Exhibit 10.3.2
CONFIDENTIAL MATERIALS OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
CONFIDENTIAL DOCUMENT
AMENDED AND RESTATED LICENSE AGREEMENT
THIS AMENDED AND RESTATED LICENSE AGREEMENT (this "Agreement") is made as of the
date of the last signature below (the "Effective Date") BETWEEN
(1) PHARMING GROUP, N.V. and PHARMING INTELLECTUAL PROPERTY B.V. (collectively,
"PHARMING"), having a place of business at 4 Archimedesweg, 2333 CA Leiden,
The Netherlands, and
(2) GTC BIOTHERAPEUTICS, INC. (formerly Genzyme Transgenics Corporation)
("GTC"), having a place of business at 000 Xxxxxxxx Xxxxxxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxxx 00000-0000, X.X.X.
WHEREAS, PHARMING has certain technology and patent rights relating to the
production of proteins in the milk of transgenic animals; and
WHEREAS, PHARMING (through assignment from Biogen, Inc.) and GTC (through
assignment from Genzyme Corporation) are parties to that certain License
Agreement entered into by and between Biogen, Inc. and Genzyme Corporation dated
December 26, 1990 (as amended by that certain Agreement dated as of September
21, 1994 between GTC and PHARMING, as amended by the Amendment Agreement dated
as of April 23, 1997, the Settlement Agreement dated April 23, 1997, and the
Second Amendment dated August 31, 1999, the "Biogen Agreement").
WHEREAS, PHARMING and GTC now wish to supercede, amend, and restate the Biogen
Agreement in its entirety;
NOW, THEREFORE, IT IS HEREBY AGREED as follows:
1. DEFINITIONS
For this Agreement, and solely for this purpose, the terms set forth below
shall be defined as follows:
1.1 "Affiliates" shall mean any corporation, firm, partnership or other
entity which owns or is owned by or is under common ownership, to the extent of
more than fifty percent (50%) of the equity having the power to vote on or
direct the affairs of the entity, with PHARMING, or GTC.
1.2 "PHARMING Patents" shall mean the patent and patent applications listed
in Appendix A to this Agreement and any patents issuing therefrom, together with
any extensions, reissues, renewals, divisions, continuations or
continuations-in-part thereof which PHARMING presently or hereafter owns, solely
with respect to the production of proteins in the milk of transgenic animals.
Notwithstanding the foregoing, in the event that any claim of the PHARMING
Patents are invalidated as a result of a US patent interference with any claims
of the Xxxxx Patent, then the corresponding claims from the Xxxxx Patent shall
be substituted herein. As used herein, Xxxxx Patent shall mean the PHARMING
Patent designated as U.S. Patent No. [*****] and all continuations,
continuations-in-part and divisional patent applications thereof and related
thereto, all counterpart foreign applications of the foregoing, and any patents
issuing thereon.
1.3 "PHARMING Technology" shall mean the materials owned or controlled by
PHARMING which are useful in the GTC Field and which are listed in Appendix B.
1.4 "GTC Field" shall mean the production of any protein in the milk of any
transgenic animal, except the commercial production of urokinase in the milk of
any animal and the commercial production of alpha-amalyse, alpha-lactalbumin,
desaturase, lactase, lactoferrin, lactoperoxidase, lysozyme and bile-salt
stimulated lipase in the milk of cattle. In addition, GTC agrees it will not
commercially produce Factor VIII in the milk of any animal without first
obtaining the written permission of PHARMING.
1.5 "GTC Products" shall mean any product, the manufacture, use or sale of
which utilizes any PHARMING Technology or infringes a valid claim of any
PHARMING Patent.
1.6 "GTC Revenue" shall mean the gross receipts of GTC, its Affiliates and
sublicensees from the sale of GTC Products to any person or entity which is not
GTC, its Affiliates and sublicensees provided that gross receipts shall not
include amounts repaid or credited for rejection or return of GTC Products,
custom duties and charges, sales or other excise taxes or other governmental
charges levied on or measured by sales and further provided that with respect to
sales of GTC Products by GTC to Genzyme Corporation or an Affiliate thereof,
PHARMING and GTC shall reasonably agree on a fair transfer price for such GTC
Products or, if the parties are unable to agree on such a price then the price
shall be determined pursuant to arbitration as set forth in Section 11.6 of this
Agreement.
