EXHIBIT 10.20
MATERIAL TRANSFER AND SCREENING AGREEMENT
This Agreement, effective as of the date last written below, is between ArQule,
Inc. ("ArQule") and CuraGen Corp. ("Recipient").
1. Screening of Compound Array: ArQule shall promptly deliver to Recipient
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any Mapping Array/TM/ compound sets (a "Compound Array") mutually selected by
ArQule and Recipient out of the Compound Arrays that ArQule generally makes
available to its collaborators for screening on a non-exclusive basis. The
delivered Compound Arrays will consist of small organic compounds ("Compounds")
in the standard ArQule format of one Compound per well in 96 well microtiter
plates. Unless ArQule otherwise notifies Recipient, Recipient will receive
10(Greek Mu)L of a 10mM solution of each Compound in 100% DMSO. Except as
provided below, ArQule will have no obligation to identify the individual
Compounds in any Compound Array, and Recipient will have no obligation to
identify its targets. Recipient shall not attempt to identify any Compounds.
ArQule grants Recipient a nonexclusive, worldwide license (without the right to
sublicense or subcontract screening) to screen the Compound Arrays using any
proprietary assays selected by Recipient.
2. Research Collaboration: If Recipient detects activity in one or more
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Compounds during the term of this Agreement, the following procedures shall
apply:
(a) Upon execution of a mutually acceptable confidential disclosure
agreement (the "CDA") between ArQule and Recipient, Recipient shall disclose to
ArQule the array plate number and well number of any Compound(s) exhibiting
confirmed significant activity (the "Active Compound(s)") and the identity of
the target(s) (the "Target(s)").
(b) ArQule will determine whether any Active Compound(s) have
previously been committed to a third party or to an internal ArQule program. If
any Active Compound(s) have been so committed, Recipient shall have no rights in
or to such Active Compound(s). For Active Compounds that are not committed
("Available Compounds"), ArQule shall (i) disclose to Recipient the chemical
composition and theoretical structure of the Available Compound(s), subject to
the CDA, and (ii) reserve the Available Compound(s) (i.e., ArQule will not
license or otherwise commit the Available Compound(s) to any third party or to
an internal ArQule program) for a period of sixty (60) days following the date
upon which Recipient received this disclosure from ArQule (the "Reservation
Period").
(c) ArQule hereby grants Recipient the right to negotiate a research
collaboration and license agreement for the Available Compound(s) (the
"Negotiation Right") in accordance with the following procedures. Recipient may
exercise the Negotiation Right upon written notice to ArQule which is received
by ArQule at any time during the term of this Agreement, whereupon the parties
will engage in good faith negotiations to establish the terms and conditions of
a mutually acceptable research collaboration and license agreement, including
the terms set forth on Attachment A. During the Reservation Period, the
Available Compound(s) are reserved for Recipient, and the Negotiation Right will
be exclusive to Recipient. After the Reservation Period, if the parties have not
executed a research collaboration and license agreement, the Available Compounds
are no longer reserved for Recipient and ArQule shall have the right to license
these Active Compound(s) to any third party or to commit these Active
Compound(s) to an internal ArQule program, subject in both cases to any
non-disclosure and non-use provisions in the CDA.
3. Use and Transfer Restrictions: Recipient acknowledges and agrees that the
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Compounds (including without limitation all Active Compounds) and the Compound
Arrays are proprietary to and owned by ArQule and are or may be covered by
claims of U.S. and international patents or patent applications of ArQule.
Recipient agrees to use the Compounds only for the purposes set forth in this
Agreement. Recipient agrees (i) not to transfer such Compounds to any third
party without the prior written consent of ArQule, (ii) to permit access to the
Compounds only to its employees and consultants requiring such access, (iii) to
inform such employees and consultants of the proprietary nature of the
Compounds, and (iv) to take reasonable precautions, at least as stringent as
those observed by Recipient to protect its own proprietary materials, to ensure
that such employees and consultants observe the obligations of Recipient
pursuant to this Section. Upon the expiration or termination of this Agreement,
Recipient shall, at the instruction of ArQule, return any unused Compounds.
4. Compliance with Law: Recipient agrees to comply with all federal, state,
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and local laws and regulations applicable to the use, storage, disposal, and
transfer of the Compounds, including without limitation the Toxic Substances
Control Act (15 USC 2601 et seq.) and implementing regulations (in particular,
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40 CFR 720.36 [Research and Development Exemption]), the Food, Drug, and
Cosmetic Act (21 USC 301 et seq.) and implementing regulations, and all Export
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Administration Regulations of the Department of Commerce. Recipient assumes sole
responsibility for any violation of such laws or regulations by Recipient or any
of its affiliates or sublicensees.
