Exhibit 10.52
BOTOX(R) -- JAPAN
LICENSE AGREEMENT
BY AND BETWEEN
ALLERGAN, INC.
ALLERGAN SALES, LLC
AND
GLAXO GROUP LIMITED
BOTOX(R) -- JAPAN LICENSE AGREEMENT
THIS BOTOX(R) -- JAPAN LICENSE AGREEMENT including the exhibits and
schedules referred to herein and attached hereto, (collectively, the
"Agreement"), dated September 30, 2005 (the "Effective Date"), is made and
entered into by and between ALLERGAN, INC., a Delaware corporation having a
place of business at 0000 Xxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx 00000, and ALLERGAN
SALES, LLC, a Delaware Limited Liability Company having a place of business at
0000 Xxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx 00000, (ALLERGAN, INC. and ALLERGAN SALES,
LLC are collectively referred to herein as "ALLERGAN") and GLAXO GROUP LIMITED,
a private limited company incorporated in England and Wales, having its
registered office at Glaxo Wellcome House, Berkeley Avenue, Greenford,
Middlesex, England UB6 0NN ("GSK").
RECITALS
A. ALLERGAN Controls (as defined in Article 1 below) the ALLERGAN Patent
Rights (as defined in Article 1 below), ALLERGAN Know-How (as defined in Article
1 below) and ALLERGAN Trademarks;
B. GSK desires to obtain from ALLERGAN, and ALLERGAN is willing to grant to
GSK, certain licenses under the ALLERGAN Patent Rights, ALLERGAN Know-How and
ALLERGAN Trademarks under the terms and conditions herein; and
C. ALLERGAN will have Product manufactured and supplied to GSK under the
terms of the Supply Agreement (as defined in Article 1 below).
NOW, THEREFORE, in consideration of the mutual covenants and obligations
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, ALLERGAN and GSK hereby agree as
follows:
1. DEFINITIONS
As used in this Agreement, the following terms will have the meanings
indicated:
1.1 An "Affiliate" of a Party or Person means any Person, whether de jure
or de facto, that directly or indirectly, controls, is controlled by, or is
under common control with such Party or Person, as applicable. Solely as used in
this definition, "control" means (a) direct or indirect ownership of more than
fifty percent (50%) of the equity (or such lesser percentage which is the
maximum allowed to be owned by a foreign corporation in a particular
jurisdiction)
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
having the power to vote on or direct the affairs of such Party or Person, as
applicable, or (b) the possession, directly or indirectly, of the power to
direct or cause the direction of the policies and management of such Party or
Person, as applicable, whether by the ownership of stock, by contract, or
otherwise.
1.2 "Agreement" will have the meaning set forth in the preamble.
1.3 "ALLERGAN" will have the meaning set forth in the preamble.
1.4 "ALLERGAN Corporate Trademarks" will have the meaning set forth in
Section 1.9.
1.5 "ALLERGAN Know-How" means any and all know how, information, data
(including, without limitation, pre-clinical data, toxicology information and
clinical trial data), documents, materials, and software (including, but not
limited to, marketing information, technical information, regulatory
information, clinical information, processes, procedures, methods, formulae,
protocols, and techniques) relating to Product (including, without limitation,
Product Improvements and Enhancements) but not including ALLERGAN Manufacturing
Information, which exists as of the Effective Date or during the Term and is
Controlled by ALLERGAN or its Affiliates.
1.6 "ALLERGAN Manufacturing Information" means any and all confidential
documents and information Controlled by ALLERGAN and/or its Affiliates and
relating to the manufacture of Product.
1.7 "ALLERGAN Patent Rights" means any and all patent applications and
patents generically or specifically claiming or covering the use, sale, offer
for sale and/or import of Product (including without limitation the active
pharmaceutical ingredient in Product and its dosage forms and formulations),
that are Controlled by ALLERGAN or its Affiliates as of the Effective Date or
during the Term in the Territory, including without limitation the following:
(a) patent applications and patents set forth on Exhibits A and A-1, such
Exhibits to be updated by ALLERGAN at least one (1) time in each Calendar Year
during the Term and also within thirty (30) calendar days after GSK's written
request, which request will not be made by GSK more than one (1) time in any
Calendar Year during the Term; (b) divisions, continuations,
continuations-in-part, renewals, and substitute applications of any patent
applications described in (a); (c) patents that may issue from any patent
applications described in (a) or (b); (d) reissues, reexaminations, and
extensions or restorations of patents described in (a) or (c) by existing or
future extension or restoration mechanisms, including without limitation, patent
restoration and supplementary protection certificates or the equivalent thereof;
and (e) any other form of government-issued right in the Territory substantially
similar to any of the foregoing. Notwithstanding anything to the contrary,
ALLERGAN Patent Rights will not include any patent applications or patents
claiming or covering any processes for manufacture of Product. For clarity,
ALLERGAN Patent Rights includes those patents and patent applications which are
Controlled by ALLERGAN or any of its Affiliates in the Territory, which
generically or specifically cover the use, sale, offer for sale and/or import of
any Product Improvements and
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
2
Enhancements made by or on behalf of ALLERGAN. For further clarity, ALLERGAN
Patent Rights do not include any GSK Patent Rights.
1.8 "ALLERGAN Product Trademarks" will have the meaning set forth in
Section 1.9.
1.9 "ALLERGAN Trademarks" means any trademarks, applications to register
trademarks, intent-to-use applications, or other registrations or applications
related to trademarks, common-law trademarks and rights, service marks, trade
dress, logos, trade names, corporate names, all rights arising from the use of
or existing in connection with domain names, and all goodwill associated with
the foregoing and all registrations and applications for registration of any of
the foregoing, all to the extent Controlled by ALLERGAN or its Affiliates in the
Territory as of the Effective Date or during the Term that are (a) specific to
and only used with Product, as set forth in Exhibit B (the "ALLERGAN Product
Trademarks") or (b) used in connection with, but are not specific to or used
exclusively with, Product (including without limitation Housemarks of ALLERGAN),
as set forth in Exhibit C (the "ALLERGAN Corporate Trademarks").
1.10 "Allowable Standard Cost" means an increase in the Standard Cost of no
greater than, (a) during each Calendar Year commencing with the first (1st)
Calendar Year and continuing through the end of *** and (b) from and after ***,
***. When calculating the Allowable Standard Cost for each Calendar Year after
the first (1st) Calendar Year, the 'Standard Cost' referred to in this Section
1.10 will be the lower of the Allowable Standard Cost for the immediately
preceding Calendar Year or the Standard Cost, as recalculated by ALLERGAN in the
immediately preceding Calendar Year as provided in Section 1.55.
1.11 "Applicable Law" means all applicable provisions of any and all
federal, national, state, provincial, and local statutes, laws, rules,
regulations, administrative codes, ordinances, decrees, orders, decisions,
injunctions, awards, judgments, permits and licenses of or from any governmental
authorities relating to or governing the use or regulation of the subject item
or action.
1.12 "Calendar Quarter" means each of the three (3) month periods ending
March 31, June 30, September 30, and December 31; provided, however, that the
first (1st) Calendar Quarter under this Agreement will be the period beginning
on the Effective Date and ending on the end of the Calendar Quarter in which the
Effective Date is encompassed.
1.13 "Calendar Year" means, for the first Calendar Year, the period
beginning on the Effective Date and ending December 31, 2005, and for each
Calendar Year thereafter, each successive period beginning on January 1 and
ending twelve (12) consecutive calendar months later on December 31; provided,
however, that the last Calendar Year of the Term will be the period beginning on
January 1 and ending on the effective date of expiration or termination of the
Term.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
3
1.14 "Closing Date" means the earlier of (a) the date on which the
applicable waiting period under Article 16 of the Anti-Monopoly Law of Japan
expires or terminates early; or (b) the date on which the Parties agree in
writing that all requests to the Parties by the JFTC with regard to the
transaction contemplated by this Agreement have been satisfactorily met and no
objection on the part of the JFTC remains.
1.15 "Co-Development Agreement" will have the meaning set forth in Section
4.1.2(b).
1.16 "Commercially Reasonable Efforts" means efforts and resources normally
used by a Party in the Territory in the exercise of its reasonable business
discretion relating to a prescription pharmaceutical product owned by it or to
which it has co-exclusive rights, which is of similar market potential at a
similar stage in its development or product life, taking into account issues of
patent coverage, safety and efficacy, product profile, the competitiveness of
the marketplace, the proprietary position of the compound or product, the
regulatory structure involved, the profitability of the applicable products, and
other relevant factors, including without limitation technical, legal,
scientific, and/or medical factors.
1.17 "Competing Product" will have the meaning set forth in Section 7.5.2.
1.18 "Confidential Information" will have the meaning set forth in Section
10.1.
1.19 "Control" means, with respect to the subject item, the ability and
authority of a Party or its Affiliate, whether arising by ownership, possession
or pursuant to a license or sublicense, to grant licenses or sublicenses to the
other Party under or to the subject item as specified in this Agreement, without
breaching the terms of any agreement with any Third Party and/or its Affiliates.
1.20 "Co-Promotion Option" will have the meaning set forth in Section 2.5.
1.21 "Co-Promotion Term" will have the meaning set forth in Section 2.5.
1.22 "Cosmetic Indication" means the treatment, minimization, and/or
eradication of, or the appearance of, glabellar lines, crow's feet, or any lines
or wrinkles on the face.
1.23 "Current Indications" means those Indications for which ALLERGAN or
any of its Affiliates, as of the Effective Date, has received Regulatory
Approval in the Territory to use Product for the treatment, prevention or
palliation of such Indications, which Indications include blepharospasm (benign
essential blepharospasm and essential blepharospasm), hemifacial spasm, and
cervical dystonia (spasmodic torticollis).
1.24 "Distribution Agreement" will have the meaning set forth in Section
4.1.1(b).
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
4
1.25 "Effective Date" means the date on which this Agreement is mutually
executed by authorized representatives of each Party, which date will be that
which is set forth in the preamble.
1.26 "Extended Term" will have the meaning set forth in Section 9.2.1.
1.27 "Field of Use" means any and all uses of Product for the Current
Indications, Cosmetic Indication, and Future Indications.
1.28 "Force Majeure Event" will have the meaning set forth in Section
11.13.
1.29 "Future Indications" means all treatment, prevention or palliation of
Indications other than the Cosmetic Indication and Current Indications.
1.30 "Good Clinical Practice" means the ministerial ordinance number 28
issued by the MHLW on March 27, 1997, as amended by the ministerial ordinance
number 106 issued on June 12, 2003, by the MHLW relating to the standard for
performance of clinical trials and its amendments related rules and regulations.
1.31 "Good Post-Marketing Study Practice" means the ministerial ordinance
number 171 issued by the MHLW on December 20, 2004, relating to the standard of
post-marketing investigation and study and its amendments related rules and
regulations.
1.32 "Good Vigilance Practice" means the ministerial ordinance number 135
issued by the MHLW on September 22, 2004, relating to the standard of
post-marketing safety management of drugs and its amendments related rules and
regulations.
1.33 "GSK" will have the meaning set forth in the preamble.
1.34 "GSK Distribution Commencement Date" means the effective date of the
Distribution Agreement, which date will not be more than fourteen (14) calendar
days after the Effective Date.
1.35 "GSK Patent Rights" means any and all patents and patent applications
Controlled by GSK or its Affiliates, which generically or specifically claim or
cover the making, having made, use, sale, offer for sale, and/or import of
Product (including, for example, any Product Improvements and Enhancements
inside and outside of the Territory, which are made by or on behalf of GSK
pursuant to this Agreement and relate to Product in the Field of Use), which
includes, without limitation, the following: (a) divisions, continuations,
continuations-in-part, renewals, and substitute applications of any such patent
applications; (b) patents that may issue from any such patent applications; (c)
reissues, reexaminations, and extensions or restorations of patents described in
(b) by existing or future extension or restoration mechanisms, including without
limitation, patent restoration and supplementary protection certificates or the
equivalent thereof; and (d) any other form of government-issued right inside or
outside of the Territory
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
5
substantially similar to any of the foregoing. For clarity, GSK Patent Rights do
not include any ALLERGAN Patent Rights.
1.36 "GSK Sales Commencement Date" means the date of invoice of the first
commercial sale of Product in the Field of Use in the Territory by GSK (or its
Affiliates or sublicensee) to a Third Party once GSK or its Affiliate in the
Territory has become the MAH for Product in the Territory.
1.37 "Housemarks" means the names of a Party or its Affiliates, or
variations of the names, and all related trade dress, logotypes, symbols, and
other trademarks used by a Party or its Affiliates in connection with its
products in the Territory.
1.38 "Indication" means any distinct disease or medical condition. For the
purpose of clarification, any label expansion or other extension into a
different segment of any Current Indication will not be considered a different
Indication.
1.39 "Initial Term" will have the meaning set forth in Section 9.1.
1.40 "JFTC" means the Japan Fair Trade Commission, or any successor entity
thereto.
1.41 "MAH" or "Marketing Authorization Holder" means a Person who possesses
all Regulatory Approvals in the Territory in such Person's name and who will
manage all interactions with Regulatory Authorities regarding such Regulatory
Approvals.
1.42 "Manufacturer" means Allergan Pharmaceuticals Ireland, a Cayman
Islands corporation doing business at Carrowberg, Xxxxxxxxx Xxxx, Xxxxxxxx,
Xxxxxx Xxxx, Xxxxxxx, a wholly owned Affiliate of ALLERGAN, or such other Person
as may be appointed to supply Product to GSK pursuant to the Supply Agreement.
1.43 "Material Regulatory Interruption" means any action or omission of any
Regulatory Authority, including, without limitation, any mandatory recall of
Product, which prevents GSK or its Affiliates or sublicensees from being able to
use, sell, offer for sale and/or import Product in the Field of Use in the
Territory, which is not caused by GSK or its Affiliates or sublicensees being in
breach of their respective obligations to such Regulatory Authority.
1.44 "Material Supply Interruption" means a breach by the Manufacturer of
its obligation to Manufacture (as defined in the Supply Agreement) Product in
accordance with the terms and conditions of the Supply Agreement.
1.45 "MHLW" means the Japanese Ministry of Health, Labour and Welfare or
any successor agency thereto.
1.46 "Net Sales" means, as to GSK or ALLERGAN and with respect to a given
period of time, gross invoiced sales of Product to Third Parties by either Party
or its Affiliates or
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
6
sublicensees in such period, less the following deductions from such gross
amounts which are actually incurred, allowed, paid, accrued or specifically
allocated: (a) credits or allowances actually granted for damaged Product,
returns or rejections of Product, price adjustments, and billing errors; (b)
governmental and other rebates (or equivalents thereof) granted to managed
health care organizations, pharmacy benefit managers (or equivalents thereof),
national, state/provincial, local, and other governments, their agencies and
purchasers, and reimbursers, or to trade customers; (c) such Party's normal and
customary trade, cash and quantity discounts, allowances, and credits actually
allowed or paid; (d) commissions allowed or paid to Third Party distributors,
brokers, or agents other than sales personnel, sales representatives, and sales
agents employed by such Party; (e) transportation costs, including insurance,
for outbound freight related to delivery of Product to the extent included in
the gross amount invoiced; (f) sales taxes, value added taxes (VAT), and other
taxes directly linked to the sales of Product to the extent included in the
gross amount invoiced; (g) the actual amount of any write offs for bad debt
directly relating to sales of Product in the period; and (h) any other items
actually deducted from gross invoiced sales amounts as reported by such Party in
its financial statements in accordance with, in the case of GSK's Net Sales, the
International Financial Reporting Standards, applied on a consistent basis, and,
in the case of ALLERGAN's Net Sales, the U.S. generally accepted accounting
principles applied on a consistent basis. Sales between or among either Party
and its Affiliates or sublicensees will be excluded from the computation of such
Party's Net Sales, but the subsequent final sales to a Third Party by such
Affiliates or sublicensees will be included in the computation of such Party's
Net Sales.
1.47 "Other Territories" means those countries in the world other than
those in the Territory, where ALLERGAN has granted, as of or after the Effective
Date, certain licenses to GSK and its Affiliates to use, sell, offer for sale
and import Product in such countries.
1.48 "Party" means either GSK or ALLERGAN, and "Parties" means both of
them.
1.49 "Person" means an individual, corporation, partnership, association,
trust, or any other entity or organization, including without limitation any
government or political subdivision or any agency or instrumentality thereof.
1.50 "Product" means any pharmaceutical composition intended for
administration to humans containing botulinum toxin type A, regardless of
formulation, dosage, or form, and manufactured and supplied by the Manufacturer
in accordance with the Supply Agreement. For clarity, Product includes any
Product Improvements and Enhancements.
1.51 "Product Improvements and Enhancements" means any and all improvements
and enhancements of Product, including, for example, research leading to
formulations, assays, and preclinical models in support of Indications,
invented, developed, or acquired by or on behalf of ALLERGAN and/or GSK, as
applicable, during the Term.
1.52 "Regulatory Approval" means an approval, license, registration, and/or
authorization necessary for the use, sale, offering for sale, or importation of
a prescription
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
7
pharmaceutical product in the Territory, including, without limitation, the
Xxxxxx and the New Drug Application.
1.53 "Regulatory Approval Applications" means an application for obtaining
a Regulatory Approval, together with all documents, data, and information
included with such application.
1.54 "Regulatory Authority" means any or all national, supranational,
regional, state, or local regulatory agency, department bureau, commission,
council, or other government entity involved in the granting of Regulatory
Approval for a pharmaceutical product in the Territory.
1.55 "Standard Cost" means the Manufacturer's internal standard cost,
comprising direct and indirect fully allocated costs to Manufacture (as such
term is defined in the Supply Agreement) botulinum toxin type A at the
Manufacturing Facility (as such term is defined in the Supply Agreement), for
supply to GSK or any of the Manufacturer's other customers (be they Third
Parties or Affiliates), including without limitation the net standard cost of
raw materials, active pharmaceutical ingredients, components, labor, and
overhead attributed to the production, processing, quality control, labeling,
and packaging of Product, determined in accordance with Applicable Law and U.S.
generally accepted accounting principles using methodology consistently applied
by the Manufacturer.
1.56 "Stock Product" will have the meaning set forth in Paragraph 5(a) of
Exhibit G.
1.57 "Supply Agreement" means the agreement for the manufacture and supply
of Product by the Manufacturer to GSK for the purposes of this Agreement, which
will be executed by GSK and the Manufacturer contemporaneously with this
Agreement.
1.58 "Tail Period" means the *** period following (a) the expiration of
this Agreement as provided in Section 9.1 or Section 9.2.3; or (b) the
termination of this Agreement by GSK solely as provided in Section 9.3.1.
1.59 "Tail Period Payments" will have the meaning set forth in Section 3.4.
1.60 "Term" means the Initial Term; however, if GSK exercises its option to
extend the Initial Term as provided in Section 9.2, the "Term" will mean the
Initial Term and the Extended Term.
1.61 "Territory" means Japan and its territories and possessions.
1.62 "Third Party" means any Person other than ALLERGAN or GSK or either of
their respective Affiliates.
1.63 "Third Party Payments" will have the meaning set forth in Section
3.2.2(b).