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2. TECHNOLOGY TRANSFER
2.1 The parties acknowledge that PHARMING has transferred certain
quantities of PHARMING Technology to GTC pursuant to the Biogen Agreement.
PHARMING further acknowledges and agrees that it shall transfer reasonable
quantities of the PHARMING Technology to GTC upon the written request of GTC.
3. LICENSES
3.1 PHARMING hereby grants GTC a worldwide, royalty-bearing,
non-terminable, non-exclusive license under the PHARMING Technology and PHARMING
Patents to make, have made, use, and sell GTC Products in the GTC Field. Such
license will not expire until the expiration of the last to expire valid claim
of the PHARMING Patents.
3.2 GTC shall have the right to sublicense the rights granted to it under
Section 3.1. Any sublicense shall exclude the right to grant further
sublicenses. In the event of the grant of any sublicense under this Section 3.2,
GTC shall notify PHARMING in writing of the name of the sublicensee and the
field and territory of the sublicense.
3.3 Save as expressly provided in this Article 3, nothing in this Agreement
shall be deemed to grant either party any rights or license to any patent,
patent application, technology, know-how or invention of the other party.
4. PAYMENTS AND REPORTING
4.1 In consideration for the rights granted to GTC hereunder:
(a) On December 26, 2002 and on each anniversary of said date
thereafter, GTC shall pay directly to Biogen, Inc. on behalf of PHARMING and GTC
a non-refundable, annual fee of [*****]; and
(b) GTC shall pay directly to Biogen, Inc. on behalf of PHARMING and
GTC a royalty on the annual GTC Revenue based on the selling price per gram
("Price"), of GTC Product according to the schedule attached hereto as Appendix
C, payable on a quarterly basis within thirty (30) days of the end of each
calendar quarter.
4.2 GTC shall be entitled to credit the annual fee paid to Biogen, Inc.
pursuant to Section 4.1(a) against the royalties payable to Biogen, Inc.
pursuant to Section 4.1(b) for the same calendar year, but in no event shall any
unused credit be carried over to another calendar year.
4.3 Together with each royalty payment due under this Article 4, GTC shall
provide Biogen, Inc. with a signed written statement certifying, separately for
each type of GTC Product and for each country, the sales volume and the Price of
such GTC Product and the amount of any permitted credit or deduction. For this
purpose, GTC shall maintain, and shall ensure that its
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sublicensees maintain, appropriate books of account and records of all sales for
a period of two (2) years after each quarterly royalty payment. At PHARMING's
request, GTC shall make such books of account and records available for
inspection during normal business hours by independent public accountants
appointed by PHARMING solely for the purpose of verification of the statements
referred to above and under suitable confidentiality obligations. The cost of
such audit shall be borne by PHARMING unless it is established by the audit that
there has been an error which has caused Biogen, Inc. to receive payments less
than it is due by five percent (5%) or more for the period under audit, in which
case the cost of such audit shall be borne by GTC.
4.4 The amounts computed or specified under this Article 4 are the actual
amounts to be received by Biogen, Inc. and shall not be reduced in any way,
including but not limited to by any liabilities incurred by GTC or its
sublicensees upon remittance to Biogen, Inc. of the payments due hereunder. In
no event shall GTC owe PHARMING any amounts under this Agreement, it being
understood that GTC shall remit all payments directly to Biogen, Inc.
4.5 All payments made hereunder shall be paid in U.S. Dollars. Monetary
conversion from the currency of a foreign country into U.S. currency shall be
made at the exchange rate in force on the last business day of the period for
which the payments are being made as reported in THE WALL STREET JOURNAL, or on
such other basis as mutually agreed upon by GTC and Biogen, Inc.
