EXHIBIT 10.47
CONFIDENTIAL
NOTE: Certain portions of this Collaboration Agreement and its exhibits, which
are identified by the symbol "[* *]", have been omitted and filed separately
with the Securities and Exchange Commission pursuant to a confidential treatment
request.
DISCOVERWORKS(R)
DRUG DISCOVERY COLLABORATION AGREEMENT
THIS DISCOVERWORKS(R) DRUG DISCOVERY COLLABORATION AGREEMENT is made as of the
Effective Date by and between 3-Dimensional Pharmaceuticals, Inc., a Delaware
corporation having its principal place of business at Three Lower Makefield
Corporate Center, 0000 Xxxxx Xxxx Xxxx, Xxxxx 000, Xxxxxxx, XX 00000, XXX
("3DP"), and Xxxxxxx Pharmaceutica, N.V., having its place of business at
Xxxxxxxxxxxxx 00, 0000 Xxxxxx, Xxxxxxx and The X.X. Xxxxxxx Pharmaceutical
Research Institute, a division of Ortho-XxXxxx Pharmaceutical, Inc. having a
place of business at X.X. Xxxxx 000, Xxxxxxx, XX 00000, XXX (collectively, with
its Affiliates, referred to herein as "Janssen"). 3DP and Janssen may be
referred to herein as a "Party" or, collectively, as the "Parties." Reference to
a Party herein shall include its Affiliates (as hereinafter defined) unless
otherwise indicated.
WHEREAS, 3DP is engaged in discovery research for a variety of
biologically-active compounds and the development of technologies to facilitate
such research, and 3DP has developed and is patenting systems for identifying
and generating chemical compounds having desired pharmaceutical properties;
WHEREAS, Xxxxxxx is engaged in research, development and commercialization of
biologically-active compounds for the treatment of human diseases; and
WHEREAS, 3DP and Xxxxxxx desire to enter into a research collaboration to allow
Xxxxxxx and 3DP to identify Prototype Compounds (as defined herein) active
against selected targets that may be developed and commercialized by Xxxxxxx.
NOW, THEREFORE, in consideration of the mutual promises and undertakings set
forth herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the Parties agree as follows:
ARTICLE 1
DEFINITIONS
The terms in this Agreement with initial letters capitalized, whether used in
the singular or the plural, shall have the meaning set forth below or, if not
listed below, the meaning designated in places throughout this Agreement.
1.1 "Active Compound" means a compound(s) claimed by a Valid Claim
of a 3DP Patent, Joint Patent or Research Program Patent
Right.
1.2 "Affiliate" means, with respect to either Party, any
corporation or other business entity, which controls, is
controlled by, or is under common control with such Party. A
corporation or other entity shall be regarded as in control of
another corporation or entity if it owns or directly or
indirectly controls at least fifty percent (50%) of the voting
stock or other ownership interest of the other corporation or
entity (or alternatively, such lesser percentage which is the
maximum allowed to be owned by a foreign corporation in a
particular jurisdiction), or if it possesses, directly or
indirectly, the power to direct or cause the direction of the
management and policies of the corporation or other entity or
the power to elect or appoint at least fifty percent (50%) of
the members of the governing body of the corporation or other
entity.
1.3 "Agreement" means this DiscoverWorks(R) Drug Discovery
Collaboration Agreement, including its Schedules, as may be
amended from time to time.
1.4 "Back-up Compound" means a compound selected from the Focused
Library which has activity against a Target, that is reserved
as a back-up for an Active Compound or Licensed Product having
activity against the same Target, and is not intended to be
developed or commercialized unless development and/or
commercialization of such Active Compound or Licensed Product
is terminated and such compound becomes a Replacement
Compound.
1.5 "Combination Product" means a Licensed Product that includes
one or more active ingredients in addition to an Active
Compound.
1.6 "Confidential Information" means all confidential and
proprietary technical and/or commercial information that has
or could have value or utility in a Party's business, or the
unauthorized disclosure of which could be detrimental to the
Party's interests, including information, inventions,
Know-how, data and materials relating to the Research Program
or to the Licensed Products, and shall include, without
limitation, research, technical, clinical development,
manufacturing, marketing, financial, personnel and other
business information and plans, whether in oral, written,
graphic or electronic form, except to the extent that it can
be established by the Receiving Party (as defined in Section
7.1) that such Confidential Information: (a) was already known
to the Receiving Party, other than under an obligation of
confidentiality from the Disclosing Party (as defined in
Section 7.1); (b) was generally available to the public or
otherwise part of the public domain at the time of its
disclosure to the Receiving Party; (c)
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became generally available to the public or otherwise part of
the public domain after its disclosure and other than through
any act or omission of the Receiving Party in breach of this
Agreement; (d) was subsequently lawfully disclosed to the
Receiving Party by a Third Party; (e) can be shown by written
records to have been independently developed by or for the
Receiving Party without reference to the Confidential
Information received from the Disclosing Party and without
breach of any of the provisions of this Agreement; or (f) is
information that the Disclosing Party has specifically agreed
in writing that the Receiving Party may disclose.
1.7 "Control" or "Controlled" means possession of the ability to
grant a license or sublicense of Patents, know-how or other
intangible rights as provided for herein without violating the
terms of any contract or other arrangements with any Third
Party.
1.8 "DirectedDiversity(R)Technology" means the technology
described in: (a) the 3DP Patents identified in Schedule 1.8,
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and (b) associated proprietary 3DP know-how used to identify
Hits, Prototype Compounds, and Active Compounds.
1.9 "DiscoverWorks(R) Technology" means 3DP's full panoply of drug
discovery and compound and library synthesis technologies,
including without limitation the technologies currently known
as DirectedDiversity(R) Technology, ThermoFluor(R) Technology,
3DP Synthetically Accessible Libraries and 3DP Probe
Libraries, notwithstanding that all such technologies and
resources may not be utilized under this Agreement.
1.10 "Effective Date" means December 28, 2001.
1.11 "Extended Research Term" means a period of time, mutually
agreed upon by the Parties, following conclusion of the Stage
A Term or Stage B Term or of an earlier Extended Research
Term, during which the Research Program is conducted. An
Extended Research Term may apply to either or both the Stage A
Term and the Stage B Term and is part of the Research Term.
1.12 "Field" means the research, development and commercialization
of compounds for use in therapeutic, prophylactic and
diagnostic products in humans or animals. The Field shall
specifically exclude [* *].
1.13 "First Commercial Sale" means, with respect to a given
Licensed Product, the first shipment of Licensed Product for
use or consumption by the public of such Licensed Product in a
country after all required approvals, including marketing and
pricing approvals, have been granted by the applicable
governmental drug regulatory agency of such country.
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1.14 "Focused Library" means a library of compounds selected from
the 3DP Synthetically Accessible Library using
DirectedDiversity(R)Technology and synthesized by 3DP.
1.15 "FTE" means a full time equivalent employee (i.e., one
full-time or multiple part-time employees aggregating to one
full-time employee) employed by 3DP and assigned to work on
the Research Program with such time and effort to constitute
one employee working on the Research Program on a full-time
basis consistent with normal business and scientific practice
(at least forty (40) hours per week of dedicated effort; on an
annual basis, at least forty (40) hours per week of dedicated
effort for at least forty-eight (48) weeks per year).
1.16 "Generic Equivalent" means a pharmaceutical product that is
being sold in a country without infringing a claim of a Patent
Right covering a Licensed Product being sold hereunder by
Xxxxxxx, which would have infringed such claim of a Patent
Right, or which would have prevented a Third Party from
selling the same Active Compound that is part of the Licensed
Product, if such claim of a Patent Right were in force in that
country.
1.17 "Hit" means a compound in the 3DP Probe Library having a
confirmed structure that (i) is identified from the screening
of a Target; (ii) modulates [* *], as measured using
ThermoFluor(R) Technology, and (iii) passes the ThermoFluor(R)
validation tests set forth on Schedule 1.17.
1.18 "IND" means an investigational new drug application filed with
the U.S. Food and Drug Administration or successor agency
("FDA") as more fully defined in 21 C.F.R.ss.312.3, a CTX, or
their respective equivalents in any country.
1.19 "Initiation of Prototype Compound Optimization" means the
receipt of written notice from Xxxxxxx to 3DP indicating that
Prototype Compound Optimization activities have been initiated
by Xxxxxxx for a Prototype Compound. Such notice shall, among
other things, specifically identify the Prototype Compound and
its Target, the project champion, and the site at which work
is being conducted.
1.20 "Xxxxxxx Know-how" means any and all technical information,
inventions, developments, discoveries, software, know-how,
methods, techniques, formulae, data, processes and other
proprietary ideas, whether or not patentable or copyrightable,
that are first conceived, discovered, developed or reduced to
practice in the conduct of Prototype Compound Optimization or
the Xxxxxxx Research Program.
1.21 "Xxxxxxx Patent" means those Patent Rights that claim
discoveries or inventions that (i) were conceived and/or
reduced to practice solely by Xxxxxxx employees or by a Third
Party acting under authority of Xxxxxxx prior to the Effective
Date; or (ii) were conceived and/or reduced to practice solely
by Xxxxxxx employees or by
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a Third Party acting under authority of Xxxxxxx during the
Term but after the completion of the Research Program and the
[* *] period following the Initiation of
Prototype Compound Optimization for each Prototype Compound,
on a compound-by-compound basis; and (iii) claiming a method,
apparatus, composition of matter, material, manufacture or
business method relating to Hits, Prototype Compounds, Active
Compound or Licensed Products.
1.22 "Xxxxxxx Research Program" means activities of Xxxxxxx during
the Term that are intended to lead to the discovery of
compounds having activity against a Target, and the further
optimization, identification and/or discovery of such
compounds, excluding any activities of Xxxxxxx which occur
prior to the Effective Date or after the [* *] period
following the Initiation of Prototype Compound Optimization
for each Prototype Compound, on a compound-by-compound basis.
1.23 "Joint Patent" means those Patent Rights that claim
discoveries or inventions that (i) were conceived and/or
reduced to practice jointly by Xxxxxxx and 3DP employees or by
a Third Party acting under authority of Xxxxxxx or 3DP during
the Term but after completion of the Research Program and the
[* *] period following the Initiation of Prototype Compound
Optimization for each Prototype Compound, on a
compound-by-compound basis; and (ii) claiming a method,
apparatus, composition of matter, material, manufacture or
business method relating to Hits, Prototype Compounds, Active
Compound or Licensed Products.
1.24 "Joint Steering and Management Committee" or "JSMC" shall have
the meaning and roles ascribed to it in Article 4.
1.25 "Know-how" means unpatented technical and other information,
including information comprising or relating to concepts,
discoveries, inventions, data, designs, formulae, ideas,
methods, models, assays, research plans, procedures, designs
for experiments and tests and results of experimentation and
testing (including results of research or development)
processes (including manufacturing processes, specifications
and techniques), laboratory records, chemical,
pharmacological, toxicological, clinical, analytical and
quality control data, trial data, case report forms, data
analyses, reports or summaries and information contained in
submissions to, and information from, ethical committees and
regulatory authorities.
1.26 "Licensed Product" means a pharmaceutical product containing
an Active Compound, a Prototype Compound, a Replacement
Compound or a Back-Up Compound as an active ingredient.
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1.27 "Major Country" means the United States, Japan, the United
Kingdom, France, Germany, or Italy.
1.28 "NDA" means a new drug application filed pursuant to 21 U.S.C.
Section 505(b)(1) including all documents, data and other
information concerning a Licensed Product which are necessary
for or included in, FDA approval to market a Licensed Product
and all supplements and amendments, including supplemental new
drug applications, that may be filed with respect to the
foregoing as more fully defined in 21 C.F.R. ss.314.50 et.
seq.
1.29 "Net Sales" means the gross amounts invoiced by Xxxxxxx, its
Affiliates or sublicensees for sales of Licensed Product in
finished package form (ready for use by the ultimate consumer)
in the Territory to a Third Party, including, but not limited
to, sales to wholesalers or other customers typical in each
country in bona fide, arm's length transactions. In the event
Xxxxxxx does not sell directly to such customers in one or
more countries, electing instead to utilize another party as a
distributor to those customers, it is understood that Net
Sales shall include sales by the distributor rather than
Xxxxxxx'x sales to the distributor. In determining Net Sales,
certain deductions may be taken against the gross amount
invoiced. These allowable deductions are:
1.29.1 (i) discounts, including cash discounts, discounts to
managed care or similar organizations or government
organizations, administrative fees paid to pharmacy
benefits managers; (ii) rebates paid or credited,
including government rebates such as Medicaid
chargebacks or rebates; (iii) retroactive price
reductions or allowances actually allowed or granted
from the billed amount; and (iv) commercially
reasonably promotional allowances actually granted to
customers as reflected on the same invoice as for the
sale of Licensed Product;
1.29.2 credits or allowances actually granted upon claims,
rejections or returns of such sales of Licensed
Products, including government mandated recalls and
recalls that Xxxxxxx reasonably believes are in the
best interest of the consumer, it being understood
that if the recalled Licensed Product is resupplied,
Net Sales shall be calculated based on the resupplied
quantities at the price previously charged, provided
that the cause of the recall was not due to the
negligence of Xxxxxxx;
1.29.3 taxes, duties or other governmental charges levied on
or measured by the billing amount when included in
billing, as adjusted for rebates, charge-backs and
refunds; and
1.29.4 freight, postage, shipping and insurance charges to
the extent included on the same invoice by Xxxxxxx or
its Affiliates or sublicensee for delivery of such
Licensed Products.
