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EXHIBIT 10.18
LICENSE AND SUPPLY AGREEMENT
This LICENSE AND SUPPLY AGREEMENT ("Agreement"), dated as of April 9th, 1998 ,
is by and between NASTECH PHARMACEUTICAL COMPANY INC., a Delaware corporation
("Nastech"), and TZAMAL PHARMA LTD., an Israeli corporation ("Tzamal").
W I T N E S S E T H
WHEREAS, Nastech is engaged, among other things, in the business of
research, development, manufacturing and commercialization of nasally
administered forms of pharmaceutical products;
WHEREAS, Tzamal is engaged among other things, through wholly owned
subsidiaries, in the business of marketing and selling of pharmaceutical
products in the Israeli area;
WHEREAS, Nastech wishes to find a partner in the Israeli area for its
intranasal cyanocobalamine product and Tzamal is interested in obtaining
marketing rights in such territory and to obtain a product license in its own
name and at its own expense; and
WHEREAS, subject to the terms and conditions set forth in this Agreement,
Nastech wishes to license to Tzamal and Tzamal wishes to license from Nastech
certain rights under certain of the assets which Nastech uses in the conduct of
its intranasal pharmaceutical business;
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1.0 Definitions
1.1 "Product" shall mean a pharmaceutical preparation in intranasal form
containing cyanocobalamine as the active therapeutic ingredient as well as any
future developments thereof.
1.2 "Territory" shall mean the Israeli area comprising Israel, West Bank & Gaze,
Palestinian Autonomous Territory.
1.3 "Party", "Parties" mean Nastech, Tzamal, either Nastech or Tzamal or both as
the case may be.
1.4 "Proprietary Information" shall mean the information submitted to the United
States Food and Drug Administration ("FDA") with respect to the manufacture and
regulatory approval of dosage forms of the Product.
1.5 "Effective Date" shall mean the last date of signing this Agreement.
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1.6 "Launch Date" shall mean the date when the Product is approved for marketing
by health authorities in Israel.
2.0 Marketing rights
2.1 Nastech hereby grants to Tzamal a license solely for the purpose of
promoting, marketing, selling and distributing the Product in the Territory. As
long as this Agreement is in force and effect Nastech shall refrain from
granting rights to market and sell the Product in the Territory to any third
party. If product will reach the Territory from sources other than Nastech
(parallel import) both sides will find jointly and amicably immediate ways to
solve the problem and compensate Tzamal.
2.2 Tzamal shall market the Product at its choice under a trademark of its own
or under Nastech's trademark "Nascobal", providing that such xxxx can be
registered in the Territory. The proprietary rights to the trademark "Nascobal"
shall be licensed to Tzamal in the Territory solely for the term of this
Agreement. Tzamal may use Nastech's name and derivations thereof in promoting,
marketing and selling the Product in the Territory; provided, however, that the
particular formulation of any reference to Nastech's name in any promotional
material shall be subject to Nastech's review and consent.
2.3 The licenses granted herein shall not be sublicensed by Tzamal without the
prior written consent of Nastech, except that Tzamal shall have the right to
sub-license its rights to its wholly owned subsidiaries in Israel.
2.4 Anything herein contained to the contrary notwithstanding, Nastech shall
retain at all times during the term of this Agreement, and shall bear all costs
associated with, all rights necessary: (a) to manufacture, or to have
manufactured, the Product for Tzamal hereunder and otherwise fulfill its
obligations under this Agreement, (b) to make such changes as Nastech may deem
reasonably appropriate in connection with any differing approach to
manufacturing it may adopt in a facility(ies) in which any of the components of
the Product are produced, as long as Tzamal is furnished with necessary
regulatory documentation as to enable Tzamal to obtain required regulatory
approval prior to the introduction of any modified Product.
2.5 Tzamal shall use reasonable and adequate efforts to market the Product in
the Territory. Tzamal shall direct its marketing efforts to the Territory only
and shall refrain from seeking customers, from establishing any branch and from
maintaining any distribution depot in any country outside the Territory. Any
inquiries or orders received from customers outside the Territory, shall be
forwarded from Tzamal to Nastech, however solely for information purposes.
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3. Purchase of the Product; Other Obligations
3.1 During the term of this Agreement, Tzamal agrees to purchase from Nastech
and Nastech agrees to supply Tzamal with all of its requirements for the Product
for its subsequent use, sale, lease or transfer by Tzamal. Nastech assumes the
obligation to supply the Product to Tzamal upon firm orders given by Tzamal and
confirmed by Nastech.