5. Termination: This Agreement shall commence on the date last written below
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and continue for a period of six (6) months; provided that the term of this
Agreement shall automatically be extended for successive six-month periods until
terminated by a party in the following manner. Either party may cause this
Agreement to expire by furnishing the other party with written notice of such
fact at least thirty (30) days prior to the conclusion of the initial term or
any subsequent extension period. Sections 3, 4, 7, and 8 shall survive
termination of this Agreement.
6. No Warranties: Any Compounds delivered pursuant to this Agreement are
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understood to be experimental in nature and may have hazardous properties. The
Recipient should assume that the compounds are dangerous and should use
appropriate precautions. ARQULE MAKES NO REPRESENTATIONS, AND EXTENDS NO
WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE
COMPOUNDS.
THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE, OR THAT THE USE OF THE COMPOUNDS WILL NOT INFRINGE ANY
PATENT OR OTHER INTELLECTUAL PROPERTY RIGHTS OF A THIRD PARTY.
7. Indemnification: Recipient assumes all liability for, and agrees to
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indemnify, defend, and hold harmless ArQule and its directors, officers,
representatives, employees, and agents against, all losses, expenses (including
without limitation any legal expenses), claims, demands, damages, judgments,
suits or other actions arising from the use, storage, or disposal of the
Compounds by Recipient and its affiliates and sublicenses, or from any breach of
its obligations under Section 4 of this Agreement.
8. Miscellaneous: This Agreement shall not be assigned or otherwise
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transferred by Recipient without the prior written consent of ArQule. This
Agreement shall be governed by the laws of the Commonwealth of Massachusetts.
This Agreement constitutes the entire understanding of the parties and
supersedes all prior agreements, written or oral, with respect to the subject
matter hereof.
ACCEPTED AND AGREED:
ArQule, Inc.
Signature: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: V.P. Bus. Dev
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Date: Jan 15, 1998
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Address:
ArQule, Inc.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
RECIPIENT:
Signature: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
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Title: V.P. Bus Dev
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Date: Jan 13, 1998
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Shipping Address:
Xxxxx Xxxxx, PhD.
000 Xxxx Xxxxx, 00xx Xxxxx
Xxx Xxxxx, XX 00000
Tel: 000 000 0000 000
Fax: 000 000 0000
ATTACHMENT A
CERTAIN TERMS OF RESEARCH COLLABORATION AND LICENSE AGREEMENT
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. establishment of committees to manage the collaboration
. licenses under the intellectual property rights of each party to conduct
lead optimization and preclinical development of the Active Compounds
. responsibilities of the parties for specific lead optimization and
preclinical development activities
. each party bears its own expenses for lead optimization and preclinical
development activities, with equal sharing of commercialization revenue
if compound licensed prior to clinical development.
. both parties have right, but not obligation, to pay half of clinical
development expenses and maintain equal sharing of commercialization
revenue
. one party may continue clinical development even if the other party
declines, in which case the declining party receives a fixed royalty and a
lower share of other commercialization revenue
. appropriate reversion provisions that establish the rights of each party if
the collaboration ends before lead optimization and preclinical development
are completed
BIOTECHNOLOGY PARTNERSHIP PROGRAM
PRINCIPLES OF COLLABORATION
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1. Voluntary Collaboration to Discover and Develop Drug Candidates > Fairness
a) Fundamental premise that we will accomplish more together than either of
us would likely accomplish separately.
b) We make all decisions together through a Research Committee and Steering
Committee, including decisions about whether to continue with a project
and when to commercialize a drug candidate.
c) If we disagree, either of us may voluntarily withdraw from the
collaboration at any time but the other party may continue on alone with
the project.
d) If we disagree and neither of us withdraws (i.e., deadlock), the work
product of the project is outlicensed to a third party unless a
negotiated buyout occurs.
2. Equal Contribution to Value Creation > Biology=Chemistry
a) Partner contributes primarily biology, ArQule contributes primarily
chemistry.
b) Each of us bears our own expenses through IND approval.
c) Each of us bears one-half of expenses after IND approval.
d) Either of us may withdraw from the collaboration and have no further
obligation to the other party if they continue the project.
3. Equal Ownership of Value Created > 50:50 Split
a) Equal ownership of intellectual property rights in a compound.
b) Equal development and commercialization rights in a compound.
c) If one of us withdraws and the other party continues, the financial
interest of the withdrawing party is determined based on the relative
value contributed before withdrawal occurs and after withdrawal occurs
(and not on cost incurred).
d) If we agree to stop a project that lacks scientific or commercial merit,
the rights in the work product revert according to the contributions of
each party, with ArQule having rights to the compound compositions and
the Partner having rights to use the compound with the biological target
(i.e., stalemate).
4. Collaboration is Non-Exclusive in Field but Exclusive for Compounds
Discovered
5. Each of Us Will Safeguard the Confidential Information and Proprietary
Research Materials Received from the Other Party.
