching, reviewing and evaluating any
patents or published patent applications pertaining to the
manufacture, use and sale of Product in each country in the
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Territory, including without limitation, relating to active
pharmaceutical ingredients and Product formulation. PLIVA and
ELITE jointly shall investigate and defend any and all claims,
actions and proceedings resulting from an assertion against
ELITE or PLIVA (or a Licensee if ELITE and PLIVA have agreed
to indemnify such Licensee) that the Product infringes upon a
third party's intellectual property rights ("INFRINGEMENT
CLAIM"). PLIVA and ELITE shall be jointly responsible for the
cost and expenses of the defense, including without limitation
damages, awards, and settlement costs. The parties shall
provide such assistance as the other party may from time to
time reasonably request in connection with the evaluation and
defense of any potential or actual Infringement Claim.
7.2 ENFORCEMENT PROCEEDINGS. ELITE and PLIVA shall jointly bring
enforcement proceeding against any third party if ELITE and
PLIVA determine jointly that a third-party is likely
infringing upon the rights of ELITE, PLIVA or a Licensee of
the Product. PLIVA and ELITE shall be jointly responsible for
the cost and expenses arising from such enforcement
proceeding, including without limitation damages, awards, and
settlement costs. All such costs and expenses shall be
allocated equally between ELITE and PLIVA. ELITE and PLIVA
shall share equally all amounts awarded in connection with any
such enforcement proceeding.
7.3 INDEMNIFICATION OBLIGATIONS OF THE PARTIES.
(a) Each party shall indemnify, defend and hold harmless
the other party and its Affiliates from and against
any and all losses, costs, expenses, liabilities,
claims, actions, damages, personal injury, or loss of
life, including without limitation, reasonable
attorney's fees (collectively, "Losses"), arising
directly from such party's (i) grossly negligent acts
or omissions or willful misconduct; and/or (ii)
breach of this Agreement.
(b) ELITE and PLIVA shall jointly defend any and all
claims, actions and proceedings brought by any third
party relating to the Product. PLIVA and ELITE shall
be jointly responsible for the cost and expenses of
defense, including without limitation damages, awards
and settlement costs, except for Losses for which one
party is entitled to indemnification from the other
party under Section 7.3 (a) above. ELITE and PLIVA
shall jointly select counsel for any such claim,
action or proceeding. Neither party may settle or
consent to judgment in any such action without the
other party's consent if such settlement or judgment
would impose any obligation, financial or otherwise,
on the non-settling party that would not be fully
covered by the settling party's indemnification under
this Agreement.
7.4 NOTWITHSTANDING ANY PROVISION TO THE CONTRARY CONTAINED IN
THIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO
THE OTHER PARTY OR A LICENSEE FOR ANY CONSEQUENTIAL,
INCIDENTAL, OR PUNITATIVE DAMAGES (INCLUDING LOSS OF PROFITS,
LOSS OF ENTERPRISE,
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AND LOSS OF OPPORTUNITY) , REGARDLESS OF WHETHER FOR BREACH OF
WARRANTY, CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT
LIABILITY OR OTHERWISE, EVEN IF ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES.
8. INSURANCE
Each party agrees to maintain in force, during the Term and for a
period of 24 months thereafter, product liability insurance coverage in
minimum limits of $5,000,000 each. Each party shall instruct its
insurance carrier to notify the other party of any change, modification
or cancellation of insurance thirty days prior to such change,
modification or cancellation taking effect.
