Exhibit 10.4
[***] TEXT OMITTED AND FILED SEPARATELY
CONFIDENTIAL TREATMENT REQUESTED
LICENSE, RESEARCH AND DEVELOPMENT AGREEMENT
This License, Research and Development Agreement is made as of January 12,
2001, by and between DOV Pharmaceutical, Inc., a Delaware corporation having its
principal place of business at 000 Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxxxx,
X.X.X. 00000 ("DOV"), and Biovail Laboratories Incorporated, a Barbados
corporation whose head office is located at Xxxxxxxx Xxxx, Xxxxxxxx 0, Xxxxxxxxx
Xxxx, Xx. Xxxxxxx BH1, Barbados, West Indies ("BIOVAIL").
RECITALS
WHEREAS, DOV owns the DOV Patent and has represented to Biovail that DOV
has acquired and developed expertise, proprietary know-how and technology
relating to extended release formulations of diltiazem;
WHEREAS, Biovail has represented to DOV that it has acquired and developed
expertise, know-how and technology relating to the formulation of controlled
release medicines, including diltiazem, and has expertise in the
commercialization of such medicines throughout the world;
WHEREAS, DOV and Biovail have agreed to work together to formulate,
research, clinically develop, manufacture, obtain marketing authorization and
market the Products on the terms set forth in or contemplated to be established
pursuant to this Agreement;
WHEREAS, Biovail desires to obtain, and DOV is willing to grant to
Biovail, an exclusive license under the DOV Intellectual Property on the terms
and conditions set forth in this Agreement;
NOW THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, the Parties hereby agree as follows:
ARTICLE I - INTRODUCTORY PROVISIONS
SECTION 1.1. DEFINED TERMS. THE FOLLOWING TERMS, WHEN USED IN CAPITALIZED
FORM IN THIS AGREEMENT, SHALL HAVE THE MEANINGS SET FORTH BELOW:
(a) "AFFILIATE" when used with reference to a Party means any
entity controlling, controlled by or under common control with such Party.
For purposes hereof, "CONTROL" shall mean ownership, directly or
indirectly, of more than 50% of the securities having the right to vote
for election of directors in the case of a corporation, and more than 50%
of the beneficial interest in the capital in the case of an entity other
than a corporation. Affiliate shall also include a joint venture partner.
(b) "AGREEMENT" means this license, research and development
agreement including all schedules and exhibits thereto; and "HEREOF,"
"HERETO" and
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"HEREUNDER" and similar expressions mean and refer
to this Agreement and not solely to any particular article or section
hereof.
(c) "BEST EFFORTS" means those efforts including incurrence of
expensesdirected toward a determined objective that would be made by a
reasonably prudent company acting in good faith and in the exercise of
reasonable commercial judgment with reference to the practice, process and
speed normally found in the pharmaceutical industry.
(d) "CALENDAR QUARTER" means each three-month period ending on
March 31, June 30, September 30 and December 31.
(e) "COMMITTEE" has the meaning set forth SECTION 3.2(a) of
this Agreement.
(f) "CONFIDENTIAL INFORMATION" means all information and data,
in any form, including any information or data on chemical structures,
unpublished clinical trial results, diagnoses, mechanisms of action,
analytical techniques, chemical syntheses, manufacturing processes,
markets, customers, suppliers, patents or patent applications, inventions,
know-how, trade secrets, products, procedures, designs, formulas, business
plans, financial projections, and other aspects of a Party's present or
future business, the secrecy of which confers a competitive advantage upon
that Party or that is clearly marked by such Party as confidential.
(g) "DEVELOPMENT COSTS" means those expenses and costs
approved by the Committee for the development of the Product including
those costs and expenses:
(i) incurred by DOV in connection with the performance
of DOV obligations under the Development Program
(including overhead allocated in accordance with
generally accepted accounting principles but
without further xxxx-up); and
(ii) incurred by or to be charged to Biovail in
connection with the conducting of clinical trials
pursuant to SECTION 3.4.
(h) "DEVELOPMENT PROGRAM" has the meaning set forth in SECTION
3.2(b) of this Agreement.
(i) "DOV INTELLECTUAL PROPERTY" means the DOV Know-How and the
DOV Patent.
(j) "DOV KNOW-HOW" means all Confidential Information
furnished by DOV pursuant to SECTION 2.3 that is owned or controlled by or
licensed (with right of or consent to sublicense) to DOV as of the date
hereof or at anytime during the term of
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this Agreement, including Improvements, and that is necessary to or useful
in the formulation, development, manufacture, use or sale of the Product.
(k) "DOV PATENT" means, subject to SECTION 7.1, that patent
for extended release formulation of diltiazem hydrochloride, U.S. patent
no. 6,162,463, issued to Xxxxxx Xxxxx on December 19, 2000, and assigned
to DOV, any continuations, continuations in part, re-issues or extensions
of that patent, and all corresponding foreign patents and patent
applications.
(l) "FDA" means the United States Food and Drug Administration
or any successor thereto.
(m) "FORCE MAJEURE" has the meaning set forth in SECTION 11.1
of this Agreement.
(n) "IMPROVEMENTS" means any discoveries, inventions,
formulations, processes, methods, know-how, techniques, formulae,
compositions, compounds, or applications etc., relating to the DOV
Intellectual Property made by or licensed to DOV or Biovail during the
term of this Agreement.
(o) "MANUFACTURE" means to process, prepare, make, test,
package or label the Product, and "MANUFACTURING" and "MANUFACTURED" have
a corresponding meaning.
(p) "MARKET" means to promote, distribute, test, market,
advertise, sell or offer to sell, and "MARKETING" and "MARKETED" have a
corresponding meaning.
(q) "MARKETING AUTHORIZATION" means any authorization that is
legally required under applicable laws, regulations or administrative
decisions to Manufacture or Market the Product in any country including
any governmental price approval or reimbursement approved under a national
health insurance system.
(r) "NET SALES" means the gross sale price of all Products
sold by Biovail, its Sublicensees and their respective Affiliates to arm's
length purchasers, as reflected in invoices issued by all such sellers
during the period in question, but excluding sales by Biovail to an
Affiliate or Sublicensee for resale to such purchasers, and further
excluding the price of samples sold by Biovail to an Affiliate or
Sublicensee, less
(i) royalties not to exceed [***]%, except with the
approval of DOV not unreasonably withheld, payable
by Biovail to persons other than DOV and Biovail
Affiliates in respect of the Products;
(ii) credit for returns, including withdrawals and
recalls;
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(iii) sales rebates or price adjustments allowed or
paid;
(iv) distributors', wholesalers' or trade discounts or
rebates, and rebates actually paid to customers
for distribution services;
(v) transportation charges separately itemized;
(vi) volume discounts to the extent not reflected in
the invoiced price;
(vii) sales, value-added and other taxes payable by the
buyer and included in the invoiced price; and
(viii) customs duties related to such sales.
(s) "PARTY" means, as the context requires, DOV or Biovail,
and "PARTIES" means both of them.
(t) "PRODUCT" means any extended release formulation of
diltiazem using or based upon, directly or indirectly, the DOV
Intellectual Property, but in all instances using or based upon, directly
or indirectly, a valid claim of the DOV Patent or any other patent covered
by ARTICLE VII, and when used herein, the phrase "THE PRODUCT" refers to
the Product in question.