3.2 Tzamal assumes the obligation to purchase and receive the Product
exclusively from Nastech. The purchase price and terms of delivery agreed
between the Parties are set out in Schedule 3.2 to this Agreement.
3.3 Upon the written request of Nastech, Tzamal shall apply for and obtain
marketing authorization for the Product in the Territory in its own name and at
its own cost. Nastech shall reasonably cooperate and provide Tzamal with such
Proprietary Information, to the extent such data presently exists and is
possessed by Nastech, as may be necessary to pursue such marketing
authorization. Tzamal will promptly provide Nastech with copies of, among other
things, all of the following documents, such list is not meant to be exhaustive:
(i) License Application, (ii) License Approval, (iii) Any communication to and
from regulatory authorities, and (iv) Marketing information relating to
reimbursement and other activities.
3.4 Nastech will make its best efforts to promptly make available to Tzamal any
documentation, clinical results, training material, marketing or promotion or
sales support documentation, developed by Nastech or by other licensees of
Nastech.
4.0 Warranties
4.1 Nastech assumes the obligation to manufacture the Product in accordance with
the health registration granted by the health authorities in the Territory for
the Product. Nastech will submit a sample of the Product to Tzamal for its
approval ("Approved Samples") and shall make available to Tzamal a certificate
of analysis for every Production batch of Product supplied to Tzamal. Nastech
warrants that the Product supplied to Tzamal will conform to the Approved
Samples and will be manufactured in accordance with applicable good
manufacturing practices as promulgated by the proper authorities within each
country of the Territory. Tzamal's sole remedy for breach of warranty shall be
to require Nastech to replace any Product that does not substantially conform to
the Approved Samples and to the registered quality of the product. For such
agreed cases the replacement or reimbursement of the rejected goods shall be
done at net costs +25%. In no event shall Nastech be liable to Tzamal for
consequential or incidental damages including, without limitation, expenditures
of any kind, loss of profits or prospective profits of any kind. Nastech HEREBY
DISCLAIMS ANY WARRANTY OTHER THAN THOSE SET FORTH ABOVE WHETHER EXPRESS OR
IMPLIED INCLUDING, WITHOUT LIMITATION, ANY
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WARRANTY OF MERCHANTABILITY OR WARRANTY THAT THE Product IS FIT FOR ANY SPECIFIC
PURPOSE.
4.2 Tzamal warrants that (i) it will not make any claim either orally or in
writing with respect to the Product which will violate any law in the Territory,
(ii) it shall store and handle the Product according to label and shipping
carton directions or as may be specified from time to time by Nastech, (iii) all
trade names and trademarks which it requests Nastech to affix to the Product are
either owned by it or it has obtained the legal right to use the same and it
agrees to indemnify and hold Nastech harmless against any claim, liability,
loss, cost, damage, amount paid in settlement and/or reasonable and actual
expense (including, without limitation, the reasonable costs of investigation
and attorney's fees incurred in litigation or otherwise) based upon the use of
any such trade name or trademark.
5.0 Insurance and Indemnification
5.1 Nastech shall name Tzamal as an additional insured on product liability
insurance it may carry, if any, and shall provide Tzamal with a certificate of
insurance so naming Tzamal as an additional insured. The foregoing shall not be
construed to require Nastech to carry Product liability insurance.
5.2 Nastech shall indemnify and hold Tzamal a harmless against any claim,
liability, loss, cost, damage, amount paid in settlement and/or reasonable and
actual expense (including, without limitation, the reasonable costs of
investigation and attorney's fees incurred in litigation or otherwise), to which
Tzamal may become subject arising out of or based upon the sale or use of any
Product manufactured by Nastech which does not conform to the Approved Samples;
provided Nastech is promptly notified of any such claim and is given the
opportunity to defend the same with counsel of its own choice.
5.3 Tzamal shall name Nastech as an additional insured on product liability
insurance it may carry, if any, and shall provide Nastech with a certificate of
insurance so naming Nastech as an additional insured. The foregoing shall not be
construed to require Tzamal to carry product liability insurance.
5.4 Tzamal shall indemnify and hold Nastech harmless against any claim,
liability, loss, cost, damage, amount paid in settlement and/or reasonable and
actual expense (including, without limitation, the reasonable costs of
investigation and attorney's fees incurred in litigation or otherwise), to which
Nastech may become subject arising out of or based upon Tzamal's promotion,
distribution or sale of the Product, including without limitation any claim made
by Tzamal with respect to the effects of the Product in the marketing of the
Product or by reason of Tzamal's failure to properly store or handle the
Product.
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5.5 The Parties shall cooperate in the defense of any claim or suits against one
of them arising out of their activities under this Agreement.