5. PATENTS
5.1 PHARMING shall be responsible for, and bear the cost of, all matters
relating to the prosecution and maintenance of the PHARMING Patents and shall
provide GTC with annual reports on their status. In the event PHARMING decides
not to prosecute or maintain any of the PHARMING Patents, PHARMING shall notify
GTC and, upon the request of GTC, the parties shall meet to discuss the matter.
If GTC alone or jointly with another licensee under such PHARMING Patent desires
PHARMING to continue the PHARMING Patent, GTC alone or jointly with such other
licensee(s) shall bear the cost thereof, but GTC shall be entitled, on a
quarterly basis, to reduce its royalty obligations related to such PHARMING
Patent by the lesser of the amount of its out-of-pocket costs (including
attorneys' fees) for prosecuting or maintaining the PHARMING Patent or fifty
percent (50%) of the royalty due. Both parties agree to cooperate with each
other in the filing, maintenance and prosecution of patent application and
patents from the PHARMING Patents.
5.2 In the event either party becomes aware of any actual or probable
infringement of any of the PHARMING Patents in the GTC Field, it shall notify
the other party in writing of the details of such infringement. PHARMING in its
sole discretion may take action against any such alleged infringer, at no cost
to GTC, and, if it does, shall be entitled to retain all the recovery of such
action. In the event, however, within six (6) months of written notice to
PHARMING, PHARMING has not caused the infringement to terminate or is not
diligently prosecuting an infringement action against the infringer, then GTC
may take action alone or with another licensee to the infringed PHARMING Patent,
at no cost to PHARMING, and the recovery or settlement from such action shall be
shared equally between the parties bringing the action and
PHARMING after the parties bringing the action are reimbursed for their
out-of-pocket fees and expenses incurred in such action.
6. WARRANTIES AND LIABILITY
6.1 PHARMING represents that it is the sole owner of the PHARMING Patents
and the PHARMING Technology and that it has the authority to grant the licenses
granted hereunder. EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION 6.1, PHARMING
MAKES NO WARRANTIES OR REPRESENTATIONS WHATSOEVER, WHETHER EXPRESS OR IMPLIED,
IN RESPECT OF ANY PHARMING TECHNOLOGY TRANSFERRED TO GTC HEREUNDER; IN
PARTICULAR, BUT WITHOUT LIMITATION, PHARMING MAKES NO WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE OR MERCHANTABILITY. Moreover, PHARMING makes no
representation or warranty that the use of PHARMING Technology or the
manufacture, use or sale of GTC Products by GTC or its sublicensees or its
customers will not constitute an infringement of the intellectual property
rights of others. IN NO EVENT SHALL PHARMING BE LIABLE FOR SPECIAL, INCIDENTAL
OR CONSEQUENTIAL DAMAGES OR LOST REVENUES OR PROFITS.
6.2 GTC agrees to indemnify PHARMING from any and all damages, losses,
costs, or other consequences which PHARMING or its subsidiaries may incur as a
result of any claim relating to the use of the PHARMING Technology transferred
to GTC hereunder or the manufacture, use or sale of GTC Products, by GTC or its
distributors, sublicensees or customers.
6.3 PHARMING hereby represents, warrants, and covenants that it has no
knowledge of any bankruptcy, insolvency, reorganization, or liquidation laws,
regulations or proceedings that would preclude GTC from practicing the licenses
granted to it hereunder throughout the term of this Agreement, and that it shall
use its best efforts to protect GTC's interest with respect thereto throughout
the term of this Agreement, including, without limitation, making all
appropriate registrations of any relevant licenses with all appropriate
authorities.
7. COMMERCIALIZATION
7.1 GTC shall provide PHARMING with notice of the date on which GTC and/or
its sublicensees make the first commercial sale of GTC Products.
7.2 GTC shall not make any use of the name of PHARMING in connection with
the use of the PHARMING Technology supplied hereunder or the manufacture, use or
sale of GTC Products (including in any advertising, promotional or sales
literature), without the prior written consent of PHARMING. Upon PHARMING's
request, GTC shall ensure that all GTC Products will be labeled "sold under
license from Pharming Group, N.V."