(u) "REGULATORY AUTHORITY" means, in respect of any country,
any agency responsible for the issuance of Marketing Authorizations for
pharmaceutical products manufactured or marketed in or sold from that
country.
(v) "SUBLICENSEE" means any person sublicensed by Biovail
under this Agreement to Manufacture and/or Market the Product, and
"SUBLICENSE" has a corresponding meaning.
(w) "SUPPORTING DATA" means all data and information owned or
controlled by either Party relating to (i) the pharmacological or
toxicological properties of any Product, (ii) any pre-clinical or clinical
testing and experience in relation to any Product and (iii) the chemical
composition, manufacturing processes and quality control testing of any
Product, to the extent reasonably required for purposes of any application
for Marketing Authorization. Supporting Data shall also include copies of
annual reports, integrated study reports, protocols for clinical research
and pre-clinical studies, protocol changes and amendments, safety data,
contract research organization databases, case report forms and access to
patient records, toxicity, safety and metabolism reports and data, and
pharmacokinetic data and reports owned or controlled by DOV or a
sublicensee of DOV and relating to any Product that would be useful for a
person pursuing clinical research and regulatory approval, or that would
typically be part of any submission to a Regulatory Authority for the
purpose of obtaining approval of a Product for the indication in question.
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ARTICLE II - LICENSE TERMS
SECTION 2.1. LICENSE GRANT TO BIOVAIL. Subject to the terms and conditions
of this Agreement, DOV hereby grants to Biovail an exclusive, worldwide license
under the DOV Intellectual Property including an exclusive license to all
substantial rights under the DOV Patent to Manufacture and Market the Product in
the field, with a right to grant Sublicenses in accordance with SECTION 2.2.
Such license includes the right to bring or defend any legal action considered
necessary by Biovail to protect its interest under the DOV Intellectual
Property. For purposes of this SECTION 2.1, "FIELD" means drug formulations for
the treatment, including suppression of angina and hypertension, of any disease
or medical condition.
SECTION 2.2. SUBLICENSES.
(a) The rights granted to Biovail by this Agreement include
the right, subject to SECTION 2.2(b), to grant to any Affiliate of Biovail
or any third party financially capable of carrying out its obligations
hereunder, on notice in writing to DOV, sublicense rights of the same
(except for the right to grant further sublicenses) or narrower scope as
the license granted to Biovail pursuant to SECTION 2.1, provided that such
Sublicensee agrees to be bound by this Agreement.
(b) Biovail shall not Sublicense the rights under the DOV
Intellectual Property granted pursuant to SECTION 2.1 unless Biovail gives
DOV notice of the identity of the Sublicensee at least 14 days prior to
the grant of the Sublicense with the right of DOV to object to such
Sublicensee within 7 days and to have its objections taken into account in
good faith, and provided that the Sublicense is in writing and (i)
includes provisions that, in Biovail's good faith business judgment,
require the Sublicensee to use Best Efforts to bring the subject matter of
the Sublicense into commercial use as quickly as is reasonably possible;
(ii) provides for payments to Biovail that, in Biovail's good faith
business judgment, are commercially reasonable amounts for the rights
granted; and (iii) prohibits further Sublicensing except with DOV's prior
written consent.
(c) At the request of Biovail, and provided that its
objections if any were taken into. account in good faith, DOV shall
confirm to any such Sublicensee the fact that Biovail has the authority to
grant such a Sublicense.
SECTION 2.3. TRANSFER OF THE DOV PATENT, SUPPORTING DATA AND DOV KNOW-HOW.
No later than 15 days after the date hereof, DOV shall provide to Biovail copies
of the DOV Patent, any Supporting Data then in the possession of DOV, and any
DOV Know-How, that has not previously been furnished to Biovail.
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ARTICLE III - PRODUCT FORMULATION, RESEARCH AND
DEVELOPMENT
SECTION 3.1. PRODUCT DEVELOPMENT. Biovail and DOV shall use their joint
Best Efforts to develop a Product in accordance with the provisions of this
Agreement. Subject to the other provisions of this Agreement and to the
establishment of the Development Program:
(a) Biovail shall be responsible for the development of
formulations of the Product in accordance with SECTION 3.3. DOV shall
provide to Biovail all its technical expertise reasonably required by
Biovail for that purpose.
(b) Provided that Biovail has developed formulations of the
Product that meet Committee approval, DOV shall be responsible for
conducting of clinical testing of the Product in accordance with SECTION
3.4.
(c) Provided that DOV has successfully completed the required
clinical testing of the Product, Biovail shall be responsible for the
preparation, filing and prosecution of Marketing Approvals in accordance
with the provisions of ARTICLE VI of this Agreement.
SECTION 3.2. JOINT OVERSIGHT COMMITTEE.
(a) Within 60 days of the date hereof, the Parties shall form
a joint oversight committee (the "COMMITTEE") to manage their
collaborative efforts with respect to the Products. The Committee shall be
comprised of an equal number of not less than two members designated by
each of DOV and Biovail, and shall meet on a regular basis, no less than
quarterly; at locations alternating between DOV and Biovail or any
Affiliate of Biovail, or at such other facility or location as may be
agreed to by the Parties. Major decisions of the Committee, including all
budget and other financial decisions, shall be taken by a majority vote of
all members of the Committee whether present or not.
(b) The Committee shall establish a detailed development
program (the "DEVELOPMENT PROGRAM") for the Products, to be consistent
with the provisions of this Agreement and mutually agreed to by DOV and
Biovail, within 60 days after its formation. The Development Program shall
allocate responsibilities consistent with this Agreement with respect to
all facets of formulation, research and clinical development of the
Product and shall include budgets and timelines therefor to be updated
annually or more frequently as required.
(c) Biovail shall report regularly to the Committee, and take
into account to the extent practicable its comments, with respect to the
status of applications for Marketing Authorizations, and with respect to
the Manufacturing and Marketing of the Product once those authorizations
are obtained.
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SECTION 3.3. PRODUCT FORMULATION. As soon as reasonably possible after (i)
DOV has complied with its obligations under SECTION 2.3 and (ii) the Committee
has established and approved timelines and budgets within the Development
Program for the development of the Product, Biovail shall at its expense
commence the development of formulations of the Product in all required dosage
strengths. DOV shall provide to Biovail such assistance in the development of
such formulations as Biovail may reasonably require.
SECTION 3.4. CLINICAL DEVELOPMENT AND FUNDING. Provided that Biovail has
successfully completed the development of formulations of the Product pursuant
to SECTION 3.3, the Committee shall establish budgets within the Development
Program for pre-clinical and clinical development studies and trials necessary
to obtain Marketing Authorization for the Product. DOV shall, subject to receipt
of Biovail's expense advances provided for in this SECTION 3.4, use its Best
Efforts to carry out all such pre-clinical and clinical development trials.
Biovail shall make quarterly payments to DOV in advance, in accordance with
SECTION 5.6, in the amount of Development Costs expected to be incurred by DOV
in each Calendar Quarter, as set forth in the budgets included in the
Development Program. Any overpayment by Biovail shall be credited to Biovail and
applied to the quarterly payment following determination of such credit.
