EXHIBIT 10.125
CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE
BEEN REDACTED AND HAVE BEEN FILED SEPARATELY WITH THE U.S. SECURITIES AND
EXCHANGE COMMISSION
LICENSE AGREEMENT
by and between
ATLANTIC TECHNOLOGY VENTURES, INC.
and
INDEVUS PHARMACEUTICALS, INC
dated
June 28, 2002
THIS LICENSE AGREEMENT effective as of June 28, 2002 ("Effective
Date"), by and between ATLANTIC TECHNOLOGY VENTURES, INC., a corporation
organized and existing under the laws of the State of Delaware and having its
principal office at 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000
("ATLANTIC") and INDEVUS PHARMACEUTICALS INC., a corporation organized and
existing under the laws of the State of Delaware and having its principal office
at 00 Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxxxxxxx 00000, Xxxxxx Xxxxxx
("INDEVUS").
W I T N E S S E T H:
WHEREAS, ATLANTIC has exclusively licensed from Xxxxxx Xxxxxxxx certain
of the Patent Assets pursuant to the Xxxxxxxx License and is the owner of other
ATLANTIC Intellectual Property, all as defined herein and;
WHEREAS, INDEVUS desires to obtain exclusive license rights, with a
right to grant sublicenses, under the ATLANTIC Intellectual Property, and
ATLANTIC desires to grant such license to INDEVUS, upon the terms and conditions
set forth herein; and
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Unless specifically set forth to the contrary herein, the following
terms, where used in the singular or plural, shall have the respective meanings
set forth below:
1.1. "Act" shall mean the Federal Food Drug and Cosmetic Act of 1934, and
the rules and regulations promulgated thereunder, or any successor act,
as the same shall be in effect from time to time.
1.2. "Affiliate" shall mean (i) any corporation or business entity of which
more than fifty percent (50%) of the securities or other ownership
interests representing the equity, the voting stock or general
partnership interest are owned, controlled or held, directly or
indirectly, by a Party; (ii) any corporation or business entity which,
directly or indirectly, owns, controls or holds more than fifty percent
(50%) (or the maximum ownership interest permitted by law) of the
securities or other ownership interests representing the equity, voting
stock or general partnership interest of a Party or (iii) any
corporation or business entity of which a Party has the right to
acquire, directly or indirectly, at least fifty percent (50%) of the
securities or other ownership interests representing the equity, voting
stock or general partnership interest thereof.
1.3. "ATLANTIC Intellectual Property" shall mean the Patent Assets and
ATLANTIC Know-How.
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1.4. "ATLANTIC Know-How" shall mean all information and materials, including
but not limited to, discoveries, information, Improvements, processes,
formulas, data, inventions, know-how and trade secrets, patentable or
otherwise, which
(a) relate to Compound or Product; and
(b) are owned by ATLANTIC or are in ATLANTIC's possession or
control, have been licensed by ATLANTIC from Xxxxxxxx or
are otherwise subject to the Xxxxxxxx License and/or as to
which ATLANTIC has the right to icense or sublicense to
Third Parties.
Such know-how shall include, without limitation, all chemical,
pharmaceutical, toxicological, preclinical, clinical, assay
control, regulatory, and any other information used or useful for
the development, manufacturing and/or regulatory approval of
Compound or Product, including such rights which ATLANTIC may have
to information developed by Third Parties and including any data
included in or generated as a result of or under an IND or the
Hannover Trial.
1.5. "Business Day(s)" means any day that is not a Saturday or a Sunday or a
day on which the New York Stock Exchange is closed.
1.6. "Xxxxxxxx License" shall mean the License Agreement dated as of March
28, 1994, by and between Xxxxxx Xxxxxxxx ("Xxxxxxxx") and Channel
Pharmaceuticals, Inc., a wholly-owned subsidiary of ATLANTIC, as
amended to date, a complete copy of which is attached hereto as Exhibit
1.6.
1.7. "Calendar Quarter" shall mean the respective periods of three (3)
consecutive calendar months ending on March 31, June 30, September 30
and December 31.
1.8. "Calendar Year" shall mean each successive period of twelve (12) months
commencing on January 1 and ending on December 31.
1.9. "cGMP" shall mean current applicable good manufacturing practices as
defined in regulations promulgated by the FDA under the Act relating to
the formulation, manufacture, testing prior to delivery, storage and
delivery of the Product.
1.10. "Centralized Procedure" shall mean the European Community Centralized
Procedure for marketing authorization in accordance with Council
Regulation EEC (2309-93) or any successor regulations.
1.11. "CFR" shall mean the United States Code of Federal Regulations.
1.12. "Compound" shall mean the chemical compounds known as (0X, 0X) Xxxxx
6-Tetrahydrocannabinol-7-oic Acids, including the compound designated
CT-3 as diagrammed on Schedule 1.12 hereto, and any other compounds
disclosed or covered in the Patent Assets and any derivative, homolog,
or analog of any of the foregoing, and any isomer, salt, hydrate,
solvate, amide, ester, metabolite, or prodrug of any of the foregoing.
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1.13. "Effective Date" shall mean the date first above written.
1.14. "End of Phase 2 Meeting" shall mean the first end of Phase 2 meeting
with the FDA, as defined in 21 CFR Section 312.47, intended to
determine the safety of proceeding to Phase 3, evaluate the Phase 3
plan and protocols and identify any additional information necessary to
support an NDA for Product.
1.15. "Europe" shall mean the United Kingdom, France, Germany, Spain and
Italy.
1.16. "FDA" shall mean the United States Food and Drug Administration and any
successor agency having substantially the same functions, and any
corresponding or successor regulatory authority in Europe or having
jurisdiction over the Centralized Procedure if the context so
indicates.
1.17. "First Commercial Sale" shall mean the first sale of Product in any
country by INDEVUS, its Affiliate or its sublicensee(s), for end use or
consumption, after all required Regulatory Approvals have been granted
by the governing health authority of such country.
1.18. "GAAP" means generally accepted accounting principles in the United
States.
1.19. "Hannover Trial" shall mean the ongoing Phase 1 /2 Clinical Trial being
conducted at Medizinische Hochscule Hannover (the University of
Hannover Medical School in Hannover, Germany) pursuant to a Clinical
Trials Agreement dated February 14, 2002.
1.20. "Improvement" shall mean any and all improvements and enhancements,
patentable or otherwise, related to the Compound or Product including,
without limitation, in the manufacture, formulation, ingredients,
preparation, presentation, means of delivery or administration, dosage,
indication, use or packaging of Compound or Product.
1.21. "IND" shall mean an investigational new drug application and any
amendments thereto relating to the use of Compound or Product in the
United States or the equivalent application in any other regulatory
jurisdiction in the Territory, the filing of which is necessary to
commence clinical testing of pharmaceutical products in humans,
including IND number [*].
1.22. "NDA" shall mean a new drug application filed with the FDA for
marketing authorization of a Product in the United States, or a
corresponding submission in Europe or under the Centralized Procedure
or with the Japanese Ministry of Health, Labour and Welfare if the
context so indicates, and any amendments and supplements thereto.
1.23. "Net Sales" shall mean the actual gross amount invoiced by INDEVUS or
its Affiliates for commercial sales of Product in the Territory,
commencing upon the date of First Commercial Sale, after deducting, in
accordance with GAAP, the following :
(i) trade, cash and quantity discounts;
*CONFIDENTIAL TREATMENT REQUESTED
4
(ii) recalls, credits and allowances on account of returned
or rejected Product, including allowance for breakage
or spoilage;
(iii) rebates and chargebacks;
(iv) retroactive price reductions;
(v) sales or excise taxes, VAT or other taxes, and
transportation and insurance charges and additional
special transportation, custom duties, and other
governmental charges;
(vi) rebates or similar payments paid in connection with
sales of Product to any governmental or regulatory
authority in respect of any state or federal Medicare,
Medicaid or similar programs in any country of the
Territory; and
(vii) write-offs for bad debts or allowances.