7.3 GTC shall be responsible for the compliance of GTC Products sold by it
or its sublicensees with all applicable laws and regulations, including, without
limitation any labeling requirements for GTC Products.
8. DURATION AND TERMINATION
8.1 This Agreement shall commence on the Effective Date and shall continue
until expiration of the obligation to pay royalties under Section 8.2, unless
earlier terminated in accordance with Sections 8.3 or 8.4.
8.2 GTC's obligation to pay royalties pursuant to Article 4 shall expire
and GTC's license hereunder thereafter shall be fully paid-up, on a
country-by-country basis, after the expiration of the last issued PHARMING
Patent or 10 years after the first sale of GTC Product, whichever occurs later.
8.3 Either party hereto shall have the right, by notice in writing, to
terminate this Agreement (i) in the event that the other party is in default or
breach of any material covenant, undertaking or obligation to be performed by
that party hereunder, and such default or breach is not corrected or cured
within ninety (90) days after written notice thereof has been given by the
non-defaulting party; or (ii) in the event that either party shall enter into
any arrangement or composition with its creditors, or enter or be put into
voluntary or compulsory liquidation (except for the purpose of any
reorganization reasonably acceptable to the other party), or have its business
enjoined or ordered into receivership by executive or judicial authorities.
Notwithstanding the foregoing and without in any way limiting GTC's right to
terminate this Agreement pursuant to Section 8.4 below, the provisions of this
Section 8.3(ii) shall only apply to PHARMING to the extent PHARMING enters into
such a condition subsequent to executing this Agreement.
8.4 GTC shall have the right to terminate this -Agreement for any reason by
providing PHARMING with ninety (90) days written notice in advance of the
effective date of termination. Furthermore, for purposes of this Agreement and
the transactions contemplated herein it is acknowledged that Pharming Group N.V.
and Pharming Intellectual Property B.V. are currently in receivership and
bankruptcy, respectively, under Dutch law. It is expected that these PHARMING
units will emerge from both receivership and bankruptcy within ninety (90) days
of the Effective Date of this Agreement. Should either Pharming Group N.V. or
Pharming Intellectual Property B.V. fail to do so within such 90 day time
period, or should any other circumstance described in Section 8.3(ii) that was
existing as of the Effective Date of this Agreement remain uncorrected for
longer than such 90 day time period, GTC shall have the right to terminate this
Agreement upon thirty days (30) written notice to PHARMING.
8.5 Any termination under this Article 8 shall be without prejudice to the
rights of either party against the other then accruing or otherwise accrued
under this Agreement.
8.6 Termination of this Agreement shall terminate all outstanding
obligations and liabilities between GTC and PHARMING arising from this Agreement
(i) except, after any termination, for those provided for in Articles 6, 8, 9
and 10 and Sections 11.5 and 11.6; and (ii) except after any termination, other
than termination by GTC under the first sentence of Section 8.4, for those
provided for in Article 3 and Sections 4.1, 4.2 and 5.1.
9. CONFIDENTIALITY
9.1 During the term of this Agreement and for a period of five years
thereafter, GTC and PHARMING shall treat all confidential information (including
the PHARMING Technology and customer related information) received from the
other party hereunder, or under the Biogen Agreement, as the exclusive property
of the disclosing party and agrees not to use or disclose to any third party any
such information, except as permitted hereunder, without first obtaining the
disclosing party's written consent. Each party further agrees to take all
practicable steps to ensure that any such information shall not be used by its
directors, officers, employees or agents, except on like terms of
confidentiality as aforesaid, and that it shall be kept fully private and
confidential by them.
9.2 The above provision of confidentiality shall not apply to that part of
such information which a receiving party is clearly able to demonstrate:
(a) was fully in its possession prior to receipt from-the other; or
(b) was in the public domain at the time of receipt from the other; or
(c) became part of the public domain through no act or omission of the
party receiving such information, its directors, officers or employees; or
(d) was lawfully received from some third party having a right of
further disclosure free of obligations of confidentiality; or
(e) is required to be disclosed by law or applicable government
regulations.