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In the case of discounts on packages of products or services
which include Licensed Product in those countries of the
Territory in which such is legally permissible ("Packages"),
the discount applied to Licensed Product within the Package
shall be no greater than the discount determined by
discounting the list price of the Licensed Product in the
Package by the average percentage discount of list prices of
all products of Xxxxxxx in the same Package, calculated as
follows:
Average percentage ( A )
Discount on a = ( 1- --- ) x 100
Particular Package ( B )
where A equals the total discounted value of a particular
Package of products, and B equals the sum of the undiscounted
value of the same Package of products. Xxxxxxx shall provide
3DP with reasonable documentation supporting the percentage
discounts with respect to each product within such Package.
A "sale" of a Licensed Product is deemed to occur upon the
invoicing, or if no invoice is issued, upon the earlier of
shipment or transfer of title in the Licensed Product to a
Third Party.
With respect to Combination Products, Net Sales for such
Combination Product sold by Xxxxxxx shall be determined by the
Parties to this Agreement in good faith based on the relative
value of the Active Compound and the additional active
ingredients that are included in the Combination Product.
1.30 "Patent Rights" means all U. S. patent applications or issued
patents, including, but not limited to, provisionals,
divisionals, continuations, continuations-in-part, reissues,
reexaminations and extensions derived therefrom, such as
patent term restorations, supplementary protection
certificates, etc., as well as all foreign patents (including
PCTs) and foreign patent counterparts to the foregoing.
1.31 "Prototype Compound" means a compound discovered using
information obtained from a Hit in the course of Prototype
Compound Generation, as described in Section 2.2, having a
dissociation constant [* *] as determined in a dose response
experiment and which demonstrates a desired activity against a
Target in a molecular or cellular functional assay. Prototype
Compounds will have pharmaceutically acceptable properties as
determined by the JSMC prior to initiation of Prototype
Compound Generation and [* *]. Prototype Compounds will be
identified as Prototype Compounds by the JSMC within [* *] of
delivery of data [* *]. For purposes of clarity, the Xxxxxxx
may, at its discretion, select a compound as a Prototype
Compound even if such compound does not meet the criteria set
forth above.
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1.32 "Prototype Compound Generation" means a program for
discovering Prototype Compounds using information obtained
from Hits, and iterative rounds of chemistry and the 3DP
Synthetically Accessible Library to make Focused Libraries for
rescreening using ThermoFluor(R) Technology against such
Target as more fully described in Section 2.2.
1.33 "Prototype Compound Optimization" means a program conducted by
Xxxxxxx for further optimizing, identifying and/or developing
a Prototype Compound or a compound discovered in the course of
the Xxxxxxx Research Program, to improve the
structure-activity relationships, potency, selectivity,
pharmacokinetics, pharmacodynamics and acute safety of such
Prototype Compound or such compound discovered in the course
of the Xxxxxxx Research Program, to identify an Active
Compound.
1.34 "Replacement Compound" shall have the meaning attributed
thereto in Section 5.8.
1.35 "Replacement Target" shall have the meaning attributed thereto
in Section 2.3.
1.36 "Research Plan" means the description of the research
activities of the Parties for particular Targets in the
performance of the Research Program, including an allocation
of FTEs to be used for various tasks and a timeline for such
tasks. A draft of the Research Plan is attached hereto as
Schedule 1.36.
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1.37 "Research Program" means research activities of the Parties
during the Research Term, as described in Article 2, that are
intended to lead to the discovery of Hits and Prototype
Compounds, excluding Prototype Compound Optimization.
1.38 "Research Program Know-how" means Know-how conceived or
developed during the conduct of the Research Program.
1.39 "Research Program Patent Rights" means those Patent Rights
that claim discoveries or inventions that were conceived
and/or reduced to practice by Xxxxxxx or 3DP or jointly by
Xxxxxxx and 3DP or by a Third Party acting under authority of
Xxxxxxx or 3DP in the course of the Research Program or a
Xxxxxxx Research Program and during the [* *] period
following the Initiation of Prototype Compound Optimization
for each Prototype Compound on a compound-by-compound basis
and relating to the Research Program or Xxxxxxx Research
Program.
1.40 "Research Term" shall have the meaning attributed thereto in
Section 10.1.
1.41 "Stage A" means the research activities undertaken by the
Parties pursuant to Article 2 as part of the Research Program
with respect to the first and second Targets to be provided by
Xxxxxxx to 3DP.
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1.42 "Stage A Commencement Date" means the Effective Date.
1.43 "Stage A Term" means the period beginning on the Stage A
Commencement Date through the first anniversary thereof,
during which Stage A of the Research Program is conducted.
1.44 "Stage B" means the research activities undertaken by the
Parties pursuant to Article 2 as part of the Research Program
with respect to the third and fourth Targets to be provided by
Xxxxxxx to 3DP.
1.45 "Stage B Commencement Date" means the date on which Xxxxxxx
provides written notice of the third and fourth Targets to
3DP.
1.46 "Stage B Term" means the period beginning on the Stage B
Commencement Date through the first anniversary thereof,
during which Stage B of the Research Program is conducted.
1.47 "Target" means a protein against which Hits are identified and
Prototype Compounds are to be optimized in the Research
Program. Targets, as defined herein, shall also include
Replacement Targets once such targets become Targets pursuant
to Section 2.3.
1.48 "Term" shall have the meaning ascribed thereto in Section
10.2.
1.49 "Territory" means the entire world.
1.50 "ThermoFluor(R) Technology" means the technology described in:
(a) the 3DP Patents identified in Schedule 1.50, and (b)
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associated proprietary 3DP Know-how used to evaluate ligand
binding parameters of Hits, Prototype Compounds, and Active
Compounds.
1.51 "Third Party" means an individual, corporation or other entity
other than a Party or any of its Affiliates.
1.52 "3DP Patent" means those Patent Rights that claim discoveries
or inventions that (i) were conceived and/or reduced to
practice solely by 3DP employees or by a Third Party acting
under authority of 3DP prior to the Effective Date; or (ii)
were conceived and/or reduced to practice solely by 3DP
employees or by a Third Party acting under authority of 3DP
during the Term, but after completion of the Research Program
and the [* *] period following the Initiation of Prototype
Compound Optimization for each Prototype Compound, on a
compound-by-compound basis; and (iii) claiming a method,
apparatus, composition of matter, material, manufacture or
business method relating to Hits, Prototype Compounds, Active
Compound or Licensed Products.
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1.53 "3DP Probe Library" means the sample compound library or any
subset thereof, comprised of proprietary and non-proprietary
compounds which are owned or Controlled by 3DP or to the
extent not encumbered by a bona fide third party interest,
that have been synthesized for the purposes of fulfilling
3DP's obligations under this Agreement, which is used for the
screening of Targets using ThermoFluor(R) Technology for the
purpose of identification of Hits, Prototype Compounds, or
Active Compounds. While the individual non-proprietary
compounds in the 3DP Probe Library are not proprietary, the
collection itself, and the list, as a whole, of
non-proprietary compounds included in the collection, are the
"Confidential Information" of 3DP.
1.54 "3DP Synthetically Accessible Library" means 3DP's virtual
compound library as it exists from time to time from which 3DP
Probe Libraries have been selected, and from which Focused
Libraries will be selected.
1.55 "Valid Claim" means (a) a claim of an issued and unexpired
patent included within the Patent Rights, which has not been
held permanently revoked, unenforceable or invalid by a
decision of a court or other governmental agency of competent
jurisdiction, unappealable or unappealed within the time
allowed for appeal, and which has not been admitted to be
invalid or unenforceable through reissue or disclaimer or
otherwise, or (b) a claim of a pending patent application
included within the Patent Rights, which claim was filed in
good faith and has not been abandoned or finally disallowed
without the possibility of appeal or refiling of such
application; provided, however, if a claim of a pending
application included within the Patent Rights has not issued
within six (6) years after the filing date from which such
claim takes priority, such claim of a pending application
shall no longer be a Valid Claim for purposes of this
definition until such patent application issues.
ARTICLE 2
RESEARCH PROGRAM
2.1 Supply of Targets. Xxxxxxx shall supply 3DP with four (4)
Targets, the first and second of which are identified in
Schedule 2.1 attached hereto, in quantities and of quality
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sufficient to perform the Research Program pursuant to the
Research Plan. The third and fourth Targets shall be provided
to 3DP by Xxxxxxx no later than [* *], or as otherwise agreed
by the Parties. All such Targets shall be supplied to 3DP in
the form of proteins.
2.2 Prototype Compound Generation. Depending on the nature and
source of each Target, 3DP will have the following
obligations. 3DP shall initially screen the Target against a
screening library, selected by 3DP from the 3DP Probe Library
and totaling approximately one hundred thousand (100,000)
compounds per Target. If such initial screening produces no
Hits, the JSMC may ask 3DP to
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perform a secondary screen of a reasonable number of
additional compounds from the 3DP Probe Library and 3DP will
undertake such secondary screen. If the initial screening or
the secondary screening produces Hits, 3DP will undertake
rounds of iterative chemistry. Each round will include the
synthesis of Focused Libraries containing up to [* *] but not
less than [* *] compounds (unless such compounds are subject
to the limitations set forth in Schedule 2.2 or such other
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maximum and minimum compound numbers as the Parties may agree
upon) per round. 3DP shall continue to perform iterative
rounds of chemistry until the first to occur of the following:
2.2.1 a Prototype Compound is identified in accordance with
Section 1.28; or
2.2.2 a maximum of [* *] total rounds of iterative
chemistry are performed to generate Focused Libraries
from the 3DP Synthetically Accessible Library; or
2.2.3 a maximum of [* *] compounds contained in Focused
Libraries are synthesized and screened using
DiscoverWorks(R) Technology from the 3DP
Synthetically Accessible Library.
2.3 Replacement Targets.
2.3.1 If neither initial screening nor the secondary
screening of the compounds from the 3DP Probe Library
produces any Hits against that Target, then Xxxxxxx
may identify, subject to approval by 3DP and the
JSMC, a replacement Target ("Replacement Target")
against which 3DP will conduct Prototype Compound
Generation pursuant to Section 2.2 for the remainder
of the applicable Stage A Term or Stage B Term.
2.3.2 If Prototype Compound Generation of such Replacement
Target is incomplete at the end of the applicable
Stage A Term or Stage B Term, then at Xxxxxxx'x
request, 3DP will continue and complete the Prototype
Compound Generation pursuant to Section 2.2 for such
Replacement Target at the same FTE rate of
compensation paid to 3DP as recited in Section 5.2.
2.3.3 Xxxxxxx may select a total of up to [* *] Replacement
Targets pursuant to the provisions of this Section
2.3.
2.3.4 Any Replacement Targets identified by Xxxxxxx may be
disapproved by 3DP only (i) in order to avoid
potential conflicts with respect to prior contractual
obligations and current internal 3DP programs, (ii)
for lack of suitability with ThermoFluor(R)
Technology, (iii) because 3DP reasonably believes
that use of such Replacement Target would infringe a
valid and enforceable third party patent, or (iv)
because the Target is for the primary
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purpose of identifying drugs specifically intended
for [* *].
2.4 Prototype Compounds. Upon identification of a Prototype
Compound in accordance with Section 1.28, (a) the Prototype
Compound, along with all Back-Up Compounds shall be licensed
to Xxxxxxx for Prototype Compound Optimization and further
development and commercialization as provided in Section 6.4
herein and (b) 3DP shall provide Xxxxxxx with the structure
and protocol for synthesis of such Prototype Compound within
[* *] of the JSMC identifying it as a Prototype Compound.
Xxxxxxx shall promptly inform 3DP upon Initiation of Prototype
Compound Optimization.
2.5 Back-up Compounds. On a Target-by-Target basis, upon
identification of a Prototype Compound, all the Compounds in
the Focused Libraries having activity against such Target
equivalent or better than the activity needed to be considered
a Hit against that Target shall constitute Back-Up Compounds.
On the first anniversary of initiation of Prototype Compound
Optimization for a Prototype Compound that has activity
against a Target, Xxxxxxx shall identify a total of up to
[* *] compounds from the Focused Libraries having activity
against the same Target to be designated as Back-up Compounds.
On the second anniversary of initiation of Prototype Compound
Optimization for such Prototype Compound, Xxxxxxx shall
identify a total of up to [* *] compounds from the [* *]
compounds previously identified and having activity against
the same Target to be designated Back-up Compounds. If a
Back-up Compound is selected for development as a Replacement
Compound, the [* *] period following the initiation of
Prototype Compound Optimization for each Prototype Compound on
a compound-by-compound basis during which Xxxxxxx Know-how
shall be disclosed by Xxxxxxx to 3DP for 3DP to prepare, file,
prosecute and maintain Research Program Patent Rights pursuant
to Article 8, will be deemed to have restarted on the date of
notification of such selection.
2.6 No Grant of License to DiscoverWorks(R) Technology.
Notwithstanding any provision to the contrary in this
Agreement, no license to any portion of the DiscoverWorks(R)
Technology, including any related Know-how, is hereby granted
by 3DP to Xxxxxxx under this Agreement or otherwise.
ARTICLE 3
RESEARCH AND DEVELOPMENT EFFORTS
3.1 Research Efforts. Each Party shall use commercially reasonable
efforts to perform its responsibilities and fulfill its
obligations under this Agreement. As used herein, the term
"commercially reasonable efforts" will mean efforts
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consistent with such Party's normal scientific and business
practice, as applied to other programs of similar scientific
and commercial potential.