9. REPRESENTATIONS AND WARRANTIES
9.1 ELITE represents and warrants to PLIVA, as of the Effective
Date, as follows:
(1) ELITE has the legal right and full corporate power
and authority to enter into this Agreement and to
perform the same;
(2) the Agreement constitutes valid and binding
obligations on ELITE in accordance with its terms
except as limited by applicable bankruptcy,
insolvency, reorganization and other laws of general
application affecting the enforcement of creditors'
rights generally, and except as enforcement of rights
to indemnity and contribution hereunder may be
limited by principles of public policy;
(3) ELITE has taken all corporate action required by it
to authorize it to enter into and to perform the
Agreement;
(4) ELITE has the right to disclose Know-How to PLIVA as
is necessary for PLIVA to perform its obligations
hereunder;
(5) to ELITE's knowledge, there are no infringement
proceedings pending against ELITE in connection with
the Product;
(6) there are no agreements between ELITE and any third
party that conflict with this Agreement;
(7) no consent or approval of any third party, court or
governmental agency is required in connection with
the execution and performance of this Agreement by
ELITE;
(8) ELITE will manufacture all Product in accordance with
cGMPs and all Applicable Laws;
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(9) ELITE is not enjoined from manufacturing nor is ELITE
currently sanctioned by the FDA pursuant to any
issued 483 inspection reports;
(10) ELITE's employees and agents are not and have not
been debarred by FDA pursuant to 21 USC Section
335(a) or involved in any investigation or proceeding
which could lead to debarment;
(11) ELITE does not and will not knowingly employ or use
the services of any individual or entity that has
been debarred or convicted of a felony or who is
currently under investigation for such conviction;
(12) all laboratory, scientific, technical or commercial
information that is submitted by ELITE to PLIVA or to
any regulatory health authority relating to the
Product should be complete, true, accurate and
correct and shall not contain any knowingly false
information, misrepresentation and/or omission; and
(13) ELITE will perform all necessary record keeping as
required under applicable federal and state laws
regarding the manufacture of the Product,
environmental impact of the manufacturing and all
potential or adverse product defects.
ELITE MAKES NO OTHER WARRANTY OF ANY KIND, EXPRESS OR IMPLIED,
EXCEPT THOSE EXPRESSLY MADE HEREIN. ELITE SPECIFICALLY
DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING,
WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY,
NON-INFRINGEMENT, OR FITNESS FOR A PARTICULAR PURPOSE.
9.2 PLIVA represents and warrants to ELITE, as of the Effective
Date, as follows:
(1) PLIVA has the legal right and full corporate power
and authority to enter into this Agreement and to
perform the same;
(2) the Agreement constitutes valid and binding
obligations on PLIVA in accordance with its terms
except as limited by applicable bankruptcy,
insolvency, reorganization and other laws of general
application affecting the enforcement of creditors'
rights generally, and except as enforcement of rights
to indemnity and contribution hereunder may be
limited by principles of public policy;
(3) PLIVA has taken or will have taken all corporate
action required by it to authorize it to enter into
and to perform the Agreement;
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(4) there are no agreements between PLIVA and any third
party that conflict with this Agreement;
(5) no consent or approval of any third party, court or
governmental agency is required in connection with
the execution and performance of this Agreement by
PLIVA;
(6) PLIVA will transport, store, handle, distribute,
market and sell all Product in accordance with cGMPs
and all Applicable Laws;
(7) PLIVA's employees and agents are not and have not
been debarred by the FDA pursuant to 21 U.S.C.
Section 335(a) or involved in any investigation or
proceedings which could lead to debarment;
(8) in the performance of its obligations under this
Agreement, PLIVA does not and will not knowingly
employ or use the services of any individual or
entity that has been debarred, convicted of a felony
or who is currently under investigation for such
conviction; and
(9) PLIVA will perform all necessary record keeping as
required under applicable federal and state laws
regarding the transport, handling, storage and
distribution of the Product, environmental impact of
the manufacturing and all potential or adverse
product defects.
PLIVA MAKES NO OTHER WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, EXCEPT
THOSE EXPRESSLY MADE HEREIN. PLIVA SPECIFICALLY DISCLAIMS ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY
WARRANTY OF MERCHANTABILITY, NON-INFRINGEMENT, OR FITNESS FOR A
PARTICULAR PURPOSE.