1.64 "Transition Period" will have the meaning set forth in Section 4.1.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
8
1.65 "Unit" means each separate stock keeping unit of a product with a
distinct product number or item code.
2. LICENSES
2.1 Product Rights.
2.1.1 Subject to the terms and conditions of this Agreement, ALLERGAN
hereby grants to GSK a co-exclusive (with ALLERGAN and its Affiliates) license,
including a right to grant sublicense rights, as further described in Section
2.4, but not to assign except as provided in Section 11.3, under the ALLERGAN
Patent Rights, other than those that are identified on Exhibit A-1, and ALLERGAN
Know-How, to use, sell, offer for sale, and import Product in the Field of Use
in the Territory. For purposes of clarification, the license granted by ALLERGAN
to GSK pursuant to this Section 2.1.1 includes, without limitation, the right to
develop, as further described in Section 2.1.4, promote, commercialize, market,
and distribute Product in the Field of Use in the Territory, but will not
include any right to make or have made any Product.
2.1.2 Subject to the terms and conditions of this Agreement, ALLERGAN
hereby grants to GSK an exclusive option to obtain a co-exclusive (with ALLERGAN
and its Affiliates) license, including a right to grant sublicense rights, as
further described in Section 2.4, but not to assign except as provided in
Section 11.3, under the ALLERGAN Patent Rights that are set forth on Exhibit A-1
to use, sell, offer for sale, and import Product for any Future Indications in
the Territory. This option may be exercised by GSK as to any of the patents and
patent applications at any time after the *** of the Term, upon providing prior
written notice to ALLERGAN and, subject to Section 3.8, payment to ALLERGAN of
***. Upon GSK's exercise of the option as provided in this Section 2.1.2 as to
any patent and/or patent application, such patent and/or patent application will
be moved from Exhibit A-1 and placed on Exhibit A.
2.1.3 Subject to the terms and conditions of this Agreement, GSK
hereby grants to ALLERGAN and its Affiliates a royalty-free, worldwide,
non-exclusive, perpetual (subject to Section 9.4.2) license, including a right
to grant sublicense rights, but not to assign except as provided in Section
11.3, under the GSK Patent Rights, to make, have made, use, sell, offer for
sale, and import Product in the Field of Use. For purposes of clarification, the
license granted by GSK to ALLERGAN pursuant to this Section 2.1.3 will include
the right to develop, promote, commercialize, market, and distribute Product in
the Field of Use.
2.1.4 ALLERGAN acknowledges and agrees that the licenses granted to
GSK under Section 2.1.1 include without limitation:
(a) The right of GSK to conduct human clinical trials and submit
clinical data packages to Regulatory Authorities for Product in the Field of Use
in the Territory;
(b) The right of GSK to manage all communications with Regulatory
Authorities relating to Product,***; and provided, further that any
communications
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
9
with Regulatory Authorities relating to the drug master file (DMF) will be
managed by ALLERGAN after good faith consultation with GSK unless the Parties
agree in writing that any such communications will be managed by GSK;
(c) Access by GSK to any data developed by ALLERGAN that is
useful for GSK to develop Product in the Field of Use for use, sale, offering
for sale and import in the Territory; and
(d) Rights to other ancillary clinical development information
Controlled by ALLERGAN or its Affiliates that is useful to GSK in using,
selling, offering for sale and importing Product in the Field of Use in the
Territory.
2.2 Trademark Rights.
2.2.1 ALLERGAN Product Trademarks. ALLERGAN hereby grants to GSK a
co-exclusive (with ALLERGAN and its Affiliates) license, including a right to
grant sublicense rights as further described in Section 2.4, but not to assign
except as provided in Section 11.3, to use ALLERGAN Product Trademarks solely in
connection with the use, sale, offering for sale, and import of Product in the
Field of Use in the Territory. All representations of ALLERGAN Product
Trademarks that GSK intends to use if not previously approved by ALLERGAN as
provided in this Section 2.2.1, will first be submitted to ALLERGAN for
approval, such approval not to be unreasonably withheld. ALLERGAN will have
thirty (30) calendar days to review the representation of the ALLERGAN Product
Trademarks. If ALLERGAN does not provide written notice of its approval or
disapproval (together with its reasons for such disapproval) within such thirty
(30) calendar day period, ALLERGAN will be deemed to have approved such
representation. For the avoidance of doubt, ALLERGAN will retain no right to use
ALLERGAN Product Trademarks in the Territory for any purpose other than
co-promotion pursuant to the terms of this Agreement without GSK's prior written
consent.
2.2.2 ALLERGAN Corporate Trademarks. ALLERGAN hereby grants to GSK a
co-exclusive license (with ALLERGAN and its Affiliates) including a right to
grant sublicense rights as further described in Section 2.4, but not to assign
except as provided in Section 11.3, to use ALLERGAN Corporate Trademarks as
trademarks solely in connection with the use, sale, offering for sale, and
import of Product in the Field of Use in the Territory. All representations of
ALLERGAN Corporate Trademarks that GSK intends to use, if not previously
approved by ALLERGAN as provided in this Section 2.2.2, will first be submitted
to ALLERGAN for approval, such approval not to be unreasonably withheld.
ALLERGAN will have thirty (30) calendar days to review the representation of the
ALLERGAN Corporate Trademarks. If ALLERGAN does not provide written notice of
its approval or disapproval (together with its reasons for such disapproval)
within such thirty (30) calendar day period, ALLERGAN will be deemed to have
approved such representation.
2.2.3 Except for any Housemarks of GSK, ALLERGAN will own all
trademarks used in connection with Product in the Field of Use in the Territory.
Except for any Xxxxxxxxxx xx XXX, XXX will not own any of the trademarks that it
may use in connection with the use, sale,
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
10
offering for sale and importing of Product in the Field of Use in the Territory
and except for its use of the Housemarks of GSK, GSK will only use ALLERGAN
Trademarks as trademarks in connection with any and all Product in the
Territory.
2.2.4 ALLERGAN and its Affiliates will have no right to use in any way
whatsoever any representation of a Housemark of GSK, whether in connection with
Product or otherwise, without obtaining the prior written consent of GSK.
2.3 Ownership; Reservation of Rights.
2.3.1 Except as expressly provided in this Agreement, ALLERGAN and its
Affiliates have and will retain sole and exclusive Control of the ALLERGAN
Patent Rights, ALLERGAN Know-How, and ALLERGAN Trademarks. Except as expressly
provided herein, no right, title, or interest is granted by ALLERGAN to GSK in,
to, or under the ALLERGAN Patent Rights, ALLERGAN Know-How, and/or ALLERGAN
Trademarks, and, except as expressly provided herein, GSK will have no right to
assign to any Third Party any right or interest received under the ALLERGAN
Patent Rights, ALLERGAN Know-How, or ALLERGAN Trademarks under the terms of this
Agreement.
2.3.2 Except as expressly provided in this Agreement, GSK and its
Affiliates have and will retain sole and exclusive Control of the GSK Patent
Rights and GSK Housemarks. Except as expressly provided in this Agreement, no
right, title, or interest is granted by GSK to ALLERGAN in, to, or under the GSK
Patent Rights and/or GSK Housemarks, and, except as expressly provided herein,
ALLERGAN will have no right to assign to any Third Party any right or interest
received under the GSK Patent Rights or GSK Housemarks under the terms of this
Agreement.
2.4 Conditions Precedent to Sublicense. GSK will have the right to grant
sublicenses to Third Parties and Affiliates to its license and option rights
under the ALLERGAN Patent Rights, ALLERGAN Know-How, and/or ALLERGAN Trademarks,
provided that (a) GSK has obtained the prior written consent of ALLERGAN, not to
be unreasonably withheld, as provided below in this Section 2.4, (b) each
sublicensee has agreed to be bound by all applicable terms and obligations of
the rights and licenses granted by ALLERGAN to GSK under this Agreement
(including without limitation GSK's confidentiality and royalty obligations),
(c) the terms and conditions of each such sublicense are consistent with, and no
less restrictive than, the terms and conditions of this Agreement, (d) ALLERGAN
is designated as a third party beneficiary of such sublicense and, consistent
with the terms and conditions of this Agreement, entitled to enforce the terms
and conditions of such sublicense with respect to such sublicensee in the event
that GSK elects not to enforce such terms and conditions of this Agreement, and
(e) GSK provides to ALLERGAN a copy of those terms and conditions contained in
each such sublicense which demonstrate compliance with the requirements in (b),
(c), and (d) of this Section 2.4. Notwithstanding anything to the contrary, GSK
agrees that GSK will not grant to any sublicensee a right to grant sublicense
rights under ALLERGAN Patent Rights, ALLERGAN Know-How, or ALLERGAN Trademarks.
ALLERGAN will have *** within which to consent
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
11
to any requests from GSK or its Affiliates to sublicense any of its and their
rights under this Agreement to the ALLERGAN Patent Rights, ALLERGAN Know-How,
and/or ALLERGAN Trademarks, as provided above. If ALLERGAN does not provide its
written consent or refusal to consent (together with its reasons for such
disapproval) to any such sublicense within such *** period, ALLERGAN will be
deemed to have consented to such request to sublicense from GSK or its
Affiliate. ALLERGAN's consent pursuant to (a) of this Section 2.4 will not be
required for grants of sublicenses by GSK to Affiliates of GSK, but the
requirement in (b), (c), and (d) of this Section 2.4 will apply to any such
grants of sublicenses by GSK to Affiliates of GSK. Notwithstanding the
foregoing, the Parties acknowledge and agree that this Section 2.4 will in no
way apply to GSK's sublicense of any of its rights under Section 2.1.1 to any
Affiliate or Third Party that is providing services to GSK relating to this
Agreement (e.g., a Clinical Research Organization (CRO) or distributor) and that
GSK will have the right at any time during the Term, without complying with any
of the requirements set forth in (a) through (e) of this Section 2.4, to
sublicense any of its rights under Section 2.1.1, with the right to grant
further sublicenses in accordance with this Section 2.4, to any Affiliate or
Third Party that is providing services to GSK or its Affiliates relating to this
Agreement; provided, however, that any such Third Party or Affiliate (or
sub-contractor thereof) shall use those rights solely for the purpose of
providing such services to GSK; and further provided, however, that GSK will
remain fully and unconditionally obligated and responsible for the full and
complete performance of all of its obligations under the terms and conditions of
this Agreement whether or not such performance is carried out by GSK or its
Affiliates or Third Parties.
2.5 Co-Promotion Option. At any time during such period of the Term that is
after thirty (30) months after the GSK Sales Commencement Date, ALLERGAN will
have the non-sublicenseable, non-assignable right, but not an obligation,
exercisable by giving not less than ninety (90) calendar days' prior written
notice to GSK, to co-promote Product in the Field of Use in the Territory,
directly or through its Affiliates, in accordance with the key terms set out in
Exhibit D (the "Co-Promotion Option"). Upon exercise of such Co-Promotion
Option, ALLERGAN will actively detail and promote Product in the Field of Use in
the Territory during the Co-Promotion Term as directed by the Territory Joint
Commercial Committee and in accordance with the key terms set out in Exhibit D.
The "Co-Promotion Term" will be the period beginning on the date of ALLERGAN's
exercise of the Co-Promotion Option as provided in this Section 2.5 and ending
on the earlier of (a) the expiration of this Agreement, (b) the termination of
this Agreement for any reason, (c) the termination of ALLERGAN's co-promotion
rights relating to Product as provided in this Agreement by ALLERGAN for any
reason, or (d) the termination of ALLERGAN's co-promotion rights relating to
Product as provided in this Agreement by GSK as a result of a material breach by
ALLERGAN of its co-promotion obligations as provided in this Agreement
(including, without limitation, Exhibit D), which breach is not cured by
ALLERGAN within sixty (60) calendar days after written notice thereof from GSK.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
12
3. PAYMENTS
3.1 Upfront Payment. In consideration for the licenses granted by ALLERGAN
to GSK pursuant to Article 2 and subject to Sections 3.6.4, 3.7, and 3.8, GSK
will pay to ALLERGAN a nonrefundable payment of *** within fifteen (15) calendar
days after the Closing Date.
3.2 Royalty Payments.
3.2.1 In further consideration for the licenses granted by ALLERGAN to
GSK pursuant to Article 2 and subject to Sections 3.2.2, 3.3, 3.6.1. 3.6.3(a),
3.6.4(a), 3.7, and 3.8, during each Calendar Year after the GSK Sales
Commencement Date, GSK will pay to ALLERGAN the following percentages of GSK's
Net Sales for each such Calendar Year, or portion thereof if applicable, as
provided below:
(a) ***
(b) ***
(c) ***
GSK acknowledges and agrees that GSK will be solely responsible for paying all
royalties owed to ALLERGAN on account of Net Sales by any and all of GSK's
Affiliates and sublicensees. ALLERGAN acknowledges and agrees that GSK will not
be obligated in any way to pay any royalties as provided in this Section 3.2.1
or any other payments of any kind whatsoever to ALLERGAN on GSK's or its
Affiliates' sales to any Person of Stock Product, including, without limitation,
if such sales of Stock Product occur on or after the GSK Sales Commencement
Date.
3.2.2 Royalty Adjustments.
(a) During each Calendar Year of the Co-Promotion Term in which
ALLERGAN employs a sales force of at least *** fully-trained (as directed by the
Territory Joint Commercial Committee), full-time sales representatives who
actively detail and promote Product in the Field of Use in the Territory in at
least a secondary detail position, which will be defined by the TJCC, and in
accordance with all of the terms set forth in Exhibit D, and subject to Sections
3.6.1, 3.6.3(a), 3.6.4(a), 3.7, and 3.8, GSK will pay ALLERGAN an additional ***
royalty on GSK's Net Sales in each such Calendar Year, or portion thereof if
applicable.
(b) The Parties acknowledge that, during the Term, one (1) or
more royalty-bearing licenses may be necessary from one (1) or more Third
Parties in order for GSK and its Affiliates to use, sell, offer for sale, and
import Product in the Field of Use in the Territory, without infringing the
intellectual property rights of one or more patent rights of such Third Parties
in the Territory. In such an event, GSK will have the right but not the
obligation, and only after prior consultation with ALLERGAN, to use Commercially
Reasonable Efforts to
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
13
obtain and maintain such Third Party licenses solely with respect to the
Territory. If, as a result of GSK obtaining and maintaining such Third Party
licenses, it is necessary for GSK to make royalty payments and/or license fee
payments to such Third Party (collectively, the "Third Party Payments") in order
for GSK to practice the rights granted hereunder to the ALLERGAN Patent Rights
and ALLERGAN Know-How without infringing such Third Party's rights, GSK will be
entitled to offset *** of all such Third Party Payments against any royalties
owed to ALLERGAN under this Agreement during the Term.
(c) If, in any Calendar Year, the Standard Cost exceeds the
Allowable Standard Cost, ALLERGAN will credit against the royalty payable under
Section 3.2.1 of this Agreement in such Calendar Year, an amount equal to the
difference between (i) the Standard Cost plus *** and (ii) the Allowable
Standard Cost plus ***, multiplied by the number of Units of Product purchased
by GSK during such Calendar Year; provided such difference was actually incurred
by GSK.
3.3 GSK Royalty Term. Subject to Section 9.5.1(a), the obligation of GSK to
pay royalties owed to ALLERGAN under Section 3.2.1 will commence on the GSK
Sales Commencement Date and continue until the expiration, pursuant to Section
9.1 or Section 9.2.3, or earlier termination, pursuant to Section 9.3, of the
Term. The obligation of GSK to pay the additional royalty owed to ALLERGAN under
Section 3.2.2(a) will, if all conditions are satisfied by ALLERGAN as provided
in Section 3.2.2(a), commence at the beginning of the Co-Promotion Term and
continue until the expiration or earlier termination thereof as provided in
Section 2.5.
3.4 Tail Period Payments. Commencing on first (1st) day of the Tail Period
and continuing until the expiration thereof, subject to Sections 3.6.2,
3.6.3(b), 3.6.4(b), 3.7, and 3.8, ALLERGAN will pay the following payments (the
"Tail Period Payments") to GSK:***. For purposes of this Section 3.3, "year"
will mean each 365-calendar day period beginning on the first (1st) day of the
Tail Period or the relevant anniversary thereof.
3.5 Product Improvement and Enhancement Reimbursement Payments.
3.5.1 During the Term, ALLERGAN will conduct the Product Improvement
and Enhancement activities described in Exhibit E. ALLERGAN will have no
obligation to engage in any activities related to Product Improvements and
Enhancements other than as set forth on Exhibit E or existing or planned
activities in which ALLERGAN and its Affiliates engage outside the Territory for
ALLERGAN's own purposes.
3.5.2 In consideration for ALLERGAN's conduct of the Product
Improvement and Enhancement activities as provided in Section 3.5.1 and subject
to Sections 3.6.4(a), 3.7, and 3.8, GSK will make research support payments to
ALLERGAN to reimburse ALLERGAN for a portion of its costs and expenses of
conducting such activities, which research support payments will not exceed the
amounts set forth on the schedule in Exhibit F for the applicable Calendar Year.
At the end of each six (6) month period beginning on January 1 or July 1 after
the Effective Date, continuing until December 31, 2009, ALLERGAN, within thirty
(30) days after
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
14
the end of such six (6) month period, will provide to GSK a written report
detailing the Product Improvement and Enhancement activities showing progress on
delivering some or all of such Product Improvement and Enhancement activities
outlined in Exhibit E conducted by ALLERGAN during the just-ended six (6) month
period and an invoice for GSK's share of the costs and expenses of conducting
such activities during such six (6) month period. Within thirty (30) days after
receipt by GSK of (i) such report and such invoice and (ii) a letter from a
manager of ALLERGAN confirming that ALLERGAN's total global expenditures in
conducting such Product Improvement and Enhancement activities in the just-ended
six (6) month period ***, GSK will pay to ALLERGAN the amount corresponding to
such invoice. ALLERGAN covenants and agrees that it will use such payments
solely to cover a portion of the costs and expenses incurred by ALLERGAN and its
Affiliates in conducting the Product Improvements and Enhancements activities
set forth on Exhibit E. In the event that ALLERGAN does not incur any costs and
expenses in conducting Product Improvement and Enhancement activities in a six
(6) month period, no payments will be due for such six (6) month period to
ALLERGAN from GSK pursuant to this Section 3.5.2.
3.5.3 If ALLERGAN and GSK mutually agree in writing that ALLERGAN will
engage in Product Improvement and Enhancement activities in addition to the
activities set forth in Exhibit E for the benefit of GSK in the Territory, GSK
will provide compensation to ALLERGAN in addition to that set forth in Exhibit F
for such additional activities under terms and conditions to be negotiated in
good faith by the Parties.
3.6 Payment Terms.
3.6.1 Quarterly Payments of Royalties. Within sixty (60) days after
the last day of each Calendar Quarter, GSK will pay to ALLERGAN all royalties
due and payable on GSK's Net Sales in the immediately preceding Calendar
Quarter, or portion thereof if applicable, in accordance with Section 3.2.
3.6.2 Quarterly Payments of the Tail Period Payment. Within sixty (60)
calendar days after the last day of each Calendar Quarter during the Tail
Period, ALLERGAN will pay to GSK all payments due and payable on ALLERGAN Net
Sales as provided under Section 3.4 in the immediately preceding Calendar
Quarter, or portion thereof if applicable.