Sales or other transfers between INDEVUS and its Affiliates
shall be excluded from the computation of Net Sales and no payments
will be payable on such sales or transfers except where such
Affiliates are end users, but Net Sales shall include the
subsequent sales to Third Parties by such Affiliates.
1.24. "Party" shall mean ATLANTIC or INDEVUS.
1.25. "Patent Assets" shall mean the United States patents and patent
applications which as of the Effective Date or at any time during the
term of this Agreement
(a) are owned by ATLANTIC or which ATLANTIC through the Xxxxxxxx
License or any other license or otherwise has or acquires rights from
a Third Party, and
(b) relate to Compound, Product or any Improvement, including but
not limited to methods of their development, manufacture, or use, or
otherwise relate to ATLANTIC Know-How,
including all certificates of invention and applications for
certificates of invention, substitutions, divisions, continuations,
continuations-in-part, patents issuing thereon or reissues or
reexaminations thereof and any and all foreign patents and patent
applications corresponding thereto, supplementary protection
certificates or the like of any such patents and current and future
patent applications, including but not limited to the patents and
patent applications listed on Schedule 1.25 hereto and the patents
and patent applications included in the definition of Patent Rights
under the Xxxxxxxx License, and any counterparts thereof which have
been or may be filed in other countries.
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1.26. "Phase 2 Clinical Trial" shall mean the first clinical trial of Product
in patients with a particular medical indication that is designed to
show safety and efficacy of Product for its intended use.
1.27. "Phase 3 Clinical Trial" means a clinical trial conducted after an End
of Phase 2 Meeting and conducted on a sufficient number of patients
that is designed to establish that Product is safe and efficacious for
its intended use, and to define warnings, precautions and adverse
reactions that are associated with Product in the dosage range to be
prescribed, and supporting marketing authorization of such
pharmaceutical product or label expansion of Product.
1.28. "Product" shall mean any product in final form for commercial sale by
prescription, over-the-counter, or by any other method (or, where the
context so indicates, the product being tested in clinical trials),
which contains Compound as at least one of the therapeutically active
ingredients in all dosage forms and package configurations for any
indication.
1.29. "Proprietary Information" shall mean any and all scientific, clinical,
regulatory, marketing, financial and commercial information or data,
whether communicated in writing, orally or by any other means, which is
owned and under the protection of one Party and is being provided by
that Party to the other Party in connection with this Agreement.
1.30. "Regulatory Approval" means all approvals (including pricing and
reimbursement approvals required for marketing authorization), product
and/or establishment licenses, registrations or authorizations of all
regional, federal, state or local regulatory agencies, departments,
bureaus or other governmental entities, necessary for the manufacture,
use, storage, import, export, transport and sale of Product in a
regulatory jurisdiction.
1.31. "Royalty Year" shall mean each successive twelve (12) month period
commencing with the first day of the first month in which occurs the
First Commercial Sale.
1.32. "Sublicense Non-Royalty Payments" shall mean any payments received by
INDEVUS from sublicensees of rights granted by ATLANTIC to INDEVUS
under Section 2.1 of this Agreement, as consideration for the grant of
such sublicense, including without limitation, license fees, milestone
payments and license maintenance fees, but excluding amounts received
by INDEVUS (i) as Sublicense Royalty Payments; (ii) in connection with
or as a result of amounts or payments to fund or reimburse INDEVUS'
research and development in connection with Compound or Product or
(iii) in connection with or as a result of amounts or payments made as
consideration for a sublicensee's purchase of securities of INDEVUS.
1.33. "Sublicense Royalty Payments" shall mean royalty payments received by
INDEVUS from sublicensees of rights granted by ATLANTIC to INDEVUS
under Section 2.1 of this Agreement, as consideration for the grant of
such sublicensee, based on net sales of Product by such sublicensee.
1.34. "Territory" shall mean all of the countries in the world.
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1.35. "Third Party(ies)" shall mean a person or entity who or which is
neither a Party nor an Affiliate of a Party.
1.36. "Valid Claim" means a claim of an issued and unexpired patent included
within the Patent Assets, which has not been revoked or held
unenforceable or invalid by a decision of a court or other governmental
agency of competent jurisdiction, and which has not been disclaimed or
surrendered through reissue or disclaimer.
ARTICLE II
LICENSE; SUBLICENSES
2.1. License Grant. ATLANTIC hereby grants to INDEVUS an exclusive (even as
to ATLANTIC) license under the Patent Assets and the ATLANTIC Know-How,
including the right to grant sublicenses, to develop, make, have made,
use, import, offer for sale, market, commercialize, distribute and sell
and otherwise dispose of Compound and Product for all uses in the
Territory.
2.2. Improvements by INDEVUS. All rights and title to and interest in any
Improvement developed or discovered by INDEVUS in connection with the
license granted under Section 2.1 above or INDEVUS' activities
hereunder shall be vested solely in INDEVUS.
2.3. Sublicenses. INDEVUS shall have the right to grant sublicenses to
Affiliates or any Third Party to develop, make, have made, use, import,
offer for sale, market, commercialize, distribute and sell and
otherwise dispose of Compound or Product in the Territory; provided,
however that any such sublicense shall be consistent with the terms of
this Agreement. In the event that INDEVUS proposes to grant a
sublicense to any Third Party, INDEVUS shall give ATLANTIC a written
notice prior to entering into the sublicense describing the proposed
sublicense, including the specific rights proposed to be sublicensed
and the material commercial and professional terms of the proposed
sublicense. INDEVUS shall also provide ATLANTIC with a copy of any
sublicense agreements. Upon any termination of this Agreement pursuant
to Section 8.3.1 (a) by ATLANTIC for an uncured material breach by
INDEVUS, ATLANTIC may elect to have any existing sublicense
agreement(s) survive and assigned by INDEVUS to ATLANTIC provided that
(i) the sublicensee is not in breach of its sublicense agreement at the
time of such termination of this Agreement, and (ii) any sublicensee
who desires its sublicense to survive shall promptly agree in writing
to be bound by the applicable terms of and assume all obligations of
INDEVUS under this Agreement. In the event of a sublicense by INDEVUS
to a Third Party, the provisions of Section 5.3.2 of this Agreement
shall be applicable.
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ARTICLE III
DEVELOPMENT AND COMMERCIALIZATION
3.1. Exchange of Information. Within ten (10) days after execution of this
Agreement, ATLANTIC shall disclose to INDEVUS in English and in writing
all ATLANTIC Intellectual Property not previously available or made
available to INDEVUS in electronic format, where available, and hard
copies (or, upon INDEVUS' request, originals). Throughout the term of
this Agreement, and in addition to the other communications required
under this Agreement, ATLANTIC shall also promptly disclose to INDEVUS
in English and in writing on an ongoing basis all ATLANTIC Intellectual
Property, and any and all additions or revisions thereto. In
particular, ATLANTIC shall disclose to INDEVUS in writing within two
Business Days of its receipt of any data or results of the Hannover
Trial.
3.2. Diligence; Development and Commercialization. INDEVUS shall use
commercially reasonable efforts to develop and commercialize Product.