10. OBLIGATION OF CONFIDENTIALITY
10.1 All Confidential Information disclosed by a party ("Disclosing
Party") shall be treated by the other party ("Receiving
Party") as confidential and shall not be disclosed or revealed
to any third party and shall be used solely in connection with
the performance of this Agreement; provided, however, that
Confidential Information shall not include information that
the Receiving Party can document as having been:
(1) public knowledge prior to the disclosure, or which
hereafter becomes public knowledge through no fault
of the Receiving Party;
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(2) lawfully in the Receiving Party's possession prior to
the time of disclosure by Receiving Party;
(3) received, after the time of disclosure, from a third
party not under a similar obligation of
confidentiality to Disclosing Party; or
(4) independently developed by Receiving Party's
employees without access to Disclosing Party's
Confidential Information.
10.2 The Receiving Party shall take all such precautions as it
normally takes with its own Confidential Information, but in
no event less than reasonable precautions, to prevent improper
disclosure; provided, however, that Confidential Information
may be disclosed within the limits required (A) to obtain any
authorization from the FDA or any other United States or
foreign governmental or regulatory agency or, with the prior
written consent of the Disclosing Party; (B) to be disclosed
pursuant to (i) any order of any court having jurisdiction and
power to order such information to be released or made public;
or (ii) any lawful action of a governmental or regulatory
agency.
10.3 In addition to and without limiting any other remedies
available to a Receiving Party at law or in equity, the
Receiving Party shall also be entitled to seek immediate
injunctive relief in any court to restrain any breach or
threatened breach of a Receiving Party and to enforce the
provisions of this Section 10. Each party acknowledges and
agrees that there is may be no adequate remedy at law or in
equity for any such breach or threatened breach and, in the
event that any proceeding is brought seeking injunctive
relief, the Receiving Party shall not use as a defense thereto
that there is an adequate remedy at law.
10.4 The Receiving Party may disclose Confidential Information of
the Disclosing Party to the Receiving Party's employees,
consultants, licensees, prospective licensees and
subcontractors on a need-to-know basis; provided, however,
that (i) any such disclosure shall be pursuant to
confidentiality undertakings with terms at least as
restrictive as those specified herein; and (ii) any violation
of this Agreement by such persons shall be deemed a breach of
the Receiving Party. Any of the persons mentioned above who
are provided with access to Confidential Information shall be
informed by the Receiving Party of the Receiving Party's
obligations hereunder.
10.5 The confidentiality obligations of each party under this
Section 10 shall survive the expiration or earlier termination
of this Agreement, howsoever terminated.
10.6 The parties shall cooperate and agree upon any public
statement concerning the existence, subject matter or any term
of this Agreement by or on behalf of any Party prior to any
issuance, dissemination or release. Subject to
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Section 10.2, neither party may issue, disseminate or release
any such public statement without the prior written approval
of the other parties, which consent shall not be unreasonably
withheld or delayed.
10.7 The confidentiality obligations contained in this Article 10
are in addition to and not in substitution for any
confidentiality obligations of the parties undertaken pursuant
to the Non-Disclosure Agreement between ELITE and PLIVA dated
June 22, 2004 (which agreement shall continue in full force
and effect as therein provided).
11. TERM OF AGREEMENT
This Agreement shall become Effective Date and shall continue in force,
in with respect to any particular country in the Territory, for a ten
(10) year period from the date the Product is first commercially sold
in that country by PLIVA ("Initial Term"), unless terminated earlier
under Article 12. Upon expiration of the Initial Term, and any
extension term as hereafter provided ("Renewal Term" and together with
the Initial Term, the "Term"), the Term shall automatically be renewed
for additional periods of three (3) years each, unless written notice
is given by either party to the other at least one (1) year prior to
the end of the Initial Term or any of the Renewal Term of such party's
decision not to extend the term of the Agreement upon expiration of the
then existing term.