3.6.3 Annual Reconciliations.
(a) Subject to Section 9.5.1(a), within sixty (60) calendar days
after the last day of each Calendar Year during the Term, or portion thereof if
applicable, GSK will calculate the royalty payments due to ALLERGAN pursuant to
Sections 3.2.1 and, if applicable, 3.2.2(a) for such Calendar Year. In the event
the total payment due pursuant to Section 3.2.1 and, if applicable, 3.2.2(a) in
any Calendar Year is greater than the total for each such amount that GSK has
paid under Section 3.6.1 in such Calendar Year, the difference will be paid by
GSK to ALLERGAN within sixty (60) days after the last day of such Calendar Year,
or portion thereof if applicable. In the event the total payment due pursuant to
Section 3.2.1 and, if applicable, 3.2.2(a) in any Calendar Year is less than the
total for each such amount that GSK
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
15
has paid under Section 3.6.1 in such Calendar Year, the difference will be paid
by ALLERGAN to GSK within sixty (60) days after the last day of such Calendar
Year, or portion thereof if applicable.
(b) Within sixty (60) calendar days after the last day of each
Calendar Year during the Tail Period, or portion thereof if applicable, ALLERGAN
will calculate the Tail Period Payments due to GSK pursuant to Section 3.4 for
such Calendar Year. In the event the total payment due pursuant to Section 3.4
in any Calendar Year is greater than the total amount that ALLERGAN has paid
under Section 3.6.2 in such Calendar Year, the difference will be paid by
ALLERGAN to GSK within sixty (60) days after the last day of such Calendar Year,
or portion thereof if applicable. In the event the total payment due pursuant to
Section 3.4 in any Calendar Year is less than the total amount that ALLERGAN has
paid under Section 3.6.2 in such Calendar Year, the difference will be paid by
GSK to ALLERGAN within sixty (60) days after the last day of such Calendar Year,
or portion thereof if applicable.
3.6.4 All payments made under this Agreement will be made in U.S.
dollars. All payments will be made by check or wire transfer in immediately
available funds to the following bank account or to such other bank account
designated in writing by ALLERGAN:
***
For sales of Product in Japanese Yen or in any currency other than U.S. dollars:
(a) With respect to payments made by GSK to ALLERGAN under this
Agreement, GSK's Net Sales, as defined in Section 1.46, will be calculated in
accordance with the International Financial Reporting Standards consistently
applied. GSK Net Sales will be converted into U.S. dollars using the average
exchange rates as calculated and utilized by GSK's group reporting system and
published accounts. The current method uses spot exchange rates sourced from
Reuters/Bloomberg and if changed, GSK will notify ALLERGAN of the revised method
in advance of it being applied.
(b) With respect to payments made by ALLERGAN to GSK pursuant to
Section 3.4, ALLERGAN's Net Sales, as defined in Section 1.46, will be
calculated in accordance with U.S. generally accepted accounting principles
consistently applied. Net Sales will be converted into U.S. dollars using the
average exchange rates as calculated and utilized by ALLERGAN's reporting
systems and published accounts. The current method uses the monthly average of
daily exchange rates obtained from Bloomberg to convert sales in local currency
into U.S. dollars. If this methodology is changed ALLERGAN will notify GSK of
the revised methodology in advance of it being applied.
3.7 Late Payment Interest. Any payment due and payable under the terms and
conditions of this Agreement, including without limitation any royalty payment
and any Tail Period Payments, made by GSK or ALLERGAN after the date such
payment is due and payable, will bear interest as of the day after the date such
payment was due and payable, and will continue to accrue such interest until
such payment is made, at rate equal to *** per month. The
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
16
payment of such interest will not limit either Party from exercising any other
rights it may have as a consequence of the lateness of any payment.
3.8 Taxes. To the extent a statutory tax withholding obligation is imposed
by a governmental authority upon any payment made by a Party (the "Payor") to
the other Party (the "Payee") under this Agreement, including, for example,
royalty payments, due and payable by the Payor to the Payee under the terms and
conditions of this Agreement, the Payor will be entitled to withhold from such
payment the amount, if any, of any tax assessed against the Payee and actually
withheld, provided that such tax is only for the account of the Payee and
evidence of the payment of such tax is promptly provided to the Payee. The Payor
will pay the amount of such tax to the proper taxing authority and will be
entitled to deduct the amount of such tax from the payment to be made by the
Payor to the Payee. The Payor will advise the Payee of any tax payment made for
the benefit of the Payee pursuant to this Section 3.8 and provide the Payee with
copies of tax receipts for all taxes paid and deducted from the payment due and
payable to the Payee, together with copies of all pertinent communications from
or with governmental authorities with respect thereto. At a Party's reasonable
request and subject to the requesting Party reimbursing any costs and expenses,
each Party will reasonably assist the requesting Party in any effort by a Party
in claiming any exemption from such deductions or withholdings under any double
taxation or similar agreement or treaty from time to time in force, and in
minimizing the amount required to be so withheld or deducted. ALLERGAN warrants
that ALLERGAN is resident for tax purposes in United States and that ALLERGAN is
entitled to relief from United Kingdom income tax under the terms of the double
tax agreement between the United Kingdom and the United States. ALLERGAN will
notify GSK immediately in writing in the event that ALLERGAN ceases to be
entitled to such relief. Pending receipt of formal certification from the United
Kingdom Inland Revenue, GSK may pay royalty income and any other payments under
this Agreement to ALLERGAN by deducting tax at a rate specified in the double
tax treaty between the United Kingdom and the United States. ALLERGAN agrees to
indemnify and hold harmless GSK against any loss, damage, expense, or liability
arising in any way from a breach by ALLERGAN of the warranties in this Section
3.8 or any future claim by a United Kingdom tax authority or other similar body
alleging that GSK was not entitled to deduct such withholding tax on such
payments at source at the treaty rate.
3.9 Records and Reports. Any and all payments made by either Party to the
other pursuant to this Agreement will be accompanied by a written statement
setting forth in reasonable detail the calculation of such Party's Net Sales,
and, if applicable, the calculation of the average exchange rate utilized by
such Party to convert a local currency payment to U.S. dollars. Each Party will
maintain, and will require its Affiliates, and sublicensees, to maintain
complete and accurate records sufficient to enable accurate calculation of any
payments due by a Party to the other Party hereunder, including, without
limitation payment of any royalties and the Tail Period Payment. Such records
and books of account will be preserved by each Party and its respective
Affiliates and sublicensees, as applicable, for a period of three (3) years
after the end of the period covered by such records and books of account, which
obligation will survive the expiration or earlier termination of this Agreement.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
17
3.10 Audit Rights.
3.10.1 GSK will permit an ALLERGAN auditor, or an independent public
accountant designated by ALLERGAN and reasonably acceptable to GSK, to have
access, no more than once in each Calendar Year, during regular business hours
and upon at least sixty (60) calendar days' prior written notice, to GSK's
records and books, and GSK's Affiliates' and sublicensees' records and books, to
the extent necessary to determine the accuracy of GSK's Net Sales reported, and
payments made, by GSK to ALLERGAN pursuant to this Article 3 within the two (2)
year period immediately preceding such an audit. If such examination results in
a determination that GSK's Net Sales or payments owed to ALLERGAN by GSK have
been understated, unpaid amounts due will be paid by GSK to ALLERGAN promptly.
If such examination results in a determination that GSK's Net Sales or payments
owed to ALLERGAN by GSK have been overstated, overpaid amounts due will be
re-paid by ALLERGAN to GSK promptly. The fees and expenses of such auditor or
accountant will be paid by ALLERGAN unless GSK's Net Sales have been
understated, or that payments owed to ALLERGAN by GSK have been underpaid, by
more than *** for the period examined, in which case GSK will pay all reasonable
costs and expenses of the auditor or accountant incurred by ALLERGAN in the
course of making such determination.
3.10.2 ALLERGAN will permit a GSK auditor, or an independent public
accountant designated by GSK and reasonably acceptable to ALLERGAN, to have
access, no more than once in each Calendar Year, during regular business hours
and upon at least sixty (60) calendar days' prior written notice, to ALLERGAN's
records and books, and ALLERGAN's Affiliates' and sublicensees' records and
books, to the extent necessary to determine the accuracy of ALLERGAN's Net Sales
reported, and payments made, by ALLERGAN to GSK pursuant to this Article 3
within the two (2) year period immediately preceding such an audit. If such
examination results in a determination that ALLERGAN's Net Sales or payments
owed to GSK by ALLERGAN have been understated, unpaid amounts due will be paid
by ALLERGAN to GSK promptly. If such examination results in a determination that
ALLERGAN's Net Sales or payments owed to GSK by ALLERGAN have been overstated,
overpaid amounts due will be re-paid by GSK to ALLERGAN promptly. The fees and
expenses of such auditor or accountant will be paid by GSK unless ALLERGAN's Net
Sales have been understated, or that payments owed to GSK by ALLERGAN have been
underpaid, by more than *** for the period examined, in which case ALLERGAN will
pay all reasonable costs and expenses of the auditor or accountant incurred by
GSK in the course of making such determination.
4. TRANSITION ACTIVITIES
4.1 Transition Period. The Parties acknowledge that due to Applicable Law,
during the period from the Effective Date and continuing until the date on which
Regulatory Authorities approve GSK or its Affiliate in the Territory becoming
the MAH for Product in the Territory (the "Transition Period"), ALLERGAN will
continue to be the MAH for Product in the Territory. Accordingly, the Parties
agree that the principles set forth in this Section 4.1 will guide the
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
18
clinical development and commercialization activities for the Product in the
Territory during the Transition Period and thereafter with respect to study 909.
4.1.1 Commercialization of Product.
(a) During the period commencing on the Effective Date and
continuing until the GSK Distribution Commencement Date, ALLERGAN will use
Commercially Reasonable Efforts to promote, sell, offer for sale and distribute
Product in the Field of Use in the Territory and ALLERGAN will be entitled to
book all Net Sales of ALLERGAN during such time.
(b) Promptly after the Effective Date, the Parties or their
respective Affiliates will enter into good faith negotiations for an agreement
(the "Distribution Agreement"), which will set forth the roles and
responsibilities of GSK relating to the commercialization of Product in the
Field of Use during the Transition Period. Such Distribution Agreement will be
executed not later than fourteen (14) calendar days after the Effective Date and
will include the principles set forth on Exhibit G.
(c) The Parties acknowledge and agree that the TJCC will oversee
all activities of ALLERGAN pursuant to Section 4.1.1(a) and all activities of
the Parties pursuant to the Distribution Agreement.
(d) Upon expiration of the Distribution Agreement, ALLERGAN will,
if so requested by GSK, use Commercially Reasonable Efforts to transfer and
assign to GSK all contracts relating to the Product, including, without
limitation, post-marketing surveillance contracts, excluding, however, any
contracts relating to study 909 as provided in Exhibit H.
4.1.2 Co-Development Activities.
(a) During the period commencing on the Effective Date and
continuing until such time as set forth in Exhibit H, the Parties will
co-develop the Product in the Territory in accordance with the terms set forth
on Exhibit H.
(b) The Parties or their respective Affiliates in the Territory
may, within a reasonable period of time after the Effective Date, mutually
determine to enter into a separate agreement setting forth their respective
obligations with respect to the co-development of Product in the Territory,
which agreement must include the terms set forth on Exhibit H (the
"Co-Development Agreement"). In the event of a conflict between the terms of any
such agreement and this Agreement, this Agreement will control.
4.2 Regulatory Approval Transfer. During the Transition Period, ALLERGAN or
its Affiliate in the Territory will work diligently with GSK to enable GSK to
become the MAH for the Product in the Territory and in addition become
responsible for all Regulatory Approval Applications in the Territory for
Product, including, without limitation, those Regulatory
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
19
Approval Applications in the Territory for Product for the Cosmetic Indication.
Notwithstanding the foregoing, the Parties acknowledge and agree that prior to
the Closing Date, they will not, and will cause their respective Affiliates not
to, communicate in any way with the Regulatory Authorities (whether orally or in
writing) regarding the transfer of Regulatory Approvals for Product in the
Territory from ALLERGAN to GSK so as to enable GSK to become the MAH. As soon as
possible but in no event later than thirty (30) calendar days after the date of
notification by the MHLW that GSK is the MAH for Product in the Territory,
ALLERGAN will at its own cost and expense (a) deliver, or cause its Affiliates
to deliver, to GSK copies of each Regulatory Approval and Regulatory Approval
Application held by ALLERGAN its Affiliates or agents relating specifically to
Product in the Field of Use in the Territory, (b) certify in writing that the
copies of such Regulatory Approval Applications and filings are true and
complete copies thereof, and (c) do all other things that are required pursuant
to any Applicable Law in the Territory to ensure that the Regulatory Approvals
and Regulatory Approval Applications are duly transferred into the name of GSK
or its nominee in a timely manner
4.3 Notification by the MHLW. Once the Regulatory Approvals and Regulatory
Approval Applications for Current Indications are transferred to GSK and GSK
receives notification by the MHLW that GSK is the MAH, the Transition Period
will immediately terminate, the Distribution Agreement will immediately
terminate, and GSK will become legally responsible for all communications with
MHLW relating to Product in the Territory. Further, all legal responsibility for
releasing Product in Japan, quality assurance/quality control, post-marketing
surveillance, and pharmacovigilance relating to Product in the Territory will
transfer to GSK at such time. Notwithstanding the foregoing, the Co-Development
Agreement will immediately terminate upon the later to occur of (a) the date on
which the Regulatory Approvals and Regulatory Approval Applications for Current
Indications are transferred to GSK and GSK receives notification by the MHLW
that GSK is the MAH or (b) the date on which the study 909 database is locked,
as described in Exhibit H.
4.4 Disclosure of ALLERGAN Know-How; Transfer of Materials.
4.4.1 Within thirty (30) calendar days after the Effective Date,
ALLERGAN or its Affiliate, will at its or their sole cost and expense disclose
the ALLERGAN Know-How to GSK and will provide to GSK all documents that recite,
are directed to, or concern ALLERGAN Know-How. Notwithstanding anything to the
contrary contained in this Article 4, ALLERGAN will thereafter during the Term
promptly disclose to GSK any ALLERGAN Know-How that comes into ALLERGAN's
possession and will provide to GSK all documents that are directed to such
ALLERGAN Know-How.
4.4.2 ***.
4.5 Maintenance of Documentation. Except as provided herein or as otherwise
required or appropriate under Applicable Law, the documents and materials
provided by ALLERGAN to GSK under this Section 4.5 may be copies of original
documents and materials, provided that such copies will be of the highest
quality possible and, if such quality is inadequate
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
20
for GSK's needs, ALLERGAN will permit GSK to have access to the original
documents and materials. In the event that ALLERGAN elects to provide original
documents and materials, GSK will permit ALLERGAN to have access to such
original documents and materials for use by ALLERGAN for purposes consistent
with the terms and conditions of this Agreement. Such original documents and
materials will be provided to GSK in accordance with the following:
4.5.1 GSK will maintain original documents and materials under safe
and secure conditions typically used by GSK to maintain its own similar
documents and materials. Specifically, GSK will maintain such original documents
and materials in files located in a GSK facility or at another secure facility
used to store GSK's own original documents. If GSK chooses to transfer such
original documents and materials to any other secure facility, GSK will notify
ALLERGAN in writing sixty (60) calendar days in advance of such transfer.
4.5.2 If a Regulatory Authority requires ALLERGAN, or an Affiliate of
ALLERGAN, to provide the Regulatory Authority with access to any of the original
documents or materials transferred by ALLERGAN or its Affiliate to GSK as
provided in this Article 4, GSK will permit ALLERGAN, its employees, agents, or
independent contractors, and/or officials or representatives of the Regulatory
Authority, as appropriate, access to the original documents and materials. Such
access will be provided at the site where the original documents and materials
are maintained by GSK, during normal business hours (Monday through Friday
between 9 a.m. and 5 p.m.) after receipt of reasonable written notice (being at
least five (5) calendar days where practicable but in any case not less than
twenty-four (24) hours advance written notice from ALLERGAN (seventy-two (72)
hours if such notice arrives on a Friday, Saturday, or Sunday), or at such other
facility and during such hours as agreed upon by GSK, ALLERGAN, and/or the
Regulatory Authority. The term "access" will mean, for the purposes of this
Section 4.5.2, that ALLERGAN and/or the Regulatory Authority, as appropriate,
will have possession of the original documents and materials at the GSK facility
where the original documents and materials are maintained, or at such other
facility as agreed upon by ALLERGAN and GSK and/or the Regulatory Authority, for
sufficient time to allow ALLERGAN to review the original documents in detail
and/or to allow the Regulatory Authority to complete its review. Prior to the
grant of access, ALLERGAN will provide GSK with a copy of the relevant written
Regulatory Authority communication or a copy of ALLERGAN's written contact
report of an oral request by the Regulatory Authority for such access, if such
letter or contact report exists.
4.5.3 Upon expiration or termination of this Agreement, GSK will
return to ALLERGAN all documents and materials provided by ALLERGAN to GSK as
provided in this Article 4 in accordance with Section 9.4.3.
4.6 Further Assistance by ALLERGAN. ALLERGAN, on GSK's or GSK's Affiliate's
request, will provide consulting services regarding specific issues in
connection with pre-clinical and clinical development and commercialization of
Product in the Field of Use ("Consultations") as set forth in this Section 4.6.
For clarity, Consultations will not include any efforts or activities conducted
by employees and/or agents of ALLERGAN in connection with
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
21
the activities and obligations involved under the Distribution Agreement, in the
transfer of Regulatory Approvals and ALLERGAN Know-How and materials pursuant to
this Article 4, in connection with ALLERGAN's participation in the TJDC and TJCC
as provided in Article 5, and in connection with global Product strategic
marketing support.
4.6.1 During the period commencing on the Effective Date and
continuing for a period of ***, Consultations will occur at mutually agreeable
times and places, and will not exceed *** hours of total employee time,
excluding travel, per month.
4.6.2 As of and after the date of the expiration of the *** period
referenced in Section 4.6.1 and continuing for *** thereafter, Consultations
will occur at mutually agreeable times and places, and will not exceed *** hours
of total employee time, excluding travel, per month.
4.6.3 In the event that GSK or an Affiliate of GSK requests
Consultations in excess of the total employee time per month set forth in
Section 4.6.1 or 4.6.2, respectively, ALLERGAN will use Commercially Reasonable
Efforts, but will have no obligation, to provide such Consultations. In the
event that ALLERGAN and GSK agree that Consultations in excess of the total
employee time per month set forth in Section 4.6.1 or 4.6.2 will be provided,
GSK will pay ALLERGAN a full time equivalent (FTE) rate of *** per person per
day on which Consultations are actually provided and will reimburse ALLERGAN for
any documented reasonable and properly incurred out-of-pocket costs or expenses
that ALLERGAN incurs in connection with such Consultations, including without
limitation all reasonable and properly incurred travel and hotel accommodation
costs and expenses (which will be pre-agreed with GSK).
