SIMULATIONS PLUS
Integrating Science and Software
LETTER OF INTENT FOR COOPERATIVE ALLIANCE
This is a non-binding Letter of Intent between Simulations Plus, Inc., 0000 X.
Xxxxxx X, Xxxxxxxxx, XX ("Simulations Plus") and Absorption Systems LP, Oaklands
Corporate Center, 000 Xxxxxxxx Xxx, Xxxxx X, Xxxxx, XX 00000 ("Absorption
Systems"). This letter summarizes our discussions to date and reflects our
mutual interest in fanning a joint venture to pursue the activities described
below.
Simulations Plus has expertise in the development of scientific software
including simulation and data correlation software for the pharmaceutical
industry.
Absorption Systems has expertise in laboratory testing of candidate drug
materials and other chemical compounds related to the absorption of such
materials in tissue culture and under various physiological conditions.
Simulations Plus and Absorption Systems believe that the combined capabilities
of the two companies may provide a unique capability to the pharmaceutical
industry in the area of absorption and general bioavailability.
Simulations Plus and Absorption Systems desire to form a Joint Venture which
combines the capabilities of both companies in such a way as to offer a new
service to the pharmaceutical industry for the study and prediction of the
absorption and general bioavailability of candidate new drug materials. The
structure of the Joint Venture and other related matters will be set forth in a
detailed and definitive agreement, which will contain terms and conditions yet
to be discussed and agreed upon. Among other things, the definitive agreement
will reflect the following:
CONSORTIUM: The Joint Venture will create a consortium of pharmaceutical and
other companies that will each provide large numbers of chemical entities for
comprehensive laboratory screening, data correlation and simulation analysis.
Each consortium member will contract with the Joint Venture, and in turn, the
Joint Venture will contract the respective activities to both Absorption Systems
and Simulations Plus.
SERVICE: The Joint Venture envisions providing a service to pharmaceutical and
biotech companies, whereby Absorption Systems will conduct laboratory
experiments on potential drug compounds provided by the customer to create a
small proprietary database for that customer's compounds. Using the data so
generated, Simulations Plus will then: (1) correlate the data generated by the
Absorption Systems experiments into a proprietary database and computer software
to allow prediction of permeabilities and other molecular parameters for
additional compounds, and (2) generate predictions for such additional compounds
as the customer may desire, to be provided to the customer in the form of a
report. Customers will benefit from the data generated for other customers, but
no customer will have access to the raw data from any other customer.
EXCLUSIVITY: Both Simulations Plus and Absorption Systems ("The Parties")
possess proprietary assays, processes, know-how, software, mathematical models,
and information ("intellectual property"). Pursuant to the definitive agreement,
each party will license exclusively, certain of their respective intellectual
property, know-how, software, expertise, etc. to the Joint Venture for the sole
purpose of developing the Consortium Database and Consortium Software. This
provision does not preclude Simulations Plus or Absorption Systems from
performing or developing their respective intellectual property, know-how,
software, expertise, or performing contract services independent of the
consortium provided such activities are funded separately and are independent
and do not infringe on the exclusivity of the consortium or consortium
membership.
OWNERSHIP OF THE INTELLECTUAL PROPERTY: In accordance with the terms set forth
in the definitive agreement, the Joint Venture will be the sole owner of all
biological data, mathematical models, and improvements to biological and
chemical assays and software that it purchases from either Absorption Systems or
Simulations Plus during its normal course of business. The Joint Venture will
own all biological data, mathematical models, and improvements to biological and
chemical assays and software it develops or purchases independent of Absorption
Systems or Simulations Plus.
Both Simulations Plus and Absorption Systems agree that this Letter of Intent is
nonbinding; however, by signing this Letter of Intent, each company expresses
its sincere interest in developing the Joint Venture described above.
Both Simulations Plus and Absorption Systems agree that time is of the essence
in forming the joint venture contemplated by this Letter of Intent. To this end,
this Letter of Intent shall expire 60 days from the date of execution, unless
extended in writing by both parties or superceded by a more definitive
agreement.
DATED THIS 9th DAY OF February, 1999
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Simulations Plus, Inc. Absorption Systems LP
/s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxxxx
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Chairman and CEO President & CEO