12. TERMINATION
12.1 This Agreement may be terminated by a party:
(1) upon breach of this Agreement by the other party
(including, without limitation, the failure to timely
perform any obligation under this Agreement), and
after sixty (60) days prior written notice to the
breaching party, the notice to become effective at
the end of the sixty (60) day period unless the
breach is sooner cured by the breaching party;
(2) if a successful pivotal biostudy demonstrating the
Product meets FDA guidelines for bioequivalence is
not completed within one (1) year from the Effective
Date, or if the parties are unable to obtain
Marketing Authorization from FDA within the later of
(i) two (2) years from the completion of the Studies
or (ii) five (5) years of the Effective Date;
(3) if there are no patents which present a risk of
infringement in the Territory and the first
commercial launch of the Product in the Territory
under this Agreement does not occur within sixty (60)
days of the date a Marketing Authorization for the
Territory is obtained;
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(4) upon the other party's insolvency or voluntary filing
of a petition for bankruptcy, or the placing of the
business of the other party in the hand of a
receiver; or
(5) if the Net Profit received by that party in respect
of the Product is less than [*] for any calendar year
after the first full calendar year of commercial
sales hereunder.
12.2 EFFECT OF TERMINATION. Termination of this Agreement for any
reason shall be without prejudice to:
(1) ELITE's and PLIVA's right to receive all amounts
accrued and unpaid under Sections 2, 3 or 5 up to the
date of such termination;
(2) any provisions clearly meant to survive termination
or expiration of this Agreement, including without
limitation representations, warranties,
indemnification and confidentiality obligations as
well as Sections 1, 4, 7, 8, 9, 10, 12, and 14, shall
remain in full force and effect.
(3) the rights of inspection and audit set out in Section
5.4 shall continue in force as required under the
terms of this Agreement; and
(4) any other remedies which either party may then or
thereafter have hereunder or otherwise.
12.3 RIGHTS TO ANDAS. Without limiting any other right or remedy
available to PLIVA, on ELITE's breach of this Agreement (if
such breach is not cured within the time period provided in
Section 12.1 (1) above), then at PLIVA's request ELITE shall,
within the Territory, transfer to PLIVA, at no charge, the
ANDA (or comparable Marketing Authorization outside of the
United States) for the Product, and ELITE promptly shall take
such other actions as reasonably requested by PLIVA from time
to time to evidence PLIVA's exclusive rights to the ANDA or
comparable Marketing Authorization and all information
contained therein, subject to PLIVA having theretofore
reimbursed ELITE in full for the Elite Product Development
Costs.
13. NOTICES
13.1 Any notice provided for herein shall be in writing and is
effective upon receipt: (i) when delivered by hand with proof
of delivery; (ii) when sent by facsimile with fax
confirmation, provided same is sent all by regular mail within
forty-eight (48) hours; (iii) three (3) days following deposit
for mailing by first class registered or certified mail,
return receipt requested; one day following deposit for mail
with an overnight carrier; or (iv) when received by the
addressee, by delivery
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service (return receipt requested). Notices shall be delivered
to the addresses set forth below:
If to ELITE: 000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to PLIVA: 00 Xxxxx Xxxx Xxxxxx
Xxxx Xxxxxxx, XX 00000
Attention: General Counsel
Telephone: 000-000-0000
Facsimile: 000-000-0000
14. MISCELLANEOUS
14.1 Neither party shall be liable for any failure to deliver or
receive or any delay to perform its obligations hereunder when
such failure or delay shall be caused (directly or indirectly)
by fire; flood; accident; explosion; equipment or machinery
breakdown; sabotage; strike, or any labor disturbance
(regardless of the reasonableness of the demands of labor);
civil commotions; riots; invasions; wars (present or future);
acts, restraints, requisitions, regulations, or directions of
any governmental entity; voluntary or mandatory compliance
with any request of any governmental entity; facility shut
down; voluntary or mandatory compliance with any request for
material represented to be for purposes of (directly or
indirectly) producing articles for national defense or
national defense facilities; shortage of labor, fuel, power or
raw materials; inability to obtain raw materials or supplies;
failures of normal sources of supplies; inability to obtain or
delays of transportation facilities; any act of God; any act
of the other party; or any cause (whether similar or
dissimilar to the foregoing) beyond the reasonable control of
such party (each cause a "Force Majeure Event").
14.2 Either party hereto may assign this Agreement in whole or in
part to any Affiliate or Affiliates who shall be substituted
directly in whole or in part for it hereunder, provided,
however, that the assignor shall guarantee the performance of
its Affiliate assignee hereunder. This Agreement shall not
otherwise be assignable by either party without the prior
written consent of the other party, which consent shall not be
unreasonably withheld, conditioned or delayed.