3.2 Allocation of FTEs. 3DP shall dedicate, and Xxxxxxx shall
fund, [* *] FTEs to Stage A of the Research Program for the
Stage A Term and [* *] FTEs to Stage B of the Research Program
for the Stage B Term, unless otherwise agreed by the Parties
in writing.
3.3 Disclosure of Research Program Results. The JSMC will provide
quarterly written reports to the Parties presenting a
meaningful summary of the work performed on the Research
Program and Prototype Compound Optimization. In addition, on
reasonable request by Xxxxxxx or 3DP, 3DP or Xxxxxxx will make
presentations to the JSMC of its activities under this
Agreement to inform the JSMC of the details of the work done
under this Agreement during the Research Term and the [* *]
period following the Initiation of Prototype Compound
Optimization for each Prototype Compound, on a
compound-by-compound basis. Know-how and other information
regarding the Research Program or Prototype Compound
Optimization disclosed by one Party to the other Party
pursuant hereto may be used only in accordance with the rights
granted under this Agreement. Within thirty (30) days
following the end of each calendar quarter, the Parties shall
each exchange and provide to the JSMC chairperson and
secretary a written report summarizing in reasonable detail
the work performed by it under the Research Program or
Prototype Compound Optimization during the preceding calendar
quarter.
3.4 Prototype Compound Optimization Continuing Report
Responsibility. For each compound identified as a Prototype
Compound or Active Compound, Xxxxxxx shall, until the issuance
of the last Research Program Patent Right, provide a report of
its activities, and/or those of its Affiliates and
sublicensees, toward the development, use and/or
commercialization of such Prototype Compound or Active
Compound. Such report relating to Prototype Compound
Optimization shall be submitted to 3DP semi-annually and shall
set forth in reasonable detail, with supporting data, the
results of work performed on such compound, including, without
limitation, all material information and data generated during
such period not previously provided to 3DP pursuant to Section
8.3, reasonably necessary to enable 3DP to prepare, file,
prosecute and maintain Research Program Patent Rights. If no
results of work performed on such compound have been obtained
by Xxxxxxx during the six-month period after the preceding
semi-annual report, Xxxxxxx will so inform 3DP. In no event
shall Xxxxxxx provide such a report relating to Prototype
Compound Optimization less frequently than semi-annually.
After achievement of the milestone in Section 5.7.2 for an
Active Compound, Xxxxxxx will thereafter provide to 3DP
reports relating to such Active Compound annually. Xxxxxxx
will provide timely notice, in good faith, of its decision to
discontinue its and/or its Affiliates' and
13
sublicensees' activities toward the development, use and/or
commercialization of a Prototype Compound, Active Compound
and/or Licensed Product.
3.5 Material Transfer. In order to facilitate the Research
Program, either Party (a "Supplying Party") may provide to the
other Party (a "Receiving Party") certain information
(including chemical structures), biological materials or
chemical compounds, including without limitation any compounds
from the 3DP Synthetically Accessible Library, 3DP Probe
Library or Focused Library (collectively, the "Substances")
owned by or licensed to the Supplying Party (other than under
this Agreement) and available for use by either Party in
furtherance of the Research Program. Except as otherwise
provided under this Agreement, all information or Substances
delivered to the Receiving Party shall remain the sole
property of the Supplying Party, shall be used only in
furtherance of the Research Program and shall be solely under
the control of the Receiving Party, shall not be used or
delivered to or for the benefit of any Third Party without the
prior written consent of the Supplying Party, and shall not be
used in research or testing involving human subjects except
pursuant to an approved Xxxxxxx clinical trial. Because not
all of their characteristics may be known, the Substances
supplied under this Section 3.6 must be used with prudence and
appropriate caution in any experimental work. THE SUBSTANCES
ARE PROVIDED "AS IS" AND WITHOUT ANY REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY
PARTICULAR PURPOSE OR ANY WARRANTY THAT THE USE OF THE
SUBSTANCES WILL NOT INFRINGE OR VIOLATE ANY PATENT OR OTHER
PROPRIETARY RIGHTS OF ANY THIRD PARTY.
3.6 Insurance. Each party shall maintain appropriate insurance
with respect to its activities hereunder, in amounts customary
in the pharmaceutical and biotechnology industries.
3.7 Liability. Each Party shall be responsible for, and hereby
assumes, any and all risks of personal injury or property
damage attributable to the gross negligent or willful acts or
omissions, during the term of the Research Program, of that
Party or its Affiliates, and their respective directors,
officers, employees and agents.
ARTICLE 4
RESEARCH PROGRAM GOVERNANCE
4.1 Joint Steering and Management Committee. 3DP and Xxxxxxx agree
to establish a Joint Steering and Management Committee (the
"JSMC"), and shall each designate three members selected by
their respective R&D management to form the JSMC. The
chairperson of the JSMC shall be selected by Xxxxxxx. 3DP
14
shall select the secretary to the JSMC. Each Party may replace
its representatives at any time, upon notice to the other
Party. Any member of the JSMC may designate a substitute to
attend and perform the functions of that member at any meeting
of the JSMC. The JSMC shall review the Research Plan for the
Stage A Term within 30 days after the Effective Date.
Thereafter, the Research Plan shall be updated by the JSMC in
writing as changes are made to the Research Program on at
least an annual basis.
4.2 Responsibilities of the JSMC. The JSMC shall be responsible
for:
4.2.1 Adopting, reviewing and amending the Research Plan to
implement the Research Program;
4.2.2 Overseeing the progress of research in the Research
Program;
4.2.3 Monitoring Prototype Compound Optimization and the
Xxxxxxx Research Program and providing a forum for
meetings and updates relating to Prototype Compound
Optimization and the Xxxxxxx Research Program until
the issuance of the last Research Program Patent
Right;
4.2.4 Allocation of funded FTEs across the Targets, and
within each Target;
4.2.5 Reviewing results from the screening of the 3DP Probe
Library and Focused Libraries in connection with
selecting the additional compounds from the 3DP Probe
Library to be screened by 3DP or synthesized by 3DP,
and the identification of Hits and Prototype
Compounds;
4.2.6 Defining quality criteria for identification of Hits
and Prototype Compounds pursuant to Sections 1.29 and
1.16; such criteria to be defined within sixty (60)
days after the Effective Date; and
4.2.7 Reviewing and approving publications and other public
disclosures related to the subject matter of the
Research Program.
4.3 JSMC Meetings. During the Research Term, the JSMC shall meet
in person or by teleconference on a calendar quarter basis
(provided that at least one meeting per year shall be in
person) or more frequently as necessary and as may be agreed
upon, with each Party bearing all travel and related costs for
its representatives. After the end of the Research Term, but
during the [* *] period following the initiation of Prototype
Compound Optimization for each Prototype Compound, on a
compound-by-compound basis, the JSMC shall meet in person or
by teleconference at least semi-annually. Thereafter, the JSMC
shall meet on an ad hoc basis as needed to perform the
responsibilities designated to the JSMC. In addition to
periodic meetings, the members of the JSMC shall communicate
regularly by telephone, electronic mail, facsimile, or other
method, as deemed necessary or appropriate.
15
4.4 JSMC Decision-Making Process. Each Party shall have one vote
on all matters decided by the JSMC, and decisions by the JSMC
shall be made by unanimous vote of the parties. The Parties
shall attempt to resolve any disagreement between the Parties
within the JSMC using the objectives and principles of this
Agreement as the basis for settling such disputes. Any
disagreement that cannot be resolved by a vote of the JSMC
shall be subject to the procedures set forth in Article 13.
4.5 Minutes of JSMC Meetings. Within two (2) weeks after each JSMC
meeting, the secretary of the JSMC shall prepare and
distribute minutes of the meeting, which shall provide a
description in reasonable detail of the discussions had at the
meeting and a list of any actions, decisions or determinations
approved by the JSMC. The JSMC secretary shall be responsible
for circulation of all draft and final minutes. Draft minutes
shall be first circulated to the chairperson, edited by the
chairperson and then circulated in final draft form to all
members of the JSMC sufficiently in advance of the next
meeting to allow adequate review and comment prior to the
meeting. Minutes shall be approved or disapproved, and revised
as necessary, at the next meeting of the JSMC. Final minutes
shall be distributed to the members of the JSMC.
4.6 Management of Matters Outside the Jurisdiction of the JSMC.
Matters outside the scope of the Research Program and internal
to each Party are not under the purview of the JSMC. Such
matters include, but are not limited to the following:
internal personnel policies and programs; budgeting, finance,
commercial and marketing strategies; Prototype Compound
Optimization; and development and commercialization decisions.
However, the Parties may, at their sole discretion,
communicate with each other on those matters which, while
outside the scope of the Research Program, influence the
conduct or term of the Research Program or the development or
commercialization of any Hit, Prototype Compound, or Active
Compound.
ARTICLE 5
FINANCIAL TERMS
5.1 Technology Access Fee. Xxxxxxx agrees to pay a nonrefundable
technology access fee of [* *] within thirty (30) days after
the Effective Date.
5.2 FTE Reimbursement Fees.
5.2.1 Xxxxxxx agrees to pay 3DP for [* *] Stage A FTEs at a
rate of [* *] per FTE per year. Such funding shall be
payable by Xxxxxxx to 3DP in a single nonrefundable
payment of [* *] by same day wire transfer and shall
be paid concurrently with the Technology Access Fee.
16
5.2.2 Xxxxxxx agrees to pay 3DP for [* *] Stage B FTEs [*
*] per FTE per year. Such funding shall be payable by
Xxxxxxx to 3DP in a single nonrefundable payment of
[* *] by same day wire transfer and shall be paid
concurrently with the Technology Access Fee.
5.3 Costs. Except as otherwise provided in this Agreement, or as
may be agreed from time to time by the Parties in writing, 3DP
and Xxxxxxx will each bear all of its own expenses incurred in
connection with the Research Program including but not limited
to any capital expenses for equipment to carry out the
Research Program.
5.4 Extended Term Fees. The level of reimbursement for FTEs in any
Extended Research Term shall be negotiated in good faith by
the Parties.
5.5 Research Audit. 3DP shall maintain complete and accurate
records tracking the number of FTEs carrying out the Research
Program. During the Research Term and for one year thereafter,
upon Xxxxxxx'x reasonable request, 3DP shall make such records
available no more than twice a year during normal business
hours for examination at Xxxxxxx 's expense for the sole
purpose of verifying for Xxxxxxx whether or not 3DP is using
the average required number of FTEs to carry out the Research
Program as specified in the Research Plan. Should it be
determined that 3DP has used fewer than the required FTEs
during any period of the Research Term, Xxxxxxx shall receive
a credit for the lost FTE time against any future payments
owed to 3DP (or if the Parties mutually agree, the lost FTE
time will be made up in subsequent quarters); or if no future
payments will be owed by Xxxxxxx to 3DP, a payment shall be
made by 3DP to Xxxxxxx for the lost FTE time.
5.6 Fees for Early Termination of the Research Program. If Xxxxxxx
terminates the Research Program without cause, pursuant to the
provisions of Section 10.3, prior to the end of the Research
Term, Xxxxxxx agrees to pay to 3DP a termination fee equal to
[* *].
5.7 Milestone Payments. The following milestones shall become due
and payable by Xxxxxxx to 3DP within sixty (60) days after
accomplishment of the following milestones:
5.7.1 Upon the identification by the JSMC of the first
Prototype Compound for each Target: [* *];
5.7.2 Upon submission of an IND and expiration of the
thirty (30) day waiting period without disapproval by
the FDA or its foreign counterpart for each Active
Compound: [* *]; and
17
5.7.3 Upon filing and acceptance by the FDA of an NDA for
each Active Compound: [* *].
5.8 Milestone Payment Credit. In the event that any milestone
payment is made pursuant to Section 5.7 with respect to a
Prototype Compound or Active Compound selected for development
(an "Original Compound"), where, after the payment of any such
milestones, such development terminates and, at any time after
such termination, a Back-up Compound is selected for
development (a "Replacement Compound"), then Xxxxxxx shall be
entitled to a credit against milestone payments due with
respect to the Replacement Compound, in the amount equal to
all milestone payments actually paid with respect to the
Original Compound prior to termination of development of such
Original Compound.
5.9 Milestone Press Release. Within ten (10) days of the
achievement of the milestone(s) set forth in Section 5.7, 3DP
shall, at its discretion and subject to Xxxxxxx'x prior
written approval (such approval not to be unreasonably
withheld or delayed) issue a press release announcing, by way
of example, the achievement of a milestone, the identification
of a Prototype Compound (excluding any structural
information), and such other information as mutually agreed by
the Parties.
5.10 Royalty Rate. Xxxxxxx shall pay 3DP a royalty of [* *] on
annual Net Sales.
5.11 Royalty Rate Reduction.
5.11.1 Generic Equivalent. If, in any quarterly royalty
reporting period, (i) a third Party commences selling
a product which is a Generic Equivalent of the
Licensed Product in a country in the Territory and
(ii) such Unlicensed Unit Sales (as defined below)
amount to the following percentages of Xxxxxxx'x Unit
Sales of the Licensed Product in such country in the
same royalty reporting period, the royalty rate on
Net Sales shall be reduced in such country in
accordance with the percentages below and such lower
royalty rate shall then apply on the Net Sales in
such country as long as the Unlicensed Unit Sales
amount to the particular percentage of Xxxxxxx'x Unit
Sales of the Licensed Product in such country in the
same royalty reporting period.
Unlicensed Unit Sales Royalty Rate Reduction*
(as a % of Xxxxxxx Unit Sales) (% of Royalty Rate)
------------------------------ -------------------
[* *] [* *]
[* *] [* *]
18
[* *] [* *]
* A royalty rate reduction will, however, only be
applicable if Xxxxxxx also experiences a decrease in
Net Sales of the applicable Licensed Product in that
country from the Net Sales of the applicable Licensed
Product in the same royalty reporting period in the
previous calendar year in the same country.
