EXHIBIT 10.2
[LETTERHEAD]
April 27, 1998
By telefax: 000 00 0000 423 111
Xx. X.X. Xxxxxxx
Peptide Therapeutics Limited
000 Xxxxxxxxx Xxxxxxx Xxxx
Xxxxxx Xxxx
Xxxxxxxxx XX0 0XX
Xxxxxxx
Dear Xxxx:
This letter is intended to outline the general terms which have been agreed
between Peptide Therapeutics ("PT") and the joint ventures between OraVax, Inc.
and Pasteur Merieux Serums et Vaccins S.A. known as Merieux OraVax S.N.C. and
OraVax Merieux Co. ("PM-O").
This letter provides for terms and conditions of an option granted by PT to PM-O
in order to allow PM-O to evaluate the technical feasibility of H. pylori
vaccines formulated with PT's Salmonella vectors. For this part, this letter is
hereinafter referred to as the "Option Agreement."
This letter also expresses the intent of the parties to negotiate in good
faith a license agreement to be executed by their authorized representatives.
Under the license agreement, PM-O will obtain rights to develop and
commercialize H. pylori vaccines formulated with any PT's Salmonella vector
(the "PT Technology"). Until the execution of this license agreement or until
July 31, 1999, whichever is sooner. PT will negotiate exclusively with PM-O
regarding the use of the PT Technology with the PM-O program H. pylori
antigens, and non-exclusively regarding the use of the PT Technology for all
other H. pylori antigens.
Option Agreement
Option Period April 1, 1998 through completion by PM-O of Phase I
trials of a vaccine utilizing the PT technology or
July 31, 1999, whichever comes first.
Option PT will grant to PM-O an exclusive option to an exclusive,
worldwide license to PT's Salmonella Technology for the
development, manufacture, use and/or sale of prophylactic
and therapeutic human vaccines against H. pylori infection,
under a License Agreement containing the terms set out below
Feasibility Study The parties will perform a joint Feasibility Study to
evaluate the utility of the PT technology in PM-O's H.
pylori vaccines in two stages as described in Attachments A
and B.
Option Fee PM-O will pay PT a non-refundable Option Fee of $200,000, in
three installments, subject to the following:
[ ]* on execution of this Option Agreement
[ ]* on successful completion by PT of items 1-5 of
Attachment A. In the event PT can not successfully
complete items 1-5 of Attachment A, this second
installment shall not be payable by PM-O, and the parties
will have the option to not proceed with items 6 and 7 of
Attachment A and item 3 of Attachment B.
[ ]* in the event the parties elect to proceed with
items 6 and 7 of Attachment A and item 3 of Attachment B
and on completion by PT of step 7 of Attachment A
The parties will keep each other informed of their
activities under the Feasibilty Study and report the results
of their work to each other in a timely manner.
Reporting PM-O will inform PT on or before thirty (30) days after the
termination of the Option of its decision whether or not to
proceed with commercial development of PT's technology under
the License Agreement terms proposed below.
Exercise of Option In the event PM-O elects to proceed with commercial
development of PT's technology, the parties will enter into
a License Agreement containing the terms set out below,
such License Agreement to be entered into by the parties
on the earlier of completion by PM-O of Phase I trials of
a vaccine utilizing the PT technology or July 31, 1999.
In the event PM-O declines to proceed with commercial
development, the Option Agreement shall be terminated and
all PT patent rights will revert to PT.
Confidentiality During the term of the Option Period any confidential
information received by one party from the other party shall
be governed by the terms of the Confidential Disclosure
Agreement between PT and PM-O dated May 8, 1997, save that
PM-O and PT shall have the right to use and disclose to
third parties data and results from the Feasibility Study
solely for research and development activities relating to
the other party's technology, provided such disclosure is
made under obligations of confidentiality similar to those
of the aforementioned Confidential Disclosure Agreement
between PT and PM-O.