Biovail's obligation under this SECTION 3.4 to fund the Development Costs
without contribution from DOV shall be capped at $6 million for the clinical
development of one indication, either anti-angina or suppression of
hypertension, for the first Product chosen by the Committee for clinical
development and any additional funding required for any other indication
pursuant to the Development Program and approved by the Committee shall be borne
equally by DOV and Biovail. If either Biovail or DOV fails to meet its payment
obligations under this SECTION 3.4, DOV or Biovail, as the case may be, may,
without waiver of its rights under SECTION 12.2, conditionally contribute the
defaulting Party's contribution, in which case the royalties payable pursuant to
SECTION 5.3 shall be [***] in the case of DOV or [***] in the case of Biovail to
the extent necessary to match at [***]% per annum the extra contribution made by
the non-defaulting Party.
SECTION 3.5. USE OF BIOVAIL'S CONTRACT RESEARCH DIVISION. DOV, acting as
contract research organization, shall use Biovail's contract research division
and phase 1 facility at Biovail's normal commercial rates for required clinical
development studies and trials contemplated by SECTION 3.4, unless it is
determined by the Committee that such development work can be conducted in a
qualified manner by another company at lower rates, in which case DOV shall
contract with such company to conduct such developmental work in accordance with
a budget to be approved by the Committee.
SECTION 3.6. NONCOMPETITION. Neither Biovail nor DOV shall, nor shall
either permit any Affiliate or sublicensee to, formulate, research, develop,
obtain Marketing Authorizations, Manufacture or Market, itself or with any third
party, any compound covered by the DOV Intellectual Property, provided that
Biovail or any such Affiliate or Sublicensee may carry out such activities,
itself or with any third party, with respect to those compounds containing
extended release formulations of diltiazem, but not using any improvement to the
DOV Intellectual Property, that are currently being marketed by such entity or
are in development as of the date hereof [***] drug currently being developed by
Biovail or any Affiliate or Sublicensee and furnished to DOV in writing as soon
as practicable but no later than 30 days after the date
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material has been separately filed with the Securities and Exchange
Commission.
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hereof. All such information provided by Biovail to DOV pursuant to this SECTION
3.6 shall be deemed to be Confidential Information.
ARTICLE IV - PRODUCT MARKETING AND MANUFACTURE
SECTION 4.1. EFFORTS TO COMMERCIALIZE. Provided that there are no legal or
regulatory impediments to any application for Marketing Authorization, and
further provided that each of Biovail and DOV have successfully completed the
development of a Product pursuant to ARTICLE III, Biovail shall use its Best
Efforts to obtain Marketing Authorization for that Product. Once Marketing
Authorization has been obtained for a Product, Biovail shall at its expense use
its Best Efforts to Manufacture and Market such Product provided that it is then
commercially reasonable to do so. Biovail shall not be obligated to Manufacture
or Market the Product if it is not protected by a valid claim under the DOV
Patent.
SECTION 4.2. DOV PROMOTION OPTION. DOV shall have the right upon notice to
Biovail to co-promote any Product using its own resources or a third party sales
force. Such copromotion shall be subject to the terms of a separate co-promotion
agreement between the Parties negotiated in good faith. If DOV has the right
pursuant to 12.2(a) to terminate it may, in lieu of such right, and following
the grant of Marketing Authorization promote the Product itself or through
Affiliates or sublicensees independent of a separate co-promotion agreement,
provided that in such case DOV shall pay to Biovail a royalty of [***]% of Net
Sales of the Product.
SECTION 4.3. COMPLIANCE WITH LAWS. Biovail shall ensure that the
Marketing, promotion and sale of the Products complies with the requirements of
any applicable Marketing Authorization, and with all other applicable legal and
regulatory requirements.
SECTION 4.4. PATENT MARKING. Biovail shall xxxx and cause any Affiliate or
Sublicensee to xxxx the Product Manufactured or Marketed by it or them with any
notice of patent rights necessary or desirable under applicable legal and
regulatory requirements to enable the patent rights to be enforced to the
maximum degree in any country where the Product is Manufactured or Marketed.
ARTICLE V - LICENSE FEE, MILESTONES AND ROYALTIES
SECTION 5.1. LICENSE FEE. In addition to amounts specified in SECTION 3.4,
Biovail shall pay to DOV, in consideration of the exclusive rights granted to
Biovail by this Agreement, a fee of U.S. $7,500,000 upon execution and delivery
of this Agreement.
SECTION 5.2. MILESTONE PAYMENTS. In further consideration of the exclusive
rights granted to Biovail by this Agreement, Biovail shall pay to DOV the
following milestone payments upon the attainment of the events set forth below,
not to exceed $10 million in the aggregate. Such payments shall be made once
with respect to events nos. 1(a) and 1(b) and once with respect to event no. 2,
each within 30 days after the occurrence of the applicable event:
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Commission.
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Amount
Event (U.S. Dollars)
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1(a). If the indication developed is for the
treatment of angina, clinical demonstration
of statistically significant superiority for
suppression of angina for all required strengths
of the Product over currently marketed
extended release diltiazem formulations [***]
1(b). If the indication developed is for
the treatment of hypertension, upon clinical
demonstration of net overall statistical equivalency
for suppression of hypertension for all required strengths
of the Product over currently marketed extended
release diltiazem formulations [***]
2. Upon the grant of Marketing Authorization in
the United States of America [***]
SECTION 5.3. ROYALTIES. Biovail shall pay to DOV a royalty in respect of
all Net Sales of each Product, at the following royalty rates:
(a) [***] % of the Net Sales of the Product made by Biovail or
an Affiliate, and
(b) [***] % of the Net Sales of the Product by a
non-Affiliated Sublicensee,
provided that royalties shall not be payable to DOV in respect of sales of
currently marketed [***] or any modifications to any of those products
resulting solely from changes or variations in, or modifications to, the
manufacturing processes by which any of them is made.
SECTION 5.4. REPORTS AND ERRORS.
(a) Each royalty payment shall be accompanied by a report and
signed by an authorized senior officer of Biovail for the applicable
period setting forth, in reasonable detail, and with itemized deductions,
the quantity of the Product sold, used, or otherwise disposed of, Net
Sales of the Product including the accounting determinations leading
thereto and the calculated royalty payable for the period. Biovail shall
keep and shall cause its Affiliates or sublicensees to keep accurate
records and books of account of all Product manufactured and sold.
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material has been separately filed with the Securities and Exchange
Commission.
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(b) Upon 10 days' prior notice to Biovail and during normal
business hours, but not more frequently than twice per year, DOV may cause
an independent auditor paid for and selected by DOV (which selection shall
be reasonably acceptable to Biovail) to inspect such records and books of
Biovail and any Affiliate or Sublicensee marketing Products at their
respective facilities for the three-year period immediately preceding the
date of inspection to verify the correctness of the reports given to DOV
under SECTION 5.4(a). Only one audit may be conducted in respect of any
Calendar Quarter. The auditor's report shall be confined to the matters
required to be reported by Biovail to DOV pursuant to SECTION 5.4(a). If
the auditor determines that actual Net Sales exceed 105% of Net Sales
reported, Biovail shall reimburse DOV for the costs of the audit.