4.6.4 Notwithstanding anything to the contrary, there will be no time
limit on communications to ALLERGAN from GSK pertaining to the acquisition of
development or regulatory documents or data identified as missing after the
transfer of Regulatory Approvals and ALLERGAN Know-How was, in the opinion of
ALLERGAN, complete, nor will there be a charge for ALLERGAN supplying such
documents or data; provided that such documents or data are in ALLERGAN's
possession or are in the possession of an ALLERGAN contractor or investigator
and are retrievable upon exercise by ALLERGAN of Commercially Reasonable
Efforts.
5. PRODUCT DEVELOPMENT AND COMMERCIALIZATION
5.1 In General. GSK, at GSK's sole expense (subject to ALLERGAN's
performance of its obligations as set forth in Article 4 and Exhibits G and H),
will use Commercially Reasonable Efforts to commercialize Product in the
Territory, as provided in Section 5.5. Additionally, as provided in Section 5.3,
GSK will develop Product for at least one (1) Future Indication. Notwithstanding
the above, ALLERGAN covenants and agrees that it will cause the Manufacturer to
supply Product for such development and commercialization activities (under the
terms of the Supply Agreement) and, at GSK's request and at GSK's expense,
subject to ALLERGAN's obligations as set forth in Article 4 and Exhibits G and
H, cooperate with GSK
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
22
and to provide assistance as reasonably necessary in connection with any such
development and commercialization activities in the Field of Use in the
Territory.
5.2 Territory Joint Development Committee.
5.2.1 Within thirty (30) calendar days after the Effective Date, the
Parties will form a Territory Joint Development Committee ("TJDC") to manage and
review the development process and Regulatory Approval Application submissions
for Product in Territory. The responsibilities of the TJDC will include, without
limitation:
(a) Reviewing co-development activities for Product during the
Transition Period as set forth in Article 4 and Exhibit H;
(b) Reviewing the ongoing development activities for Product in
the Field of Use during the Term in accordance with the clinical development
plan in the Territory as described in Section 5.9.1;
(c) Reviewing the progress of GSK's development of Product in the
Territory after the expiration of the Transition Period, including, without
limitation, Product Improvement and Enhancement activities, as provided in
Section 3.5;
(d) Reviewing the progress of ALLERGAN's Product Improvement and
Enhancement activities as set forth in Section 3.5;
(e) Acting as a forum for the Parties to exchange information
concerning the development and routine regulatory maintenance of Product in the
Field of Use in the Territory after the Transition Period, including
communications and correspondence to and from Regulatory Authorities;
(f) Reviewing and discussing pharmacovigilance activities,
post-marketing surveillance activities, and manufacturing/CMC topics; and
(g) Performing such other responsibilities as agreed to by the
Parties.
5.2.2 The TJDC will meet periodically every Calendar Year as agreed to
by the Parties, but in no event less than once during each Calendar Quarter of
each Calendar Year during the Term, in person in the Territory not more than
twice per Calendar Year, or by video teleconference or teleconference as
mutually agreed, to discuss matters within its purview.
5.2.3 ALLERGAN will designate two (2) members and GSK will designate
three (3) members to comprise the TJDC. Such individuals will be executives with
responsibility for the clinical development of and/or regulatory matters
relating to the Product in the Territory. In addition, the TJDC may from time to
time include additional non-voting, ad-hoc representatives from either Party on
specific issues as the need arises. Each Party will identify its members on
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
23
the TJDC within thirty (30) days after the Effective Date. Chairmanship of the
TJDC will reside with a GSK member. The chairman will be responsible for
preparing minutes of each TJDC meeting and distributing such minutes to members
of the TJDC within thirty (30) days after each meeting for review and comment.
Such minutes will be approved as the first order of business at the immediately
succeeding TJDC meeting.
5.2.4 Each Party will bear all expenses it incurs in regard to
participating in such TJDC meetings, including, without limitation, all travel
and living expenses.
5.2.5 At least one (1) representative from each Party must be present
at any meeting of the TJDC to represent a quorum for voting purposes, with each
member on the TJDC having one (1) vote.
5.2.6 All decisions related to Product portfolio management and
routine regulatory maintenance of Product in the Territory, initiation, conduct
and termination of clinical trials for Product, subject to Section 5.2.8,
budgeting for all such development and regulatory activities, and selection of
Indications for which Product may be developed, will be made by majority vote of
the TJDC, which decision will be final and binding on the Parties.
5.2.7 All decisions related to other aspects of clinical development
or Regulatory Approval not specified in Section 5.2.6 will be made by unanimous
vote of the TJDC, which decision will be final and binding on the Parties. If
the TJDC cannot reach unanimous agreement, any disputes will be submitted for
resolution to a senior clinical development executive of each Party, or his/her
designee, for the Territory. If the senior clinical development executives of
each Party, or their respective designees, for the Territory cannot resolve such
any disputes within thirty (30) calendar days after the first (1st) interaction
(whether in writing, via telephone or in person) between the senior clinical
development executives of each Party or their respective designees, such dispute
will be decided by GSK, which decision of GSK will be final and binding on the
Parties.
5.2.8 Notwithstanding the foregoing, any development plan or clinical
trial ***. GSK or its Affiliate will provide ALLERGAN with written notice prior
to proceeding with any matter set forth in this Section 5.2.8, and within thirty
(30) calendar days of receipt of such written notice from GSK or its Affiliate,
ALLERGAN will provide written notice to GSK or its Affiliate of whether ALLERGAN
consents to GSK or its Affiliate progressing with such matter. If ALLERGAN does
not refuse consent, or does not provide any response to GSK or its Affiliate, in
each case within such thirty (30) calendar day period, ALLERGAN will be deemed
to have consented to GSK or its Affiliate proceeding with the matter as
presented in GSK's or its Affiliate's written notice to ALLERGAN.
5.2.9 For the avoidance of doubt, the TJDC's role will only be with
respect to development and regulatory activities of the Parties relating to
Product in the Territory as provided herein and, unless provided otherwise by
this Agreement, the TJDC will have no authority to (a) modify any term or
condition of this Agreement, including without limitation
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
24
ALLERGAN's right pursuant to Section 2.5, or (b) create, provide for, or
eliminate any financial obligation of either Party under this Agreement.
5.3 Development Responsibilities of GSK.
5.3.1 Cosmetic Indications. Provided that GSK or any of its Affiliates
is the Marketing Authorization Holder and subject to Section 5.2.8, GSK will use
Commercially Reasonable Efforts to initiate and complete development and
regulatory activities that are reasonably required to obtain Regulatory Approval
for Product for Glabellar Lines in the Territory. Upon GSK becoming the
Marketing Authorization Holder, and except to the extent ALLERGAN's cooperation
is required in order to comply with regulatory requirements in the Territory,
and further subject to the Manufacture (as defined in the Supply Agreement) by
the Manufacturer of Product for use in such development activities in accordance
with the terms and conditions of the Supply Agreement, full responsibility for
any activities to obtain Regulatory Approvals of Cosmetic Indications for
Product in the Territory will be the sole responsibility of GSK.
5.3.2 Future Indication Development Requirements and Diligence.
(a) Provided that GSK or any of its Affiliates is the MAH and
subject to Section 5.2.8, GSK, at GSK's sole expense, will use Commercially
Reasonable Efforts to develop Product in the Territory and, in connection with
such Commercially Reasonable Efforts, undertake Product development activities
directed toward obtaining Regulatory Approval for Product for ***. Future
Indication, as reviewed by the TJDC. Such Product development activities may
include, without limitation, preclinical, clinical, and regulatory activities.
(b) GSK will commence and continue such development of Product
for *** Future Indication as provided in Section 5.3.2(a) above until the
earlier of (A) the end of the *** of the Term; or (B) GSK obtaining Regulatory
Approval for the *** Future Indication for Product in the Territory.
(c) If GSK ceases all development of Product during the ***
period set forth in Section 5.3.2(b) prior to obtaining *** Regulatory Approval
for Product for a Future Indication, all rights related to Future Indications
will revert to ALLERGAN.
For the avoidance of doubt, failure to use Commercially Reasonable Efforts to
perform any material development responsibilities in accordance with this
Section 5.3.2 will be considered a material breach of this Agreement provided
that in the event of a breach by ALLERGAN of its representations, warranties,
covenants or obligations under this Agreement, a Material Supply Interruption or
Material Regulatory Interruption, other scientific, medical or technical reason
outside GSK's control, and/or a Force Majeure Event in the Territory, the
failure of GSK to perform any of the development responsibilities as provided in
this Section 5.3.2(a) through 5.3.2(c) will not be considered a material breach
of this Agreement.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
25
5.4 Territory Joint Commercial Committee.
5.4.1 Not later than thirty (30) calendar days after the Effective
Date, the Parties will form a Territory Joint Commercial Committee ("TJCC") to
oversee GSK's commercialization, sales, and promotion activities relating to
Product in the Field of Use in the Territory. The responsibilities of the TJCC
will include, without limitation:
(a) Overseeing the Parties' respective commercialization
activities during the Transition Period pursuant Section 4.1.1(a) and the
Distribution Agreement, and managing the transition of such activities to GSK
once GSK or any of its Affiliates becomes the MAH;
(b) Reviewing, on an annual basis, GSK's then-current marketing
plans, sales forecasts, and launch plans for Product in the Field in the
Territory;
(c) Reviewing the progress and status of GSK's commercialization
of Product in the Territory;
(d) Acting as a forum for the Parties to exchange information
concerning the commercialization of Product;
(e) Coordinating ALLERGAN's co-promotion activities during the
Co-Promotion Term; and
(f) Performing such other responsibilities as agreed to by the
Parties.
5.4.2 The TJCC will meet periodically every Calendar Year as agreed to
by the Parties, but in no event less than once during each Calendar Quarter of
each Calendar Year during the Term, in person in the Territory not more than
twice per Calendar Year, or by video teleconference or teleconference as
mutually agreed, to discuss matters within its purview.
5.4.3 ALLERGAN will designate two (2) members and GSK will designate
three (3) members to comprise the TJCC. Such individuals will be senior
management executives with responsibility for Product commercialization in the
Territory. In addition, the TJCC may from time to time include additional
non-voting, ad-hoc representatives from either Party for specific issues as the
need arises. Each Party will identify its members on the TJCC within thirty (30)
days after the Effective Date. Chairmanship of the TJCC will reside with a GSK
member. The chairman will be responsible for preparing minutes of each TJCC
meeting and distributing such minutes to members of the TJCC within thirty (30)
days after each meeting for review and comment. Such minutes will be approved as
the first order of business at the immediately succeeding TJCC meeting.
5.4.4 Each Party will bear all expenses it incurs in regard to
participating in such TJCC meetings, including, without limitation, all travel
and living expenses.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
26
5.4.5 At least one (1) representative from each Party must be present at any
meeting of the TJCC to represent a quorum for voting purposes, with each member
on the TJCC having one (1) vote..
5.4.6 The TJCC will strive to make all decisions by consensus vote,
however, any disputes will be decided by a majority vote of the members of the
TJCC, which decision will be final and binding on the Parties.
5.4.7 For the avoidance of doubt, the TJCC's role will only be with
respect to commercialization activities of the Parties relating to Product in
the Territory and, unless provided otherwise by this Agreement, the TJCC will
have no authority to (a) modify any term or condition of this Agreement,
including without limitation ALLERGAN's right pursuant to Section 2.5, or (b)
create, provide for, or eliminate any financial obligation of either Party under
this Agreement.
5.5 Commercialization Responsibilities of GSK. Provided that GSK or any of
its Affiliates is the Marketing Authorization Holder, GSK, at GSK's sole
expense, will use Commercially Reasonable Efforts to commercialize Product in
the Field of Use in the Territory as directed by the TJCC.
5.6 Adverse Event and Serious Adverse Event Reporting. GSK will be solely
responsible for and will comply with all applicable medical event reporting
requirements for the Product in the Territory and any countries in the Other
Territories. ALLERGAN will solely be responsible for and will comply with all
applicable medical event reporting requirements in all countries outside the
Territory and the Other Territories where the Product is being marketed, under
investigation, or pending registration. Adverse event information will be
exchanged between the Parties in such a manner as to ensure that their
respective regulatory obligations are met. Both Parties will agree in a separate
Pharmacovigilance Agreement on the detailed procedures including timeframes and
formats of adverse event information exchange specific to clinical trial and
spontaneous serious adverse events and non-serious adverse events and other
regulatory safety information. The drug safety groups for both Parties will have
standard operating procedures outlined in the Pharmacovigilance Agreement
relating to the receipt, processing, evaluation, and reporting of all adverse
events. Mechanisms for training and assessing compliance with these procedures
will also be identified in the Pharmacovigilance Agreement. The Parties will
negotiate and execute the Pharmacovigilance Agreement, which will include the
core principles set forth on Exhibit I as well as such other terms and
conditions agreed to by the Parties, within sixty (60) calendar days of the
Effective Date. GSK will be responsible for submitting all required
pharmacovigilance information to Regulatory Authorities in the Territory.
ALLERGAN will have access to such information provided by GSK and will be free
to use such information outside the Territory and Other Territories for any
purpose in connection with the sale of Product. GSK will provide reports to
ALLERGAN regarding all such pharmacovigilance information in the development
reports provided to ALLERGAN pursuant to Section 5.9.1.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
27
5.7 Product Recall. If any Regulatory Authority in the Territory orders or
requires the recall of any Product in the Territory, or if in GSK's opinion a
recall is necessary in the Territory, GSK will promptly notify ALLERGAN and
provide such information regarding such recall order or other information as may
be reasonably requested by ALLERGAN. GSK will, unless prohibited by Applicable
Law, consult ALLERGAN on the need for a recall and take all ALLERGAN submissions
into account when making a decision of whether to instigate or recall (such
decision not to be unreasonably made). GSK will be responsible for conducting
any recall in the Territory and ALLERGAN will co-operate with GSK by providing
all such information and assistance as may be reasonably required to implement
such recall. To the extent that any recall of the Product is implemented as a
result of Manufacturer's failure to Manufacture (as defined in the Supply
Agreement) Product in accordance with the terms and conditions of the Supply
Agreement, ALLERGAN will (a) bear all direct expenses incurred by GSK in
connection with such recall, (b) indemnify the GSK Indemnitees (as defined in
Section 8.1) from any and all Liabilities (as defined in Section 8.1) incurred
by the GSK Indemnitees to the extent that these are proven to be attributable to
the Manufacturer's failure to Manufacture Product in accordance with the terms
and conditions of the Supply Agreement, and (c) either, at GSK's sole option,
replace or credit GSK for the cost of the relevant Lots (as defined in the
Supply Agreement) of Product subject to the recall. If a recall is required due
to any negligence or willful misconduct of a XXX Xxxxxxxxxx, XXX will bear all
such costs and expenses incurred in connection with such recall and will
indemnify the ALLERGAN Indemnitees (as defined in Section 8.2) from and against
any and all Liabilities incurred by the ALLERGAN Indemnitees that are proven to
be attributable solely to the negligence or willful misconduct of GSK. If any
Regulatory Authority outside the Territory orders or requires the recall of any
of the Products outside the Territory then ALLERGAN will promptly notify GSK and
provide such information regarding such recall order or other information as may
be reasonably requested by GSK. Except as set forth in Article 8, each Party's
sole and exclusive remedies for recalled Product shall be limited to the
remedies provided in this Section 5.7.
5.8 Product Flow Outside of Territory. Each Party will implement reasonable
safeguards so that country-specific Products are sold only in its respective
territory and are not sold in any country outside such territory. Each Party
will sell Product only in its respective territory and will not, directly or
indirectly, offer Product to any Third Party that such Party reasonably believes
is going to market, distribute, or sell such Product, directly or indirectly,
outside such territory, unless mutually agreed upon by both Parties. If a Party
becomes aware that any of its customers has illegally imported Products from
outside its territory or exported Products to outside its territory, or has
reason to believe that a customer intends to illegally import Products from
outside its territory or exported Products to outside its territory, such Party
will take Commercially Reasonable Efforts to cause such customer to cease such
illegal import/export activities. If such Party reasonably believes that such
customer has not ceased such activities, then such Party will immediately cease
sale or distribution of any Product to such customer, to the full extent
permitted by Applicable Law. In addition, ALLERGAN will continue to implement
during the Term and during the Tail Period, and GSK will use Commercially
Reasonable Efforts to implement during the Term, ALLERGAN's product integrity
plan, the principles of which are set forth on Exhibit J to protect the safety
of patients,
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
28
maintain the loyalty of physician customers, preserve value, and assure that
safe Product is available to patients seeking treatment and appropriately
handled for safe and effective treatment. Accordingly, GSK will designate one
(1) Person in the Territory to monitor the foregoing activities and concerns
(the "Product Integrity Manager"), and the Parties will use Commercially
Reasonable Efforts to ensure that: (a) Product will be promoted or sold solely
to authorized medical professionals through legitimate distribution channels;
(b) in order to guard against counterfeiters and illegal imports/exports, all
sales personnel of the Parties will be trained to recognize Product brand
packaging and help customers to determine and guard against counterfeiting or
illegal imports/exports; and (c) detection of illegal importers/exporters and
counterfeiters will be reported to the Product Integrity Manager by employees or
agents of the Parties as soon as possible.
5.9 Reports. GSK will deliver to ALLERGAN the following written reports in
English summarizing GSK's activities and progress in its development and
commercialization of Product in the Territory.
5.9.1 Development Reports.
(a) If GSK or any of its Affiliates becomes the MAH and GSK (or
its Affiliate), in its sole discretion, undertakes to develop the Product in the
Field of Use in the Territory in accordance with Section 5.3 but subject to
Section 5.2.8, GSK will deliver to ALLERGAN a preliminary clinical development
plan listing major activities to be conducted within twelve (12) weeks after the
effective date of each such undertaking. Thereafter, not later than thirty (30)
calendar days after the end of each Calendar Year, GSK will update each such
clinical development plan and deliver to ALLERGAN a written report summarizing
progress in development of Product in the Field of Use during such Calendar
Year. Each such report will summarize all regulatory activities and development
progress made by GSK in development of Product in the Field of Use as of the
date of such report and, in addition, GSK's plans for the continuing such
development of Product in the Field of Use during the immediately following next
Calendar Year. Each such report will include information with respect to the
Product Improvement and Enhancements development programs since the prior
report, such as: (i) current status (for example, planning, enrollment, and
completion) of any clinical trial under the development program; (ii) efforts
toward and progress of enrolling patients in any clinical trial under the
development programs; and (iii) clinical trial synopsis for any clinical trial
under the development programs that is to be undertaken. The synopsis will
include, for example: (A) a description of the patient population, number of
patients to be enrolled, inclusion and exclusion criteria, study design,
description of endpoints, general statistical analyses plans, and formulation
and presentation to be utilized; (B) efforts undertaken in preparing a
Regulatory Approval Application relating to the development programs and status
of the efforts to prepare such application; (C) information submitted to the
local regulatory authorities relating to the development programs, including
without limitation regulatory updates and matters pertaining to Product
labeling; and (D) information received from the local regulatory authorities
relating to the development programs, including, for example, records of meeting
minutes of any other correspondence.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
29
5.9.2 Commercialization Reports.
(a) Beginning on the date that is *** after the date of
initiation of clinical studies with a Product intended by GSK to be the subject
of a Regulatory Approval Application, GSK will deliver to ALLERGAN, within
thirty (30) calendar days after such date and, thereafter, within ***, a written
marketing plan with respect to commercialization by GSK of Product in the Field
of Use in the Territory that is the subject of the Regulatory Approval
Application.