As used herein, "commercially reasonable efforts" shall mean efforts
and resources normally used by INDEVUS for a product owned by it or to
which it has exclusive rights, which is of similar market potential at
a similar stage in its development or product life, taking into account
issues of safety and efficacy, product profile, the competitiveness of
the marketplace, the proprietary position of the compound or product,
the regulatory and reimbursement structure involved, the profitability
of the applicable products, and other relevant factors. The obligations
set forth in this Section 3.2 are expressly conditioned upon the
absence of any serious adverse conditions or event relating to the
safety or efficacy of Compound or Product including the absence of any
action by any regulatory authority limiting the development or
commercialization of Compound or Product.
3.3. Reports
3.3.1 INDEVUS shall provide ATLANTIC with an annual written report
summarizing the status of INDEVUS's clinical development and
regulatory activities with respect to Compound and Product,
with the delivery to ATLANTIC of the summary of the annual
report to an IND submitted by INDEVUS to the FDA in connection
with a clinical trial of Product to be in satisfaction of the
foregoing requirement In addition, within two (2) Business Days
prior to the anticipated filing of INDEVUS' Annual Report on
Form 10-K ("Form 10-K) with the Securities and Exchange
Commission ("SEC"), INDEVUS shall provide ATLANTIC with a draft
copy of the portion of such Form 10-K that discloses the status
of INDEVUS clinical development and regulatory activities with
respect to Compound and Product. ATLANTIC shall designate an
appropriate representative of ATLANTIC to receive such reports
and to coordinate further correspondence between the Parties.
ATLANTIC's initial designee shall be notified to INDEVUS in
writing.
3.3.2 Any disclosures of such progress and results in any of the
foregoing reports or draft reports shall be deemed Proprietary
Information of INDEVUS.
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3.4. Regulatory Matters.
(a) INDEVUS shall own, control and retain primary legal responsibility
for the preparation, filing and prosecution of all filings and regulatory
applications required to obtain authorization to commercially develop, sell and
use Product in the Territory. INDEVUS shall promptly notify ATLANTIC upon the
receipt of Regulatory Approvals and of the date of First Commercial Sale.
(b) ATLANTIC shall transfer to INDEVUS as soon as practicable after the
Effective Date any IND or other regulatory filings relating to Compound or
Product owned or controlled by ATLANTIC, and ATLANTIC shall allow INDEVUS to
cross reference any other IND or Drug Master File relating to Compound or
Product. Upon INDEVUS' request, ATLANTIC shall consult and cooperate with
INDEVUS in connection with obtaining regulatory approval of Product.
3.5. Trademark. INDEVUS shall select, own and maintain trademarks for
Product in the Territory.
3.6. Product Inventory. Effective as of the Effective Date, all right, title
and interest in ATLANTIC's entire current inventory of Product or Compound
(excluding that being used in the Hannover Trial) (the "Product Inventory"),
which ATLANTIC represents consists of 30.5 grams of Product currently held at
[*], shall be transferred to INDEVUS and shall remain at [*] in the name of and
for the account of INDEVUS. ATLANTIC represents and warrants that the
manufacture, testing, delivery and storage of Product Inventory was and is in
compliance with cGMP and all other applicable laws and regulations.
3.7. Agreements. Attached hereto as Exhibit 3.7 is a list of all contracts,
agreements and other arrangements between ATLANTIC and any and all Third Parties
relating to the research, development or commercialization of the Compound or
Product (other than the Xxxxxxxx License which is attached as Exhibit 1.6).
ATLANTIC shall promptly (and in no event later than five days after a request
from INDEVUS) assign to INDEVUS those contracts and agreements listed in Exhibit
3.7 which INDEVUS shall specifically request, and ATLANTIC shall terminate such
other contracts, agreements or other arrangements, with any costs, expenses or
liability associated with such contracts, agreements or other arrangements or
the termination thereof, to be the sole responsibility of ATLANTIC. With the
exception of obligations under Agreements specifically assigned to INDEVUS
pursuant to this Section 3.7, INDEVUS shall not be responsible for any
contractual obligations relating to Compound or Product incurred by ATLANTIC.
ARTICLE IV
CONFIDENTIALITY AND PUBLICITY
4.1. Non-Disclosure and Non-Use Obligations. All Proprietary Information
disclosed by one Party to the other Party hereunder shall be maintained
in confidence and shall not be
* CONFIDENTIAL TREATMENT REQUESTED
9
disclosed to any Third Party or used for any purpose except as
expressly permitted herein without the prior written consent of the
Party that disclosed the Proprietary Information to the other Party
during the term of this Agreement and for a period of five years
thereafter. The foregoing non-disclosure and non-use obligations shall
not apply to the extent that such Proprietary Information:
(a) is known by the receiving Party at the time of its receipt,
and not through a prior disclosure by the disclosing Party,
as documented by business records;
(b) is or becomes properly in the public domain or knowledge;
(c) is subsequently disclosed to a receiving Party by a Third
Party who may lawfully do so and is not under an obligation
of confidentiality to the disclosing Party; or
(d) is developed by the receiving Party independently of
Proprietary Information received from the other Party, as
documented by research and development records.
4.2. Permitted Disclosure of Proprietary Information. Notwithstanding
Section 4.1, a Party receiving Proprietary Information of another Party
may disclose such Proprietary Information:
(a) to governmental or other regulatory agencies in order to
obtain patents pursuant to this Agreement, or to gain approval to
conduct clinical trials or to market Product, but such disclosure
may be only to the extent reasonably necessary to obtain such
patents or authorizations;
(b) by each of INDEVUS or ATLANTIC to its respective agents,
consultants, Affiliates, INDEVUS' sublicensees and/or other Third
Parties for the research and development, manufacturing and/or
marketing of the Compound and/or Product (or for such parties to
determine their interests in performing such activities) on the
condition that such Third Parties agree to be bound by the
confidentiality obligations consistent with this Agreement; or
(c) if required to be disclosed by law or court order, provided
that notice is promptly delivered to the non-disclosing Party in
order to provide an opportunity to challenge or limit the
disclosure obligations; provided, however, without limiting any
of the foregoing, it is understood that the Parties or their
Affiliates may make disclosure of this Agreement and the terms
hereof in any filings required by the SEC, may file this
Agreement as an exhibit to any filing with the SEC and may
distribute any such filing in the ordinary course of its
business, provided, however, that to the maximum extent allowable
by SEC rules and regulations, the Parties shall be obligated to
maintain the confidentiality obligations set forth herein and
shall redact any confidential information set forth in such
filings.
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(d) Upon execution of this Agreement, either Party may issue a
press release in the form to be attached as Exhibit 4.2.
4.3. Publication In the event ATLANTIC or any Affiliate of or consultant to
ATLANTIC wishes to make a publication relating to Compound or Product,
it shall deliver to INDEVUS a copy of the proposed publication or an
outline of the oral disclosure at least sixty (60) Business Days prior
to submission or presentation, such that any issue of patent protection
can be resolved in accordance with the terms of this Agreement.
ARTICLE V
PAYMENTS; ROYALTIES AND REPORTS
5.1. License and Transfer Fee. In consideration of the rights granted by
ATLANTIC hereunder, INDEVUS shall pay ATLANTIC US $ [*] within ten (10)
days after the Effective Date, of which US $ [*] shall be deemed a
license fee and US $ [*] shall be deemed a transfer fee for the Product
Inventory.