(c) If such an audit determines that an error in the royalty
calculation and payment by Biovail has been made, DOV shall immediately
notify Biovail of the nature of the error and if (i) the error has
resulted in an underpayment of royalty by Biovail, it shall pay the
balance due within 10 days of its receipt of notice from DOV, and (ii) if
the error has resulted in an overpayment of royalty by Biovail, DOV shall
so advise Biovail, which may deduct it from the next quarterly payment,
provided that if such overpayment exceeds $10,000, DOV shall within 10
days return the overpayment to Biovail.
SECTION 5.5. TAXES. Biovail, if required so to do by any applicable tax
law, may deduct any governmental withholding tax required to be deducted by it
on payment of royalties under SECTION 5.3 or on payment of any of the
Development Costs set out in SECTION 3.4, but shall account to the relevant tax
authorities for the sum so deducted and provide DOV with proof of such payment
from such authorities. Biovail shall provide reasonable assistance to DOV in
securing any benefits available to DOV with respect to governmental tax
withholdings by any relevant law or double tax treaty.
SECTION 5.6. PAYMENTS. All payments hereunder shall be made in U.S.
dollars and by wire transfer to a bank account designated by DOV. For purposes
of determining the amount of Net Sales during any Calendar Quarter, all sales in
each other currency during such quarter shall be converted into dollars at the
rate in effect at the time such payment is due and payable hereunder, as then
reported by the Wall Street Journal. Any overdue amounts hereunder shall bear
interest at the lesser of 8% per annum and the maximum legal interest rate.
ARTICLE VI - REGULATORY MATTERS
SECTION 6.1. MARKETING AUTHORIZATIONS. Biovail shall be responsible for
obtaining all Marketing Authorizations for the Product as the Committee may
determine should be obtained, in Biovail's own name and at its own expense. To
the extent permitted by law, DOV shall promptly take all necessary actions with
the applicable Regulatory Authorities to name Biovail as the applicant on all
active investigatory new drug applications, new drug applications or abbreviated
new drug applications for the Products and shall provide Biovail with a right of
reference and access to any and all Supporting Data owned or controlled by DOV,
solely for Biovail's regulatory purposes.
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SECTION 6.2. OTHER INFORMATION AND DATA. Each Party shall provide to the
other Party complete and accurate copies of all documentation containing
Supporting Data, adverse experience data (as defined below) and other data
relating to the Products prepared or acquired by such Party or any of its
respective Affiliates or sublicensees during the term of this Agreement. Copies
of Supporting Data shall be forwarded within 30 days after prepared or acquired.
Copies of adverse experience data shall be forwarded by facsimile or courier as
quickly as may be necessary to permit the recipient to comply with any
applicable legal requirements and in no event later than the earlier of 7
calendar days after such data is prepared or acquired and the date such data is
provided to any Regulatory Authority. As used herein, the phrase "ADVERSE
EXPERIENCE DATA" shall mean all data concerning any serious or unexpected
adverse effects, sideeffects and contraindications of any Product that come to
the attention of either Party, its Affiliates or sublicensees and of such a
nature and magnitude that it is required under the laws of the country to be
collected, maintained and reported to the appropriate Regulatory Authority.
ARTICLE VII - INTELLECTUAL PROPERTY
SECTION 7.1. JOINT IMPROVEMENTS. Any Improvement resulting from the
Parties' joint efforts under this Agreement (including an invention in which one
or more inventors from DOV and Biovail, including individuals normally obliged
to assign an invention to a Party, have made an inventive contribution as
determined by U.S. patent law), and any patents issuing in respect of any such
invention, shall be issued in the name of Biovail but shall be jointly and
co-equally owned by DOV and Biovail and Biovail shall provide such documentation
relating to DOV's coownership as may be reasonably requested. No such patent may
be licensed to any other person without the consent of Biovail. All such patents
and patent applications shall be deemed to be a DOV Patent for all purposes of
this Agreement.
SECTION 7.2. IMPROVEMENTS MADE BY OR FOR ONE PARTY. Any Improvement under
this Agreement that is made by one of the Parties without the assistance of the
other, and any patents issued in respect of any such invention, shall be owned
by the Party making that Improvement. The Parties shall negotiate in good faith
for the inclusion in the license grant hereunder of any such patent owned by
DOV. Neither Party shall use a patent applied for by it prior to the Marketing
of the Product by Biovail to interfere with such Marketing.
SECTION 7.3. PATENT PROTECTION. Biovail shall use Best Efforts in the
preparation, prosecution and maintenance (subject to SECTION 7.4 and SECTION
7.6) of any patents and any patent applications relating to any Product
(including any joint inventions as set forth in SECTION 7.1) that the Committee
elects to file and prosecute including any revisions, continuations, divisions
or re-issues. Biovail shall provide to DOV copies of relevant patent documents
within 30 days of Biovail receiving such documents. The cost of the preparation,
filing and prosecution of any patent application that the Committee determines
should be filed shall be borne equally by DOV and Biovail. Each Party shall
ensure that its employees and consultants assign to it all patent rights
relating to any inventions. With regard to any patent application based upon
Improvements pursuant to SECTION 7.1 that the Committee determines not to file,
the Parties shall negotiate in good faith as to which Party will be entitled to
file such application and on what terms, and with regard to any patent
application for Improvements pursuant to SECTION 7.2, the
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Party responsible for such Improvement may at its own expense prepare, file and
prosecute any patent application.
SECTION 7.4. PATENT INFRINGEMENT ALLEGATIONS.
(a) If any person alleges that the practice of the DOV
Intellectual Property or any portion thereof or that the Manufacture or
Marketing of any Product infringes any patent or any other intellectual
property rights of any other person, Biovail shall defend against any such
action including by defending the DOV Patent in the United States and
elsewhere from any attacks, affirmative defenses, counterclaims, and
declaratory judgment actions relating in any way to the DOV Patent. DOV
shall cooperate fully with Biovail at DOV's own expense in the defense of
any such claim or action.
(b) Any recovery from any such action shall first be applied
in satisfaction of expenses and legal fees incurred by the Parties in
connection with the action, and any balance remaining from any such
recovery shall be divided between the Parties pro rata according to the
losses incurred by the Parties by reason of the infringement.
SECTION 7.5. FAILURE TO DEFEND. If Biovail fails to defend against any
claim or action as provided in SECTION 7.4 within the lessor of 60 days and the
time required for response after receipt of any process or claim, DOV shall,
subject to Biovail's consent, not to be unreasonably withheld, have the option
to defend such action at its own expense provided that Biovail shall cooperate
fully with DOV in the defense of any such action.