For purposes of this Section 5.11.1, (i) "Unlicensed
Unit Sales" and "Xxxxxxx Unit Sales" shall be deemed
to mean the total grams of the Active Compound
contained in the Third Party product (irrespective of
dosage form) and the Licensed Product (irrespective
of dosage form), respectively, as reflected on the
label of each such Licensed Product and Third Party
product; and (ii) Unlicensed Unit Sales shall be
determined by the sales reports of IMS America Ltd.
of Plymouth Meeting, Pennsylvania ("IMS") or any
successor to IMS or any other independent sales
auditing firm selected by Xxxxxxx and reasonably
acceptable to 3DP. Xxxxxxx shall bear all costs of
providing 3DP with such information. If Xxxxxxx is
entitled to a royalty reduction based on Unlicensed
Unit Sales pursuant to this Section 5.11.1 for any
royalty reporting period, Xxxxxxx shall submit the
sales report of IMS or such other independent firm,
as applicable, for the relevant royalty reporting
period to 3DP, together with Xxxxxxx 's or its
Affiliates' or sublicensees' sales report for the
relevant royalty reporting period. Such sales reports
for each royalty reporting period in which Xxxxxxx is
entitled to such royalty reduction shall be submitted
with the royalty report for such royalty reporting
period submitted pursuant to Section 5.15.
5.11.2 Third Party Patents. If Patent Rights of a Third
Party should exist in any country during the Term
which are required to manufacture, use sell the
Licensed Product, and if it should prove in Xxxxxxx'x
reasonable judgment (as supported by an opinion from
outside patent counsel which counsel is acceptable to
both Parties) impractical or impossible for Xxxxxxx,
its Affiliates or its sublicensee to continue the
activity or activities licensed hereunder without
obtaining a royalty bearing license from such Third
Party under such Patent Rights in said country, then
Xxxxxxx shall be entitled to a credit against the
royalty payments due hereunder of an amount equal to
the royalty paid to such Third Party, not to exceed
[* *] of the royalty rate due under this Agreement,
arising from the manufacture, use or sale of the
Licensed Product in said country.
5.11.3 Compulsory License. If at any time and from time to
time a Third Party in any country shall, under the
right of a compulsory license granted or ordered to
be granted by a competent governmental authority,
19
manufacture, use or sell any Licensed Product, with
respect to which royalties would be payable pursuant
to Section 5.10 hereof, then Xxxxxxx may reduce the
royalty on sales in such country of such Licensed
Product according to the rates specified in Section
5.11.1.
5.12 Royalty Period. The royalty payments set forth in Section 5.9
shall be payable for each Licensed Product on a
product-by-product and country-by-country basis from the time
of First Commercial Sale of Licensed Product in such country
until the later of: (a) [* *] from the time of First
Commercial Sale of Licensed Product in such country; or (b)
until the last-to-expire or -lapse of Patent Rights containing
a Valid Claim with respect to the Active Compound (including
without limitation a Replacement Compound) which is an
ingredient of such Licensed Product in such country.
5.13 Royalty Conditions. No royalties shall be due upon the sale or
other transfer among Xxxxxxx, its Affiliates, licensees or
sublicensees, but in such cases the royalty shall be due and
calculated upon Xxxxxxx'x or its Affiliate's, licensee's or
sublicensee's Net Sales of Licensed Product to the first
independent Third Party.
5.14 Mode of Payment. All payments to 3DP hereunder shall be made
by wire transfer of United States Dollars in the requisite
amount to the account designated by 3DP which is attached
hereto as Schedule 5.14; provided, however, that any notice by
-------------
3DP of a change in such account shall not be effective until
thirty (30) days after receipt thereof by Xxxxxxx. Payments
shall be free and clear of any taxes due by Xxxxxxx (other
than withholding and other taxes imposed on 3DP), fees or
charges, to the extent applicable. For purposes of computing
royalty payments for Net Sales made outside of the United
States, such royalties shall be converted into U.S. Dollars,
by applying the rate of exchange as used by Xxxxxxx'x global
accounting system which reflects the average exchange rate for
the applicable payment period.
5.15 Quarterly Royalty Reports. During the Term and commencing with
the First Commercial Sale of each Licensed Product, Xxxxxxx
shall furnish or cause to be furnished to 3DP on a quarterly
basis, a written report or reports covering each quarter (each
such quarter being sometimes referred to herein as a
"reporting period") showing:
5.15.1 Gross invoiced sales and total deductions used to
calculate Net Sales of each Licensed Product sold by
Xxxxxxx and its sublicensees during the reporting
period on a country-by-country basis. For the United
States only, twice per calendar year, Xxxxxxx shall
provide to 3DP a report showing all itemized
deductions from gross sales to Net Sales. In any
Major Country or country which represents ten percent
(10%) or more of world wide gross invoiced sales
(other than the United States), to the extent that
there are significant variances in total deductions
from gross
20
invoiced sales to Net Sales from one quarter to
another, Xxxxxxx shall, at 3DP's reasonable request,
provide a reasonably detailed explanation as to such
increase.
5.15.2 The royalties, payable in U.S. Dollars, which shall
have accrued hereunder in respect of such Net Sales.
5.15.3 The exchange rates used, if any, in converting into
U.S. Dollars, from the currencies in which sales were
made.
5.15.4 Dispositions of such Licensed Product other than
pursuant to sale for cash, if such data is normally
reported in royalty reports of other licensed
products.
5.15.5 Any withholding taxes required to be paid from such
royalties.
5.16 Royalty Payment Due Date; Accrual. Royalties which have
accrued during any month and are required to be shown on a
final quarterly sales report provided for hereunder shall be
due and payable on the date such final quarterly sales report
is due. In addition, at the end of each calendar year in which
royalties are paid hereunder, Xxxxxxx agrees to reconcile
estimated or accrued rebates and discounts taken during such
calendar year in accordance with its standard reconciliation
practices and make any necessary adjustment in the next
calendar quarter in which royalties are due and payable.
5.17 Royalty Report Timing. Xxxxxxx shall provide flash sales
reports to 3DP [* *] after the close of each reporting period,
and final reports shall be due [* *] following the close of
each reporting period.
5.18 Currency Exchange. In the case of sales of any Licensed
Product outside the United States, royalty payments by Xxxxxxx
to 3DP shall be converted to U.S. Dollars in accordance with
Xxxxxxx'x current customary and usual procedures for
calculating same which are the following: the rate of currency
conversion shall be calculated using a simple monthly period
average of the end "spot rates" provided by Xxxxx Brothers
Xxxxxxxx, 00 Xxxx Xxxxxx, XX, XX 00000, for each quarter, or
if such rate is not available, the spot rate as published by a
leading United States commercial bank for such accounting
period. This method of conversion is consistent with Xxxxxxx'x
current accounting methods. Xxxxxxx shall give 3DP prompt
written notice of any changes to Xxxxxxx'x customary and usual
procedures for currency conversion, which shall only apply
after such notice has been delivered and provided that such
changes continue to maintain a set methodology for currency
conversion.
21
5.19 Records Retention. With respect to any products for which
royalties are due pursuant to this Agreement, Xxxxxxx and its
Affiliates and any licensees or sublicensees shall keep
records, for two (2) years, of such Net Sales in sufficient
detail to confirm the accuracy of the royalty calculations
hereunder. At the request of 3DP, Xxxxxxx shall permit an
independent certified accountant of nationally recognized
standing appointed by 3DP and reasonably acceptable to
Xxxxxxx, during normal business hours and upon reasonable
notice, to examine these records solely to the extent
necessary to verify such calculations. Such investigation
shall be at the expense of 3DP unless it reveals a discrepancy
in Xxxxxxx'x favor of more than [* *], in which event it shall
be at Xxxxxxx'x expense.
5.20 Taxes. The Party receiving royalties and other payments under
this Agreement shall pay any and all taxes levied on account
of such payment. If any taxes are required to be withheld by
the paying Party, it shall: (a) deduct such taxes from the
remitting payment, (b) pay the taxes, in a timely manner, to
the proper taxing authority, and (c) send proof of payment to
the other Party and certify its receipt by the taxing
authority within sixty (60) days following such payment.
ARTICLE 6
OWNERSHIP; GRANT OF LICENSE RIGHTS
6.1 Ownership of Libraries. 3DP shall retain its ownership rights
to the compounds in the 3DP Probe Library and the 3DP
Synthetically Accessible Library and in any Focused Library
developed by 3DP pursuant to this Agreement.
6.2 No Reverse Engineering. Xxxxxxx shall not, and shall not cause
or assist any Third Party to, use any data or information
derived from the Research Program or the 3DP Probe Library or
the 3DP Synthetically Accessible Library to design, create or
supplement a compound library.
6.3 Ownership of Targets. Xxxxxxx shall retain any ownership
rights Xxxxxxx may have in any Targets Xxxxxxx provides to 3DP
pursuant to this Agreement, and 3DP shall have a right to use
such Targets solely for the purpose of performing its
obligations under the Research Program pursuant to the terms
of this Agreement. During the Research Term [* *], 3DP
shall not use Targets in any work it conducts with Third
Parties. During the Research Term [* *], 3DP shall not enter
into a drug discovery or development agreement with any Third
Party on the same Target or Targets.
6.4 Ownership of Hits and Prototype Compounds; Xxxxxxx Exclusive
License. 3DP shall retain any proprietary rights, title and
interest in and appurtenant to Hits, Prototype Compounds and
any other compounds in the Focused Library; provided, however,
that Xxxxxxx shall have an exclusive, worldwide license under
22
3DP Patents, Joint Patents and Research Program Patent Rights
(even as to 3DP), with the right to sublicense, to conduct
research, develop, make, have made, use, sell, have sold,
offer for sale or import Prototype Compounds, Replacement
Compounds, Active Compounds, Back-Up Compound or Licensed
Products in the Field. Notwithstanding the foregoing, 3DP
shall retain the right to use any Prototype Compounds, Back-up
Compounds, Replacement Compounds, Active Compounds, or any
other compounds in the Focused Library that are used in
Licensed Products to conduct research; provided, however, that
3DP shall not publish results of such research and shall not
provide Active Compounds, Prototype Compounds, Replacement
Compounds, or Back-Up Compounds to any Third Party during the
Term [* *].
ARTICLE 7
CONFIDENTIAL INFORMATION
7.1 Confidentiality Obligations. The Parties agree that, for the
Term and for five (5) years thereafter, either Party (a
"Receiving Party") that receives Confidential Information from
the other Party (a "Disclosing Party") shall keep, and shall
endeavor to ensure that its officers, directors and employees
keep, confidential and shall not publish or otherwise disclose
and shall not use for any purpose (except as expressly
permitted hereunder) any Confidential Information furnished to
it by the Disclosing Party pursuant to this Agreement
(including without limitation, Know-how). The obligations of
confidentiality and non-use set forth in this Section 7.1
shall also apply to biological material and chemical compounds
and associated information (including, without limitation,
Know-how) disclosed by one Party to the other prior to or
during the Term; provided however, that such obligation of
confidentiality and non-use shall not apply to Xxxxxxx with
respect to compounds that are assigned to Xxxxxxx or
exclusively licensed to Xxxxxxx by 3DP.
7.2 Written Assurances and Permitted Uses of Confidential
Information.
7.2.1 Each Party shall inform its employees and consultants
who perform work on the Research Program, of the
obligations of confidentiality specified in Section
7.1 and all such persons shall be bound by the terms
of confidentiality set forth therein.
7.2.2 The Receiving Party may disclose the Disclosing
Party's Confidential Information to the extent the
Receiving Party is compelled to disclose such
information by a judicial or administrative authority
of competent jurisdiction, including but not limited
to submitting information to tax authorities or
complying with any discovery or similar request for
production of documents in litigation or similar
alternative dispute resolution proceedings; provided
however, that in such case the Receiving
23
Party shall give notice, in a timely fashion, to the
Disclosing Party so that the Disclosing Party may
seek a protective order or other remedy from said
authority. In any event, the Receiving Party shall
disclose only that portion of the Confidential
Information that, in the opinion of its legal
counsel, is legally required to be disclosed and will
exercise reasonable efforts to ensure that any such
information so disclosed will be accorded
confidential treatment by said court or tribunal.
7.2.3 To the extent it is reasonably necessary or
appropriate to fulfill its obligations and exercise
its rights under this Agreement, either Party may
disclose Confidential Information to its Affiliates
on a need-to-know basis on condition that such
Affiliates agree to keep the Confidential Information
confidential for the same time periods and to the
same extent as such Party is required to keep the
Confidential Information confidential under this
Agreement, and to any regulatory authorities to the
extent reasonably necessary to obtain regulatory
approvals.
7.2.4 To the extent that it is reasonably necessary or
appropriate to fulfill its obligations, either Party
may disclose Confidential Information to the U.S.
Patent and Trademark Office or any foreign
counterparts thereof, in order to comply with the
rules governing disclosure of material information
during patent examination.
7.2.5 The existence and the terms and conditions of this
Agreement which the Parties have not specifically
agreed to disclose pursuant to this Section 7.2 shall
be treated by each Party as Confidential Information
of the other Party.