-----------------
* This portion of the Exhibit has been omitted pursuant to a Request for
Confidential Treatment under Rule 406 of the Securities Act of 1933, as
amended. The complete Exhibit, including the portions for which confidential
treatment has been requested, has been filed separately with the Securities
and Exchange Commission.
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License Agreement
Grant PT will grant to PM-O an exclusive license for human
applications to its Salmonella typhimurium and Salmonella
typhi vectors and all related patents, patent applications
and know-how (the "PT technology"), the right to sublicense,
for use with the PM-O program H. pylori antigens, and a
non-exclusive license regarding the use of the PT technology
for all other H. pylori antigens.
Territory Worldwide
Term The term of the license will be the longer of (i) ten
(10) years from product launch on a country-by-country
basis or (ii) through the last to expire of relevant
patents owned or licensed to Peptide Therapeutics. PM-O
will have the right to terminate on ninety (90) days
notice, with all rights to the PT Technology reverting
to Peptide Therapeutics, at no additional cost to PM-O.
PM-O Diligence PM-O will exert reasonable efforts to develop and introduce
requirements the PT technology into the commercial market.
Royalty PM-O will pay to PT []* royalties on net sales of licensed
products (whether by PM-O or any licensee); in the event
PM-O is required to license other third party technologies,
this rate may be reduced by []* of royalties due to such
third parties, but in no event will the rate payable by PM-O
be reduced to less than (i) []* if the PT technology is
the only adjuvant or delivery system required to
commercialize a licensed product; (ii) []* if PM-O is
required to license other adjuvant or delivery system
technologies in order to commercialize a licensed product;
(iii) []* if PT know-how only is used by PM-O to
commercialize a licensed product. []*
License Fee On execution of the License Agreement, PM-O will pay PT a
non-refundable signing fee of []*.
Milestone payments PM-O will pay to PT the following milestone payments:
[]*
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* This portion of the Exhibit has been omitted pursuant to a Request for
Confidential Treatment under Rule 406 of the Securities Act of 1933, as
amended. The complete Exhibit, including the portions for which confidential
treatment has been requested, has been filed separately with the Securities
and Exchange Commission.
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[]*
[]*
General If the parties agree that PT should provide additional
services (such as process development/manufacturing of
clinical lots, toll manufacture, etc.), then the parties
agree to negotiate additional payments to reflect this added
input by PT.
Governing Law Option and License Agreement to be under English law and
jurisdiction.
Please indicate Peptide Therapeutics agreement to the terms set out below in the
space provided below.
/s/ Xxxxx X. Xxxxxx /s/ Xxxx Xxxxxxxxxxx
------------------------------------ ------------------------------------
Xxxxx X. Xxxxxx, Ph.D. Xxxx Xxxxxxxxxxx
XxxXxx Merieux Co. Merieux OraVax S.N.C.
/s/ Xxxxxxx Xxxxxxx
------------------------------------
Xxxxxxx Xxxxxxx
Director
Peptide Therapeutics Limited
-----------------
* This portion of the Exhibit has been omitted pursuant to a Request for
Confidential Treatment under Rule 406 of the Securities Act of 1933, as
amended. The complete Exhibit, including the portions for which confidential
treatment has been requested, has been filed separately with the Securities
and Exchange Commission.
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ATTACHMENT A
CONFIDENTIAL
Feasibility Study for H. pylori Vaccine
Peptide Therapeutics Workplan
[]*
------------------
* This portion of the Exhibit has been omitted pursuant to a Request for
Confidential Treatment under Rule 406 of the Securities Act of 1933, as
amended. The complete Exhibit, including the portions for which confidential
treatment has been requested, has been filed separately with the Securities
and Exchange Commission.
5
ATTACHMENT B
CONFIDENTIAL
Feasibility Study for H. pylori Vaccine
PM-O Workscope
[]*
-----------------
* This portion of the Exhibit has been omitted pursuant to a Request for
Confidential Treatment under Rule 406 of the Securities Act of 1933, as
amended. The complete Exhibit, including the portions for which confidential
treatment has been requested, has been filed separately with the Securities
and Exchange Commission.
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