SECTION 7.6. ENFORCEMENT OF DOV PATENT. Each of Biovail and DOV shall
immediately report to the other any infringement or any unauthorized use or
misuse of the DOV Intellectual Property that may come to its attention. Biovail
shall have the exclusive right to enforce the DOV Patent against others,
including the exclusive right to xxx others for past, present and future
infringements of the DOV Patent, including the right to seek injunctions and/or
money damages, and to seek any other legal or equitable remedy authorized by
law, to protect the invention covered by the DOV Patent against violation by
third parties, to commence and prosecute any action or proceeding in respect of
any such infringement of the DOV Patent or misappropriation, and if necessary
may do so in the name of DOV. Biovail's attorneys shall represent both DOV and
Biovail in any such litigation, and Biovail shall have sole control over any
such litigation. DOV may retain its own attorneys at its own expense to advise
DOV with respect to Biovail's conduct of the litigation. DOV shall fully
co-operate with Biovail at the expense of Biovail and execute such documents and
do such acts and things as, in the opinion of Biovail, may be necessary or
desirable. If Biovail fails within a reasonable time, not to exceed 90 days, to
take appropriate steps against that infringement or misappropriation, DOV shall
be entitled to take such reasonable steps against such infringement or
misappropriation for the protection of Biovail's and/or DOV's rights, and if
necessary may do so in the name of and on behalf of Biovail.
12
SECTION 7.7. REIMBURSEMENT OF LITIGATION COSTS. DOV shall, upon receipt of
all communications relative to such claims or proceedings including all
pleadings and an itemized accounting for all legal costs and expenses for which
reimbursement is requested by Biovail, reimburse Biovail for legal fees and
disbursements incurred pursuant to SECTIONS 7.4 or 7.6, up to a maximum of $1.5
million.
ARTICLE VIII - REPRESENTATIONS & WARRANTIES
SECTION 8.1. BY DOV. DOV hereby represents and warrants to Biovail as
follows, but disclaiming all other warranties, express or implied, including any
implied warranty of merchantability, manufacturability and fitness for a
particular purpose:
(a) DOV has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power to conduct the business contemplated by this Agreement.
DOV has the corporate power and authority to enter into this Agreement and
to consummate the transactions contemplated hereby.
(b) The execution, delivery and performance of this Agreement,
and the consummation of the transactions contemplated thereby, by DOV have
been duly and validly authorized by all requisite corporate action. This
Agreement has been duly executed and delivered by DOV and constitutes the
legal, valid and binding obligation of DOV, enforceable against DOV in
accordance with its terms, except as enforceability thereof may be limited
by bankruptcy, insolvency, reorganization or other similar laws relating
to or affecting the rights of creditors generally and by general
principles of equity.
(c) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated by this Agreement by
DOV do not conflict with or result in any breach of any of the provisions
of, constitute a default under, result in a violation of, give rise to any
right of termination under, or require any authorization, consent (except
as may have been obtained), approval, exemption or other action by or
notice to any court or governmental body under the provisions of DOV's
articles of incorporation or bylaws or any indenture, mortgage, lease,
loan agreement, license or other agreement or instrument to which DOV is a
party or of any law, statute, rule or regulation or order, judgment or
decree to which DOV is subject.
(d) DOV (i) is the owner of the entire right, title and
interest in and to, the DOV Intellectual Property, free and clear of any
liens or encumbrances and (ii) has not assigned or granted a license to
the DOV Intellectual Property to, or entered into any inconsistent prior
obligations with, any other person or entity that would restrict or impair
the rights granted hereunder.
(e) To its knowledge (i) the DOV Patent is not currently
infringed by any third party and (ii) the manufacture, use or sale of the
Product will not infringe any
13
patent, property or proprietary rights of any third party with respect to
its use of the DOV Intellectual Property.
(f) DOV has not received any notice from any person or entity
claiming to have any right, title or interest in or to the DOV
Intellectual Property and to its knowledge there is no reason to expect
that any such notice is forthcoming. To DOV's knowledge, there have been
no third party claims asserted that would challenge or impair the license
of the rights granted to Biovail herein including any claims based upon
patent, copyright or trade secret laws nor to the knowledge of DOV are any
such claims likely, nor is there any valid basis for any such claim.
(g) To DOV's knowledge there are no actions, suits,
proceedings or inquiries pending or threatened in writing against or
affecting DOV at law or in equity or before or by any federal, provincial,
state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, that may
materially adversely affect DOV or the DOV Intellectual Property.
(h) To DOV's knowledge all information known to the inventor
to be material to the patentability of the claims is disclosed in the DOV
Patent and that the best mode contemplated by the inventor of carrying out
the invention is set forth therein.
(i) To DOV's knowledge all the prior art that the inventor
named in the DOV Patent may be aware and which may be material to the
patentability of the Product has been disclosed to the United States
Patent and Trademark Office during the prosecution of the DOV Patent.
(j) All Supporting Data to be supplied to Biovail or provided
at the request of Biovail will, at the time the information is disclosed,
accurately reflect the results of the tests and studies performed on the
Product.
SECTION 8.2. BY BIOVAIL. Biovail hereby represents and warrants to DOV as
follows:
(a) Biovail has been duly organized and is validly existing as
a corporation under the laws of Barbados, with corporate power to conduct
the business contemplated by this Agreement. Biovail has the corporate
power and authority to enter into this Agreement and to consummate the
transactions contemplated by this Agreement.
(b) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein by Biovail
have been duly and validly authorized by all requisite corporate action.
This Agreement has been duly executed and delivered by Biovail and
constitutes the legal, valid and binding obligations of Biovail,
enforceable against it in accordance with its terms, except as
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization or other similar laws relating to or affecting the rights
of creditors generally, and by general principles of equity.
14
(c) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated by this Agreement by
Biovail do not conflict with or result in any breach of any of the
provisions of, constitute a default under, result in a violation of, or
require any authorization, consent (except as may have been obtained),
approval, exemption or other action by or notice to any court or
governmental body, under the provisions of Biovail's articles of
incorporation or memorandum of association or bylaws or any indenture,
mortgage, lease, loan agreement, license or other agreement or instrument
to which either is a party, or of any law, statute, rule or regulation or
order, judgment or decree to which Biovail is subject.
(d) Biovail has sufficient rights with respect to Cardizem CD
and Tiazac to enable the reformulation and Marketing upon Committee
determination of each such drug using the DOV Patent.
ARTICLE IX - INDEMNIFICATION
SECTION 9.1. INDEMNIFICATION BY BIOVAIL. Biovail shall indemnify, defend
and hold harmless DOV and its Affiliates from and against any and all
liabilities, damages, losses, costs or expenses (including reasonable attorneys'
and professional fees and other expenses of litigation and/or arbitration)
resulting from a claim, suit or proceeding made or brought by a third party
against DOV arising under or resulting from or occurring as a result of (a) any
breach of the representations and warranties set forth in SECTION 8.2; (b) any
research, development, testing, Manufacture, importation, use, offer for sale,
sale or other distribution of any Product by Biovail or any of its Affiliates or
sublicensees (including product liability claims); or (c) failure of Biovail or
any of its Affiliates, contract manufacturers or Sublicensees to comply with any
provision of this Agreement, or with any applicable law, regulation or
administrative decision relating to any Product, except in each case to the
extent caused by the negligence or willful misconduct of DOV, provided that such
indemnification shall not apply to the extent the liability (i) results from the
invalidity of the DOV Patent or third-party ownership of DOV Know-How or (ii) is
based upon entering into including execution and delivery of this Agreement.