7.3 Permitted Disclosures for Business Development Purposes.
Notwithstanding the foregoing or any other provision in this
Agreement to the contrary, 3DP may disclose statistics and
masked informational data for presentations to investors or to
scientific audiences, based on the research data produced
pursuant to the activities under this Agreement, including
without limitation, success rates; and excluding Confidential
Information identifying, for example, specific Prototype
Compounds, Active Compounds, Targets, Hits, Back-Up Compounds,
Replacement Compounds, Research Program Patent Rights,
chemical names, chemical structures and their activities.
7.4 Notification. Both Parties recognize that each may wish to
publish the results of their work relating to the Research
Program. However, both Parties also recognize the importance
of acquiring patent protection on Licensed Products.
Consequently, 3DP shall not make any publication relating to
any Prototype Compound, Replacement Compound, Active Compound
or Licensed Product without the prior written permission of
Xxxxxxx and any proposed publication by either Party relating
to the Research Program or Prototype Compound
24
Optimization shall comply with this Article 7. At least sixty
(60) days before a manuscript is to be submitted to a
publisher, the publishing Party will provide the JSMC with a
copy of the manuscript. If the publishing Party wishes to make
an oral presentation, it will provide the JSMC with a copy of
the abstract (if one is submitted) at least sixty (60) days
before it is to be submitted. The publishing Party will also
provide to the JSMC a copy of the text of the presentation,
including all slides, posters and any other visual aids, at
least sixty (60) days before the presentation is made.
7.5 Review of Proposed Publications. The JSMC will review the
manuscript, abstract, text or any other material provided
under Section 7.4 to determine if patentable subject matter is
disclosed. The JSMC will notify the publishing Party within
sixty (60) days of receipt of the proposed publication if the
JSMC determines that patentable subject matter is or may be
disclosed, or if the JSMC believes Confidential Information or
proprietary information is or may be disclosed. If it is
determined by the JSMC that patent applications should be
filed, the publishing Party shall delay its publication or
presentation for a period not to exceed ninety (90) days from
the JSMC's notification to the publishing Party to allow time
for the filing of patent applications covering patentable
subject matter. In the event that the delay needed to complete
the filing of any necessary patent application will exceed the
ninety (90)-day period, the Parties will discuss the need for
obtaining an extension of the publication delay beyond the
ninety (90)-day period. If it is determined by the JSMC that
confidential or proprietary information is being disclosed,
the JSMC will attempt to arrive at an agreement on mutually
acceptable modifications to the proposed publication to avoid
such disclosure. The publishing Party of any manuscript, text
or oral presentation will acknowledge the other Party for its
contribution to the material being published or presented and
to the Research Program.
ARTICLE 8
PATENT RIGHTS AND INTELLECTUAL PROPERTY
8.1 Ownership; Inventions. Inventorship for patentable inventions
conceived and reduced to practice during the course of the
performance of activities pursuant to this Agreement shall be
determined in accordance with U.S. patent laws for determining
inventorship. Xxxxxxx Patents shall be owned by Xxxxxxx, 3DP
Patents shall be owned by 3DP, and Joint Patents shall be
jointly owned by the Parties. Research Program Patent Rights
shall be owned by 3DP, regardless of inventorship, and Xxxxxxx
agrees to assign to 3DP its rights in any Research Program
Patent Rights having Xxxxxxx employees as sole or joint
inventors. In the event of a dispute regarding inventorship,
if the parties are unable to resolve such inventorship
dispute, the Parties shall establish a procedure to resolve
such dispute, which may include engaging a Third Party patent
attorney jointly selected by the Parties to resolve such
dispute. Each Party will cooperate with the other to
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the extent reasonably necessary to execute assignments and
other documentation as may be required.
8.2 Disclosure of Patentable Inventions. Each Party shall promptly
provide to the other any invention disclosure submitted in the
normal course of business and disclosing an invention arising
during the Research Program and [* *] period following the
Initiation of Prototype Compound Optimization for each
Prototype Compound, on a compound-by-compound basis, and
relating to Hits, Prototype Compounds, Active Compounds,
Back-Up Compounds or Replacement Compounds.
8.3 Disclosure of Xxxxxxx Know-how. During the [* *] period
following the initiation of Prototype Compound Optimization
for each Prototype Compound on a compound-by-compound basis,
Xxxxxxx shall promptly provide 3DP with complete written
disclosures of any potentially patentable technology derived
from the Research Program, the Xxxxxxx Research Program and/or
Prototype Compound Optimization.
8.4 3DP Patentable Inventions and Know-How.
8.4.1 3DP Patent Prosecution.
(a) Selection of Outside Counsel. Before
retaining any law firm and/or patent
attorney for the preparation and prosecution
of any patent applications which are
Research Program Patent Rights, 3DP shall
inform Xxxxxxx of the identity of such law
firm and/or patent attorney it desires to
employ and the Parties will discuss such
firm and/or attorney. 3DP will consider any
suggestions from Xxxxxxx regarding the
selection of a law firm and/or patent
attorney for handling preparation,
prosecution and maintenance of Research
Program Patent Rights and Xxxxxxx may
disapprove any law firm and/or patent
attorney proposed by 3DP, such approval not
to be unreasonably withheld or delayed.
(b) Prosecution and Maintenance. During the
Term, 3DP shall prepare, file, prosecute and
maintain 3DP Patents (at 3DP's sole expense)
and Research Program Patent Rights (at
Xxxxxxx'x sole expense) and use reasonable
efforts to initially file all such patent
applications in the United States. For
Research Program Patent Rights, Xxxxxxx
shall provide a list of countries in which
such patent applications shall be filed
reasonably in advance of 3DP's estimated
filing date. 3DP shall file such patent
applications in each indicated country.
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(c) Discontinuance. If 3DP does not intend to
file for patent protection or does not wish
to continue preparation, prosecution or
maintenance of Research Program Patent
Rights, then it shall give at least
forty-five (45) days advance notice to
Xxxxxxx, and in no event less than a
reasonable period of time for Xxxxxxx to act
in its stead. In such case, Xxxxxxx may
elect at its sole discretion to continue
preparation, filing and prosecution or
maintenance of the discontinued patent at
its sole expense. 3DP shall execute such
documents and perform such acts as may be
reasonably necessary for Xxxxxxx to file or
to continue prosecution or maintenance of
such patent. Discontinuance may be elected
on a country-by-country basis or for a
patent application or patent series in
total.
8.4.2 Cooperation. 3DP shall consult with Xxxxxxx and shall
keep Xxxxxxx continuously informed of all material
matters relating to the preparation, filing,
prosecution and maintenance of Research Program
Patent Rights covered by this Agreement, including,
but not limited to, disclosing to Xxxxxxx the
complete text of all such Research Program Patent
Rights. In addition, 3DP shall provide Xxxxxxx with
copies of all material correspondence with the
applicable patent office.
8.5 Xxxxxxx Patentable Inventions and Know-How.
8.5.1 Xxxxxxx Patent Prosecution.
(a) Prosecution and Maintenance. During the
Term, Xxxxxxx shall, at its own expense,
prepare, file, prosecute and maintain
Xxxxxxx Patents and use reasonable efforts
to file initially all such patent
applications in countries in which Xxxxxxx
would file patent applications in its normal
business practice for comparable technology.
(b) Discontinuance. If Xxxxxxx does not intend
to file for Patent protection or does not
wish to continue preparation, prosecution or
maintenance of a Xxxxxxx Patent, then it
shall give at least forty-five (45) days
advance notice to 3DP, and in no event less
than a reasonable period of time for 3DP to
act in its stead. In such case, 3DP may
elect at its sole discretion to continue
preparation, filing and prosecution or
maintenance of the discontinued patent at
its sole expense. Xxxxxxx shall execute such
documents and perform such acts as may be
reasonably necessary for 3DP to file or to
continue prosecution or maintenance of such
patent. Discontinuance may be elected on a
country-by-country basis or for a patent
application or patent series in total.
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8.5.2 Cooperation. Xxxxxxx shall consult with 3DP and shall
keep 3DP continuously informed of all material
matters relating to the preparation, filing,
prosecution and maintenance of Xxxxxxx Patents
covered by this Agreement, including, but not limited
to, disclosing to 3DP the complete text of all such
Xxxxxxx Patents.
8.6 Joint Patents
8.6.1 The Parties shall jointly determine whether to
prepare, file, prosecute and maintain any Joint
Patents. Xxxxxxx shall act as the lead Party for the
prosecution and maintenance of such Joint Patents.
8.6.2 Xxxxxxx shall keep 3DP apprised of the status of each
Joint Patent and shall seek the advice of 3DP with
respect to patent strategy and drafting applications
and shall give reasonable consideration to any
suggestions or recommendations of 3DP concerning the
preparation, filing, prosecution, maintenance and
defense thereof. Each Party shall be responsible for
50% of the cost of such filings.
8.6.3 The Parties shall cooperate reasonably in the
prosecution of all Joint Patents and shall share all
material information relating thereto, including all
material communications from patent offices, promptly
after receipt of such information.
8.6.4 If, during the term of this Agreement, Xxxxxxx
intends to allow any Joint Patent to lapse or to
abandon any such Joint Patent, Xxxxxxx shall,
whenever practicable, notify 3DP of such intention at
least sixty (60) days prior to the date upon which
such Joint Patent shall lapse or become abandoned but
in no event less than a reasonably sufficient time to
prevent such lapse or abandonment, and 3DP shall
thereupon have the right, but not the obligation, to
assume responsibility for the prosecution,
maintenance and defense thereof and all expenses
related thereto.
8.7 Assistance. Each Party hereby agrees:
8.7.1 to make its employees, agents and consultants
reasonably available to the other Party (or the other
Party's authorized attorneys, agents or
representatives), to the extent reasonably necessary
to enable the Prosecuting Party to undertake
preparation, filing, prosecution and maintenance of
its Patent Rights;
8.7.2 to cooperate, if necessary and appropriate, with the
other Party in gaining patent term extensions
wherever applicable to Patent Rights; and
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8.7.3 to endeavor in good faith to coordinate its efforts
with the other Party to minimize or avoid
interference with the preparation, filing,
prosecution and maintenance of the other Party's
Patent Rights.
8.8 Initial Filing if Made Outside of the United States. The
Parties agree to use reasonable efforts to ensure that any
Patent Rights filed outside of the United States prior to a
U.S. filing will be in a form sufficient to establish the date
of original filing as a priority date for the purposes of a
subsequent U.S. filing.
8.9 Infringement Claims by Third Parties.
8.9.1 Notice. If the manufacture, use or sale of an Active
Compound or any Licensed Product results in a claim
or a threatened claim by a Third Party against a
Party hereto for patent infringement or for inducing
or contributing to patent infringement ("Infringement
Claim"), the Party first having notice of an
Infringement Claim shall promptly notify the other in
writing. The notice shall set forth the facts of the
Infringement Claim in reasonable detail.
8.9.2 Defense. Xxxxxxx shall have the right but not the
obligation to defend any suit resulting from an
Infringement Claim at its expense. 3DP shall
cooperate and assist Xxxxxxx in any such litigation
at Xxxxxxx'x expense. In the event Xxxxxxx declines
to take steps with respect to such infringement
within [* *] following notice of such infringement,
3DP shall have the right to do so at its expense.
8.9.3 Settlement. In the event that the manufacture, use or
sale of the Active Compound or the Licensed Product
in a country would infringe Third Party Patent Rights
and a license to such Third Party Patent Rights is
available, and Xxxxxxx in its sole discretion seeks
such a license, the Parties agree:
(a) Subject to Section 5.11.2, Xxxxxxx shall be
responsible for all costs associated with
acquiring such Third Party license; and
(b) Xxxxxxx shall use reasonable efforts to
obtain required licenses under the Third
Party Patents, with a right to sublicense to
3DP.
8.10 Patent Assignment. Neither Party may assign its interest in
rights under Research Program Patent Rights or any Patent
Rights claiming an Active Compound or Licensed Product, except
with the prior written consent of the other Party, such
consent not to be unreasonably withheld or delayed; provided,
however, that either Party may assign such rights without
consent of the other Party to a permitted assignee under this
Agreement.
8.11 Infringement Claims Against Third Parties.
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8.11.1 Cooperation. 3DP and Xxxxxxx each agree to take
reasonable actions to protect 3DP Patents, Xxxxxxx
Patents, Joint Patents or Research Program Patent
Rights from infringement. If one Party brings any
such action or proceeding, the other Party may be
joined as a Party plaintiff if necessary for the
action or proceeding to proceed and, in case of
joining, the other Party agrees to give the first
Party reasonable assistance and authority to file and
to prosecute such suit. The other Party shall be
reimbursed for any costs associated with its
participation.
8.11.2 Notice. If any 3DP Patent, Xxxxxxx Patent, Joint
Patents and/or Research Program Patent Rights is
infringed by a Third Party in any country in
connection with the manufacture, use and/or sale of
an Active Compound or Licensed Product in such
country, the Party to this Agreement first having
knowledge of such infringement, or knowledge of a
reasonable probability of such infringement, shall
promptly notify the other in writing. The notice
shall set forth the known facts of such infringement
in reasonable detail.
8.11.3 Institution of Proceedings.
(a) 3DP shall have the primary right, but not
the obligation, to institute, prosecute and
control with its own counsel, any action or
proceeding with respect to infringement of a
3DP Patent or Research Program Patent
Rights. Xxxxxxx shall have the right, at its
own expense, to be represented in such
action by its own counsel; provided,
however, no settlement may be entered into
by 3DP without the written consent of
Xxxxxxx, which consent shall not be
unreasonably withheld or delayed, if such
settlement would have a material adverse
effect on Xxxxxxx'x interests.