6.0 Nondisclosure
6.1 During the term of this Agreement and thereafter, for a period of three
years, Tzamal assumes the obligation to maintain in strict confidence all the
information, including but not limited to the Proprietary Information, received
from Nastech hereunder and / or contained in its documentation for government
health registration for the Product, except disclosures to government bodies for
registration purposes. Tzamal shall impose a similar secrecy obligation on its
employees, consultants and clinicians as well as on third parties to whom any
information is given for the purpose of this Agreement. Tzamal shall not sell,
disclose or otherwise make available the health registration documentation to
third parties and shall not use it outside the Territory.
6.2 The following are not subject of the secrecy-obligations hereunder:
6.2.1 information, which at the time of disclosure, is in the public
domain;
6.2.2 information, which after disclosure, becomes part of the public
domain by publication or otherwise, except by breach of this Agreement by
Tzamal;
6.2.3 information, which Tzamal can establish by competent proof, was in
Tzamal's possession at the time of disclosure by Nastech and was not acquired
either directly or indirectly from Nastech;
6.2.4 information, which Tzamal receives from a third party, provided
however, that such information was not obtained by said party directly or
indirectly from Nastech;
6.2.5 information, which Tzamal develops independently of Nastech, as
evidenced in writing.
6.3 During the period of secrecy specified under Section 6.1. Tzamal shall not
undertake, either directly or indirectly, to develop the manufacture of the
Product based on Nastech's confidential information or otherwise.
7.0 Additional Covenants and Agreements of the Parties
7.1 No liability shall result from delay in performance in whole or in part
hereunder by the occurrence of a contingency, the nonoccurrence of which is
basic assumption on which this Agreement is made, including, but not limited to,
acts of God, fire, flood, accident, riot, war,
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sabotage, strike, labor trouble, supply shortage or embargo. If any such
circumstances affect only a part of Nastech's capacity tp perform, quantities
affected by this section may, at the option of either party, be eliminated from
the Agreement without liability, but the Agreement shall remain otherwise
unaffected. A party shall be excused from performance under this Agreement to
the extent that and for so long as such performance is substantially hindered or
prevented by causes beyond its reasonable control; provided, however, that this
Section shall not be construed to excuse performance unless prompt written
notice of such inability xxx perform is given to the other party.
7.2 Tzamal and Nastech shall jointly develop written procedures and define
responsibilities for (i) the reporting of adverse drug experiences, (ii) the
administration and analysis of and response to complaints concerning the
Product, and (v) the development of training materials related to the Product.
Tzamal and Nastech shall each comply with the provisions of such written
procedures.
7.3 Tzamal and Nastech shall each comply with all laws and regulations
applicable to manufacturing, marketing and selling the Product in the Territory
and the performance of their respective obligations hereunder. Nastech and
Tzamal each shall keep all records and reports required to be kept by applicable
laws and regulations, and each shall make its facilities available at reasonable
times during business hours for inspection by representatives of governmental
agencies. Nastech and Tzamal each shall notify the other within twenty-four (24)
hours of receipt of any notice or any other indication whatsoever of any
governmental agency inspection, investigation or other inquiry, or other
material notice or communication of any type, involving the Product. Tzamal and
Nastech shall cooperate with each other during any such inspection,
investigation or other inquiry including, but not limited to, allowing upon
request a representative of the other to be present during the applicable
portions of any such inspection, investigation or other inquiry and providing
copies of all relevant documents.
7.4 If either party shall become engaged in or participate in any investigation,
claim, litigation or other proceeding with any third party, relating in any way
to the Product, the other party shall cooperate in all reasonable respects with
such party in connection therewith, including, without limitation, using its
reasonable efforts to make available to the other such employees who may be
helpful with respect to such investigation, claim, litigation or other
proceeding, provided that, for purposes of this provision, reasonable efforts to
make available any employee shall be deemed to mean providing a party with
reasonable access to any such employee at no cost for a period of time not to
exceed 24 hours (e.g., three 8-hour business days). Thereafter, any such
employee shall be made available for such time and upon such terms and
conditions (including, but not limited to, compensation) as the parties may
mutually agree.
7.5 Nastech and Tzamal shall each bear their own direct and indirect expenses
incurred in connection with the negotiation and preparation of this Agreement
and, except as set forth in this Agreement, the performance of the obligations
contemplated hereby.
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7.6 Nastech and Tzamal each hereby agrees to use all reasonable efforts to take,
or cause to be taken, all actions and to do, or cause to be done all things
necessary or proper to make effective the transactions contemplated by this
Agreement, including such actions as may be reasonably necessary to obtain
approvals and consents of governmental applicable governmental agencies.