14.3 This Agreement shall be governed by and interpreted in
accordance with the laws of the State of New Jersey, United
States of America without regard to its conflict of laws
principles, and should legal action become necessary to
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enforce its terms, the prevailing party shall be entitled to
reasonable costs and attorneys' fees.
14.4 In connection with any litigation out of or relating to the
subject matter of this Agreement, each of the parties hereto
(a) irrevocably consents and submits to the exclusive
jurisdiction of the state and federal courts located in New
Jersey, and (b) agrees that service of process may be
effected, in addition to any other means permitted by the
applicable rules of court, by mailing such process certified
mail, return receipt requested or by reputable overnight
courier provided a receipt against delivery at their
respective addresses set forth above is obtained.
14.5 The terms and provisions contained in this Agreement
constitute the entire Agreement between the parties and,
except as provided in Section 11.7 hereof, shall supersede all
previous communications, representations, agreements or
understandings, either oral or written, between the parties
hereto with respect to the subject matter hereof and no
agreement or understanding varying or extending these
Agreements shall be binding upon either party hereto, unless
in writing which specifically refers to the Agreement, signed
by fully authorized officers or representatives of the
respective parties and the provisions of these Agreements not
specifically amended thereby shall remain in full force and
effect.
14.6 Any waiver must be explicit and in writing. The waiver by
either of the parties to this Agreement of any breach of any
provision hereof by the other party shall not be construed to
be a waiver of any succeeding breach of such provision or a
waiver of the provision itself.
14.7 If and to the extent that any court or tribunal of competent
jurisdiction holds any of the terms, provisions or conditions
or part thereof of this Agreement, or the application hereof
of any circumstances, to be invalid or to be unenforceable in
a final non-appealable order, the remainder of this Agreement
and the application of such term, provision or condition or
part thereof to circumstances other than those as to which it
is held invalid or unenforceable shall not be affected
thereof, and each of the other terms, provisions and
conditions of this Agreement shall be valid and enforceable to
the fullest extent of the laws.
14.8 The relationship of ELITE and PLIVA under this Agreement is
that of independent contractors. Neither party shall be deemed
to be the agent of the other nor authorized to take any action
binding upon the other.
14.9 This Agreement may be executed in counterparts, each of which
shall be deemed to be an original and all together shall be
deemed to be one and the same Agreement. All headings in this
Agreement are inserted for convenience of reference only and
shall not affect its meaning or interpretation.
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15. AGREEMENT TO PERFORM NECESSARY ACTS
Each party to this Agreement agrees to perform any further acts and
execute and deliver any documents that may be reasonably necessary to
carry out the provisions of this Agreement.
16. DISPUTE RESOLUTION
16.1 Should any dispute or difference arise between ELITE and PLIVA
or the Committee during the Term of this Agreement, then
either party may forthwith give notice to the other party that
it wishes such dispute or difference to be referred to a
designated senior officer of each of ELITE and PLIVA.
16.2 If designated senior officers of each of ELITE and PLIVA agree
upon a resolution or disposition of the matter, they shall
each sign a statement which sets out the terms of their
agreement. If, however, the parties' designated senior
officers are still unable to resolve their differences within
60 days of its being referred to them, either party may pursue
any legal remedy available to it. Nothing contained herein
shall be deemed to limit or restrict a party from seeking
equitable remedies, such as a preliminary or permanent
injunction, if necessary, from a court of competent
jurisdiction located in the State of New Jersey.
17. QUALITY AGREEMENT
17.1 PLIVA and ELITE shall enter into an agreement with respect to
quality and regulatory issues (the "Quality Agreement")
substantially in the form attached hereto as Exhibit A.
17.2 If any term in this agreement is inconsistent with any term in
the Quality Agreement, the term in the Quality agreement shall
control.
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IN WITNESS WHEREOF, ELITE and PLIVA have executed this Agreement in duplicate as
of the day and year first above written.
ELITE LABORATORIES, INC.
By:
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Its
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PLIVA, INC.
By:
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Its
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