(b) With respect to Joint Patents, Xxxxxxx shall
have the primary right, but not the
obligation, to institute, prosecute and
control any action or proceeding with
respect to infringement of such Joint
Patents, by counsel of its own choice and at
its own expense; provided, however, 3DP may
participate in such proceedings, represented
by counsel of its own choice and at its own
expense, no settlement may be entered into
by Xxxxxxx without the written consent of
3DP, which consent shall not be unreasonably
withheld or delayed.
(c) Xxxxxxx shall have the sole right to enforce
any rights under the Xxxxxxx Patents at its
own expense.
8.11.4 Failure to Institute Proceedings. If the Party having
the primary right to institute proceedings under
Section 8.11.3 (hereinafter referred to as the
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"First Prosecuting Party") fails to institute,
prosecute or control such action or prosecution
within a period of one hundred eighty (180) days
after receiving notice of the infringement from the
other Party (hereinafter referred to as the "Second
Prosecuting Party"), then the Second Prosecuting
Party shall have the right to bring and control any
such action by counsel of its own choice, and the
First Prosecuting Party shall have the right, at its
own expense, to be represented in any such action by
counsel of its own choice. The First Prosecuting
Party shall cooperate with the Second Prosecuting
Party in such effort, including being joined as a
party to such action if necessary.
8.11.5 Costs. The Party bringing suit under this Article
shall bear all costs of the suit and shall retain any
damages or other monetary awards recovered.
8.11.6 Settlement. The parties shall keep each other
informed of the status of and of their respective
activities regarding any litigation or settlement
thereof concerning Licensed Products in the Field. A
settlement or consent judgment or other voluntary
final disposition of a suit brought by a Party under
this Section 8.11 may be entered without the consent
of the other Party; provided such settlement, consent
judgment or other disposition does not admit the
invalidity or unenforceability of any Patent Rights;
and provided further, that any rights to continue the
infringing activity in such settlement, consent
judgment or other disposition shall be limited to the
product or activity that was the subject of the suit.
8.12 Notices Relating to the Act. 3DP shall notify Xxxxxxx of the
issuance of each U.S. patent included among the 3DP Patents,
Research Program Patent Rights and Joint Patents wherein 3DP
is the filing Party, giving the date of issue and patent
number for each such patent. 3DP and Xxxxxxx each shall
immediately give notice to the other of any certification
filed under the "U.S. Drug Price Competition and Patent Term
Restoration Act of 1984" (hereinafter the "Act"), including,
but not necessarily limited to, notices pursuant toss.ss.101
and 103 of the Act from persons who have filed an abbreviated
NDA ("ANDA") or a "paper" NDA claiming that 3DP Patents,
Xxxxxxx Patents, Joint Patents or Research Program Patent
Rights are invalid or that infringement will not arise from
the manufacture, use or sale of any Active Compound or
Licensed Product by a Third Party.
8.12.1 If Xxxxxxx decides not to bring infringement
proceedings against the entity making such a
certification, Xxxxxxx shall give notice to 3DP of
its decision not to bring suit within twenty-one (21)
days after receipt of notice of such certification.
8.12.2 3DP may then, but is not required to, bring suit
against the party that filed the certification.
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8.12.3 Any suit by Xxxxxxx or 3DP shall either be in the
name of Xxxxxxx or in the name of 3DP, or jointly in
the name of Xxxxxxx and 3DP, as may be required by
law.
8.12.4 For purposes of this Section, the Party not bringing
suit shall execute such legal papers necessary for
the prosecution of such suit as may be reasonably
requested by the Party bringing suit.
8.13 Patent Term Extensions. 3DP hereby authorizes Xxxxxxx to (a)
provide in any NDA a list of patents which includes 3DP
Patents, Joint Patents and Research Program Patent Rights
owned by 3DP that relate to such Licensed Product and such
other information as Xxxxxxx believes is appropriate; (b)
commence suit for infringement of 3DP Patents, Joint Patents
and Research Program Patent Rights underss.271(e) (2) of Title
35 of the United States Code; and (c) exercise any rights that
may be exercisable by 3DP as patent owner under the Act,
including without limitation, applying for an extension of the
term of any patent included in 3DP Patents, Joint Patents and
Research Program Patent Rights. In the event that applicable
law in any country provides for the extension of the term of
any patent included among Research Program Patent Rights owned
by 3DP, such as under the Act, the Supplementary Certificate
of Protection of the Member States of the European Union and
other similar measures in any other country, 3DP shall apply
for and use its reasonable efforts to obtain such an extension
or, should the law require Xxxxxxx to so apply, 3DP hereby
gives permission to Xxxxxxx to do so. Xxxxxxx and 3DP agree to
cooperate with one another in obtaining such extension. 3DP
agrees to cooperate with Xxxxxxx or its sublicensee, as
applicable, in the exercise of the authorization granted
herein and shall execute such documents and take such
additional action as Xxxxxxx may reasonably request in
connection therewith, including, if necessary, permitting
itself to be joined as a Party in any suit for infringement
brought by Xxxxxxx hereunder.
ARTICLE 9
INDEMNIFICATION
9.1 Indemnification by Xxxxxxx. Xxxxxxx shall indemnify, defend
and hold 3DP and its agents, employees and directors (the "3DP
Indemnitees") harmless from and against any and all liability,
damage, loss, cost or expense (including reasonable attorneys'
fees) arising out of Third Party claims or lawsuits related to
(a) Xxxxxxx'x performance of its obligations under this
Agreement; or (b) patent infringement related to 3DP's use of
the Targets pursuant to this Agreement; or (c) patent
infringement or product liability for bodily injury and/or
property damage related to Xxxxxxx'x development activities
with compounds identified under the Research Program and/or
with Licensed Products; or (d) the manufacture, use or sale of
Licensed Products by Xxxxxxx, sublicensees, distributors and
agents, except to the extent such claims or suits result from
the
32
breach of any of the provisions of this Agreement, gross
negligence or willful misconduct of the 3DP Indemnitees. Upon
the assertion of any such claim or suit, the 3DP Indemnitees
shall promptly notify Xxxxxxx thereof and shall permit Xxxxxxx
to assume direction and control of the defense of the claim
(including the selection of counsel and the right to settle it
at the sole discretion of Xxxxxxx, provided that such
settlement does not impose any material obligation on the 3DP
Indemnitees), and shall cooperate as requested (at the expense
of Xxxxxxx) in the defense of the claim.
9.2 Indemnification By 3DP. 3DP shall indemnify, defend and hold
Xxxxxxx and its agents, employees and directors (the "Xxxxxxx
Indemnitees") harmless from and against any and all liability,
damage, loss, cost or expense (including reasonable attorneys'
fees) arising out of Third Party claims or lawsuits related to
3DP's performance of its obligations under this Agreement,
except to the extent that such claims or suits result from the
breach of any of the provisions of this Agreement, gross
negligence or willful misconduct of the Xxxxxxx Indemnitees.
Upon the assertion of any such claim or suit, the Xxxxxxx
Indemnitees shall promptly notify 3DP thereof and shall permit
3DP to assume direction and control of the defense of the
claim (including the selection of counsel and the right to
settle it at the sole discretion of 3DP, provided that such
settlement does not impose any material obligation on the
Xxxxxxx Indemnitees), and shall cooperate as requested (at the
expense of 3DP) in the defense of the claim.
ARTICLE 10
TERM AND TERMINATION
10.1 Term of Research Program. The Research Program shall commence
upon the Effective Date, and unless earlier terminated as
provided herein, shall expire on the last to expire of the
Stage A Term or the Stage B Term or any Extended Research Term
(the "Research Term").
10.2 Term of Agreement. This Agreement shall commence upon the
Effective Date and shall terminate: (a) thirty (30) days after
notice, in good faith, by one Party to the other Party,
following the termination or expiration of the Research Term,
if no compound, which was identified as a Prototype Compound,
is being optimized, developed, commercialized and/or sold by
Xxxxxxx or 3DP, or (b) upon the identification and
commercialization of one or more Licensed Products, upon
expiration of Xxxxxxx'x obligation to pay royalties hereunder
(the "Term").
10.3 Termination of the Research Program Without Cause. Subject to
the provisions of Section 5.6, Xxxxxxx may terminate the
Research Program upon ninety (90)-days advance written notice
during the Research Term provided, however, [* *].
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10.4 Breach. The failure by a Party to comply with any of the
material obligations contained in this Agreement shall entitle
the other Party to give notice to have the default cured. If
such default is not cured within sixty (60) days after the
receipt of such notice, or diligent steps are not taken to
cure if by its nature such default cannot be cured within
sixty (60) days, the notifying Party shall be entitled,
without prejudice to any of its other rights conferred to it
by this Agreement, and in addition to any other remedies that
may be available to it, to terminate the Research Program
and/or this Agreement; provided, however, that such right to
terminate shall be stayed in the event that, during such sixty
(60)-day period, the Party alleged to have been in default
shall have: (a) initiated arbitration in accordance with
Article 13, below, with respect to the alleged default, and
(b) diligently and in good faith cooperated in the prompt
resolution of such arbitration proceedings.
10.5 No Waiver. The right of a Party to terminate the Research
Program and/or this Agreement, as provided in this Article 10,
shall not be affected in any way by its waiver or failure to
take action with respect to any prior default.
10.6 Insolvency or Bankruptcy.
10.6.1 Either Party may, in addition to any other remedies
available by law or in equity, terminate the Research
Program and/or this Agreement by written notice to
the other Party in the event the latter Party shall
have become insolvent or bankrupt, or shall have an
assignment for the benefit of its creditors, or there
shall have been appointed a trustee or receiver of
the other Party or for all or a substantial part of
its property or any case or proceeding shall have
been commenced or other action taken by or against
the other Party in bankruptcy or seeking
reorganization, liquidation, dissolution, winding-up,
arrangement or readjustment of its debts or any other
relief under any bankruptcy, insolvency,
reorganization or other similar act or law of any
jurisdiction now or hereafter in effect, or there
shall have been issued a warrant of attachment,
execution, distraint or similar process against any
substantial part of the property of the other Party,
and any such event shall have continued for ninety
(90) days undismissed, unbonded and undischarged.
10.6.2 All rights and licenses granted under or pursuant to
this Agreement by Xxxxxxx or 3DP are, and shall
otherwise be deemed to be, for purposes of Section
365(n) of the U.S. Bankruptcy Code, licenses of right
to "Intellectual Property" as defined under Section
101 of the U.S. Bankruptcy Code. The Parties agree
that the Parties as licensees of such rights under
this Agreement, shall retain and may fully exercise
all of their rights and elections under the U.S.
Bankruptcy Code. The Parties further agree that, in
the event of the commencement of a bankruptcy
proceeding by or against either Party under the U.S.
Bankruptcy Code, the Party
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hereto which is not a party to such proceeding shall
be entitled to a complete duplicate of (or complete
access to, as appropriate) any such intellectual
property and all embodiments of such intellectual
property, and same, if not already in their
possession, shall be promptly delivered to them (a)
upon any such commencement of a bankruptcy proceeding
upon their written request therefor, unless the Party
subject to such proceedings elects to continue to
perform all of their obligations under this
Agreement, or (b) if not delivered under (a) above,
upon the rejection of this Agreement by or on behalf
of the Party subject to such proceeding upon written
request therefor by a nonsubject party.
10.7 Consequences of Termination of the Research Program.
10.7.1 In the event of termination of the Research Program
by Xxxxxxx pursuant to the provisions of Sections
10.4 or 10.6, 3DP shall (i) promptly transfer to
Xxxxxxx copies, whether in written or electronic
form, of all data, reports, records and materials
(including any Research Program Know-how) in 3DP's
possession or control which relate to the Research
Program; (ii) return to Xxxxxxx all relevant records
and materials, whether in written or electronic form,
in 3DP's possession or control containing
Confidential Information of Xxxxxxx; and (iii)
furnish to Xxxxxxx all unused Substances provided to
3DP by Xxxxxxx in connection with the Research
Program. Thereafter, Xxxxxxx shall have no further
obligation to fund the Research Program, but the
remainder of the Agreement shall, including without
limitation, Xxxxxxx'x rights to continue Prototype
Compound Optimization for those Prototype Compounds
identified as such pursuant to Section 1.29, remain
in force and effect until expiration of the term of
the Agreement, unless it is sooner terminated as
provided in this Agreement.
10.7.2 In the event of termination of the Research Program
by 3DP pursuant to the provisions of 10.4 or 10.6, or
if Xxxxxxx terminates the Research Program pursuant
to the provisions of Section 10.3, Xxxxxxx shall (i)
promptly transfer to 3DP copies, whether in written
or electronic form, of all data, reports, records and
materials (including any Research Program Know-how)
in Xxxxxxx'x possession or control which relate to
the Research Program; (ii) return to 3DP all relevant
records and materials, whether in written or
electronic form, in Xxxxxxx'x possession or control
containing Confidential Information of 3DP; and (iii)
furnish to 3DP all unused Substances, if any,
provided to Xxxxxxx by 3DP in connection with the
Research Program. Thereafter, the remainder of the
Agreement shall remain in force and effect until
expiration of the term of the Agreement, unless it is
sooner terminated as provided in this Agreement.
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10.7.3 Either Party's termination of the Research Program
pursuant to Section 10.3, 10.4 and/or 10.6 shall be
without prejudice to, and shall not affect, any of
the Parties' respective rights and obligations under
this Agreement that do not specifically relate to the
Research Program. Without limiting the generality of
the foregoing, Xxxxxxx'x rights to exploit the
Licensed Products under any Research Program Patent
Rights and Research Program Know-how, if such
licenses are in operation, in accordance with the
terms of this Agreement, shall not be affected by any
such termination.