10. NOTICES
10.1 Any notice required hereunder shall be sent in writing by registered
or certified airmail, postage prepaid, return receipt requested, or by
telecopier, followed-up with a hard copy, air courier or hand delivery,
addressed to the party to whom it is to be given as follows:
If to GTC: GTC Biotherapeutics, Inc.
000 Xxxxxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxxx 00000-0000
Fax: (000) 000-0000
Attention: Chief Executive Officer
with a copy to: Xxxxxx & Dodge LLP
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Fax: (000) 000-0000
Attention: Xxxxxxxxx Xxxxxxxx, Esq.
If to PHARMING: Pharming Group, X.X.
0 Xxxxxxxxxxxxx 0000 XX
Xxxxxx, Xxx Xxxxxxxxxxx
Fax: 00-(0) 00 000 0000
Attention: Chief Executive Officer
and Mr. E.N. Xxxxxx, Trustee
Geelkerken & Lindskens Advocaten,
Xxxxxxxxx 0x X-0,
0000 XX Xxxxxxx,
Xxx Xxxxxxxxxxx
with a copy to: Xx. Xxxx XxXxx
Xxxxxx Xxxxxx, Solicitors
Xxxxxx Xxxxx
0-0 Xxxxxxxxxx Xxxxxxx
Xxxxx Xxxxxxx, Xxxxxx XX0 0XX
Fax: 000 0000 0000
or to such other address or addresses as may from time to time be given in
writing by either party to the other pursuant to the terms hereof.
10.2 Any notice sent pursuant to this Article 10 shall be deemed delivered
within five (5) days if sent by -registered or certified airmail, postage
prepaid, and within twenty-four (24) hours if sent by telecopier, air courier or
hand delivery.
11. MISCELLANEOUS
11.1 FORCE MAJEURE:
Any delays in or failures of performance by either party under this
Agreement shall not be considered a breach of this Agreement if and to
the extent caused by occurrences beyond the reasonable control of the
party affected, including, but not limited to: Acts of God; acts,
regulations or laws of any government (including, without limitation,
import and export regulations); strikes or other concerted acts of
workers; fires; floods; explosions; riots; wars; rebellion and
sabotage; and any time for performance hereunder shall be extended by
the actual time of delay caused by such occurrence, provided that each
party shall use reasonable commercial efforts to avoid such causes of
non-performance and shall continue performance with reasonable
dispatch when such causes are removed, and shall promptly give notice
to the other of the beginning and end of the period of
non-performance.
11.2 ENTIRE AGREEMENT:
This Agreement constitutes the entire understanding between the
parties with respect to the subject matter hereof, and supersedes and
replaces all prior agreements, understandings, writings and
discussions between the parties relating to said subject matter,
including, without limitation, the Biogen Agreement.
11.3 AMENDMENTS; WAIVERS:
This Agreement may be amended and any of its terms or conditions may
be waived only by a written instrument executed by both parties, or,
in the case of a waiver, by the party
waiving compliance. The failure of either party at any time to require
performance of any provision hereof shall in no manner affect its
rights at a later time to enforce the same. No waiver by either party
of any condition or term in any instance shall be construed as a
further or continuing waiver of such condition or term or of another
condition or term.
11.4 ASSIGNMENT; BINDING EFFECT:
This Agreement shall not be assigned by either party without the prior
written consent of the other party, except to any of their respective
successors in business, or to any company, corporation or business in
which a party controls more than fifty percent (50%) of the voting
stock or in connection with a sale of substantially all assets of the
business to which this Agreement relates. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the
parties hereto and their respective successors and permitted assigns.
11.5 LAW OF THE CONTRACT:
This Agreement shall be governed by and construed and interpreted in
accordance with the laws of the Commonwealth of Massachusetts.