5.2. Milestone Payments. Subject to the terms and conditions contained in
this Agreement, and in further consideration of the rights granted by
ATLANTIC hereunder, INDEVUS shall pay ATLANTIC the following milestone
payments, contingent upon occurrence of the specified event, with each
milestone payment to be made no more than once with respect to the
achievement of such milestone (but payable the first time such
milestone is achieved) for Compound or Product, as applicable:
(a) US $ [*] upon completion of a Phase 2 Clinical Trial, the
results of which meet or exceed the primary clinical
efficacy endpoints and safety outcome measurements
outlined in the Clinical Trial protocol;
(b) US $ [*] upon the commencement (first dosing of the first
patient) of the first Phase 3 Clinical Trial;
(c) US $ [*] upon the commencement (first dosing of the first
patient) of the second Phase 3 Clinical Trial;
(d) US $ [*] upon the FDA's first acceptance for filing of an
NDA;
(e) US $ [*] upon the first acceptance for filing of an NDA
under the Centralized Procedure or in Europe;
(f) US $ [*] upon receipt of first written Regulatory
Approval for marketing in the United States by the FDA;
(g) US $ [*] upon receipt of written Regulatory Approval for
marketing each of the second and third indications in the
United States by the FDA;
(h) US $ [*] upon receipt of written Regulatory Approval in
Europe, provided that in the event the approval is
granted in less than all of the countries listed in the
definition of "Europe", INDEVUS shall pay an amount equal
* CONFIDENTIAL TREATMENT REQUESTED
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to US $ [*] multiplied by the number of countries in
Europe in which such approval is granted;
(i) US $ [*] upon receipt of written Regulatory Approval
by the Ministry of Health, Labour and Welfare (or any
successor agency having substantially the same
functions) in Japan; and
(j) US $ [*] upon the achievement of cumulative Net Sales
of US $ [*] .
INDEVUS shall notify ATLANTIC in writing within thirty (30)
days after the achievement of each milestone (ninety (90) days
for milestone (j)), and such notice shall be accompanied by
the appropriate milestone payment. An amount equal to (i) [*]
of milestone payments made under Section 5.2 (f), (g) (h)
and/or (i) (the "Approval Milestone Payments") shall be
creditable against any amounts otherwise payable to ATLANTIC
under Section 5.3.1 or 5.3.2 (b) of this Agreement and (ii)
[*] of any payments made under Section 5.1 and 5.2 of this
Agreement shall be creditable against any amounts otherwise
payable under Section 5.3.2 (a) of this Agreement. Except as
specifically set forth in this Section 5.2, the payments
described in this Section 5.2 shall be payable only upon the
initial achievement of each milestone, and no amounts shall be
due hereunder for any subsequent or repeated achievement of
such milestones, regardless of the number of Products for
which such milestone may be achieved.
5.3. Royalties and Other Payments.
5.3.1. Royalties Payable By INDEVUS.
(i) Subject to the terms and conditions of this
Agreement, and in further consideration of the rights
granted by ATLANTIC hereunder, INDEVUS shall pay to
ATLANTIC royalties in an amount equal to [*] of Net
Sales in each Royalty Year by INDEVUS or its
Affiliates in the United States if the manufacture,
use or sale of such Product would, absent the license
granted hereunder, infringe one or more Valid Claims
of the Patent Assets in the United States.
(ii) Subject to the terms and conditions of this
Agreement, and in further consideration of the rights
granted by ATLANTIC hereunder, INDEVUS shall pay to
ATLANTIC royalties equal to [*] of Net Sales in each
Royalty Year by INDEVUS or its Affiliates in each
country in the Territory other than the United States
where the manufacture, use or sale of such Product
would, absent the license granted hereunder, infringe
one or more Valid Claims of the Patent Assets in such
country.
(iii) Royalties on Net Sales at the rates set forth in (i)
and (ii) above shall accrue as of the date of First
Commercial Sale of Product in the applicable country
and shall continue and accrue on Net Sales on a
country-by-country basis until the expiration of the
last to expire Patent Asset in such
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country. Thereafter, INDEVUS shall be relieved of any
royalty payment under this Section 5.3.
(iv) The payment of royalties set forth above shall be
subject to the following conditions:
(A) only one payment shall be due with respect to
the same unit of Product;
(B) no royalties shall accrue on the disposition of
Product by INDEVUS, Affiliates or sublicensees
as samples (promotion or otherwise) or as
donations (for example, to non-profit
institutions or government agencies) or to
clinical trials; and
(C) ATLANTIC shall be responsible for payment of any
royalties or other obligations owed by ATLANTIC
or relating to the Patent Assets to any Third
Party, including without limitation, pursuant to
the Xxxxxxxx License.
5.3.2. Payments in the Event of Sublicense. In the event INDEVUS enters
into a sublicense with a Third Party or Third Parties under Section 2.3
of this Agreement, then the following shall be applicable as of the
effective date of the sublicense:
(a) INDEVUS'obligation to pay ATLANTIC any of the milestone
payments set forth in Section 5.2 above shall terminate and, in
lieu thereof, ATLANTIC shall be entitled to [*] of Sublicense
Non-Royalty Payments received by INDEVUS, net of [*] of any
amounts paid by INDEVUS under Section 5.1 or 5.2 of this
Agreement prior to the effective date of the sublicense; and
(b) INDEVUS'obligation to pay ATLANTIC any royalties under
Section 5.3.1 above shall terminate and, in lieu thereof,
ATLANTIC shall be entitled to [*] of Sublicense Royalty Payments
received by INDEVUS, for the same period set forth in Section
5.3.1(iii), net of [*] (not to exceed an aggregate of $ [*] ) of
(i) any Approval Milestone Payments paid by INDEVUS prior to the
effective date of the sublicense and (ii) any amounts paid by
INDEVUS under Section 5.3.2 (a) above. .
5.3.3. Affiliate Sales. In the event that INDEVUS transfers Compound
(for conversion to Product) or Product to one of its Affiliates, there
shall be no royalty due at the time of transfer. Subsequent sales of
Product by the Affiliate to end users such as patients, hospitals,
medical institutions, health plans or funds, wholesalers (which are not
sublicensees), pharmacies or other retailers, shall be reported as Net
Sales hereunder by INDEVUS.
5.3.4. Compulsory Licenses. If a compulsory license is granted to a
Third Party with respect to Product in any country in the Territory
with a royalty rate lower than the royalty rate provided by Section
5.3.1, then the royalty rate to be paid by INDEVUS on
* CONFIDENTIAL TREATMENT REQUESTED
13
Net Sales in that country under Section 5.3.1 shall be reduced to the
rate paid by the compulsory Third Party licensee.
5.3.5. Third Party Licenses. If one or more licenses from a Third Party
or Third Parties are obtained by INDEVUS in order to develop, make,
have made, use, sell or import Compound or Product in a particular
country, any royalties or other payments paid under such Third Party
patent licenses by INDEVUS in such country for such Calendar Quarter
shall be creditable against the royalty or other payments payable to
ATLANTIC by INDEVUS in such country.
5.3.6. Combination Product. Notwithstanding the provisions of Section
5.3.1, in the event a Product is sold as a combination product with
other biologically active components, Net Sales, for purposes of
royalty payments on the combination product, shall be calculated by
multiplying the Net Sales of that combination product by the fraction
A/B, where A is the gross selling price of the Product sold separately
and B is the gross selling price of the combination product. If no such
separate sales are made by INDEVUS or its Affiliates, Net Sales for
royalty determination shall be calculated by multiplying Net Sales of
the combination product by the fraction C/(C+D), where C (excluding the
fully allocated cost of the other biologically active component in
question) is the fully allocated cost of the Compound and D is the
fully allocated cost of such other biologically active components.
5.4. Reports; Payment of Royalty. During the term of the Agreement
for so long as royalty or other payments are due, INDEVUS shall furnish to
ATLANTIC a quarterly written report for the Calendar Quarter showing the
Net Sales of all Products subject to royalty payments sold by INDEVUS and
its Affiliates (or, if sales of Product were made by an INDEVUS
sublicensee, the Sublicense Royalty Payments received from such sublicensee
as a result of such sales) during the reporting period and the royalties or
other payments payable to ATLANTIC under this Agreement. Reports shall be
due on the ninetieth (90th) day following the close of each Calendar
Quarter. Royalties or other payments shown to have accrued by each royalty
report, if any, shall be due and payable on the date such report is due.