10.8 Consequences of Termination of this Agreement. Upon
termination of this Agreement, all remaining records and
materials in a Party's possession or control containing the
other Party's Confidential Information and to which the former
Party does not retain rights hereunder shall promptly be
returned, except that one (1) copy shall be retained by legal
counsel for the former Party.
10.9 Survival of Obligations. The termination or expiration of this
Agreement shall not relieve the Parties of any obligations
accruing prior to such termination, and any such termination
shall be without prejudice to the rights of either Party
against the other. The provisions of Sections 3.7, 5.15, 5.16,
6.1, 6.2, 6.3, 8.1, 10.8, 14.1, 14.14, 14.15 and Articles 1,
7, 9 and 13 shall survive any termination of this Agreement.
ARTICLE 11
DEVELOPMENT, REGULATORY AND COMMERCIALIZATION RESPONSIBILITIES
11.1 Commercial Responsibilities. Xxxxxxx agrees to use
commercially reasonable efforts consistent with its normal
business practices, and in no event less than efforts standard
in the pharmaceutical industry, to develop and commercialize
Licensed Products. Such efforts shall be efforts consistent
with efforts used by Xxxxxxx (in each case comparable efforts
will be measured against such efforts used by Xxxxxxx for
marketing in the country where the commercialization takes
place for that Licensed Product) in commercializing its own
products that are similar with regard to, for example, market
potential, price per treatment, patient population, and
competitive position. Xxxxxxx shall use commercially
reasonable efforts consistent with its normal business
practices to effect the commercial launch of Licensed Products
in the Major Countries within [* *] of Regulatory Approval in
such Major Countries.
11.2 Xxxxxxx'x Marketing Obligations For Licensed Product. All
business decisions, including, without limitation, the design,
sale, price and promotion of Licensed Products under this
Agreement and the decisions whether to market any particular
Licensed Product shall be within the sole discretion of
Xxxxxxx.
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11.3 Xxxxxxx Responsibilities. Xxxxxxx shall be responsible for all
development, regulatory filings and related submissions that
are made in connection with the commercialization of Licensed
Products developed by Xxxxxxx and all commercialization
activities with respect to Licensed Products, and shall do so
at Xxxxxxx'x sole discretion and expense. The JSMC will
provide annual written reports to the Parties presenting a
meaningful summary of the development and commercialization
activities undertaken for each Licensed Product for the Term.
ARTICLE 12
REPRESENTATIONS AND WARRANTIES
12.1 Authority. Each Party represents and warrants that as of the
Effective Date it has the full right, power and authority to
enter into this Agreement and that this Agreement has been
duly executed by such Party and constitutes a legal, valid and
binding obligation of such Party, enforceable in accordance
with its terms.
12.2 No Conflicts. Each Party represents and warrants that the
execution, delivery and performance of this Agreement does not
conflict with, or constitute a breach or default under, any of
its charter or organizational documents, any law, order,
judgment or governmental rule or regulation applicable to it,
or any material agreement, contract, commitment or instrument
to which it is a party.
12.3 No Existing Third Party Rights. Each Party represents and
warrants that its obligations under this Agreement are not
encumbered by any rights granted by such Party to any Third
Parties that are or may be inconsistent with the rights and
licenses granted in this Agreement.
12.4 Permitted Use of Targets. Xxxxxxx represents and warrants that
it has the legal right to use and permit 3DP to use all
Targets provided to 3DP for Research Program activities under
this Agreement.
12.5 Continuing Representations. The representations and warranties
of each Party contained in this Article 12 shall survive the
execution and delivery of this Agreement and shall remain true
and correct at all times during the Term with the same effect
as if made on and as of such later date.
12.6 Disclaimer of Warranties. 3DP MAKES NO REPRESENTATIONS AND
EXTENDS NO WARRANTIES OR CONDITIONS OF ANY KIND, EITHER
EXPRESS OR IMPLIED, WITH RESPECT TO THE 3DP DISCOVERWORKS(R)
TECHNOLOGY, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. IN
PARTICULAR, 3DP OFFERS NO REPRESENTATION OR WARRANTY THAT THE
USE OF ALL OR ANY PART OF THE 3DP DISCOVERWORKS(R) TECHNOLOGY
UNDER THIS
37
AGREEMENT WILL RESULT IN THE DISCOVERY OR THE SUCCESSFUL
COMMERCIALIZATION OF A LICENSED PRODUCT FOR USE AGAINST THE
TARGET IN THE FIELD.
12.7 No Infringement. To the best of its knowledge as of the
Effective Date, 3DP represents and warrants that the use of
the DirectedDiversity(R)Technology and
ThermoFluor(R)Technology does not infringe any Patent Rights
of a Third Party.
12.8 Infectious Disease Targets. Xxxxxxx covenants that the Targets
and Replacement Targets that are provided by Xxxxxxx for
screening pursuant to this Agreement are not provided for the
primary purpose of identifying [* *].
ARTICLE 13
DISPUTE RESOLUTION
13.1 Any dispute concerning or arising out of this Agreement or
concerning the existence or validity hereof shall be
determined by the following procedure:
13.1.1 Dispute Resolution and Arbitration. In the case of
any disputes between the Parties arising from this
Agreement, and in case this Agreement does not
provide a solution for how to resolve such disputes,
the Parties shall discuss and negotiate in good faith
a solution acceptable to both Parties and in the
spirit of this Agreement. If after negotiating in
good faith pursuant to the foregoing sentence, the
Parties fail to reach agreement within sixty (60)
days, then the Chief Executive Officer of 3DP and the
Chairman Research & Development Pharmaceuticals shall
discuss in good faith an appropriate resolution to
the dispute. If these executives fail, after good
faith discussions, to reach an amicable agreement
within sixty (60) days, then either Party may upon
written notice to the other submit the dispute to
binding arbitration pursuant to Section 13.2.
13.2 Arbitration. Any claim, dispute or controversy arising out of
or in connection with or relating to this Agreement,
(including, without limitation, disputes with respect to the
rights and obligations of the Parties following termination)
not settled by the procedures set forth in Section 13.1 above
or the breach or alleged breach of a material provision of
this Agreement shall be adjudicated by arbitration in
accordance with the Arbitration Proceedings as set forth in
Schedule 13.2 attached hereto.
ARTICLE 14
MISCELLANEOUS PROVISIONS
14.1 Entire Agreement. This Agreement and each of the Schedules
hereto constitute and contain the entire understanding and
agreement of the Parties respecting the
38
subject matter of this Agreement and cancels and supersedes
any and all prior negotiations, correspondence, understandings
and agreements between the Parties, whether oral or written,
regarding such subject matter.
14.2 Further Actions. Each Party agrees to execute, acknowledge and
deliver such further instruments and to do all such other acts
as may be necessary or appropriate in order to carry out the
purposes and intent of this Agreement.
14.3 Binding Effect. This Agreement and the rights granted herein
shall be binding upon and shall inure to the benefit of 3DP,
Xxxxxxx and their successors and permitted assigns.
14.4 Assignment. Neither Party may assign this Agreement without
the prior written consent of the other Party; provided,
however, that either Party may assign this Agreement without
the prior written consent of the other Party in connection
with the sale or transfer of substantially all of its assets
that relate to this Agreement, or in the event of its merger
or consolidation or change of control or similar transaction.
Any permitted assignee shall assume all obligations of its
assignor under this Agreement.
14.5 No Implied Licenses. No rights to any other patents, Know-how
or technical information, or other intellectual property
rights, other than as explicitly identified herein, are
granted or deemed granted by this Agreement. No right, express
or implied, is granted by this Agreement to a Party to use in
any manner the name or any other trade name or trademark of
the other Party in connection with the performance of this
Agreement.
14.6 No Waiver. No waiver, modification or amendment of any
provision of this Agreement shall be valid or effective unless
made in writing and signed by a duly authorized officer of
each Party. The failure of either Party to assert a right
hereunder or to insist upon compliance with any term or
condition of this Agreement shall not constitute a waiver of
that right or excuse a similar subsequent failure to perform
any such term or condition.
14.7 Force Majeure. The failure of a Party to perform any
obligation under this Agreement by reason of acts of God, acts
of governments, riots, wars, strikes, accidents or
deficiencies in materials or transportation or other causes of
a similar magnitude beyond its control shall not be deemed to
be a breach of this Agreement.
14.8 Independent Contractors. Both Parties are independent
contractors under this Agreement. Nothing contained in this
Agreement is intended nor is to be construed so as to
constitute 3DP or Xxxxxxx as partners or joint venturers with
respect to this Agreement. Neither Party shall have any
express or implied right or authority to assume or create any
obligations on behalf of or in the name of the
39
other Party or to bind the other Party to any other contract,
agreement or undertaking with any Third Party.
14.9 Notices and Deliveries. Any formal notices, request, delivery,
approval or consent required or permitted to be given under
this Agreement shall be in writing and shall be deemed to have
been sufficiently given when it is received, whether delivered
in person, transmitted by facsimile with contemporaneous
confirmation, delivered by registered letter (or its
equivalent) or delivered by overnight courier service (receipt
required), to the Party to which it is directed at its address
shown below or such other address as such Party shall have
last given by notice to the other Parties.
If to Xxxxxxx: with a copy to:
Xxxxxxx & Xxxxxxx Pharmaceutical Xxxxxxx & Xxxxxxx
Research & Development, LLC Xxx Xxxxxxx & Xxxxxxx Xxxxx
X.X. Xxxxx 000 Xxx Xxxxxxxxx, Xxx Xxxxxx 00000
Xxxxxxx, XX 00000
ATTN: Chairman ATTN: Chief Patent Counsel
FAX: 000-000-0000 FAX: 000-000-0000
If to 3DP: with a copy to:
3-Dimensional Pharmaceuticals, Inc. Xxxxxx, Xxxxx & Bockius LLP
Three Lower Makefield Corporate Center 0000 Xxxxxx Xxxxxx
0000 Xxxxx Xxxx Xxxx, Xxxxx 000 Xxxxxxxxxxxx, XX 00000
Xxxxxxx, XX 00000
ATTN: Chief Executive Officer ATTN: Xxxxx X. Xxxxx, Esq.
FAX: 000-000-0000 FAX: 000-000-0000
14.10 Public Announcements. On or shortly after the Effective Date,
3DP shall issue a press release with respect to entering into
this Agreement in the form attached hereto as Schedule 14.10.
--------------
14.11 Headings. The captions to the sections and articles in this
Agreement are not a part of this Agreement, and are included
merely for convenience of reference only and shall not affect
its meaning or interpretation.
14.12 Severability. In the event that any provision of this
Agreement shall, for any reason, be held to be invalid or
unenforceable in any respect, such invalidity or
unenforceability shall not affect any other provision hereof,
and this Agreement shall be construed as if such invalid or
unenforceable provision had not been included herein.
40
14.13 No Consequential Damages. IN NO EVENT SHALL EITHER PARTY OR
ANY OF ITS RESPECTIVE AFFILIATES BE LIABLE TO THE OTHER PARTY
OR ANY OF ITS AFFILIATES FOR SPECIAL, INDIRECT, INCIDENTAL OR
CONSEQUENTIAL DAMAGES, WHETHER IN CONTRACT, WARRANTY, TORT,
NEGLIGENCE, STRICT LIABILITY OR OTHERWISE, INCLUDING, BUT NOT
LIMITED TO, LOSS OF PROFITS OR REVENUE, OR CLAIMS OF CUSTOMERS
OF ANY OF THEM OR OTHER THIRD PARTIES FOR SUCH OR OTHER
DAMAGES.
14.14 Applicable Law. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of
Delaware without reference to its conflicts of laws
provisions.
14.15 Advice of Counsel. Xxxxxxx and 3DP have each consulted with
counsel of their choice regarding this Agreement, and each
acknowledges and agrees that this Agreement shall not be
deemed to have been drafted by one Party or another and will
be construed accordingly.
14.16 Counterparts. This Agreement may be executed in counterparts,
or facsimile versions, each of which shall be deemed to be an
original, and both of which together shall be deemed to be one
and the same agreement.
41
IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed by their respective duly authorized officers as of the date first above
written, each copy of which -shall for all purposes be deemed to be an original.
3-DIMENSIONAL PHARMACEUTICALS, INC. XXXXXXX PHARMACEUTICA, N.V.
By: __________________________ By: __________________________
Name: Xxxxx X. U'Xxxxxxxx, Ph.D. Name: __________________________
Title: Chief Executive Officer Title: __________________________
THE X.X. XXXXXXX
PHARMACEUTICAL RESEARCH
INSTITUTE, a division of
Ortho-XxXxxx Pharmaceutical, Inc.