SECTION 9.2. INDEMNIFICATION BY DOV. DOV shall indemnify, defend and hold
harmless Biovail and their Affiliates from and against any and all liabilities,
damages, losses, costs or expenses (including reasonable attorneys' and
professional fees and other expenses of litigation and/or arbitration) resulting
from a claim, suit or proceeding made or brought by a third party against either
arising under or resulting from (a) any breach of the representations and
warranties set forth in SECTION 8.1; (b) any research, development, testing,
Manufacture, importation, use, offer for sale, sale or other distribution of any
Product by DOV or any of its Affiliates, contract manufacturers or sublicensees
(including product liability claims;) or (c) failure of DOV or any of its
Affiliates, contract manufacturers or sublicensees to comply with any provision
of this Agreement, or with any applicable law, regulation or administrative
decision relating to the Product, except in each case to the extent caused by
the negligence or willful misconduct of Biovail. Such indemnification shall not
apply to the extent the liability (i) results from the invalidity of any Biovail
patent or other intellectual property or (ii) is based upon entering into
including execution and delivery of this Agreement.
15
SECTION 9.3. SUBROGATION. If any indemnified Party intends to claim
indemnification under this ARTICLE IX it shall promptly notify the other Party
in writing of such alleged claim. The indemnifying Party shall have the sole
right to control the defense and settlement thereof. The indemnified Party shall
cooperate with the indemnifying Party and its legal representatives in the
investigation of any action, claim or liability covered by this ARTICLE IX. The
indemnified Party shall not, except at its own cost, voluntarily make any
payment or incur any expense with respect to any claim or suit without the prior
written consent of the indemnifying Party. In addition, the indemnifying Party
shall be subrogated to the rights of the indemnified Party against any third
Party, and such indemnified Party hereby assigns to the indemnifying Party all
claims, causes of action and other rights that the indemnified Party may then
have against any third party, including Affiliates and sublicensees and, in the
case of DOV, against any contract manufacturer of the Product, with respect to
the claim, suit or proceeding. Conversely, and without in any way limiting the
obligation of either Party to indemnify the other Party as herein provided, to
the extent that any Party shall fail to perform its indemnification obligations
under SECTION 9.1 or SECTION 9.2, such Party owing a duty of indemnification
hereby assigns to the indemnified Party to whom indemnification is owed all
claims, cause of action and other rights that the Party owing such duty may then
have against any third party, including Affiliates and sublicensees with respect
to the claim, suit or proceeding.
SECTION 9.4. INSURANCE.
(a) Biovail shall maintain comprehensive general liability
insurance, product liability insurance as well as other types of insurance
in type and amount considered to be reasonable and prudent given the types
of risks involved in the research, formulation, regulatory work,
Manufacturing and Marketing of the Product. Biovail shall maintain such
coverage with one or more third party commercial insurance carriers for
the term of this Agreement plus the period of any applicable statutory
limitation. Biovail shall cause DOV to be named as an additional insured
on all such policies, at DOV's expense, and provide DOV with copies of the
endorsements to such policies naming DOV as an additional insured. Biovail
shall instruct its insurance carriers providing such coverage to notify
DOV in writing of any material change in coverage provided by such
policies.
(b) DOV shall maintain comprehensive general liability
insurance in type and amount considered to be reasonable and prudent given
the types of risks involved in the development and clinical trials of
similar products. DOV shall maintain such coverage with one or more third
party commercial insurance carriers. DOV shall, at the request of Biovail
and at Biovail's expense, cause Biovail to be named as an additional
insured on all such policies and provide Biovail with copies of the
endorsements to such policies naming Biovail as an additional insured. DOV
shall instruct its insurance carriers providing such coverage to notify
Biovail in writing of any material change in coverage provided by such
policies.
16
ARTICLE X - CONFIDENTIALITY
SECTION 10.1. NON-USE AND NON-DISCLOSURE. DOV and Biovail acknowledge and
agree that the other Party's Confidential Information is confidential and
proprietary to the disclosing Party. Without the consent of the other, the
receiving Party shall not use or disclose to any third party the disclosing
Party's Confidential Information for any purpose other than as permitted or
required hereunder, provided that each Party may on a need-to-know basis
disclose Supporting Data to its respective Affiliates or sublicensees or
potential sublicensees provided thateach such recipient executes a non-use and
non-disclosure agreement with terms comparable to the terms hereof. Each Party
shall take the same reasonable measures necessary to prevent any disclosure by
its employees, agents, contractors, or consultants of the other Party's
Confidential Information as it applies to the protection of its own Confidential
Information of like value.
SECTION 10.2. PUBLICATIONS. Prior to the publication or presentation of
any information or data arising from the Development Program, the publishing
Party shall submit to the other Party a summary of the proposed publication or
presentation at least 60 days prior to the submission thereof for publication or
presentation to provide the reviewing Party with an opportunity to review and
comment on the contents of the proposed publication or presentation, and to
identify any Confidential Information of the reviewing Party to be deleted from
the proposed publication or presentation. The reviewing Party shall provide any
comments to the publishing Party or identify any of the reviewing Party's
Confidential Information to be deleted from the proposed publication or
presentation within 30 days of receipt of the proposed publication or
presentation. If so requested by the reviewing Party, the publishing Party shall
delete any of the reviewing Party's Confidential Information and shall delay
publication up to an additional 60 days to allow the reviewing Party to take
such measures as it deems appropriate to establish and preserve its proprietary
rights. If the reviewing Xxxxx fails to comment within the 30 day review period,
the publishing Party shall be free to proceed with publication or presentation.
SECTION 10.3. EXCLUSIONS. Information shall not be considered Confidential
Information hereunder if it:
(a) is, or becomes, part of the public knowledge or literature
through no fault, act or omission of the receiving Party provided that
Confidential Information shall not be deemed to have entered the public
domain by reason of its having been filed with any Regulatory Authority;
(b) was, or becomes, available to the receiving Party from a
source other than the disclosing Party, which source has rightfully
obtained the same information and has no obligation of confidentiality to
the disclosing Party with respect to it;
(c) is independently developed by or for the receiving Party
without use of the Confidential Information;
(d) is made available on an unrestricted basis by the
disclosing Party to a third party unaffiliated with the disclosing Party;
17
(e) legally is required to be disclosed provided that the
receiving Party shall give reasonable notice to the disclosing Party of
such requirement and shall cooperate with the disclosing Party in
reasonable legal efforts to limit or mitigate any such disclosure so as to
preserve the proprietary nature of any Confidential Information contained
therein; or
(f) is clinical information or data reasonably required for
the Marketing of the Product.
SECTION 10:4. DURATION; SURVIVING OBLIGATION. Each Party's obligations of
non-use and non-disclosure of the other Party's Confidential Information shall
apply during the term of this Agreement and shall also survive for seven years
its termination or expiration for any reason.
SECTION 10.5. INJUNCTIVE RELIEF. Damages at law may be an inadequate
remedy for breach of any of the covenants, promises and agreements contained in
this ARTICLE X and accordingly either Party shall be entitled to seek injunctive
relief with respect to such breach, including specific performance or an order
enjoining the breaching Party from any threatened, or from the continuation of
any actual breach of such covenants, promises or agreements. The rights set
forth in this SECTION 10.5 shall be in addition to any other rights that either
DOV or Biovail may have at law or in equity.