INDEVUS shall keep complete and accurate records in sufficient detail to
enable the royalties or other payments hereunder to be determined.
5.5. Audits. Upon the written request of ATLANTIC and not more than
once in each Calendar Year, INDEVUS shall permit an independent certified
public accounting firm selected by ATLANTIC and reasonably acceptable to
INDEVUS to have access during normal business hours, upon ten-days notice
to INDEVUS, to such of the records of INDEVUS as may be reasonably
necessary to verify the accuracy of the royalty reports hereunder for any
Royalty Year ending not more than twenty-four (24) months prior to the date
of such request. The accounting firm shall disclose to ATLANTIC only
whether the royalty reports are correct or incorrect and the specific
details concerning any discrepancies.
5.5.1. If such accounting firm concludes that additional royalties
were owed during such Royalty Year, INDEVUS shall pay the additional
royalties within sixty (60) days of the date ATLANTIC delivers to
INDEVUS such accounting firm's written report so concluding; provided
however, that, in the event that INDEVUS
14
shall not be in agreement with the conclusion of such report (a)
INDEVUS shall not be required to pay such additional royalties and
(b) such matter shall be resolved pursuant to the provisions of
Section 9.5 herein. In the event such accounting firm or, if the
matter is resolved in accordance with Section 9.5 herein, any
arbitration award concludes that amounts were overpaid by INDEVUS
during such period, ATLANTIC shall repay INDEVUS the amount of
such overpayment within sixty (60) days of the date ATLANTIC
delivers to INDEVUS such accounting firm's written report so
concluding. The fees charged by such accounting firm shall be paid
by ATLANTIC; provided, however, that if an error in favor of
ATLANTIC of more than the greater of (i) $ [*] or (ii) [*] of the
royalties due hereunder for the period being reviewed is
discovered, then the fees and expenses of the accounting firm
shall be paid by INDEVUS.
5.5.2. Upon the expiration of twenty-four (24) months following
the end of any Royalty Year the calculation of royalties payable
with respect to such year shall be binding and conclusive upon
ATLANTIC, and INDEVUS shall be released from any liability or
accountability with respect to royalties for such year.
5.5.3. ATLANTIC shall treat all financial information subject to
review under this Section 5.5 in accordance with the
confidentiality provisions of this Agreement.
5.6. Payment Exchange Rate. All payments to ATLANTIC under this
Agreement shall be made in United States dollars. In the case of sales
outside the United States, the rate of exchange to be used in computing
Net Sales shall be calculated monthly in accordance with GAAP and based
on the conversion rates published in the Wall Street Journal, Eastern
edition (if available).
5.7. Tax Withholding. If laws, rules or regulations require
withholding of income taxes or other taxes imposed upon payments set
forth in this Article V, ATLANTIC shall provide INDEVUS, prior to any
such payment, once each Royalty Year or more frequently if required, with
all forms or documentation required by any applicable taxation laws,
treaties or agreements to such withholding or as necessary to claim a
benefit thereunder (including, but not limited to Form W-8BEN or any
successor forms) and INDEVUS shall make such withholding payments as
required and subtract such withholding payments from the payments set
forth in this Article V. INDEVUS will use commercially reasonable efforts
consistent with its usual business practices and cooperate with ATLANTIC
to ensure that any withholding taxes imposed are reduced as far as
possible under the provisions of the current or any future taxation
treaties or agreements between foreign countries.
5.8. Exchange Controls. Notwithstanding any other provision of this
Agreement, if at any time legal restrictions prevent the prompt
remittance of part or all of the royalties with respect to Net Sales in
any country, payment shall be made through such lawful means or methods
as INDEVUS may determine. When in any country the law or regulations
prohibit both the transmittal and deposit of royalties on sales in such a
country, royalty payments shall be suspended for as long as such
prohibition is in effect (and such suspended payments shall not accrue
interest), and promptly after such prohibition ceases
* CONFIDENTIAL TREATMENT REQUESTED
15
to be in effect, all royalties or other payments that INDEVUS or its
Affiliates would have been obligated to transmit or deposit, but for the
prohibition, shall be deposited or transmitted, as the case may be, to
the extent allowable (with any interest earned on such suspended
royalties which were placed in an interest-bearing bank account in that
country, less any transactional costs). If the royalty rate specified in
this Agreement should exceed the permissible rate established in any
country, the royalty rate for sales in such country shall be adjusted to
the highest legally permissible or government-approved rate.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. ATLANTIC Representations and Warranties. ATLANTIC represents and
warrants to INDEVUS that as of the Effective Date:
(a) the issued patents included in the Patent Assets are
valid and enforceable over any references or prior art
known to ATLANTIC or its agents, including Xxxxxxxx,
taken alone or in combination;
(b) this Agreement has been duly executed and delivered by
ATLANTIC and constitutes legal, valid, and binding
obligations enforceable against ATLANTIC in accordance
with its terms, except as enforceability is limited by
(A) any applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting
creditor's rights generally, or (B) general principals of
equity, whether considered in a proceeding in equity or
at law;
(c) no approval, authorization, consent, or other order or
action of or filing with any court, administrative agency
or other governmental authority is required for the
execution and delivery by ATLANTIC of this Agreement or
the consummation by ATLANTIC of the transactions
contemplated hereby;
(d) ATLANTIC has the full corporate power and authority to
enter into and deliver this Agreement, to perform and to
grant the licenses granted under Article II hereof and to
consummate the transactions contemplated hereby; all
corporate acts and other proceedings required to be taken
to authorize such execution, delivery, and consummation
have been duly and properly taken and obtained;
(e) ATLANTIC has not previously assigned, transferred,
conveyed or otherwise encumbered its right, title and
interest in the ATLANTIC Intellectual Property or entered
into any agreement with any Third Party which is in
conflict with the rights granted to INDEVUS pursuant to
this Agreement;
(f) it is the sole owner or exclusive licensee under the
ATLANTIC Intellectual Property, all of which are free and
clear of any liens, charges and encumbrances, no other
person, corporate or other private entity, or
16
governmental or university entity or subdivision thereof
(including, without limitation, the [*]) has any claim of
ownership or rights with respect to the ATLANTIC
Intellectual Property, whatsoever Notwithstanding the
foregoing, with respect only to (a) U.S. Serial No.[*],
(b) International patent application number [*] and (c)
U.S. Serial No. [*], which are listed in Schedule 1.25
(Patent Assets) attached hereto, ATLANTIC is an owner of
at least an undivided interest in the invention disclosed
and claimed in (a) and (b), above, and has been granted a
license, with a right to grant a sublicense, by the
United States Government under the United States
Government's ownership rights in (c);
(g) ATLANTIC has disclosed to INDEVUS the complete texts of
all Patent Assets as well as all information received by
ATLANTIC concerning the institution or possible
institution of any interference, opposition,
re-examination, reissue, revocation, nullification, or
any official proceeding involving a Patent Asset, and
that it will continue such disclosure with respect to new
events during the term of the Agreement;
(h) to the best of ATLANTIC's knowledge, the development,
manufacture, use and sale of Compound and Products would
not infringe any patent rights owned or possessed by any
Third Party;
(i) Schedule 1.25 is a complete and accurate list of all
patents and patent applications in the Territory relating
to Compound or Product owned or exclusively licensed by
ATLANTIC or to which ATLANTIC has the right to license;
(j) there are no claims, judgments or settlements against or
owed by ATLANTIC relating to the Patent Assets or pending
or, to the best of ATLANTIC's knowledge, threatened
claims or litigation against ATLANTIC or Xxxxxxxx
relating to the Patent Assets;
(k) ATLANTIC has disclosed to INDEVUS all relevant
information known by it regarding the ATLANTIC
Intellectual Property reasonably related to the
activities contemplated under this Agreement;
(l) no contract research organization, corporation, business
entity or individual which have been involved in any
studies conducted for the purpose of obtaining regulatory
approvals have been debarred individuals or entities
within the meaning of 21 U.S.C. section 335(a) or (b);
(m) in connection with development of Compound and Product,
ATLANTIC has complied and is complying in all material
respects with applicable U.S. and German laws and
regulations including U.S. good laboratory practices in
its conduct of toxicology studies on Compound and U.S.