By: __________________________
Name: __________________________
Title: __________________________
42
Schedule 1.8
DIRECTED DIVERSITY(R) PATENTS
--------------------------------------------------------------------------------
TITLE COUNTRY SERIAL FILING PATENT ISSUE DATE
NUMBER DATE NUMBER
--------------------------------------------------------------------------------
[* The entire table, consisting of 1 page, has been
omitted pursuant to a confidential treatment request *]
43
Schedule 1.17
THERMOFLUOR(R) VALIDATION TESTS
[* *]
[* *]
[* 1 entire page has been omitted pursuant to a confidential treatment
request *]
44
Schedule 1.36
RESEARCH PLAN
[* 1 entire page has been omitted pursuant to
a confidential treatment request *]
45
Schedule 1.50
THERMOFLUOR(R) PATENTS
--------------------------------------------------------------------------------
TITLE COUNTRY SERIAL FILING PATENT ISSUE DATE
NUMBER DATE NUMBER
--------------------------------------------------------------------------------
[* The entire table, consisting of 1 page, has been
omitted pursuant to a confidential treatment request *]
46
Schedule 2.1
TARGETS
TARGET 1: [* *]
[* *]
TARGET 2: [* *]
[* *]
[* 2 pages have been omitted pursuant to a confidential treatment request *]
47
Schedule 2.2
[* 1 entire page has been omitted pursuant to
a confidential treatment request *]
48
Schedule 5.14
WIRE INSTRUCTIONS
[* 1 entire page has been omitted pursuant to
a confidential treatment request *]
49
Schedule 13.2
ARBITRATION PROCEEDINGS
1.1 (a) Any dispute, controversy or claim arising out of or related to
this Agreement, or the interpretation, application, breach,
termination or validity thereof, including any claim of
inducement by fraud or otherwise, which claim would, but for
this provision, be submitted to arbitration shall, before
submission to arbitration, first be mediated through
non-binding mediation in accordance with the Model Procedures
for the Mediation of Business Disputes promulgated by the CPR
Institute for Dispute Resolution, or successor ("CPR") then in
effect, except where those rules conflict with these
provisions, in which case these provisions control. The
mediation shall be conducted in Wilmington, Delaware and shall
be attended by a senior executive with authority to resolve
the dispute from each of the operating companies that are
Parties.
(b) The mediator shall be neutral, independent, disinterested and
shall be selected from a professional mediation firm such as
ADR Associates or JAMS/ENDISPUTE or CPR.
(c) The parties shall promptly confer in an effort to select a
mediator by agreement. In the absence of such an agreement
within 10 days of initiation of the mediation, the mediator
shall be selected by CPR as follows: CPR shall provide the
parties with a list of at least 15 names. Each party shall
exercise challenges for cause, two peremptory challenges, and
rank the remaining candidates within 5 working days of
receiving the CPR list. The parties may together interview the
three top-ranked candidates for no more than one hour each
and, after the interviews, may each exercise one peremptory
challenge. The mediator shall be the remaining candidate with
the highest aggregate ranking.
(d) The mediator shall confer with the parties to design
procedures to conclude the mediation within no more than 45
days after initiation. Under no circumstances may the
commencement of arbitration under Section 1.2 hereof be
delayed more than 45 days by the mediation process specified
herein absent contrary agreement of the parties.
(e) Each party agrees not to use the period or pendency of the
mediation to disadvantage the other party procedurally or
otherwise. No statements made by either side during the
mediation may be used by the other or referred to during any
subsequent proceedings.
(f) Each party has the right to pursue provisional relief from any
court, such as attachment, preliminary injunction, replevin,
etc., to avoid irreparable harm,
50
maintain the status quo, or preserve the subject matter of the
------ ---
arbitration, even though mediation has not been commenced or
completed.
1.2 (a) Following the mediation procedures set forth in Section 1.1,
any dispute, claim or controversy arising from or related in
any way to this Agreement or the interpretation, application,
breach, termination or validity thereof, including any claim
of inducement of this Agreement by fraud or otherwise, will be
submitted for resolution to arbitration pursuant to the rules
then pertaining of CPR, except where those rules conflict with
these provisions, in which case these provisions control. The
arbitration will be held in Wilmington, Delaware.
(b) The panel shall consist of three arbitrators chosen from the
CPR Panels of Distinguished Neutrals (or, by agreement, from
another provider of arbitrators) each of whom is a lawyer with
at least 15 years experience with a law firm or corporate law
department of over 25 lawyers or was a judge of a court of
general jurisdiction. In the event the aggregate damages
sought by the claimant are stated to be less than $5 million,
and the aggregate damages sought by the counterclaimant are
stated to be less than $5 million, and neither side seeks
equitable relief, then a single arbitrator shall be chosen,
having the same qualifications and experience specified above.
Each arbitrator shall be neutral, independent, disinterested,
impartial and shall abide by The Code of Ethics for
Arbitrators in Commercial Disputes approved by the AAA. There
shall be no ex parte communications with an arbitrator either
-- -----
before or during the arbitration, relating to the dispute or
the issues involved in the dispute or the arbitrator's views
on any such issues.
(c) The parties agree to cooperate (1) to attempt to select the
arbitrator(s) by agreement within 45 days of initiation of the
arbitration, including jointly interviewing the final
candidates, (2) to meet with the arbitrator(s) within 45 days
of selection and (3) to agree at that meeting or before upon
procedures for discovery and as to the conduct of the hearing
which will result in the hearing being concluded within no
more than 9 months after selection of the arbitrator(s) and in
the award being rendered within 60 days of the conclusion of
the hearings, or of any post-hearing briefing, which briefing
will be completed by both sides within 45 days after the
conclusion of the hearings.
(d) In the event the parties cannot agree upon selection of the
arbitrator(s), CPR will select arbitrator(s) as follows: CPR
shall provide the parties with a list of no less than 25
proposed arbitrators (15 if a single arbitrator is to be
selected) having the credentials referenced above. Within 25
days of receiving such list, the parties shall rank at least
65% of the proposed arbitrators on the initial CPR list, after
exercising cause challenges. The parties may then interview
the five candidates (three if a single arbitrator is to be
selected) with the highest combined rankings for no more than
one hour each and, following the interviews, may exercise one
peremptory challenge each. The panel will consist of the
remaining three
51
candidates (or one, if one arbitrator is to be selected) with
the highest combined rankings.
In the event these procedures fail to result in selection of
the required number of arbitrators, CPR shall select the
appropriate number of arbitrators from among the members of
the various CPR Panels of Distinguished Neutrals, allowing
each side challenges for cause and three peremptory challenges
each.
(e) In the event the parties cannot agree upon procedures for
discovery and conduct of the hearing meeting the schedule set
forth in Section 1.2(c) above, then the arbitrator(s) shall
set dates for the hearing, any post-hearing briefing, and the
issuance of the award in accord with the Section 1.2(c)
schedule. The arbitrator(s) shall provide for discovery
according to those time limits, giving recognition to the
understanding of the parties that they contemplate reasonable
discovery, including document demands and depositions, but
that such discovery be limited so that the Section 1.2(c)
schedule may be met without difficulty. In no event will the
arbitrator(s), absent agreement of the parties, allow more
than a total of ten days for the hearing or permit either side
to obtain more than a total of 40 hours of deposition
testimony from all witnesses, including both fact and expert
witnesses, or serve more than 20 individual requests for
documents, including subparts, or 20 individual requests for
admission or interrogatories, including subparts. Multiple
hearing days will be scheduled consecutively to the greatest
extent possible.
(f) The arbitrator(s) must render their award by application of
the substantive law of the State of Delaware and are not free
to apply "amiable compositeur" or "natural justice and
equity." The arbitrator(s) shall render a written opinion
setting forth findings of fact and conclusions of law with the
reasons therefor stated. A transcript of the evidence adduced
at the hearing shall be made and shall, upon request, be made
available to either party. The arbitrator(s) shall have power
to exclude evidence on grounds of hearsay, prejudice beyond
its probative value, redundancy, or irrelevance and no award
shall be overturned by reason of such ruling on evidence. To
the extent possible, the arbitration hearings and award will
be maintained in confidence.
(g) The United States District Court for the District in which the
arbitration is held may enter judgment upon any award. In the
event the panel's award exceeds $5 million in monetary damages
or includes or consists of equitable relief, or rejects a
claim in excess of that amount or for that relief, then the
court shall vacate, modify or correct any award (including
remanding to the arbitrators for further proceedings) where
the arbitrators' findings of fact are clearly erroneous,
and/or where the arbitrators' conclusions of law are
erroneous; in other words, the court will undertake the same
review as if it were a federal appellate court reviewing a
district court's findings of fact and conclusions of law
rendered after a bench trial. An award for less than $5
million in damages and not including equitable relief,
52
or which neither rejects a claim in excess of that amount or
for that relief, may be vacated, modified or corrected only
pursuant to the Federal Arbitration Act. The parties consent
to the jurisdiction of the above-specified Court for the
enforcement of these provisions, the review specified herein,
and the entry of judgment on any award. In the event such
Court lacks jurisdiction, then any court having jurisdiction
of this matter may enter judgment upon any award and provide
the same relief, and undertake the same review, as specified
herein.
(h) In the event the expanded judicial review provided for under
Section 1.2(g) above is not available from the court as a
matter of law, the party unable to obtain such review may
instead obtain review of the arbitrators' award or decision by
a single appellate arbitrator (the "Appeal Arbitrator")
selected from the CPR list of distinguished neutrals and
pursuant to selection procedures specified in Section 1.2(d)
above. If CPR cannot provide such services, the parties will
together select another provider of arbitration services that
can. No Appeal Arbitrator shall be selected unless he or she
can commit to rendering a decision within forty-five days
following oral argument as provided in this paragraph. Any
such review must be initiated within thirty (30) days
following the date the court declines the expanded review
specified in Section 1.2(g) above. In the event timely review
is sought, the Appeal Arbitrator will make the same review of
the arbitration panel's ruling and its bases that the U.S.
Court of Appeals of the Circuit where the arbitration hearings
are held would make of findings of fact and conclusions of law
rendered by a district court after a bench trial and then
modify, vacate or affirm the arbitration panel's award or
decision accordingly, or remand to the panel for further
proceedings. The Appeal Arbitrator will consider only the
arbitration panel's findings of fact and conclusions of law,
pertinent portions of the hearing transcript and evidentiary
record as submitted by the parties, opening and reply briefs
of the party pursuing the review, and the answering brief of
the opposing party, plus a total of no more than four (4)
hours of oral argument evenly divided between the parties. The
party seeking review must submit its opening brief and any
reply brief within seventy-five (75) and one hundred thirty
(130) days, respectively, following the date the court
declines the expanded review specified in Section 1.2(g);
whereas, the opposing party must submit its responsive brief
within one hundred ten (110) days of that date. Oral argument
shall take place within five (5) months after the court
declines the expanded review specified in Section 1.2(g), and
the Appeal Arbitrator shall render a decision within
forty-five (45) days following oral argument. That decision
will be final and not subject to further review, except
pursuant to the Federal Arbitration Act.
(i) Each party has the right before or, if the arbitrator(s)
cannot hear the matter within an acceptable period, during the
arbitration to seek and obtain from the appropriate court
provisional remedies such as attachment, preliminary
injunction, replevin, etc. to avoid irreparable harm, maintain
the status quo, or preserve the subject matter of the
arbitration.
53
(j) EACH PARTY HERETO WAIVES ITS RIGHT TO TRIAL OF ANY ISSUE BY
JURY.
(k) EACH PARTY HERETO WAIVES ANY CLAIM TO PUNITIVE, EXEMPLARY OR
MULTIPLIED DAMAGES FROM THE OTHER.
(l) EACH PARTY HERETO WAIVES ANY CLAIM OF CONSEQUENTIAL DAMAGES
FROM THE OTHER.
(m) EACH PARTY HERETO WAIVES ANY CLAIM FOR ATTORNEYS' FEES AND
COSTS AND PREJUDGMENT INTEREST FROM THE OTHER.
54
SCHEDULE 14.10
PRESS RELEASE
FOR IMMEDIATE RELEASE
Corporate Contact Media Inquiries Investor Inquiries
----------------- --------------- ------------------
3-Dimensional Pharmaceuticals Xxxxxx/Xxxxx Communications Rx Communications
Xxxxx Xxxxxxx Xxxxx Silver Xxxxxx Xxxxx
VP, Finance and Administration 000-000-0000, ext. 271 917-322-2571
000-000-0000 x.xxxxxx@xxxxxxxxxxx.xxx xxxxxx@xxxx.xxx
xxxxxxx@0xx.xxx ------------------------
---------------
3-DIMENSIONAL PHARMACEUTICALS ANNOUNCES DISCOVERWORKS(R)DRUG
DISCOVERY ALLIANCE WITH XXXXXXX & XXXXXXX PHARMACEUTICAL
RESEARCH & DEVELOPMENT
Yardley, PA, January 7, 2002 - 3-Dimensional Pharmaceuticals, Inc. (Nasdaq:DDDP)
(3DP) today announced a drug discovery alliance that will apply 3DP's
proprietary technologies to discover and optimize small molecule drug leads
directed to genomics targets identified by Xxxxxxx & Xxxxxxx Pharmaceutical
Research & Development, L.L.C.
Under terms of the agreement, 3DP will receive an upfront technology access fee
and committed research funding during the research collaboration period. 3DP is
also eligible to receive milestone payments and royalties on any sales of
resulting products.
3DP (xxxx://xxx.0xx.xxx) is an integrated bio-pharmaceuticals company dedicated
to revolutionizing small molecule drug discovery and development. 3DP's
proprietary platform, DiscoverWorks, can be applied to virtually any potential
drug target. It produces drug candidates suitable for faster development , with
fewer resources and a higher probability of success than using conventional drug
discovery methods. 3DP is developing its own drug pipeline and collaborates with
other pharmaceutical companies in discovery and development.
###
Statements in this press release that are not strictly historical are "forward
looking" statements which involve a high degree of risk and uncertainty. Such
statements are only predictions, and the actual events of results may differ
materially from those projected in such forward-looking statements. Factors that
could cause or contribute to differences include, but are not limited to, risks
associated with our new and uncertain technologies, clinical trials and product
development, the long and arduous process of obtaining regulatory approval, our
dependence on existing strategic alliances and new collaborations, our
dependence on patents and proprietary rights, our ability to protect and enforce
our patents and proprietary rights, the development and availability of
competitive products or technologies, our ability to attract and retain talented
employees and our ability to manage our expansion as a company increasingly
focused on internal product research and development.
55