8.0 Duration and Termination
8.1 This Agreement shall commence on the Effective Date and shall thereafter
remain in force, unless terminated prematurely by mutual agreement, up to and
including December 31 of the third year following the receipt of license from
Israel Health Authorities. The Agreement shall thereafter be automatically
renewed for another period of two (2) years each time, unless terminated by
either Party giving twelve (12) months notice in writing to the other Party
before the expiry of the initial third (3) year period or any subsequent
extension. Notwithstanding the foregoing, this Agreement may be terminated
prematurely as follows:
8.1.1 If either Nastech or Tzamal makes a general assignment for the
benefit of creditors or becomes insolvent; (ii) files an insolvency petition in
bankruptcy; (iii) petitions for or acquiesces in the appointment of any
receiver, trustee or similar officer to liquidate or conserve its business or
any substantial part of its assets; (iv) commences under the laws of any
jurisdiction any proceeding involving its insolvency, bankruptcy,
reorganization, adjustment of debt, dissolution, liquidation or any other
similar proceeding for the release of financially distressed debtors; or (v)
becomes a party to any proceeding or action of the type described above in (iii)
or (iv) and such proceeding or action remains undismissed or unstayed for a
period of more than 60 days, then the other party may by written notice
terminate this Agreement in its entirety with immediate effect.
8.1.2 Nastech and Tzamal each shall have the right to terminate this
Agreement for default upon the other's failure to comply in any material respect
with the terms and conditions of this Agreement. At least 30 days prior to any
such termination for default, the party seeking to so terminate shall give the
other written notice of its intention to terminate this Agreement in accordance
with the provisions of this Section 8.1.2, which notice shall set forth the
default(s) which form the basis for such termination. If the defaulting party
fails to correct such default(s) within 30 days after receipt of notification,
or if the same cannot reasonably be corrected or remedied within 30 days, then
if the defaulting party has not commenced curing said default(s) within said 30
days and be diligently pursuing completion of same, then such party immediately
may terminate this Agreement.
8.1.3 Termination of this Agreement for any reason shall not relieve the
parties of any obligation accruing prior thereto with respect to the Product and
any ongoing obligations hereunder with respect to the remaining Product and
shall be without prejudice to the rights and remedies of either party with
respect to any antecedent breach of the provisions of this Agreement.
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Without limiting the generality of the foregoing, no termination of this
Agreement, whether by lapse of time or otherwise, shall serve to terminate the
obligations of the parties hereto under Sections 5.0, 6.0, 7.0, 8.0 and 9.0
hereof, and such obligations shall survive any such termination.
9.0 General Provisions
9.1 This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and permitted assigns; provided,
however, that neither Nastech nor Tzamal may assign any of its rights, duties or
obligations hereunder without the prior written consent of the other, which
consent shall not be unreasonably withheld, except that no prior written consent
shall be required in the event that a third party acquires substantially all of
the assets or outstanding shares of, or merges with, Tzamal or Nastech, as the
case may be.
9.2 All notices or other communications required or permitted to be given
hereunder shall be in writing and shall be deemed to have been duly given if
delivered by hand or facsimile and confirmed in writing, or mailed first class,
postage prepaid, by registered or certified mail, return receipt requested
(mailed notices and notices sent by facsimile shall be deemed to have been given
on the date received) as follows:
If to Nastech, as follows:
Nastech Pharmaceutical Company Inc.
00 Xxxxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Facsimile: 000-000-0000
Attention: President
If to Tzamal, as follows:
Tzamal Pharma Ltd.
21 Gonen Xx.
Xxxxxx Xxxxxxx
Xxxxx-Xxxxx
00000, Xxxxxx
Facsimile: 011 972 3 9240259
Attention: President
or in any case to such other address or addresses as hereafter shall be
furnished as provided in this Section 9.2 by any party hereto to the other
party.
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9.3 Any term or provision of this Agreement may be waived at any time by the
party entitled to the benefit thereof by a written instrument executed by such
party. No delay on the part of Nastech or Tzamal in exercising any right, power
or privilege hereunder shall operate as a waiver thereof, nor shall any waiver
on the part of either Nastech or Tzamal of any right, power or privilege
hereunder operate as a waiver of any other right, power or privilege hereunder
nor shall any single or partial exercise of any right, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder. The indemnification provided in
Section 5.0 shall be the sole remedy available for any damages arising out of or
in connection with this Agreement except for any rights or remedies which the
parties hereto may otherwise have in equity.