(b) Approximately *** prior to the anticipated date of
commercialization of a Product in such Field of Use, GSK will deliver to
ALLERGAN a complete marketing plan including market analysis and marketing and
sales activities in the Territory, the date anticipated by GSK that such
marketing and sales activities will begin, and, after Regulatory Approval for
Product has been obtained for such Field of Use, marketing and sales information
with respect to such Product for such Indication in the Territory; provided,
however, that GSK will not be required to generate extensive commercial analysis
solely for the purpose of reporting. Such annual reports will be in addition to
the written reports concerning progress in development described in Section
5.9.1. GSK may delete proprietary and sensitive information describing GSK's
customer and marketing strategies from reports to be provided to ALLERGAN under
this Section 5.9.2.
(c) After the GSK Sales Commencement Date, GSK shall provide to
ALLERGAN, within *** after the end of each ***, a written report of GSK's
estimated Net Sales in the Territory during the immediately preceding ***.
(d) Within *** after the end of each ***, GSK shall provide to
ALLERGAN a written report of the estimated Net Sales of GSK in the Territory
during the immediately preceding ***, broken down into two (2) categories:
aggregate Net Sales for the Cosmetic Indications and aggregate Net Sales for all
Indications other than the Cosmetic Indications.
(e) ALLERGAN acknowledges and agrees that the written reports
received from GSK in accordance with Sections 5.9.2(c) and (d): (i) are
estimates of Net Sales only, and thus by definition may contain inherent errors,
and will not be binding upon and/or create any diligence obligation on GSK
and/or any of its Affiliates or sublicensees for any purpose under this
Agreement; (ii) are being provided to ALLERGAN solely for information purposes
and that as a result, neither GSK nor any of its Affiliates or sublicensees will
be liable for, and ALLERGAN will indemnify and hold GSK, its Affiliates and
sublicensees harmless from and against, any liabilities, damages, losses, costs
and/or expenses of any kind whatsoever incurred by ALLERGAN, its Affiliates, its
sublicensees or any Person relating to the use of such written reports by
ALLERGAN, its Affiliates and/or its sublicensees whether internally or publicly,
subject to Section 5.9.5; (iii) may be amended by GSK, its Affiliates or
sublicensees at any time and for any reason whatsoever; and (iv) are not subject
to being audited by ALLERGAN or its Affiliates or sublicensees. Further ALLERGAN
acknowledges and agrees
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
30
that it cannot obligate GSK to alter or amend in any way any written report
received from GSK in accordance with Sections 5.9.2(c) and (d).
5.9.3 Forecasts.
(a) GSK will provide to ALLERGAN the following financial
forecasts relating to Product sales in the Territory: (i) by *** of each
Calendar Year, a rolling forecast of GSK's Net Sales for such Calendar Year,
broken down by Quarter and by all Cosmetic Indications and all Indications other
than Cosmetic Indications, and for *** (annual totals only); (ii) by *** of each
Calendar Year, an updated forecast of GSK's Net Sales for the remainder of such
Calendar Year, broken down by Quarter and by all Cosmetic Indications and all
Indications other than Cosmetic Indications; and (iii) by *** of each Calendar
Year, an updated forecast of GSK's Net Sales for the *** (annual totals only).
The Parties acknowledge and agree that GSK will in no way be obligated to
provide any assumptions along with any forecasts provided pursuant to this
Section 5.9.3.
(b) ALLERGAN acknowledges and agrees that the forecasts received
from GSK in accordance with Section 5.9.3(a): (i) are estimates of Net Sales
only, and thus by definition may contain inherent errors, and will not be
binding upon and/or create any diligence obligation on GSK and/or any of its
Affiliates or sublicensees for any purpose under this Agreement; (ii) are being
provided to ALLERGAN solely for information purposes and that as a result,
neither GSK nor any of its Affiliates or sublicensees will be liable for, and
ALLERGAN will indemnify and hold GSK, its Affiliates and sublicensees harmless
from and against, any liabilities, damages, losses, costs and/or expenses of any
kind whatsoever incurred by ALLERGAN, its Affiliates, its sublicensees or any
Person relating to the use of such forecasts by ALLERGAN, its Affiliates and/or
its sublicensees whether internally or publicly, subject to Section 5.9.5; (iii)
may be amended by GSK, its Affiliates or sublicensees at any time and for any
reason whatsoever; and (iv) are not subject to being audited by ALLERGAN or its
Affiliates or sublicensees. Further ALLERGAN acknowledges and agrees that it
cannot obligate GSK to alter or amend in any way any forecast received from GSK
in accordance with Section 5.9.3(a).
5.9.4 Data and Information Reports. GSK will disclose to ALLERGAN in
written reports delivered to ALLERGAN at each meeting of the TJDC or TJCC, as
applicable, any and all information and/or data generated or otherwise acquired
by GSK during the Term in connection with GSK's activities relating to Product
in the Field of Use in the Territory, for use by ALLERGAN and its Affiliates for
any purpose outside the Territory. In addition, after GSK has obtained
Regulatory Approval for a Product for a Field of Use in the Territory, GSK will
deliver to ALLERGAN a single written report each Calendar Year covering GSK's
development activities and marketing and sales activities in the immediately
preceding Calendar Year with respect to Product in the Field of Use covered by
such Regulatory Approval, such annual reports to be delivered within thirty (30)
days after December 31 of each Calendar Year.
5.9.5 ALLERGAN agrees to treat written reports received from GSK
pursuant to this Section 5.9 as Confidential Information of GSK and in
accordance with Article 10.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
31
6. PATENT AND TRADEMARK MAINTENANCE AND ENFORCEMENT
6.1 Patent Maintenance and Prosecution.
6.1.1 ALLERGAN will file, prosecute, and maintain the ALLERGAN Patent
Rights after taking into account GSK's reasonable interests and requests after
reasonable consultation with GSK. As relevant to the activities and interests of
GSK under this Agreement, ALLERGAN will promptly inform GSK in writing of any
change in the status of the ALLERGAN Patent Rights. GSK will reimburse ALLERGAN
for *** of all of ALLERGAN's costs and expenses in prosecuting and maintaining
the ALLERGAN Patent Rights in the Territory, including the costs of oppositions,
interferences, and similar proceedings, and any appeals arising therefrom.
Should ALLERGAN elect not to file, prosecute, or maintain any patent or patent
application included within the ALLERGAN Patent Rights, ALLERGAN will provide
(a) GSK with written notice as soon as reasonably possible after making such
election but in any event no later than sixty (60) calendar days before GSK
would be faced with a possible loss of rights, (b) give GSK the right, at GSK's
discretion and sole expense, to file, prosecute and maintain such patents and/or
patent applications, and (c) offer reasonable assistance in connection with such
filing, preparation, and maintenance at no cost to GSK except for reimbursement
for reasonable out-of-pocket expenses incurred by ALLERGAN. In the event that
GSK elects to file, prosecute and maintain any patent and/or patent application
included within ALLERGAN Patent Rights as provided herein, such patent and/or
patent application will not be regarded as an ALLERGAN Patent Right for the
purpose of Section 6.3.2(a), but rather GSK will have the initial right to
initiate, maintain and control any enforcement actions relating to such patent
or patent application as provided in Section 6.3.2(b).
6.1.2 GSK will file, prosecute, and maintain the GSK Patent Rights in
at its sole cost and expense; provided, however the Parties acknowledge and
agree that GSK will have no obligation whatsoever to file, prosecute, or
maintain any GSK Patent Rights. Should GSK elect not to file, prosecute or
maintain any patent or patent application included within the GSK Patent Rights,
GSK will provide (a) ALLERGAN with written notice as soon as reasonably possible
after making such election but in any event no later than sixty (60) calendar
days before ALLERGAN would be faced with a possible loss of rights, (b) give
ALLERGAN the right, at ALLERGAN's discretion and sole expense, to file,
prosecute and maintain such patents and/or patent applications, and (c) offer
reasonable assistance in connection with such filing, preparation, and
maintenance at no cost to GSK except for reimbursement for reasonable
out-of-pocket expenses incurred by GSK.
6.2 Trademark Maintenance and Prosecution. ALLERGAN, at its sole discretion
but after taking into account GSK's reasonable interests and requests after
reasonable consultation with GSK, will at its own cost and expense file,
prosecute, and maintain the ALLERGAN Product Trademarks in the Territory,
including the costs of oppositions, interferences, and similar proceedings, and
any appeals arising therefrom.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
32
6.3 Enforcement.
6.3.1 Notice. Each Party will notify the other promptly of any
apparent, threatened, or actual infringement by a Third Party of any patent
within the ALLERGAN Patent Rights, any trademark within the ALLERGAN Product
Trademarks or any patent within the GSK Patent Rights, in each case in the Field
of Use in the Territory, of which the Party becomes aware. The notifying Party
will promptly furnish the other Party with all known evidence of such
infringement (an "Infringement Notice").
6.3.2 Enforcement Actions. As between ALLERGAN and GSK:
(a) ALLERGAN will have the initial right, but not an obligation,
at its expense and in its own name or in the name of any of its Affiliates, to
initiate, maintain, and control any legal action on account of any infringement
of any patent within the ALLERGAN Patent Rights or trademark within the ALLERGAN
Product Trademarks by a Third Party, by counsel of its own choice. ALLERGAN will
notify GSK in writing within sixty (60) calendar days after giving or receiving
an Infringement Notice of its intention to initiate legal action against a Third
Party for infringement of a patent within the ALLERGAN Patent Rights or a
trademark within the ALLERGAN Product Trademarks in the Field of Use in the
Territory. If ALLERGAN exercises its first right, GSK will thereafter have a
right, in GSK's sole discretion and at GSK's expense, to join or otherwise
participate or not to join or otherwise participate in such legal action in the
Territory with legal counsel selected by GSK. If ALLERGAN does not exercise its
first right, GSK will thereafter have the right, but not the obligation, at its
expense and in its own name or in the name of any of its Affiliates, to
initiate, maintain, and control such legal action on ALLERGAN's behalf by
counsel of its choice. In the event that GSK initiates and thereafter maintains
such legal action against infringement of a patent within the ALLERGAN Patent
Rights or a trademark within the ALLERGAN Product Trademarks by a Third Party in
the Field of Use in the Territory, ALLERGAN, at GSK's expense, will provide GSK
cooperation as reasonably necessary, including agreeing to be named as a party
to such legal action.
(b) GSK will have the initial right, but not an obligation, at
its expense and in its own name or in the name of any of its Affiliates, to
initiate, maintain, and control any legal action on account of any infringement
of any patent within the GSK Patent Rights by a Third Party, by counsel of its
own choice. GSK will notify ALLERGAN in writing within sixty (60) calendar days
after giving or receiving an Infringement Notice of its intention to initiate
legal action against a Third Party for infringement of a patent within the GSK
Patent Rights in the Field of Use in the Territory. If GSK exercises its first
right, ALLERGAN will thereafter have a right, in ALLERGAN's sole discretion and
at ALLERGAN's expense, to join or otherwise participate or not to join or
otherwise participate in such legal action in the Territory with legal counsel
selected by ALLERGAN. If GSK does not exercise its first right, ALLERGAN will
thereafter have the right, but not the obligation, at its expense and in its own
name or in the name of any of its Affiliates, to initiate, maintain, and control
such legal action on GSK'S behalf by counsel of its choice. In the event that
ALLERGAN initiates and thereafter maintains such legal action against
infringement of a patent within the GSK Patent Rights by a Third Party in the
Field of Use in the Territory, GSK, at ALLERGAN's expense, will provide
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
33
ALLERGAN cooperation as reasonably necessary, including agreeing to be named as
a party to such legal action.
(c) Any recovery received by a Party from legal action initiated
pursuant to this Section 6.3 in the Territory, whether by judgment, award,
decree, or settlement, will be used ***.
6.4 Third Party Action. In the event of the institution of any suit by a
Third Party against ALLERGAN, GSK or their respective Affiliates or sublicensees
for patent infringement involving the use, sale, offering for sale or import of
Product in the Field of Use in the Territory, the Party sued will promptly
notify the other Party in writing. GSK will have the first right, but not the
obligation, to defend such suit at its own expense. ALLERGAN and GSK will
provide reasonable assistance to one another and reasonably cooperate in any
such litigation at the other's request without expense to the requesting Party.
6.5 Cooperation. In any suit, proceeding, or dispute as described in this
Article 6, the Parties will provide each other with reasonable cooperation, and,
upon the request and at the expense of the Party bringing suit, the other Party
will make available to the Party bringing suit, at reasonable times and under
appropriate conditions, all relevant personnel, records, papers, information,
samples, specimens, and the like in its possession. Notwithstanding any other
provision of this Article 6, neither Party will make any settlements of any
suit, proceeding, or action as described in this Article 6 that would adversely
affect the other Party, materially affect the rights and licenses granted
hereunder, require the other Party to be subject to an injunction, or require
the other Party to make any monetary payment without first obtaining such other
Party's prior written consent, such consent not to be unreasonably withheld or
delayed.
7. REPRESENTATIONS, WARRANTIES, AND COVENANTS
7.1 Representations and Warranties of ALLERGAN. ALLERGAN represents and
warrants that, as of the Effective Date:
7.1.1 ALLERGAN is a corporation duly organized, validly existing, and
in good standing under the laws of the state of Delaware;
7.1.2 The execution, delivery, and performance of this Agreement by
ALLERGAN have been duly authorized by all requisite corporate action and do not
require any shareholder action or approval;
7.1.3 The execution, delivery, and performance by ALLERGAN of this
Agreement and its compliance with the terms and provisions hereof do not and
will not conflict with or result in a breach of any of the terms and provisions
of or constitute a default under (a) any agreement with a Third Party, including
but not limited to a loan agreement, guaranty, financing agreement, agreement
affecting a Product, or other agreement or instrument binding or affecting it or
its property; (b) the provisions of its charter or operative documents or
bylaws; or
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
34
(c) any order, writ, injunction, or decree of any court or governmental
authority entered against it or by which any of its property is bound;
7.1.4 ALLERGAN has taken customary and reasonable steps, consistent
with industry practice, to protect the confidentiality of the ALLERGAN Know-How;
7.1.5 ALLERGAN has the right and authority to grant the licenses
granted to GSK and its Affiliates pursuant to the terms and conditions set forth
in this Agreement in the Territory;
7.1.6 Neither ALLERGAN nor its Affiliates has granted any right,
license, or interest in, to, or under the ALLERGAN Patent Rights, ALLERGAN
Know-How or ALLERGAN Trademarks in the Territory that is inconsistent with the
rights, licenses, and interests granted under the terms and conditions set forth
in this Agreement;
7.1.7 ALLERGAN is the registered proprietor of the ALLERGAN Trademarks
that are registered in the Territory and the applicant in respect of those
ALLERGAN Trademarks which are applications at the Effective Date in the
Territory and, to the knowledge of ALLERGAN, the use of the ALLERGAN Trademarks
by GSK as contemplated by this Agreement will not infringe the intellectual
property rights of any Third Party in the Territory;
7.1.8 ALLERGAN Controls the ALLERGAN Patent Rights and the ALLERGAN
Know-How and, the ALLERGAN Patent Rights have been properly filed, prosecuted,
and maintained and all fees and other charges due have been paid, in the
Territory;
7.1.9 To the knowledge of ALLERGAN, the patents in the ALLERGAN Patent
Rights are not invalid and their exercise would not infringe the patent or other
intellectual property rights of any Third Party in the Territory, and there has
been no written notice of any claim or objection that the use of the ALLERGAN
Patent Rights and the ALLERGAN Know-How infringes, misappropriates, or otherwise
violates or makes unauthorised use of, or has infringed, misappropriated, or
otherwise violated or made unauthorised use of, the intellectual property or
know-how rights of any Third Party in the Territory and there is no fact or
circumstance which may give rise to any such claim or objection;
7.1.10 To the knowledge of ALLERGAN, no Third Party is, infringing, or
otherwise violating or making unauthorised use of the ALLERGAN Patent Rights in
the Territory;
7.1.11 To the knowledge of ALLERGAN, there are no pre-clinical or
clinical data or other information concerning Product in the Territory that it
has not provided to GSK prior to the Effective Date that demonstrates or
suggests that there is or may exist material quality, toxicity, safety, and/or
efficacy concerns that may impair the utility and/or safety of the Product in
the Territory;
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
35
7.1.12 To the knowledge of ALLERGAN, each Regulatory Approval in the
Territory has been validly issued by the appropriate Regulatory Authority and is
in full force and effect, ALLERGAN and its Affiliates and agents have been and
are in material compliance with all regulatory requirements of all competent
Regulatory Authorities in the Territory with respect to Product, and there are
no material facts or circumstances that might be expected to cause any
Regulatory Approval in the Territory to be revoked or not renewed;
7.1.13 To the knowledge of ALLERGAN, all information and data provided
to GSK relating to the sales of the Products in the Territory is accurate in all
material respects and ALLERGAN and its distributors and agents have continued to
conduct their business in relation to the Product in the Territory in the
ordinary course and in accordance with Applicable Law since the date of the last
such information and data;
7.1.14 To the knowledge of ALLERGAN, the information provided by
ALLERGAN to GSK for due diligence purposes in relation to this Agreement is
accurate in all material respects and ALLERGAN has not omitted to supply GSK
with any material information in its possession concerning Product in the
Territory or the transactions contemplated by this Agreement that would be
material to GSK's decision to enter into this Agreement and undertake the
commitments and obligations set forth in this Agreement. ALLERGAN acknowledges
that GSK has relied on the information in its material respects so provided by
ALLERGAN in deciding to enter into this Agreement;
7.1.15 To the knowledge of ALLERGAN, all Products sold by ALLERGAN in
the Territory prior to the Effective Date were in material compliance with the
registered Product specifications, were manufactured in accordance with
Applicable Law, including requirements of current Good Manufacturing Practice
(cGMP), complied with any representation or warranty, express or implied, given
in respect of them, and were promoted, marketed, and sold in accordance with all
Applicable Law in the Territory; and
7.1.16 To the knowledge of ALLERGAN, there are no material legal
proceedings or regulatory or governmental claims pending against ALLERGAN or its
agents in the Territory in relation to the Product.