11.6 DISPUTES; ARBITRATION: Any controversy or claim arising out of, or
relating to, any provisions of this Agreement, or breach thereof, shall be
referred for resolution to GTC's Chief Executive Officer, or his or her
designee, and to PHARMING's Chief Executive Officer, or his or her designee. If
the parties' respective officers, or their designees cannot reach a resolution
of the dispute within sixty (60) days, then the dispute shall be finally settled
by binding arbitration under the rules of the World Intellectual Property
Organization ("WIPO") Arbitration Rules, effective from October 1, 1994 in the
London Court of International Arbitration ("LCIA") in London, England. The
parties also agree as follows with respect to such arbitration:
(a) The Arbitration proceedings shall be before a panel of three (3)
arbitrators, one of such arbitrators to be selected by GTC, one of such
arbitrators to be selected by PHARMING, and a third to be selected by the other
two;
(b) Both legal and equitable remedies shall be available to the
arbitrators. If London is inconvenient to GTC or PHARMING the arbitration shall
be held at such other location as GTC and PHARMING may reasonably agree;
(c) Judgment upon the award rendered by the arbitrators may be entered
in any court having jurisdiction thereof;
(d) GTC and PHARMING shall each bear its own costs, including the
costs of the Arbitration;
(e) If GTC or PHARMING fails to select an arbitrator within thirty
(30) days after receiving notice of arbitration from the other party, then such
party shall forfeit its right to select an arbitrator, and such arbitrator shall
be selected by the LCIA; and
(f) Pursuant to Article 40 of the WIPO arbitration rules the language
of the arbitration shall be English.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers on the date and year first above written.
GTC BIOTHERAPEUTICS, INC.
By: /S/ XXXXXXXX X. XXX
Name: Xxxxxxxx X. Xxx
Title: Chief Executive Officer
Date: June 24, 2002
PHARMING GROUP N.V.
By: /S/ XXXXXXX XXXXX
Name: Xx. Xxxxxxx Xxxxx
Title: Chief Executive Officer
Date: June 21, 2002
By: /S/ XXXXX XXXXXX
Name: Xx. Xxxxx Xxxxxx
Title: Managing Director, Vice President, Research & Technology
Date: June 21, 2002
By: /S/ E. N. XXXXXX
Name: Mr. E.N. Xxxxxx,
Title: Bewindvoeder for Pharming Group N.V.
Date: June 21, 2002
PHARMING INTELLECTUAL PROPERTY B.V.
By: /S/ E.N. XXXXXX
Name: Mr. E.N. Xxxxxx,
Title: Curator for Pharming Intellectual Property B.V.
Date: June 21, 0000
XXXXXXXX A
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APPENDIX B
PLASMIDS AND MATERIALS TO BE TRANSFERRED TO GTC
CASEIN EXPRESSION SYSTEM
Genomic clones of Alpha 5-1 casein:
C9 and CAS900 series which are 3' regions of the gene
D4 and E1 which are 5' or upstream regions
The first round of constructs containing only 6kb upstream with tPA insert:
CAS 1151 deposited for U.S. Patent 4,873,316
CAS 1215 casein expression vector
CAS 1217 casein expression vector with casein 3' untranslated region
Island of expression with 21kb upstream and 8kb genomic 3':
CAS 1288 deposited for patent application
CAS 1295 deposited for patent application contains genomic urokinase
CAS 1313 island of expression with upstream Xho removed CAS 1312 3'
untranslated region of genomic urokinase CAS 1328 3' untranslated
region of genomic urokinase with modified upstream sites
Listed above are the constructs used for testing in mice for the ability of the
island of expression to function as defined in the patent application. AU are
derivatives of the original Alpha S--i Casein genomic clone.
HUMAN SERUM ALBUMIN
Constructs to test for expression of Human Serum Albumin:
CAS 1242 ESA c-DNA in early 6kb expression vector
ESA 2 and ESA 3 partial genomic clone of ESA; Sstl fragment
CAS 1333 ESA c-DNA cloned into CAS 1313 expression island
CAS 1337 ESA BstE2/Sstl genomic subcloned into c-DNA
CAS 1339 ESA c-DNA modified 5' untranslated region
BASIC RESEARCH TOOLS
Mouse c-DNA library with Beta casein c-DNA clone
Mouse c-DNA casein genomic clone
APPENDIX C
PRICE $ ROYALTY %
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