good
*CONFIDENTIAL TREATMENT REQUESTED
17
clinical practices in its conduct of clinical studies on
Compound and any corresponding German regulations in
connection with the Hannover Trial;
(n) attached as Exhibit 1.6 is a true and complete copy of
the Xxxxxxxx License, including all supplements thereto
and modifications or amendments thereof. ATLANTIC is not,
and to the best of ATLANTIC's knowledge, Xxxxxxxx is not,
in default under or in breach of any terms or provisions
of the Xxxxxxxx License and such agreement is in full
force and effect as of the date hereof. During the term
of this Agreement, ATLANTIC shall not amend, modify,
terminate or cause a default under the Xxxxxxxx License,
or reject the Xxxxxxxx License pursuant to 11 U.S.C.
(S)365;
(o) IND number [*] is owned by ATLANTIC free and clear of any
rights of any Third Party and is active, in good standing
and in full force and effect with all applicable
regulatory agencies; and
(p) EXCEPT AS SPECIFICALLY PROVIDED HEREIN, ATLANTIC DOES NOT
MAKE, AND EXPRESSLY DISCLAIMS ANY WARRANTIES, EITHER
EXPRESS OR IMPLIED, ORAL OR WRITTEN, AS TO ANY MATTER
WHATSOEVER, INCLUDING, INCLUDING WITHOUT LIMITATION ANY
EXPRESS OR IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE CONCERNING THE PATENT ASSETS.
6.2. INDEVUS Representations and Warranties. INDEVUS represents and warrants
to ATLANTIC that as of the Effective Date:
(a) this Agreement has been duly executed and delivered by it
and constitutes legal, valid, and binding obligations
enforceable against it in accordance with its terms;
(b) it has full corporate power and authority to execute and
deliver this Agreement and to consummate the transactions
contemplated hereby. All corporate acts and other
proceedings required to be taken to authorize such
execution, delivery, and consummation have been duly and
properly taken and obtained;
(c) no approval, authorization, consent, or other order or
action of or filing with any court, administrative agency
or other governmental authority is required for the
execution and delivery by it of this Agreement or the
consummation by it of the transactions contemplated
hereby.
*CONFIDENTIAL TREATMENT REQUESTED
18
ARTICLE VII
PATENT MATTERS
7.1. Filing, Prosecution and Maintenance of Patent Applications or Patents.
INDEVUS shall have the first right to file, prosecute and maintain the
Patent Assets in ATLANTIC's name and shall initially be responsible for
the payment of all patent prosecution and maintenance costs, subject to
the next sentence. INDEVUS shall credit against any milestone payments
payable to ATLANTIC under Section 5.2 of this Agreement and/or under
Section 5.3.2 (a) amounts paid by INDEVUS for patent prosecution and
maintenance costs incurred during the Term of this Agreement in
connection with the filing, prosecution and maintenance of the Patent
Assets. If INDEVUS elects not to file, prosecute or maintain a patent
application or patent included in the Patent Assets in any particular
country, it shall provide ATLANTIC with written advance notice sufficient
to avoid any loss or forfeiture, and ATLANTIC shall have the right, but
not the obligation, at its sole expense, to file, prosecute or maintain
such patent application or patent in such country in ATLANTIC's name.
Thereafter, INDEVUS' royalty obligations related to that Patent Asset in
such country shall terminate and such patent or patent application in
such country shall no longer be deemed a Patent Asset. Upon INDEVUS'
request, ATLANTIC shall reasonably cooperate in the filing, prosecution
or maintenance of any patent application or patent included in the Patent
Assets.
7.2. Patent Office and Court Proceedings. Each Party shall inform the other
Party of any request for, filing, or declaration of any proceeding before
a patent office seeking to protest, oppose, cancel, reexamine, declare an
interference proceeding, initiate a conflicts proceeding, or analogous
process involving a patent application or patent included in the Patent
Assets, or of the filing of an action in a court of competent
jurisdiction seeking a judgment that a patent included in the Patent
Assets is either invalid or unenforceable or both.. Each Party thereafter
shall cooperate fully with the other with respect to any such patent
office or court proceeding. Each Party will provide the other with any
information or assistance that is reasonable. Notwithstanding the
foregoing or the provisions of Section 7.3 below, in the event of any
such action or proceeding, ATLANTIC shall indemnify and hold INDEVUS and
its Affiliates harmless from and against any and all claims, damages,
judgments, liabilities, costs and expenses including, without limitation
reasonable litigation costs and legal fees and expenses, that may be
incurred by, levied upon or are payable by INDEVUS or any of its
Affiliates as a result of such action or proceeding or due to the breach
of ATLANTIC's representations and warranties under Section 6.1 of this
Agreement.
7.3. Enforcement and Defense.
(a) Each Party shall promptly give the other Party notice of any
infringement in the Territory of any patent application or patent
included in the Patent Assets that comes to such Party's
attention. The Parties will thereafter consult and cooperate fully
to determine a course of action, including, without limitation,
the commencement of legal action by any Party. However, INDEVUS
shall have the first right to initiate and prosecute such legal
action at its own expense and in the name of ATLANTIC and INDEVUS,
or to control the defense of any declaratory
19
judgment action relating to Patent Assets. INDEVUS shall
promptly inform ATLANTIC if INDEVUS elects not to exercise
such first right, and ATLANTIC thereafter shall have the right
either to initiate and prosecute such action or to control the
defense of such declaratory judgment action in the name of
ATLANTIC and, if necessary, INDEVUS. In no event shall
ATLANTIC be obligated to enforce or defend any of the Patent
Assets.
(b) If INDEVUS elects not to initiate and prosecute an
infringement or defend a declaratory judgment action in any
country in the Territory as provided in Subsection 7.3(a), and
ATLANTIC elects to do so, the cost of any agreed-upon course
of action, including the costs of any legal action commenced
or any declaratory judgment action defended, shall be borne
solely by ATLANTIC.
(c) For any such legal action or defense, in the event that
any Party is unable to initiate, prosecute, or defend such
action solely in its own name, the other Party will join such
action voluntarily and will execute all documents necessary
for the Party to prosecute, defend and maintain such action.
In connection with any such action, the Parties will cooperate
fully and will provide each other with any information or
assistance that either reasonably may request.
(d) Any recovery obtained by INDEVUS or ATLANTIC shall be
shared as follows:
(i) the Party that initiated and prosecuted, or
maintained the defense of, the action shall recoup
all of its costs and expenses (including
reasonable attorneys' fees) incurred in connection
with the action, whether the recovery is by
settlement or otherwise;
(ii) the other Party then shall, to the extent possible,
recover its costs and expenses (including
reasonable attorneys' fees) incurred in connection
with the action;
(iii) if ATLANTIC initiated and prosecuted, or maintained
the defense of, the action, the amount of any
recovery remaining then shall be retained by
ATLANTIC; and
(iv) if INDEVUS initiated and prosecuted, or maintained
the defense of, the action, the amount of any
recovery remaining shall be retained by INDEVUS,
except that ATLANTIC shall receive a portion
equivalent to the royalties it would have received
in accordance with the terms of this Agreement if
such amount were deemed Net Sales.