7.2 Covenants of ALLERGAN. ALLERGAN covenants that:
7.2.1 Neither ALLERGAN nor its Affiliates will grant, during the Term,
any right, license, or interest in, to, or under the ALLERGAN Patent Rights,
ALLERGAN Know-How, or ALLERGAN Trademarks in the Field of Use in the Territory
that is inconsistent with the rights, licenses, and interests granted to GSK
hereunder or ALLERGAN's Control in such ALLERGAN Patent Rights, ALLERGAN
Know-How or ALLERGAN Trademarks;
7.2.2 ALLERGAN will at all times comply with all Applicable Laws
relating to its activities under this Agreement;
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
36
7.2.3 ALLERGAN will not, and will cause all of its Affiliates and
sublicensees not to, either on its or their own or with any Third Party, conduct
any development activities or conduct clinical trials relating to Product, or
seek Regulatory Approvals for Product, in the Territory during the Term, except
as provided in Section 4.1;
7.2.4 ALLERGAN will not, and will cause all of its Affiliates and
sublicensees not to, either on its or their own or with any Third Party, use,
sell, offer for sale or import (including, without limitation, distribute)
Product in the Territory during the Term, except as provided in Section 4.1 and
with respect to ALLERGAN's co-promotion activities during the Co-Promotion Term
as provided in Section 2.5, or as otherwise authorized by GSK in writing; and
7.2.5 Prior to the GSK Distribution Commencement Date, ALLERGAN will,
and will use Commercially Reasonable Efforts to cause its Affiliates,
sublicensees, employees, and agents to, continue to develop and sell Product in
the Territory, and conduct business in relation to the Product in the Territory
in the ordinary course of business and in accordance with all Applicable Law,
including, without limitation, (a) preserving intact the market for Product in
the Territory and the goodwill associated with Product, (b) continuing to
maintain its (or their) relationships with distributors, customers and others
having material business relationships with it (or them) related to Product in
the Territory, (c) continuing to distribute Product in accordance with past
practice and, in particular, not to accelerate or increase the quantity of
Product distributed to the trade and not at prices below ALLERGAN's (or its
Affiliate's) average normal prices over the immediately preceding three (3)
consecutive months, and (d) take all reasonable steps to retain the services of
employees of ALLERGAN (or its Affiliate) to assist in the transition activities
set forth in Article 4.
7.3 Representations and Warranties of GSK. GSK represents and warrants
that, as of the Effective Date:
7.3.1 GSK is a private limited company duly organized, validly
existing, and in good standing under the laws England and Wales;
7.3.2 The execution, delivery, and performance of this Agreement by
GSK has been duly authorized by all requisite corporate action and does not
require any shareholder action or approval;
7.3.3 The execution, delivery, and performance by GSK of this
Agreement and its compliance with the terms and provisions hereof does not and
will not conflict with or result in a breach of any of the terms and provisions
of or constitute a default under (a) a loan agreement, guaranty, financing
agreement, agreement affecting a Product, or other agreement or instrument
binding or affecting it or its property; (b) the provisions of its charter or
operative documents or bylaws; or (c) any order, writ, injunction, or decree of
any court or governmental authority entered against it or by which any of its
property is bound; and
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
37
7.3.4 GSK has the right and authority to grant the rights and licenses
granted pursuant to the terms and conditions set forth in this Agreement.
7.4 Covenants of GSK. GSK covenants that:
7.4.1 GSK will at all times comply in all material respects with all
Applicable Law relating to its activities under this Agreement;
7.4.2 GSK will take customary and reasonable steps, consistent with
industry practice, to protect the confidentiality of the ALLERGAN Know-How;
7.4.3 GSK will not grant any right, license, or interest in, to, or
under any GSK Patent Rights that are inconsistent with the rights, license, and
interests granted under the terms and conditions set forth in this Agreement;
7.4.4 GSK will use Commercially Reasonable Efforts to ensure that all
aspects of its regulatory, development, regulatory, and commercialization
activities with respect to Product in the Field of Use in the Territory,
including for example clinical trial design, pharmacovigilance, and clinical and
regulatory management activities, will be conducted in accordance with Good
Clinical Practice, Good Vigilance Practice, and Good Post-Marketing Study
Practice and professional standards consistent with the standards utilized by
GSK, including the relevant JPMA (Japan Pharmaceutical Manufacturers
Association) code, in GSK's commercialization efforts for Product in the Field
of Use in the Territory.
7.5 Restrictive Covenant of GSK.
7.5.1 The Parties acknowledge that:
(a) As of the Effective Date, neither GSK nor its Affiliates have
any current or future intention of making, having made, using, offer for sale or
importing a Competing Product (as defined in Section 7.5.2) in the Field of Use
in any country of the world; and
(b) During the Term, GSK will obtain certain Confidential
Information of ALLERGAN relating to the development, manufacture and
commercialization Product, which is valuable and highly confidential to ALLERGAN
and critical to the competitive success of ALLERGAN's business worldwide.
7.5.2 To the extent permitted under Applicable Law, during the Term
and for a period of *** after the effective date of the expiration of this
Agreement pursuant to Sections 9.1 or 9.2.3, or the termination of this
Agreement for any reason other than by GSK pursuant to Sections 9.3.1 or 9.3.2
(the "Restrictive Period"), neither GSK nor any Affiliate of GSK will
manufacture, market, distribute, sell, promote, or detail any pharmaceutical
product in the Territory, which ***, other than Product (a "Competing Product")
in the Field of Use; provided, however, that:
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
38
(a) If GSK or any of its Affiliates manufactures, initiates
clinical studies, markets, distributes, sells, promotes, or details
(collectively, "commercialization") a Competing Product in *** during the Term,
GSK will (i) notify ALLERGAN immediately upon becoming aware of such
commercialization, and (ii) cease commercialization of such Competing Product
within *** after the date that GSK became aware of such commercialization. If
GSK does not cease such commercialization within *** after becoming aware of
such commercialization, ALLERGAN, at any time thereafter, will have a right to
terminate this Agreement and any other agreement between the Parties relating to
Product in the Other Territories, which termination by ALLERGAN of this
Agreement will be deemed a termination by ALLERGAN pursuant to Section 9.3.1.
During the period between the date that GSK becomes aware of commercialization
of a Competing Product as provided in this Section 7.5.2(a) and the earlier of
the date on which GSK ceases such commercialization and expiration of the
Restrictive Period, GSK will pay to ALLERGAN *** of all of GSK's or its
Affiliates' net sales of such Competing Product (which net sales will be
calculated in the same manner that Net Sales are calculated herein).
Notwithstanding the foregoing, if GSK or any of its Affiliates has used
ALLERGAN's Know-How or Confidential Information in connection with the
commercialization of a Competing Product as provided in this Section 7.5.2(a),
ALLERGAN will have the right to immediately terminate this Agreement and any
other agreement between the Parties relating to Product in the Other Territories
upon thirty (30) calendar days' prior written notice to GSK, which termination
by ALLERGAN of this Agreement will be deemed a termination by ALLERGAN pursuant
to Section 9.3.1.
(b) Notwithstanding anything contained in this Section 7.5.2,
nothing herein will, expressly or impliedly, preclude or restrict GSK, or any of
its Affiliates, in any way from (i) acquiring a majority of the voting stock, or
all or substantially all of the assets of, a Business Entity (as defined below);
(ii) being acquired by a Business Entity; or (iii) merging, amalgamating, taking
over, or consolidating (or engaging in any similar transaction) with a Business
Entity (hereinafter, the actions referred to in (i), (ii), and (iii) of this
Section 7.5.2(b) are collectively referred to as "Merger" or "Merging").
The term "Business Entity" as used in this Section 7.5.2(b)
means any Person, which, at the time of such Merger, is commercializing (as such
term is defined in Section 7.5.2(a)) a Competing Product in ***, including, for
example, the Persons listed on Exhibit K.
In the event that GSK or any of its Affiliates Merges with a
Business Entity during the Term, GSK will divest or cause the divestiture of the
Competing Product being commercialized by the Business Entity within *** after
the date of the public announcement of such Merger ("Merger Date"). During such
*** period, (A) neither GSK nor any of its Affiliates will use any ALLERGAN
Know-How or Confidential Information in connection with the commercialization of
such Competing Product; and (B) GSK will continue to comply with the terms of
this Agreement in all respects. If GSK does not divest or cause the divesture of
such Competing Product within *** after the Merger Date, ALLERGAN, at any time
thereafter, will have a right to terminate this Agreement and any other
agreement between
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
39
the Parties relating to Product in the Other Territories, which termination by
ALLERGAN will be deemed a termination by ALLERGAN pursuant to Section 9.3.1. In
the event that GSK does not divest or cause the divesture of such Competing
Product within the *** period as provided in this Section 7.5.2(b), GSK will pay
to ALLERGAN *** of all of GSK's or its successor's net sales of such Competing
Product after such *** period (which net sales will be calculated in the same
manner that Net Sales are calculated herein) and continuing until the earlier of
the date on which GSK or its successor divests such Competing Product or the
expiration of the Restrictive Period.
7.6 Disclaimer. EXCEPT AS EXPRESSLY PROVIDED FOR IN THIS ARTICLE 7,
ALLERGAN MAKES NO, AND HEREBY DISCLAIMS ANY AND ALL, REPRESENTATIONS AND
WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, WITH RESPECT TO THE ALLERGAN PATENT
RIGHTS, ALLERGAN KNOW-HOW, AND/OR ALLERGAN TRADEMARKS, INCLUDING WITHOUT
LIMITATION, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND
NONINFRINGEMENT OF ANY THIRD PARTY'S PROPRIETARY RIGHTS.
8. INDEMNIFICATION AND INSURANCE
8.1 Indemnification by ALLERGAN. ALLERGAN will indemnify, defend, and hold
GSK and its Affiliates and their directors, officers, employees, and agents
(each and collectively a "GSK Indemnitee") harmless from and against any and all
liabilities, damages, losses, costs and expenses, investigations, and reasonable
attorneys' fees incurred hereunder (each and collectively a "Liability")
resulting from or arising out of a claim, suit, or proceeding brought by a Third
Party against a GSK Indemnitee arising out of or related to:
8.1.1 the research, development, manufacture, promotion, sale,
distribution, importation and/or use of Product in the Field of Use in the
Territory prior to the GSK Distribution Commencement Date;
8.1.2 the research, development, manufacture, promotion, sale,
distribution, importation and/or use of Product in any country outside of the
Territory and the Other Territories;
8.1.3 the promotion, sale, distribution, importation and/or use of
Product in the Territory for the Current Indications after the GSK Distribution
Commencement Date;
8.1.4 the promotion, sale, distribution, importation and/or use of
Stock Product in the Territory;
8.1.5 the research and development of Product in the Territory for the
Cosmetic Indications which is conducted or sponsored by an ALLERGAN Indemnitee
(as defined in Section 8.2) up to and continuing until the date on which the
study 909 is locked;
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
40
8.1.6 the employment (and/or termination) of any employees of ALLERGAN
and/or its Affiliates in the Territory, including, without limitation,
Liabilities relating to pensions and other defined benefits, severance payments
and/or wrongful dismissal claims;
8.1.7 any violation of Applicable Law by any ALLERGAN Indemnitee in
performing ALLERGAN's obligations under this Agreement; and
8.1.8 any material breach by any ALLERGAN Indemnitee of ALLERGAN's
representations, warranties and/or obligations under this Agreement;
provided, however, with respect to Sections 8.1.3, 8.1.4, 8.1.7 and 8.1.8,
except to the extent that any such Liabilities are the responsibility of GSK
under Section 8.2; and provided further with respect to Section 8.1.3, to the
extent that any such Liabilities occur during the first (1st) Calendar Year
after the Effective Date.
8.2 Indemnification by GSK. GSK will indemnify, defend, and hold harmless
ALLERGAN and its directors, officers, employees, agents, and consultants (each
and collectively an "ALLERGAN Indemnitee") from and against any and all
Liabilities resulting from or arising out of a claim, suit, or proceeding
brought by a Third Party against an ALLERGAN Indemnitee arising out of or
related to:
8.2.1 the research, development, promotion, sale, distribution,
importation and/or use of Product in the Field of Use in the Territory after the
Effective Date;
8.2.2 any violation of Applicable Law by any GSK Indemnitee in
performing GSK's obligations under this Agreement; and
8.2.3 any material breach by any GSK Indemnitee of GSK's
representations, warranties and/or obligations under this Agreement;
provided, however, with respect to Sections 8.2.1, 8.2.2 and 8.2.3, except to
the extent such Liabilities are the responsibility of ALLERGAN under Section
8.1.
8.3 Procedure. For purposes of Sections 8.1 and 8.2, the Person asserting a
claim for indemnification pursuant to either Section 8.1 or 8.2 (the
"Indemnified Person") will notify the Party responsible for such indemnification
(the "Indemnifying Party") in writing of any claims, suits, or proceedings by
Third Parties that may give rise to any claim for which indemnification may be
required under this Article 8 as follows: (a) within fifteen (15) calendar days
after receipt of service of process of the commencement of suit or (b) for
non-litigated matters, within thirty (30) calendar days after receipt of notice
thereof; provided, however, that failure to give such notice will not relieve
the Indemnifying Party of its obligation to provide indemnification hereunder
except if, and to the extent that, such failure materially and adversely affects
the ability of the Indemnifying Party to defend the applicable claim, suit, or
proceeding. The Indemnifying Party will be entitled to assume sole control over
the defense of any such claim at its own cost and expense; provided, however,
that the Indemnified Person will have the right to
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
41
be represented by its own counsel at its own cost in such matters. Neither the
Indemnifying Party nor the Indemnified Person will settle or dispose of any such
matter in any manner that would adversely affect the rights or interests of the
other, require the other to be subject to an injunction, or require the other to
make any monetary payment, in each case without the prior written consent of the
other, which will not be unreasonably withheld or delayed. The Indemnifying
Party and Indemnified Person will reasonably cooperate with the other and its
counsel in the course of the defense of any such suit, claim, or demand, such
cooperation to include without limitation using reasonable efforts to provide or
make available documents, information, and witnesses.
8.4 Limitation of Liability. With respect to any claim by one Party against
the other arising out of the performance or failure of performance of the other
Party under this Agreement, the Parties expressly agree that the liability of
such Party to the other Party for such breach will be limited under this
Agreement or otherwise at law or equity to direct damages only and in no event
will a Party be liable for indirect, special, punitive, exemplary, or
consequential damages. The limitations set forth in this Section 8.4 will not
apply with respect to the obligations of either Party to indemnify the other
under Sections 8.1 or 8.2 in connection with a claim of a Third Party.
8.5 Insurance. Each Party, at its own expense, will maintain commercial
general (public liability)/ product liability insurance, including coverage for
clinical trials, with a minimum limit of liability per occurrence of, or the
equivalent of, *** and *** in the annual aggregate, or self insure for any such
amounts, and will provide the other Party with a certificate of such insurance.
Each Party will provide at least thirty (30) calendar days' written notice to
the other Party prior to cancellation or material change in the relevant Party's
policy or coverage.
9. TERM AND TERMINATION
9.1 Term. The initial term of this Agreement will commence on the Effective
Date and continue for a period of twenty (20) years (the "Initial Term"), unless
extended pursuant to Section 9.2 or terminated at an earlier date in accordance
with Sections 9.3 or 11.16. If GSK does not elect to extend the Initial Term as
provided in Section 9.2 below, unless earlier terminated as provided in Sections
9.3 or 11.16, this Agreement will expire at the end of the Initial Term.
9.2 Options to Extend Initial Term.
9.2.1 If, by the end of the Initial Term, cumulative GSK Net Sales,
based on the price of Product on the GSK Sales Commencement Date, of Product is
equal to or greater than ***, or the equivalent of *** in Japanese Yen using the
currency exchange rate for purchase of U.S. dollars as published in The Wall
Street Journal (Western edition) on the GSK Sales Commencement Date, GSK will
have the option to extend the Initial Term for an additional five (5) years
(such five (5) year period referred to as the "Extended Term"), for a total
duration of the Term equal to twenty-five (25) years, upon providing written
notice to ALLERGAN prior to the expiration of the Initial Term. Any reduction in
price of Product over the Initial Term of ***
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
42
or more from the price of Product on the GSK Sales Commencement Date, or any
similar reduction in the reimbursement rate of Product from that on the GSK
Sales Commencement Date, will reduce the Net Sales minimum threshold of *** set
forth in this Section 9.2.1 by *** reduction of price of Product or
reimbursement rate.
9.2.2 Notwithstanding the foregoing, if during the Initial Term there
is a Material Supply Interruption or Material Regulatory Interruption, of GSK's
or its Affiliates' or sublicensees' ability to commercialize Product in the
Territory is materially disrupted due to a Force Majeure Event, the Net Sales
minimum threshold of *** will not apply and the Parties will negotiate in good
faith a new threshold which appropriately reflects GSK's inability to meet the
threshold of *** due to each such interruption or disruption.
9.2.3 If GSK exercises its option to extend the Initial Term as
provided in this Section 9.2, unless earlier terminated as provided in Section
9.3, this Agreement will expire at the end of the Extended Term.
9.3 Early Termination.
9.3.1 Termination for Material Breach. In the event of a material
breach or default of this Agreement by either Party that is not cured within ***
after receipt of notice thereof from the other Party, the non-breaching Party
will be entitled to terminate this Agreement by giving written notice to the
other Party, such termination to take effect immediately. The right to terminate
this Agreement will not be affected in any way by a waiver of, or failure to
take action with respect to, any previous default.
9.3.2 Termination for Bankruptcy. Either Party will have the right to
terminate this Agreement effective upon written notice to the other Party in the
event the non-notifying Party becomes insolvent or makes an assignment for the
benefit of creditors, or in the event bankruptcy or insolvency proceedings are
instituted against the non-notifying Party or on the non-notifying Party's
behalf.
9.3.3 Termination for Safety or Quality Reasons; Material Regulatory
Interruption. GSK will have the right to immediately terminate this Agreement
upon providing thirty (30) calendar days' written notice to ALLERGAN, if (a)
there is a Material Regulatory Interruption which has lasted for at least ***
during the Term; or (b) GSK reasonably determines, after consultation with
ALLERGAN, that there are significant safety or quality concerns relating to
Product that GSK considers (in accordance with its corporate policies and
procedures) justifying that Product not be sold in the Territory.
9.3.4 Termination for Commercial or Development Reasons. GSK may
terminate this Agreement on not less than six (6) months' prior written notice
to ALLERGAN in the event that GSK decides that based on a reasonable
determination, using the same standards as it would use to determine whether or
not to continue the commercialization of its own prescription pharmaceutical
products, that the intellectual property, medical, scientific, technical,
regulatory, and/or commercial profile of the Product does not justify the
continued
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
43
commercialization of the Product in the Territory. During the period subsequent
to GSK providing notice of termination pursuant this Section 9.3.4 and until the
effective date of such termination, GSK will use Commercially Reasonable Efforts
to develop and commercialize Product in the Field of Use in the Territory as
provided in this Agreement.
9.4 Effect of Expiration or Termination.
9.4.1 In the event of the expiration of this Agreement in accordance
with Sections 9.1 or 9.2.3, or termination of this Agreement for whatever
reason, effective as of the date of expiration or such termination, all of GSK's
rights hereunder to ALLERGAN Patent Rights, ALLERGAN Know-How, and/or ALLERGAN
Trademarks will terminate and revert to ALLERGAN, and GSK will have no further
rights thereto.
9.4.2 In the event of the termination of this Agreement by GSK
pursuant to and in accordance with Sections 9.3.1 or 11.16, all of ALLERGAN's
rights under the GSK Patent Rights pursuant to Section 2.1.3 will terminate and
revert to GSK, and ALLERGAN will have no further rights thereto.
9.4.3 In the event of expiration of this Agreement in accordance with
Sections 9.1 or 9.2.3, or termination of this Agreement for whatever reason,
each Party will promptly return, or at the other Party's request destroy, any
Confidential Information of such other Party in such Party's possession or
control at the time of termination and, if destroyed, certify such destruction
to such other Party; provided that each Party may, at such Party's expense, make
and retain one (1) copy of the other Party's Confidential Information for legal
archival purposes only.