9.4 The parties hereto are independent contractors, and nothing contained in
this Agreement shall be deemed to create the relationship of partners, joint
venturers, or of principal and agent, franchisor and franchisee, or of any
association or relationship between the parties other than as expressly provided
in this Agreement. Tzamal acknowledges that it does not have, and Tzamal shall
not make representations to any third party, either directly or indirectly,
indicating that Tzamal has any authority to act for or on behalf of Nastech or
to obligate Nastech in any way whatsoever. Nastech acknowledges that it does not
have, and it shall not make any representations to any third party, either
directly or indirectly, indicating that it has any authority to act for or on
behalf of Tzamal or to obligate Tzamal in any way whatsoever.
9.5 This Agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all prior agreements or
understandings of the parties relating thereto.
9.6 This Agreement may be modified or amended only by written agreement of the
parties hereto.
9.7 This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original but all of which together shall constitute a single
instrument.
9.8 This Agreement shall be governed and construed in accordance with the laws
of the State of New York excluding any choice of law rules which may direct the
application of the law of another state.
9.9 Any dispute, controversy or claim arising out of or in connection with this
Agreement shall be determined and settled by arbitration in New York, New York,
pursuant to the Rules of Arbitration then in effect of the American Arbitration
Association. Any award rendered shall be final and conclusive upon the parties
and a judgment thereon may be entered in a court having competent jurisdiction.
Any arbitration hereunder shall be (i) submitted to an arbitration tribunal
comprised of three (3) independent members knowledgeable in the pharmaceutical
industry, one
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of whom shall be selected by Tzamal, one of whom shall be selected by Nastech,
and one of whom shall be selected by the other two arbitrators; (ii) allow for
the parties to request discovery pursuant to the rules then in effect under the
Federal Rules of Civil Procedure for a period not to exceed 90 days; and (iii)
require the award to be accompanied by findings of fact and a statement of
reasons for the decision. Each party shall bear its own costs and expenses,
including attorney's fees incurred in any dispute which is determined and/or
settled by arbitration pursuant to this Section. Except where clearly prevented
by the area in dispute, both parties agree to continue performing their
respective obligations under this Agreement while the dispute is being resolved.
Arbitration shall not prevent any party from seeking injunctive relief where
such remedy is an appropriate form of remedy under the circumstances.
9.10 All section titles or captions contained in this Agreement, in any Schedule
referred to herein or in any Exhibit annexed hereto, and the table of contents,
if any, to this Agreement are for convenience only, shall not be deemed a part
of this Agreement and shall not affect the meaning or interpretation of this
Agreement.
9.11 No provision of this Agreement shall be deemed or construed in any way to
result in the creation of any rights or obligation in any person not a party or
not affiliated with a party to this Agreement.
9.12 If any provision of this Agreement is found or declared to be invalid or
unenforceable by any court or other competent authority having jurisdiction,
such finding or declaration shall not invalidate any other provision hereof, and
this Agreement shall thereafter continue in full force and effect.
9.13 All Schedules, Exhibits and other attachments to this Agreement are by this
reference incorporated herein and made a part of this Agreement.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered on the day and year first above written.
NASTECH PHARMACEUTICAL
COMPANY INC.
By:
--------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
TZAMAL PHARMA LTD.
By:
--------------------------------
Name: Xxxx Xxxxxxxxx
Title: General Manager
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SCHEDULE 3.2
Purchase Price and Terms
The following terms and conditions complete Section 3.2 of the License and
Supply Agreement as follows:
Nascobal is available for supply in trade units of 5 ml bottles, equivalent to 8
doses, unlabeled on both the inner and outer package. There is no patient
information or package insert. Sample units will be labeled with labeling
provided by Tzamal and indicated as "Medical Samples - Not For Sale".
Firm orders shall be placed by Tzamal at least (3) months before required
delivery date and shall be subject to confirmation by Nastech. Minimum order
quantity of 1,000 units.
All costs, other than product manufacturing costs, to be incurred by Tzamal.
Pre-Payment: US $5,000 - payable upon submission of first order.
Unit Price: US $23.00 trade units, $6.50 sample units.
Launch Year Minimum Quantities: For the first twelve (12) months from Launch
Date (100%) percent of the volume forecast shall be guaranteed by Tzamal.
Marketing Support: Nastech agrees to provide Tzamal with US $4.00 per bottle
contribution for market materials to support the successful introduction and
on-going acceptance of Nascobal in the Israeli market.
Delivery Terms: FOB Nastech warehouse (common carrier).
Payment Terms: Invoices are payable net without discount in US $ within 90 days
after the date of invoice. Interest shall be paid on overdue amounts at a rate
of four (4%) percent over the prime rate of interest as announced and in effect,
from time to time, by the Chase Manhattan Bank.
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