ARTICLE XL - FORCE MAJEURE
SECTION 11.1. DEFINITION AND NOTICE. "FORCE MAJEURE" means any event, not
existing as of the date hereof and not reasonably within the control of the
Parties as of such date that materially prevents or makes commercially
unreasonable one Party's performance of its obligations under this Agreement
other than obligations to render statements and make payments pursuant to the
provisions of this Agreement. Force Majeure shall include fire, storm,
earthquake, flood, acts of State or other governmental action, war or civil
unrest, strikes, and prolonged shortage of energy or any other supplies. A Party
affected by an event of Force Majeure shall promptly provide the other Party
with written notice describing the event, its cause and foreseeable duration,
and its possible consequences upon performance under this Agreement.
SECTION 11.2. SUSPENSION OF PERFORMANCE. After an affected Party has given
notice under SECTION 11.1, that Party shall be relieved of any liability under
this Agreement, except for the obligation to pay amounts due and owing, but only
to the extent and only for so long as the Force Majeure prevents performance.
The other Party may likewise suspend the performance of all or part of its
obligations, except for the obligation to pay any amounts due and owing, to the
extent that such suspension is commercially reasonable.
SECTION 11.3. TERMINATION. If the period of Force Majeure continues for
more than one year, either Party may terminate this Agreement upon giving notice
to the other Party without incurring liability other than the obligation to make
payments due to such date.
18
ARTICLE XII - TERM AND TERMINATION
SECTION 12.1. TERM OF AGREEMENT. The term of this Agreement shall commence
on the date hereof and unless earlier terminated in accordance with the
provisions of this ARTICLE XII shall continue in full force and effect until
expiration of the DOV Patent and any extension and, unless a Party gives notice
of termination after such expiration, from year to year thereafter.
SECTION 12.2. TERMINATION AND OTHER REMEDIES FOR DEFAULT.
(a) DOV shall have the right to terminate this Agreement if
(i) Biovail has not made a commercial sale of the
Product within six months following the grant of Marketing
Authorization or otherwise fails to meet its obligations under
SECTION 4.1 with respect to obtaining Marketing Authorization or
Marketing the Product, provided that in such case DOV shall pay
Biovail [***]% of the Net Sales of the Product up to the Development
Costs contributed by Biovail pursuant to SECTION 3.4;
(ii) Marketing Authorization has not been obtained with
five years of the date hereof;
(iii) clinical trials for an extended release
formulation of the Product with either anti-angina or
hypertension-suppressing indications using DOV Intellectual Property
(A) are not conducted on a commercially reasonable schedule within
24 months of the date hereof owing to the failure to secure a
Committee determination opposed by the Biovail members but favored
by the DOV members to conduct such trials or establish such a
schedule or (B) once conducted are suspended over objection of the
Biovail members for more than six months owing to litigation or
threat thereof challenging Biovail's right to carry out its
obligations hereunder;
(iv) Biovail defaults with respect to any other material
obligation including any obligations set forth in SECTIONS 3.4, 5.2
and 5.3, provided that DOV shall pay Biovail the excess if any of
[***]% of Net Sales of the Product up to the Development Costs
contributed by Biovail pursuant to SECTION 3.4 over the payments
owing to DOV pursuant to SECTIONS 3.4, 5.2 and 5.3;
provided further that in each above case, DOV shall notify Biovail in
writing specifying the nature of Biovail's non-compliance and Biovail
shall have 30 days following receipt of such notice to cure such
non-compliance and if such non-compliance is not cured within such period,
DOV may by written notice terminate this Agreement.
(b) If DOV defaults under any provision of this Agreement, and
fails to remedy such default within 60 days after receipt by DOV of
Biovail's written notice thereof, Biovail may by notice to DOV suspend its
obligation to pay royalties under this
----------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
19
Agreement during the pendancy of such default. No such suspension shall
affect the license herein granted. Biovail shall also have the right, in
the case of a default by DOV under SECTIONS 3.4, 3.5 or 3.6, to reduce
royalties payable to DOV up to amount of Development Costs contributed by
Biovail pursuant to SECTION 3.4.
SECTION 12.3. TERMINATION FOR BANKRUPTCY. If Biovail becomes insolvent or
bankrupt, makes any assignment for the benefit of creditors, fails generally to
pay its debts as they become due, is adjudged bankrupt, or if a receiver,
custodian, or trustee of Biovail's property or a major part of its property is
appointed, or if any other proceeding for relief under any bankruptcy law or
similar law for the relief of debtors is instituted by or against Biovail and,
if instituted against Biovail, is consented to or not dismissed within 60 days
after such institution, this Agreement and the licenses herein granted may be
terminated by notice in writing from DOV.
SECTION 12.4. FURTHER EFFECT OF TERMINATION OR EXPIRATION. Upon any
termination of this Agreement or of any rights granted by this Agreement, the
following additional provisions shall apply:
(a) Biovail shall promptly make any payment unpaid but earned
under SECTION 5.2 or SECTION 5.3.
(b) Biovail and its Affiliates and Sublicensees shall have the
right to sell any remaining inventory of finished Products in the ordinary
course of business, subject to the payment of royalties hereunder and
until such inventory can be reasonably transferred to DOV.
(c) Promptly after termination of this Agreement, each
receiving Party shall return to each disclosing Party all of such
disclosing Party's Confidential Information, or at the request of the
disclosing Party, shall destroy such Confidential Information and shall
certify such destruction in writing to the disclosing Party.
(d) The license granted under SECTION 2.1 shall revert to DOV,
in such event, Biovail shall, to the extent permitted by law, assign to
DOV any Marketing Authorizations for the Product and name DOV as the
applicant for all active investigatory new drug applications, new drug
applications and abbreviated new drug applications, as applicable, and
take all necessary actions with the appropriate Regulatory Authorities to
effect such assignment to DOV.
(e) The Parties' respective rights and obligations under
SECTION 12.4, ARTICLE VI (Regulatory Matters), SECTIONS 7.1, 7.2, 7.3,
7.7, ARTICLES IX (Indemnification), X (Confidentiality), XIII (Dispute
Resolution) and XV(Miscellaneous) shall survive termination of this
Agreement.
ARTICLE XIII - DISPUTE RESOLUTION
20
SECTION 13.1. NEGOTIATION. Subject to SECTION 13.2, the Parties agree to
consult and negotiate in good faith to resolve any dispute, controversy or claim
that arises out of or relates to this Agreement.
SECTION 13.2. RESERVATION FOR LITIGATION. Each Party expressly reserves
the right to seek judicial relief from a court of competent jurisdiction (i) if
another Party is or appears to be in violation of such other Party's obligations
of non-use and non-disclosure under ARTICLE X above, including any injunction or
other preliminary relief and (ii) for a claim involving ownership of the DOV
Patent and interpretation of the respective rights and obligations under ARTICLE
II, provided that if a Party's claim combines claims covered by both SECTION
13.1 and the foregoing, such claim may be presented to a court if the claim is
otherwise arbitrable cannot, in the judgment of such court, be fairly or
conveniently separated.
SECTION 13.3. ARBITRATION. Subject to SECTION 13.2, any dispute,
controversy or claim that arises out of or relates to this Agreement that is not
resolved under SECTION 13.1 shall be settled by final and binding arbitration in
accordance with the International Arbitration Rules of the American Arbitration
Association ("AAA") in effect on the date hereof, as modified by SECTION 13.4.