9.4.4 In the event of termination of this Agreement for whatever
reason, each Party will retain any and all rights or remedies such Party may
have in law or in equity, subject to Section 8.4 of this Agreement.
9.4.5 In the event of the expiration of this Agreement in accordance
with Sections 9.1 or 9.2.3, or the earlier termination of this Agreement by
either Party for any reason, each Party will pay to the other Party, any payment
hereunder that accrued prior to the effective date of such expiration or
termination, but has not been paid.
9.4.6 Upon expiration of this Agreement in accordance with Sections
9.1 or 9.2.3, or the earlier termination of this Agreement for any reason, GSK
will, to the extent permitted under Applicable Law and at ALLERGAN's sole cost
and expense, transfer or assign to ALLERGAN or a Person designated by ALLERGAN
(or have reissued in the name of ALLERGAN or a Person designated by ALLERGAN, if
applicable), for use by ALLERGAN as ALLERGAN may determine (a) all Regulatory
Approvals, and Regulatory Approval Applications existing at the Effective Date
and transferred to GSK by ALLERGAN under this Agreement, and (b) except in the
event of termination of this Agreement by GSK pursuant to Section 9.3.1, all
data, Regulatory Approvals, and Regulatory Approval Applications obtained by GSK
in connection with GSK's activities related to Product in the Territory during
the Term.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
44
GSK will cooperate fully with ALLERGAN to effect any such transfer or
assignment, or reissuance, if applicable.
9.4.7 Upon expiration or termination of this Agreement, GSK will
return to ALLERGAN all documents and materials provided by ALLERGAN pursuant to
Article 4 to GSK in accordance with Section 9.4.3, and in addition approvals and
rights.
9.5 Survival.
9.5.1 Termination or expiration of this Agreement for any reason will
terminate all outstanding obligations and liabilities between the Parties
arising from this Agreement except those described in:
(a) Sections 2.1.1, 2.2, 2.4, 3.2, 3.3, 3.6.1, 3.6.3(a),
3.6.4(a), 3.7, 3.8, 3.9, 3.10.1, 5.5, 5.8, 9.5.1(a) and 11.6, all with regard to
GSK's post termination/expiration sales of Product pursuant to Section 8.5 of
the Supply Agreement; and
(b) Sections 2.1.3 (subject to Section 9.4.2), 2.3, 3.4, 3.6.2,
3.6.3(b), 3.6.4(b), 3.7, 3.8 (for clarity, the last sentence of Section 3.8 will
survive indefinitely), 3.9, 3.10, 5.6, 5.7 (4th and 5th sentences only),
5.9.2(e), 5.9.3(b), 7.5, 9.4, 9.5.1(b), 9.5.1(c), 9.5.2, 11.1, 11.3, 11.4, 11.5,
11.6, 11.7, 11.8, 11.10 and 11.11, and Articles 8 and 10, all of which will
survive termination or expiration of this Agreement for the longer of (A) the
duration of the Tail Period if such Sections and Articles are specifically
applicable to the Tail Period, or (B) the time period specified in such Sections
and Articles; provided, however, that if such Sections and Articles are not
specifically applicable to the Tail Period or no such time period is specified
in such Sections and Articles, they will all survive termination or expiration
of this Agreement indefinitely; and
(c) Article 1 for the sole purposes of interpreting the
obligations and liabilities between the Parties surviving termination of this
Agreement.
9.5.2 Expiration or termination of this Agreement for any reason will
not release either Party from any obligation that has accrued prior to
expiration or such termination, including without limitation any obligation of a
Party to pay any amount which became due and payable under the terms and
conditions of this Agreement prior to expiration or such termination.
Termination of this Agreement will not preclude either Party from claiming any
other damages, compensation, or relief that it may be entitled, whether in law
or in equity, upon such termination.
10. CONFIDENTIALITY
10.1 Confidential Information. "Confidential Information" means, except as
provided below in this Section 10.1, the terms and conditions of this Agreement
as well as confidential and proprietary information of a Party, whether in
written, printed, verbal, or electronic form, and whether disclosed before or
after the Effective Date, including research and development
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
45
activities, Product design details and specifications, technology and know-how,
sales and marketing plans, finances and business forecasts, procurement
requirements and vendor information, customer lists, personnel information and
strategic plans. Confidential Information will not include information that: (a)
is now, or hereafter becomes, generally known or available to the public through
no act or failure to act on the part of the receiving Party; (b) was acquired by
the receiving Party before receiving such information from the disclosing Party
through no breach of any duty of confidentiality owed to the disclosing Party
and without restriction as to use or disclosure; (c) is hereafter rightfully
furnished to the receiving Party by a Third Party without any breach of any duty
of confidentiality owed to the disclosing Party and without restriction as to
use or disclosure; or (d) is information that the receiving Party can document
was independently developed by the receiving Party without any use of the
disclosing Party's Confidential Information.
10.2 Non-Disclosure of Confidential Information. Each Party, when it is the
receiving Party, agrees: (a) to hold the disclosing Party's Confidential
Information in strict confidence and not to disclose such Confidential
Information to any other Third Party without the prior written consent of the
disclosing Party; (b) not to use, at any time following the Effective Date, any
Confidential Information of the disclosing Party for its own benefit or for the
benefit of any Third Party for any purpose other than for the express purposes
permitted under this Agreement or any other agreement between the Parties and/or
their respective Affiliates relating to Product; and (c) to limit the disclosure
of Confidential Information to Permitted Persons. For purposes hereof, the term
"Permitted Person" will mean the receiving officers and employees of the
receiving Party or of an Affiliate of the receiving Party who have a need to
know in order to carry out the obligations under this Agreement; provided each
has agreed in writing to maintain the confidentiality of the Confidential
Information in a manner no less protective than that set forth herein. The
receiving Party will use Confidential Information of a disclosing Party solely
to exercise its rights and perform its obligations under this Agreement
(including without limitation the right to use and disclose such Confidential
Information in Regulatory Approval Applications and regulatory filings), unless
otherwise mutually agreed in writing. The receiving Party will take the same
degree of care with Confidential Information of a disclosing Party that it uses
to protect its own confidential and proprietary information of a similar nature
and importance (but in any event no less than reasonable care).
10.3 Legal Disclosure. In the event a receiving Party is required to
disclose Confidential Information of the disclosing Party by any Applicable Law,
it may do so only to the extent required thereby; provided, however, that the
receiving Party will (a) use reasonable efforts under the circumstances to
provide advance notice to the disclosing Party of the required disclosure to
allow the disclosing Party an opportunity to take steps to object to, prevent,
or limit its disclosure or obtain a protective or other similar order with
respect to the required disclosure and (b) restrict disclosure to only that
portion of the Confidential Information that is required to be disclosed.
10.4 Remedies. The receiving Party agrees that its obligations hereunder
are necessary and reasonable to protect the disclosing Party's business
interests and that the unauthorized
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
46
disclosure or use of Confidential Information of a disclosing Party would cause
irreparable harm and significant injury, the degree of which may be difficult to
ascertain. The receiving Party further acknowledges and agrees that in the event
of any actual or threatened breach of this Agreement, the disclosing Party may
have no adequate remedy at law and, accordingly, that the disclosing Party will
have the right to seek an immediate injunction enjoining any breach or
threatened breach of this Agreement, as well as the right to pursue any and all
other rights and remedies available at law or in equity for such breach or
threatened breach.
10.5 Return of Confidential Information. Upon the request of the disclosing
Party, the receiving Party will promptly return to the disclosing Party or, upon
the disclosing Party's written approval, destroy all material embodying
Confidential Information of the disclosing Party in its possession or under its
control, including all copies thereof; provided that each Party may, at such
Party's expense, make and retain one (1) copy of the other Party's Confidential
Information for legal archival purposes only.
10.6 Disclosure of Agreement, Publicity, and Publications. Except as
expressly provided otherwise in Section 10.3, neither GSK nor ALLERGAN will
release to any Third Party or publish in any way any non-public information with
regard to the terms of this Agreement or concerning their cooperation without
the prior written consent of the other, which consent will not be unreasonably
withheld or delayed. Subject to the foregoing, the Parties will issue a joint
press release, public statement, or disclosure regarding this Agreement in the
Territory, which joint press release, public statement or disclosure will be
mutually agreed upon by the Parties. Nothing in the foregoing, however, will
prohibit a Party from making disclosures to the extent deemed necessary under
applicable federal or state securities laws or any rule or regulation of any
nationally recognized securities exchange. In such event, however, the
disclosing Party will use good faith efforts to consult with the non-disclosing
Party prior to such disclosure and will request confidential treatment to the
extent available. Each Party acknowledges and agrees that the other will have
the right to submit manuscripts relating to Product for scientific publications.
A copy of any scientific abstract or manuscript of results from any clinical
trial that is submitted for publication will be provided by to the other Party
within thirty (30) days after such submission. ALLERGAN acknowledges and agrees
that GSK may publish the results of clinical trials conducted by GSK with the
Product after the Effective Date on GSK's Clinical Trial Register and that such
publication will not be a breach of the confidentiality obligations provided in
Section 10.2. ALLERGAN agrees to cooperate with GSK in such effort as further
determined by the TJCC, including using Commercially Reasonable Efforts to
provide GSK with the protocols, results, data, and other information relating to
all clinical trials conducted by GSK with the Product in ALLERGAN's possession
that GSK reasonably requires to be published on GSK's Clinical Trial Register.
10.7 ALLERGAN Data Protections. GSK agrees and understands that
Confidential Information of ALLERGAN, including but not limited to data,
disclosed to GSK through the TJCC or otherwise and arising under or related to
Product, is very sensitive and ALLERGAN would not enter into this Agreement
without additional assurances from GSK with respect to GSK's use of such
Confidential Information or possible disclosure of such Confidential
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
47
Information to ALLERGAN's competitors. Accordingly, GSK will not use any
Confidential Information in connection with any botulinum toxin research and/or
development other than as provided under this Agreement.
10.8 Termination. All obligations of confidentiality and non-use imposed
under this Article 10 will expire *** after the date of expiration or
termination of this Agreement, except that Article 10 obligations of
confidentiality and non-use will continue thereafter with respect to
manufacturing and regulatory information, including without limitation filings
with regulatory bodies.
11. GENERAL PROVISIONS
11.1 Governing Law. Notwithstanding its place of execution or performance,
this Agreement, and all claims arising out of or relating to this Agreement,
will be governed by and construed in accordance with the laws of the State of
New York, irrespective of its laws regarding choice or conflict of laws. The
Parties hereby agree that for the purposes of resolving any Disputes hereunder,
in accordance with Section 11.4, that the Parties hereby submit to the exclusive
jurisdiction of the courts of New York.
11.2 Further Assurances. Each Party will, at its own expense, furnish,
execute, and deliver all documents and take all actions as may reasonably be
required to effect the terms and purposes of this Agreement
11.3 Assignment. This Agreement is binding upon and inures to the benefit
of the Parties, and to their permitted successors and assigns. No Party may
assign or delegate any or all of its rights or obligations under this Agreement
without the prior written consent of the other Party except to an Affiliate. Any
assignment or delegation, or any other transfer or change of control by sale,
acquisition, merger, or otherwise, or attempt at the same, other than to an
Affiliate, made in the absence of such prior written consent will be void and
without effect; provided, however, that in the event of the foregoing, such
written consent will not be unreasonably withheld. If a Party assigns this
Agreement to an Affiliate, such Party will also promptly inform the other Party
and guarantee the performance by its Affiliate of all of such Party's
obligations under this Agreement. Either Party may, however, with notice, but
without consent and at its sole discretion, assign all of the rights and
obligations under this Agreement (excluding however, with regard to ALLERGAN,
any of its rights under Section 7.5) to a Third Party in connection the transfer
or sale of all or substantially all of its business, or in the event of its
merger or consolidation or change in control or similar transaction.
11.4 Dispute Resolution. Except with regard to any matters or disputes
between the Parties that are to be resolved by the TJDC or TJCC as set forth in
this Agreement, if a dispute or controversy regarding any other matter under
this Agreement, arises between the Parties which they are unable to resolve (a
"Dispute"), each of the Parties will (subject to any cure period as set forth in
this Agreement), be entitled to submit to the other Party written notice of such
Dispute, with such notice setting forth in reasonable detail the nature of the
Dispute (the "Dispute Notice"). For a period of thirty (30) calendar days after
the date of the receiving Party's receipt
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
48
of the Dispute Notice, the Parties will seek to resolve such Dispute by good
faith negotiation between the President Japan Pharmaceuticals for GSK or his/her
designee and the President, Pharmaceuticals of ALLERGAN or his/her designee. If
at the end of such thirty (30) calendar day period the Dispute remains
unresolved, the Parties may seek relief for such Dispute using any appropriate
administrative or judicial mechanism which may be available, subject to Section
11.1. The provisions of this Section 11.4 will not restrict in any way the
Parties' rights to seek preliminary injunctive or other equitable relief from
any court having jurisdiction.
11.5 Legal Fees. If any Party to this Agreement resorts to any legal action
in connection with this Agreement, the prevailing Party will be entitled to
recover reasonable fees of attorneys and other professionals in addition to all
court costs which that Party may incur as a result.
11.6 No Use of Names. Except as otherwise required under Applicable Law, or
as otherwise permitted under this Agreement, neither Party will use the name of
the other in its advertising, press releases or promotional materials without
the prior written consent of such other Party.
11.7 Notices. Any notice to be given under this Agreement must be in
writing and delivered either in person, by any method of mail (postage prepaid)
requiring return receipt, or by overnight courier or facsimile confirmed
thereafter by any of the foregoing, to the Party to be notified at its address
given below, or at any address such Party has previously designated by prior
written notice to the other. Notice will be deemed sufficiently given for all
purposes upon the earlier of: (a) the date of actual receipt; (b) if mailed,
three (3) calendar days after the date of postmark; or (c) if delivered by
overnight courier, the next business day the overnight courier regularly makes
deliveries.
If to GSK, notices must be addressed to:
Glaxo Group Limited
Glaxo Xxxxxxxx Xxxxx, Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxx, XX0 0XX, Xxxxxxx
Attention: Company Secretary
Telephone:
Facsimile:
With a copy to:
Xxxxx Xxxxx Xxxxxxx Corporation d/b/a GlaxoSmithKline
0000 Xxxxxxxxxxx Xxxxxxxxx
Xxxx xx Xxxxxxx, XX 00000-0000
Attention: Vice President and Associate General Counsel,
R&D Legal Operations, Business Development
Transactions Team
Facsimile: 000-000-0000
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
49
If to ALLERGAN, notices must be addressed to:
ALLERGAN, INC.
0000 Xxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000 X.X.X.
Attention: General Counsel
Telephone:
Facsimile:
11.8 Integration; Modification. This Agreement by and between the Parties
hereto, is both a final expression of the Parties' agreement and a complete and
exclusive statement with respect to all of its terms. The exhibits and schedules
referred to in this Agreement are incorporated herein and made a part of this
Agreement by this reference. This Agreement supersedes all prior and
contemporaneous agreements and communications, whether oral, written or
otherwise, concerning any and all matters contained herein; provided, however,
that the confidentiality provisions of Article 10 are in addition to and do not
supersede the terms and conditions of the Confidential Disclosure Agreement
between Allergan Inc. and GlaxoSmithKline Research & Development Limited, an
Affiliate of GSK, dated October 6, 2004, and any amendments thereto. No rights
or licenses are granted or deemed granted hereunder or in connection herewith,
other than those rights expressly granted in this Agreement. No trade customs,
courses of dealing, or courses of performance by the Parties will be relevant to
modify, supplement, or explain any term used in this Agreement. This Agreement
may only be modified, altered, amended, or supplemented in a writing expressly
stated for such purpose and signed by the Parties to this Agreement.
11.9 No Waiver. The failure of a Party to exercise, enforce, or insist upon
strict performance of any provisions of this Agreement, or rights of or arising
out of this Agreement, will neither impair that provision or right nor
constitute a waiver of that provision or right, in whole or in part, and will
not be construed to be a waiver of such rights or provisions, or a waiver by
such Party to thereafter enforce such rights or provision or any other rights or
provisions hereunder. No waiver will be effective unless made in writing and
signed by the waiving Party.
11.10 Severability. If, for any reason, any part of this Agreement is
adjudicated invalid, unenforceable, or illegal by a regulatory authority or
court of competent jurisdiction, such adjudication will not affect or impair, in
whole or in part, the validity, enforceability, or legality of any remaining
portions of this Agreement. All remaining portions will remain in full force and
effect as if the original Agreement had been executed without the invalidated,
unenforceable, or illegal part.
11.11 Relationship Between the Parties. The Parties have no ownership
interest in the other and their relationship, as established by this Agreement,
is solely that of independent
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
50
contractors. This Agreement does not create any partnership, joint venture, or
similar business relationship between the Parties. Neither Party is a legal
representative of the other Party, and neither Party can assume or create any
obligation, representation, warranty, or guarantee, express or implied, on
behalf of the other Party for any purpose whatsoever.
11.12 No Third Party Beneficiaries. This Agreement is neither expressly nor
impliedly made for the benefit of any Person other than those executing it.
11.13 Force Majeure. Without prejudice to any rights of GSK set out in the
Supply Agreement, each Party will be excused from liability for the failure or
delay in performance of any obligation under this Agreement by reason of any
event beyond such Party's reasonable control, which materially impacts the
performance of the relevant Party's obligations under this Agreement including
but not limited to acts of God, fire, flood, earthquake, or other natural
forces, war, terrorism, civil unrest, or any other event similar to those
enumerated above (a "Force Majeure Event"). Such excuse from liability will be
effective only to the extent and duration of the Force Majeure Event causing the
failure or delay in performance and provided that the Party has not caused such
Force Majeure Event to occur. Notice of a Party's failure or delay in
performance due to a Force Majeure Event must be given to the other Party within
*** after its occurrence. All performance timelines under this Agreement that
have been affected by a Force Majeure Event will be suspended for the duration
of such Force Majeure Event.
11.14 Interpretation.
11.14.1 Captions and Headings. The captions and headings of clauses
contained in this Agreement preceding the text of the articles, sections,
subsections, and paragraphs hereof are inserted solely for convenience and ease
of reference only and will not constitute any part of this Agreement, or have
any effect on its interpretation or construction.
11.14.2 Singular and Plural. All references in this Agreement to the
singular will include the plural where applicable, and all references to gender
will include both genders and the neuter.
11.14.3 Articles, Sections, and Subsections. Unless otherwise
specified, references in this Agreement to any article will include all
sections, subsections, and paragraphs in such article; references in this
Agreement to any section will include all subsections and paragraphs in such
sections; and references in this Agreement to any subsection will include all
paragraphs in such subsection.
11.14.4 Days. All references to days in this Agreement will mean
calendar days, unless otherwise specified.
11.14.5 The word "including" or any variation thereof means "including
without limitation" and the word "including" or any variation thereof will not
be construed to limit any general statement which it follows to the specific or
similar items or matters immediately following it.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
51
11.14.6 Ambiguities. Ambiguities and uncertainties in this Agreement,
if any, will not be interpreted against either Party, regardless of which Party
may be deemed to have authored the ambiguous provision or caused the ambiguity
or uncertainty to exist.