(e) ATLANTIC shall inform INDEVUS of any certification
regarding any Patent Assets it has received pursuant to either
21 U.S.C. (S)(S)355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) or
under Canada's Patented Medicines (Notice of Compliance)
Regulations Article 5 and shall provide INDEVUS with a copy of
such certification within five (5) days of receipt.
20
ATLANTIC's and INDEVUS' rights with respect to the initiation
and prosecution, or defense, of any legal action as a result
of such certification or any recovery obtained as a result of
such legal action shall be allocated as defined in Subsections
7.3(d) (i) through (iv); provided, however, that INDEVUS shall
exercise the first right to initiate and prosecute, or defend,
any action and shall inform ATLANTIC of such decision within
fifteen (15) days of receipt of the certification, after which
time, if INDEVUS has not advised ATLANTIC of its intention to
initiate and prosecute, or defend, such action, ATLANTIC shall
have the right to initiate and prosecute, or defend, such
action.
7.4. Patent Term Extensions or Restorations and Supplemental Protection
Certificates. The Parties shall cooperate with each other in obtaining
patent term extensions or restorations or supplemental protection
certificates or their equivalents in any country in the Territory where
applicable and where desired by INDEVUS. If elections with respect to
obtaining such extension or supplemental protection certificates are to be
made, INDEVUS shall have the right to make the election and ATLANTIC shall
abide by such election. ATLANTIC shall notify INDEVUS of (a) the issuance
of each U.S. patent included within the Patent Assets, giving the date of
issue and patent number for each such patent, and (b) each notice
pertaining to any patent included within the Patent Assets pursuant to the
United States Drug Price Competition and Patent Term Restoration Act of
1984 (hereinafter called the " 1984 Act"), including notices pursuant
toss.ss.101 and 103 of the 1984 Act from persons who have filed an
abbreviated NDA ("ANDA"). Such notices shall be given promptly, but in any
event within five (5) calendar days of each such patent's date of issue or
receipt of each such notice pursuant to the Act, whichever is applicable.
ATLANTIC shall notify INDEVUS of each filing for patent term extension or
restoration under the 1984 Act, any allegations of failure to show due
diligence and all awards of patent term restoration (extensions) with
respect to the Patent Assets. Likewise, ATLANTIC shall inform INDEVUS of
patent extensions in the rest of the world regarding Compound or Product.
7.5 Security Interest. Within fifteen (15) days from the Effective Date,
ATLANTIC shall grant to INDEVUS a first priority security interest, senior to
any and all other liens and encumbrances, in all of the ATLANTIC Patent Assets,
whether now owned or hereafter acquired by ATLANTIC and in all of ATLANTIC'S
rights in and to all ATLANTIC Patent Assets controlled by ATLANTIC
(collectively, the "Collateral"). The grant of the security interest will secure
the performance when due of the obligations of ATLANTIC owed to INDEVUS under
this Agreement. ATLANTIC shall execute and deliver such agreements, instruments,
documents or notices (including without limitation financing statements or
amendments thereto), and take such other actions, as INDEVUS may reasonably deem
necessary in order to perfect, protect and preserve any lien granted or
purported to be granted by such security interest and to enable INDEVUS to
exercise and enforce any of its rights and remedies hereunder with respect to
any Collateral.
21
ARTICLE VIII
TERM AND TERMINATION
8.1. Term and Expiration. This Agreement shall be effective as of the Effective
Date and unless terminated earlier pursuant to Section 8.2 and 8.3 below,
the term of this Agreement shall continue in effect on a country-by-country
basis until the expiration of the last to expire Patent Asset in such
country..
8.2. Termination by Notice. Notwithstanding anything contained herein to the
contrary, INDEVUS shall have the right to terminate this Agreement at any
time by giving thirty (30) days advance written notice to ATLANTIC. Except
as set forth in this Agreement, in the event of such termination, (i) the
rights and obligations hereunder, excluding any payment obligation that has
accrued as of the termination date and excluding rights and obligations
relating to confidentiality, shall terminate immediately, and (ii) the
provisions of Section 8.4 shall be applicable.
8.3. Termination.
8.3.1 Termination for Cause. Either Party may terminate this Agreement by
notice to the other Party at any time during the term of this
Agreement as follows:
(a) if the other Party is in breach of any material obligation
hereunder by causes and reasons within its control, or has
breached, in any material respect, any representations or
warranties set forth in Article VI, and has not cured such
breach within ninety (90) days after notice requesting cure of
the breach, provided, however, that if the breach is not
capable of being cured within ninety (90) days of such written
notice, the Agreement may not be terminated sooner than one
hundred twenty (120) days of such written notice so long as the
breaching Party commences and is taking commercially reasonable
actions to cure such breach as promptly as practicable; or
(b) upon the filing or institution of bankruptcy, reorganization,
liquidation or receivership proceedings, or upon an assignment
of a substantial portion of the assets for the benefit of
creditors by the other Party; provided, however, in the case of
any involuntary bankruptcy, reorganization, liquidation,
receivership or assignment proceeding such right to terminate
shall only become effective if the Party consents to the
involuntary proceeding or such proceeding is not dismissed
within ninety (90) days after the filing thereof.
8.3.2 Licensee Rights Not Affected.
(a) In the event INDEVUS terminates this Agreement under Section
8.3.1(b), or this Agreement is otherwise terminated under
Section 8.3.1(b), or ATLANTIC is a debtor in a bankruptcy
proceeding, whether voluntary or involuntary, all rights and
licenses granted pursuant to this Agreement are, and shall
otherwise be deemed to be, for purposes of Section 365(n) of 11
22
U.S.C.(S)101 et seq. (the "Bankruptcy Code"), licenses of
rights to "intellectual property" as defined under Section
101(35A) of the Bankruptcy Code. The Parties agree that INDEVUS
and ATLANTIC shall retain and may fully exercise all of their
respective rights, remedies and elections under the Bankruptcy
Code. The Parties further agree that, in the event of the
commencement of a bankruptcy proceeding by or against ATLANTIC
under the Bankruptcy Code, INDEVUS shall be entitled to all
applicable rights under Section 365 of the Bankruptcy Code,
including but not limited to, entitled to a complete duplicate
of (or complete access to, as appropriate) any such
intellectual property and all embodiments of such intellectual
property upon written request therefor by INDEVUS.
(b) In the event INDEVUS is a debtor in a bankruptcy proceeding,
whether voluntary or involuntary, all rights and licenses
granted pursuant to this Agreement are, and shall otherwise be
deemed to be, for purposes of Section 365 of the Bankruptcy
Code, executory contracts. The Parties agree that applicable
law does not excuse ATLANTIC from accepting performance by, or
rendering performance under this Agreement and all rights and
licenses granted hereunder to, a person or entity other than
INDEVUS.