Judgment upon the award rendered by the arbitrators may be entered in any court
of competent jurisdiction. The place of arbitration shall be mutually agreed to
by the Parties or, failing such agreement, shall be either
New York,
New York or
Xxxxxxx, Xxxxxxx, as determined by a flip of a coin. The arbitration shall be
conducted in the English language by one neutral arbitrator selected by mutual
agreement of the Parties or, if such agreement is not possible within 30 days of
the initial demand for such arbitration, the arbitrator shall be selected from a
list of three persons provided by the AAA. The arbitrator shall have experience
in the pharmaceutical industry and technology licensing.
SECTION 13.4. SPECIAL RULES. Notwithstanding any provision to the contrary
in the AAA's International Arbitration Rules, the Parties hereby stipulate that
any arbitration hereunder shall be subject to the following special rules: (a)
the arbitrators may not award or assess punitive or special or consequential
damages against either Party even if in the case of special or consequential
damages the Party has been advised of the possibility of such damage; and (b)
each Party shall bear its own costs and expenses of the arbitration and one-half
of the fees and costs of the arbitrators, subject to the right of the
arbitrator, in his or her sole discretion, to award all such reasonable costs,
expenses and fees to the prevailing Party.
SECTION 13.5. SURVIVAL. The duty of the Parties to arbitrate any dispute,
controversy or claim under this ARTICLE XIII shall survive termination of this
Agreement.
ARTICLE XIV - MISCELLANEOUS
SECTION 14.1. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement of the Parties with respect to the subject matter hereof, and
supersedes all previous agreements by and between the Parties as well as all
proposals, oral or written, and all prior or contemporaneous negotiations,
conversations or discussions between the Parties related to this Agreement.
21
SECTION 14.2. PUBLICITY. Any public announcement or disclosure by DOV or
Biovail regarding the Agreement shall be mutually agreed upon by the Parties
provided that either Party may disclose the terms hereof to prospective
investors or make public disclosures to the extent required by state or federal
securities or other law. With respect to a disclosure required by law, each
Party shall to the extent practicable share the proposed disclosure in advance
with the other Party and take into account in good faith the comments, if any,
made by such Party provided that such comments are made in a timely manner and
provided further that the disclosing Party shall retain the final decision
regarding content and timing of such disclosure.
SECTION 14.3. RELATIONSHIP. The Parties are independent contractors and
shall not be deemed to have formed any partnership, joint venture or other
relationship. Neither Party shall make, or represent to any other person that it
has the power or authority to make, any financial or other commitment on behalf
of the other Party.
SECTION 14.4. ASSIGNMENT. This Agreement shall be binding upon and inure
to the benefit of the Parties and their respective successors and permitted
assigns, but except pursuant to SECTION 2.2 neither DOV nor Biovail, shall have
the right to assign or otherwise transfer its rights and obligations under this
Agreement except with the prior written consent of the other Party, provided
that (i) a successor in interest by merger, operation of law, assignment,
purchase or otherwise of Biovail's diltiazem based products, or of all or
substantially all the business and assets of either shall acquire all rights and
obligations of such Party hereunder without any such consent and (ii) either may
transfer to an Affiliate without any such consent. Any prohibited assignment
shall be null and void.
SECTION 14.5. NO CONSEQUENTIAL DAMAGES. No Party shall be liable to the
other for punitive or special or consequential damages even if in the case of
special or consequential damages the Party has been advised of the possibility
of such damage.
SECTION 14.6. NOTICES. Except as may be otherwise provided in this
Agreement, any notice, demand or request given, made or required to be made
shall be in writing and shall be effective, unless otherwise provided herein,
when received after delivery by (a) registered air mail, postage prepaid; (b)
facsimile with electronic confirmation of receipt; or (c) a reputable
international courier such as Federal Express or DHL at the addresses set forth
below or to any other address that a Party specifies in writing.
If to Biovail, to:
Biovail Laboratories Incorporated
Chelston Park, Building 2
Xxxxxxxxx Rock
St. Xxxxxxx BH1
Barbados, West Indies
Attention: Mr. Xxx Cancellara,
Senior Vice President and General Counsel.
22
With a copy to
Biovail Corporation
0000 Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxx X0X lJ9
Attention: Mr. Xxx Cancellara,
Senior Vice President and General Counsel.
If to DOV, to:
DOV Pharmaceutical, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Chief Executive Officer
With a copy to:
Xxxxxxx, Procter LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: J. Xxxxxx Xxxxxx, Esq.
SECTION 14.7. GOVERNING LAW. This Agreement shall be governed by, and
interpreted and construed in accordance with, the law of the State of
New York
(regardless of the laws that might otherwise govern under applicable principles
of conflicts of law).
SECTION 14.8. AMENDMENT. This Agreement may not be amended except by
written agreement signed by all Parties.
SECTION 14.9. SEVERABILITY. If one or more of the provisions of this
Agreement is subsequently declared invalid or unenforceable, this Agreement
shall be treated as though that provision were not in this Agreement, and this
shall not affect the validity or enforceability of the remaining provisions of
this Agreement unless those provisions that are invalidated or unenforceable are
clearly material and inseparable from the other provisions. The Agreement as
modified shall be applied and construed to reflect substantially the good faith
intent of the Parties and to achieve the economic effects originally intended by
the terms hereof.
SECTION 14.10. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, and each such counterpart shall be deemed an original hereof.
Counterparts may be executed either in original or faxed form and the Parties
adopt any signatures received by a fax machine as the original signatures of the
Parties.
SECTION 14.11. WAIVER. No failure by either Party to take any action or
assert any right hereunder shall be deemed to be a waiver of such right in the
event of the continuation or repetition of the circumstances giving rise to such
right. A waiver by either Party of a breach or
23
violation of any provision of this Agreement shall not constitute or be
construed as a waiver of any other breach or violation of this Agreement.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
24
IN WITNESS WHEREOF, DOV and Biovail have caused this Agreement to be
executed by their respective duly authorized officers as of the date first above
written.
DOV PHARMACEUTICAL, INC.
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Chief Executive Officer
BIOVAIL LABORATORIES INCORPORATED,
By: ____________________________________
Name: Xxxxxx Xxxxxx
Title: President
25
IN WITNESS WHEREOF, DOV and Biovail have caused this Agreement to be
executed by their respective duly authorized officers as of the date first above
written.
DOV PHARMACEUTICAL, INC.
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Lipppa
Title: CEO
BIOVAIL LABORATORIES INCORPORATED,
By: ____________________________________
Name:
Title:
25
IN WITNESS WHEREOF, DOV and Biovail have caused this Agreement to be
executed by their respective duly authorized officers as of the date first above
written.
DOV PHARMACEUTICAL, INC.
By: ____________________________________
Name:
Title:
BIOVAIL LABORATORIES INCORPORATED,
By: /s/ Xxxxxx Xxxxxx
------------------------------------
Name: Xxxxxx Xxxxxx
Title: President
25
Products for the treatment of hypertension and angina currently marketed
or under development by or for Biovail Laboratories Limited or its Affiliates.
The following list of products is delivered as the list contemplated by
Section |X| of the License Agreement of January 12, 2001 between Biovail
Laboratories Limited and DOV Pharmaceutical, Inc. [***]
----------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.