11.15 Performance by Affiliates. The Parties recognize that each Party may
perform some or all of its obligations under this Agreement through Affiliates,
provided, however, that each Party will remain responsible for the performance
by its Affiliates and will cause its Affiliates to comply with the provisions of
this Agreement in connection with such performance. Each Party hereby expressly
waives any requirement that the other Party exhaust any right, power or remedy,
or proceed against an Affiliate, for any obligation or performance hereunder
prior to proceeding directly against such Party.
11.16 JFTC Approval. Except as set forth below, each Party will use
Commercially Reasonable Efforts to obtain JFTC clearance for this Agreement. GSK
and/or its Affiliate in the Territory will file all necessary documents with the
JFTC in accordance with Article 16 of the Anti-Monopoly Law of Japan, including,
without limitation, those documents set forth in this Section 11.16 which are
received from ALLERGAN or its Affiliate. ALLERGAN will, and will cause its
Affiliates to, co-operate with GSK or its Affiliate in the Territory in
complying with all filing requirements and any request received by the JFTC
pursuant to Article 16 of the Anti-Monopoly Law of Japan, including, without
limitation, by promptly after the Execution Date, providing the following
documents to GSK or its Affiliate in the Territory, and any other documents
reasonably requested by GSK or its Affiliate in the Territory:
11.16.1 JFTC Form 12, appropriately completed by ALLERGAN'S Affiliate
in the Territory, or accompanied with the appropriate materials to enable GSK to
complete such form;
11.16.2 The most recent Articles of Association for ALLERGAN'S
Affiliate in the Territory, which have been duly certified to be an original
copy by such Affiliate's representative director;
11.16.3 The most recent financial statements, including, business
report, profit and loss statement and balance sheet for ALLERGAN'S Affiliate in
the Territory;
11.16.4 Minutes of the shareholder's meeting and board of directors
meeting approving the execution of this Agreement; and
11.16.5 A executed copy of the Distribution Agreement by ALLERGAN'S
Affiliate in the Territory.
Neither Party will take any action inconsistent with this Agreement (or its
effect if clearance is obtained) while the Parties are seeking JFTC clearance
for this Agreement. The Parties agree that all necessary documents to be filed
with the JFTC in accordance with Article 16 of the Anti-Monopoly Law of Japan
will be filed within five (5) business days after the Effective Date; provided,
however, that such documents will have been reviewed and the content thereof
agreed
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
52
upon by each of the Parties prior to such filing. The Parties will use best
efforts to resolve any concerns that may be raised by the JFTC regarding
clearance. For the purposes of this Agreement, "best efforts" means as to GSK,
efforts and resources that would normally be used by an Affiliate of GSK in the
Territory, in the exercise of its reasonable business and legal discretion, to
obtain Regulatory Approval of such Affiliate's in-license of co-exclusive rights
to develop and commercialize a product which is of similar market potential in
the Territory as Product. For the purposes of this Agreement, "best efforts"
means as to ALLERGAN, efforts and resources normally used by ALLERGAN, in the
exercise of its reasonable business and legal discretion, to obtain Regulatory
Approval to out-license co-exclusive rights to develop and commercialize a
product which is of similar market potential as Product. In the event that JFTC
clearance is not possible, or has not been obtained within twelve (12) months
after the Effective Date, GSK at its option will have a right to continue as
ALLERGAN's distributor of Product under the terms and conditions of the
Distribution Agreement or immediately terminate this Agreement, unless otherwise
agreed in writing by the Parties.
11.17 Counterparts. This Agreement may be executed in one or more
counterparts (which may be delivered via facsimile), each of which will be
deemed an original document, and all of which, together with this writing, will
be deemed one instrument.
IN WITNESS WHEREOF, ALLERGAN and GSK have executed this Botox(R) Japan
License Agreement by their respective duly authorized representatives.
ALLERGAN, INC. GLAXO GROUP LIMITED
By: /s/ XXXXX XXXXX By: /s/ XXXXXXXX DAY
--------------------------------- ------------------------------------
Name: Xxxxx Xxxxx Name: Xxxxxxxx Day
------------------------------- ----------------------------------
For and on behalf of
Edinburgh Pharmaceutical Industries
Limited
Title: Chairman and Chief Executive Title: Corporate Director
Officer ---------------------------------
------------------------------
ALLERGAN SALES, LLC
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
-------------------------------
Title: Vice President and
Chief Financial Officer
------------------------------
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
53
Exhibit A
ALLERGAN Patent Rights Not Subject to the Option
***
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
54
Exhibit A-1
ALLERGAN Patent Rights Subject to the Option
***
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
55
Exhibit B
ALLERGAN Product Trademarks
ID XXXX CLASSES REG. OWNER APP. # APP. DT REG. # REG. DT STATUS
--- ---- ------- ---------- ------ ------- ------ ------- ------
*** *** *** *** *** *** *** *** ***
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
56
Exhibit C
ALLERGAN Corporate Trademarks
ID XXXX CLASSES REG. OWNER APP. # APP. DT REG. # REG. DT STATUS
--- ---- ------- ---------- ------ ------- ------ ------- ------
*** *** *** *** *** *** *** *** ***
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
57
Exhibit D
Principles and Terms for Co-Promotion
- ALLERGAN will ensure that sales personnel are adequately trained in
accordance with GSK policies and have the background, experience, and skill
sets customarily expected to promote the Product in the Field in the
Territory.
- Such sales force deployment will conform to the commercial Product
strategy, deployment plan, marketing objectives, and promotional guidelines
designed and implemented by GSK from time to time during the Co-Promotion
Term in the Territory and reviewed by the TJCC.
- GSK will be solely responsible for pricing, distributing and booking sales
of Product during the Co-Promotion Term.
- Allergan will provide periodic (not less than once per Calendar Quarter)
reports of its detailing efforts, as directed by the TJCC, which reports
will include, without limitation, the number of details performed.
- ALLERGAN will arrange for such number of details, which details will be in
the secondary position as defined by the TJCC, to be provided for Product
in each Calendar Year during the Co-Promotion Term, pro rated as necessary,
as determined by the TJCC. A "detail" means a face-to-face meeting, in an
individual or group practice setting, between one (1) or more physicians
identified by the TJCC, during which a complete Product presentation is
communicated (a) describing in a fair and balanced manner, the
MHLW-approved indicated uses, and other relevant characteristics, of the
Product, and (b) using the TJCC approved promotional materials in an effort
to increase the prescribing preferences of the Product for its
MHLW-approved indicated uses.
- GSK will be entitled to periodically (not less than once per Calendar Year
during the Co-Promotion Term) to audit ALLERGAN's records relating to its
detailing efforts relating to Product in the Territory.
- GSK will deliver promotional materials to ALLERGAN during the Co-Promotion
Term. ALLERGAN will be responsible for all costs and expenses in
distributing such promotional materials to its sales force.
- ALLERGAN will be responsible for all costs and expenses incurred in its
co-promotion of Product in the Territory, including, without limitation,
sales force costs (salaries, bonuses, training costs) and all costs
incurred in promotion activities provided during the Co-Promotion Term.
- Final approval authority and ultimate decisions responsibility related to
all aspects of commercialization and promotion of Product in the Field of
Use in the Territory will be determined by a majority vote of the TJCC.
- Final approval authority and ultimate decisions responsibility related to
all aspects of sales deployment and sales execution of ALLERGAN sales
representatives will be determined by
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
58
ALLERGAN provided that any such decisions will be made by ALLERGAN in a manner
consistent with any marketing plan and policies approved by the TJCC.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
59
Exhibit E
Summary Description and Activities for Product Improvements and Enhancements and
Research and Pre-Clinical Support of New Indications
A. GENERAL SCOPE. On-going and planned ALLERGAN efforts in development and
modification of *** used in the formulation of Product.
***
B. SPECIFIC ACTIVITIES.
I. ***
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
60
Exhibit F
Product Improvement and Enhancement Payments
Product Improvement and Enhancement Payments (in U.S. dollars):
YEAR '05 '06 '07 '08 '09
---------- --- --- --- --- ---
Annual
Payment to
ALLERGAN *** *** *** *** ***
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
61
Exhibit G
Distribution Agreement Terms
1. The term of the Distribution Agreement will commence on a date that is
no later than fourteen (14) calendar days after the Effective Date (referred to
in the Agreement as the "GSK Distribution Commencement Date") and terminate on
the date on which the Regulatory Authorities approve GSK as the MAH for Product
in the Territory.
2. During the term of the Distribution Agreement, ALLERGAN or its Affiliate
in the Territory will appoint GSK or its Affiliate to co-exclusively distribute
and promote Product in the Territory. In this regard, neither ALLERGAN nor its
Affiliates, agents or distributors will promote, sell, distribute, import or use
Product in the Territory during the term of the Distribution Agreement, except
as otherwise agreed by GSK in writing.
3. ALLERGAN Responsibilities under the Distribution Agreement during the
Distribution Agreement Term:
(a) ALLERGAN will remain the MAH for Product in the Territory and will
retain all legal responsibility for Product in the Territory, including, without
limitation as provided in Exhibit H, legal responsibility for conducting post
marketing surveillance for Product, pharmacovigilance activities, product
testing and release and quality assurance activities.
4. GSK Responsibilities under the Distribution Agreement during the term of
the Distribution Agreement.
(a) Upon the effective date of the Distribution Agreement, GSK or its
Affiliate will commence the distribution of Product in the Field of Use in the
Territory;
(b) Within a reasonable period of time after the Closing Date, GSK
will hire such number of employees as may be necessary to, on behalf of
ALLERGAN, promote Product in the Territory.
(c) GSK will book all sales of Product during the term of the
Distribution Agreement, and the Parties acknowledge and agree that GSK will not
owe any royalties or payments of any other kind to ALLERGAN on Net Sales of
Stock Product during the term of the Distribution Agreement.
(d) Upon the effective date of the Distribution Agreement, GSK or its
Affiliate will be responsible for direct, non-personnel (of ALLERGAN) costs and
expenses, and any indirect costs and expenses incurred in connection with
promotion and marketing of the Product in the Territory, including, for example,
travel and other costs related to such activities. Allergan will not conduct any
promotional and/or marketing activities in the Territory relating to
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
62
Product without obtaining the prior written agreement from GSK. For clarity,
neither GSK nor any of its Affiliates will be responsible in any way for any
salaries, pensions, benefits or compensation of any other kind whatsoever
payable to agents and employees of ALLERGAN.
5. Purchase of Product.
(a) GSK will purchase from ALLERGAN *** Units of Product which are
labeled with the ALLERGAN Corporate Trademark (the "Stock Product"), as a
one-time sale, promptly after the effective date of the Distribution Agreement;
provided, that each such Unit of Stock Product, as of the date of purchase, will
have an expiration date not earlier than *** and will meet such other quality
criteria of GSK.
(b) GSK will purchase such Stock Product from ALLERGAN at a transfer
price of *** per Unit of Stock Product.
(c) Terms of payment by GSK to ALLERGAN for this one-time sale of
Stock Product will be thirty (30) calendar days from the date GSK first takes
physical possession of such Stock Product from ALLERGAN. ALLERGAN will ship not
less than *** Units of Stock Product within three (3) business days after the
effective date of the Distribution Agreement and the remaining Units of Stock
Product within four (4) weeks after the effective date of the Distribution
Agreement.
(d) During the term of the Distribution Agreement, GSK and its
Affiliates will not be obligated to purchase any Product from the Manufacturer
under the Supply Agreement unless and until GSK or its Affiliate sells all Stock
Product purchased from ALLERGAN as provided in 5(a) and (b) herein. In the event
that ALLERGAN is required to sell additional stock of Product to GSK during the
period of the Distribution Agreement, such sales will be made at a price of ***
per vial. ***.
(e) With respect to the inventory of Product with the wholesalers as
of the effective date of the Distribution Agreement, ALLERGAN and GSK will
negotiate in good faith on methods to liquidate such inventory with minimum
financial impact to both Parties, which agreed methodology will be included in
the Distribution Agreement.
6. In the event of any conflict between the terms of the Distribution
Agreement and this Agreement, the terms of this Agreement will control.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
63
Exhibit H
Co-Development Terms
1. During the Transition Period, ALLERGAN will
- Remain the MAH for Product in the Territory and retain all legal
responsibility for Product in the Territory, including, without
limitation, sponsorship of ongoing clinical studies (specifically
study 909 for the use of Product for the Cosmetic Indication) legal
responsibility for conducting post marketing surveillance for Product,
pharmacovigilance activities, product testing, and release and quality
assurance activities.
- At its sole cost and expense complete the study 909 for the use of
Product for the Cosmetic Indication until the study database is
locked, including, without limitation, maintaining all
investigator/site agreements relating to the study 909.
Notwithstanding anything to the contrary contained herein, if the
Transition Period expires (i.e., GSK or its Affiliate becomes the MAH)
prior to the study 909 database being locked, ALLERGAN will, at its
sole cost and expense (including, without limitation, all costs and
expenses related to salaries, payroll, pension benefits and other
compensation payable to employees and agents of ALLERGAN working on
the study 909), continue to be responsible for completing the study
909 as provided herein, however, if any time GSK employees, including
for example R&D and regulatory affairs personnel, assist in completing
work on study 909, the cost and expense of such GSK employees will be
borne by GSK. All costs and expenses incurred in connection with study
909 after the study 909 database is locked will be borne by GSK. All
costs and expenses incurred by ALLERGAN in connection with the study
909 prior to the date on which the study 909 database is locked, even
if such costs and expenses are accrued after the date on which the
study 909 database is locked, will be borne by ALLERGAN.
- At its sole cost and expense, maintain all required facility leases
including such leases for the facilities where its employees as
provided in the paragraph above will be located, and such leases for
space where certain Product release testing equipment is located.
Further, GSK will be permitted to use such facilities during the
Transition Period and thereafter if agreed to by the Parties, but in
no event for a term extending after December 31, 2005, at no cost to
GSK.
- Be responsible for facilitating all required communications with the
MHLW relating to the development and commercialization of Product in
the Territory and to the extent permitted under Applicable Law, will
permit GSK or its Affiliate to participate in all such communications
- Retain such number of employees as may be required by Japanese law by
a MAH for a prescription pharmaceutical product in the Territory.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
64
2. Within a reasonable period of time after the Closing Date, GSK will hire such
number of employees as may be necessary to develop Product in the Territory, and
conduct post marketing surveillance activities, quality assurance activities,
release testing, and pharmacovigilance activities for Product in the Territory.
When hiring of such personnel is complete, GSK will become operationally
responsible for all development activities for Product in the Territory,
including completion and, to the extent permitted under Applicable Law,
submission of the applicable Regulatory Approval Application to commercialize
Product for the Cosmetic Indication in the Territory, even if the existing
Regulatory Approvals have not yet been transferred from ALLERGAN to GSK.
3. GSK will be solely responsible for all external costs and expenses relating
to post marketing surveillance agreements, which will be maintained by ALLERGAN
after the GSK Distribution Commencement Date and thereafter until (if so
requested by GSK) transferred to GSK. For clarity, ALLERGAN will continue to be
responsible for all costs and expenses related to salaries, payroll, pension
benefits and other compensation payable to employees and agents of ALLERGAN
associated with post marketing surveillance activities.
4. Notwithstanding that ALLERGAN will be responsible for facilitating all
required communications with the MHLW relating to the development and
commercialization of Product in the Territory during the term of the
Distribution Agreement, as provided above, GSK will be solely responsible for
all costs relating to Regulatory Approvals and Regulatory Approval Applications
for Product during the term of the Distribution Agreement.
5. When GSK becomes the MAH for the Product in the Territory, all commercial,
legal and regulatory responsibilities for the Product will transfer from
ALLERGAN to GSK; provided, however that ALLERGAN will maintain, at its sole cost
and expense, all current contracts with institutions participating in study 909
until the study database is locked (which ALLERGAN estimates to be December 13
2005).
6. Promptly after the locking of the database for study 909, ALLERGAN will, at
its sole cost and expense, transfer the study 909 database (electronic datasets)
to GSK or its Affiliate in the Territory along with all other study documents
and information required to allow GSK or its Affiliate in the Territory to
analyze the data, complete the clinical study report and, to the extent
permitted under Applicable Law, file the appropriate Regulatory Approval
Application to commercialize Product for the Cosmetic Indication in the
Territory.
7. GSK will be responsible for all reasonable and documented travel costs and
expenses incurred by ALLERGAN's employees in providing services to GSK as
provided herein during the Transition Period and will pay ALLERGAN for such
costs and expenses within thirty (30) calendar days after the date of an invoice
from ALLERGAN, but excluding, however, any expenses which are related to
participation in TJDC and TJCC meetings as provided in Article 5.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
65
Exhibit I
Pharmacovigilance Agreement
- ALLERGAN will hold the global safety database for the Product.
- ALLERGAN will be responsible for providing all relevant pharmacovigilance
support for the Product to GSK's Affiliate in the Territory, including,
without limitation, providing any non-domestic expedited or periodic
reports necessary for local regulatory submission, signal detection and
issue management.
- GSK's Affiliate in the Territory will be responsible for collecting adverse
event reports in the Territory and forwarding such reports to ALLERGAN.
GSK's Affiliate in the Territory will also be responsible for submitting
relevant reports to the appropriate Regulatory Authority.
- GSK will not be obligated to maintain a central safety and
pharmacovigilance department to provide support for, or involvement in,
pharmacovigilance activities conducted pursuant to this Agreement or the
Pharmacovigilance Agreement
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
66
Exhibit J
Product Integrity Plan
PRODUCT INTEGRITY PLAN OBJECTIVE:
Protect the safety of patients and maintain the loyalty of physician customers
by assuring that patients seeking treatment with Product continue to get
Product, appropriately handled for safe and effective treatment.
REQUIREMENTS FOR SUCCESSFUL IMPLEMENTATION:
- Each Party will designate a Person in the Territory as Product
Integrity Manager in accordance with Section 5.8.
- All personnel promoting Product in the Territory are trained to
recognize current approved packaging of Product in the Territory.
- Personnel promoting Product are trained to promptly report
suspected counterfeit or imported product to the Product
Integrity Manager.
- Examples (or photos) of counterfeit product packaging obtained by
personnel of a Party should be sent to the Product Integrity
Manager for such Party.
- The Party's Product Integrity Manager will file complaint the
TJCC chairman and such Party's local team, in accordance with
internal procedures, with evidence of suspected counterfeit or
imported product.
- GSK will use Commercially Reasonable Efforts to send "cease and
desist" warning letter to the suspected importer within *** after
completing an internal investigation regarding the suspected
importer.
- If the illegal activity is not discontinued within *** after the
date of the cease and desist warning letter, GSK may report the
importer to the appropriate Regulatory Authorities.
- ALLERGAN will determine origin of counterfeit product and request
assistance from ALLERGAN'S Regional President to shut down supply
of such counterfeit product.
- ALLERGAN will respond to GSK's Product Integrity Manager within
30 days of result of regional efforts to limit supply of such
counterfeit product.
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
67
Exhibit K
Competing Business Entities
***
*** Certain confidential information contained in this document, marked with 3
asterisks, has been omitted and filed separately with the Securities and
Exchange Commission pursuant to Rule 24b-2 of the Securities Act of 1934,
as amended.
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