8.4. Effect of Expiration or Termination. Expiration or termination of this
Agreement shall not relieve the Parties of any obligation accruing prior to
such expiration or termination. INDEVUS and its Affiliates and sublicensees
shall have the right to sell or otherwise dispose of the stock of any
Product subject to this Agreement then on hand or in process of
manufacture. In addition to any other provisions of this Agreement which by
their terms continue after the expiration of this Agreement, the provisions
of Article IV shall survive the expiration or termination of this Agreement
and shall continue in effect for five (5) years from the date of expiration
or termination. In addition, any other provision required to interpret and
enforce the Parties' rights and obligations under this Agreement shall also
survive, but only to the extent required for the full observation and
performance of this Agreement. Any expiration or early termination of this
Agreement shall be without prejudice to the rights of any Party against the
other accrued or accruing under this Agreement prior to termination. Except
as expressly set forth herein, the rights to terminate as set forth herein
shall be in addition to all other rights and remedies available under this
Agreement, at law, or in equity, or otherwise. Upon termination of this
Agreement pursuant to Section 8.2 or upon termination by ATLANTIC pursuant
to Section 8.3.1(a), INDEVUS shall, if requested to do so in writing by
ATLANTIC, negotiate a license to ATLANTIC of know-how relating to the
manufacture or sale of Compound or Product that was developed by INDEVUS
during the Term of this Agreement and is owned and controlled by INDEVUS at
the time of termination, on commercially reasonable terms to be negotiated
in good faith between the Parties.
23
ARTICLE IX
MISCELLANEOUS
9.1. Force Majeure. Neither Party shall be held liable or responsible to the
other Party nor be deemed to have defaulted under or breached the Agreement
for failure or delay in fulfilling or performing any term of the Agreement
during the period of time when such failure or delay is caused by or
results from causes beyond the reasonable control of the affected Party
including, but not limited to, fire, flood, embargo, war, acts of war
(whether war be declared or not), insurrection, riot, civil commotion,
strike, lockout or other labor disturbance, act of God or act, omission or
delay in acting by any governmental authority or the other Party. The
affected Party shall notify the other Party of such force majeure
circumstances as soon as reasonably practicable.
9.2. Assignment. The Agreement may not be assigned or otherwise transferred
without the prior written consent of the other Party; provided, however,
that either Party may assign this Agreement to an Affiliate or in
connection with the transfer or sale of its business or all or
substantially all of its assets related to Compound or Product or in the
event of a merger, consolidation, change in control or similar corporate
transaction. Any permitted assignee shall assume all obligations of its
assignor under this Agreement.
9.3. Severability. In the event that any of the provisions contained in this
Agreement are held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby, unless the
absence of the invalidated provision(s) adversely affect the substantive
rights of the Parties. In such event, the Parties shall replace the
invalid, illegal or unenforceable provision(s) with valid, legal and
enforceable provision(s) which, insofar as practical, implement the
purposes of this Agreement.
9.4. Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered
personally, sent by facsimile (and promptly confirmed by personal delivery,
registered or certified mail or overnight courier), sent by
nationally-recognized overnight courier or sent by registered or certified
mail, postage prepaid, return receipt requested, addressed as follows:
if to INDEVUS to:
INDEVUS PHARMACEUTICALS, INC.
00 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: President
Fax No.: 000-000-0000
if to ATLANTIC to:
ATLANTIC TECHNOLOGY VENTURES, INC.
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chief Executive Officer
24
Fax No.: 000.000.0000
or to such other address as the Party to whom notice is to be given may have
furnished to the other Parties in writing in accordance herewith. Any such
communication shall be deemed to have been given when delivered if personally
delivered or sent by facsimile on a Business Day, upon confirmed delivery by
nationally-recognized overnight courier if so delivered and on the third
Business Day following the date of mailing if sent by registered or certified
mail.
9.5. Applicable Law and Dispute Resolution. The Agreement shall be governed by
and construed in accordance with the laws of the United States of America and
State of New York without reference to any rules of conflict of laws.
(a) The Parties agree to attempt initially to solve all claims, disputes, or
controversies arising under, out of, or in connection with this Agreement (a
"Dispute") by conducting good faith negotiations. Any Disputes which cannot be
resolved by good faith negotiation within twenty (20) Business Days, shall be
referred, by written notice from either Party to the other, to the Chief
Executive Officer of each Party. Such Chief Executive Officers shall negotiate
in good faith to achieve a resolution of the Dispute referred to them within
twenty (20) Business Days after such notice is received by the Party to whom the
notice was sent. If the Chief Executive Officers are unable to settle the
Dispute between themselves within twenty (20) Business Days, they shall so
report to the Parties in writing. The Dispute shall then be referred to
mediation as set forth in the following subsection (b).
(b) Upon the Parties receiving the Chief Executive Officers' report that the
Dispute referred to them pursuant to subsection (a) has not been resolved, the
Dispute shall be referred to mediation by written notice from either Party to
the other. The mediation shall be conducted pursuant to the American Arbitration
Association ("AAA") procedures. The place of the mediation shall be New York,
New York. If the Parties have not reached a settlement within twenty (20)
Business Days of the date of the notice of mediation, the Dispute shall be
referred to arbitration pursuant to subsection (c) below.
(c) If after the procedures set forth in subsections (a) and (b) above, the
Dispute has not been resolved, a Party shall decide to institute arbitration
proceedings, it shall give written notice to that effect to the other Party. The
Parties shall refrain from instituting the arbitration proceedings for a period
of sixty (60) days following such notice. During such period, the Parties shall
continue to make good faith efforts to amicably resolve the dispute without
arbitration. If the Parties have not reached a settlement during that period the
arbitration proceedings shall go forward and be governed by the AAA rules then
in force. Each such arbitration shall be conducted by a panel of three
arbitrators: one arbitrator shall be appointed by each of ATLANTIC and INDEVUS
and the third arbitrator, who shall be the Chairman of the tribunal, shall be
appointed by the two Party-appointed arbitrators. Any such arbitration shall be
held in New York, New York, USA .
The arbitrators shall have the authority to grant specific performance. Judgment
upon the award so rendered may be entered in any court having jurisdiction or
application may be made to such court for judicial acceptance of any award and
an order of enforcement, as the case may be. In
25
no event shall a demand for arbitration be made after the date when institution
of a legal or equitable proceeding based on such claim, dispute or other matter
in question would be barred by the applicable statute of limitations. Each Party
shall bear its own costs and expenses incurred in connection with any
arbitration proceeding and the Parties shall equally share the cost of the
mediation and arbitration levied by the AAA.
Any mediation or arbitration proceeding entered into pursuant to this Section
9.5 shall be conducted in the English language. Subject to the foregoing, for
purposes of this Agreement, each Party consents, for itself and its Affiliates,
to the jurisdiction of the courts of the State of New York, county of New York
and the U.S. District Court for the Southern District of New York.
9.6. Entire Agreement. This Agreement, including the exhibits and schedules
hereto and the security interest required by Section 7.5 hereto, contains the
entire understanding of the Parties with respect to the subject matter hereof
and supersedes all previous writings and understandings. This Agreement may be
amended, or any term hereof modified, only by a written instrument duly executed
by all Parties hereto.
9.7. Independent Contractors. It is expressly agreed that the Parties shall be
independent contractors and that the relationship between the Parties shall not
constitute a partnership, joint venture or agency. Neither Party shall have the
authority to make any statements, representations or commitments of any kind, or
to take any action, which shall be binding on the other Party, without the prior
consent of such other Party.
9.8. Waiver. The waiver by a Party hereto of any right hereunder or the failure
to perform or of a breach by another Party shall not be deemed a waiver of any
other right hereunder or of any other breach or failure by said other Party
whether of a similar nature or otherwise.
9.9. Headings. The captions to the several Articles and Sections hereof are not
a part of the Agreement, but are merely guides or labels to assist in locating
and reading the several Articles and Sections hereof.
9.10. Counterparts. The Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
9.11. Use of Names. Except as otherwise provided in this Agreement, neither
Party shall use the name of the other Party in relation to this transaction in
any public announcement, press release or other public document without the
consent of such other Party, which consent shall not be unreasonably withheld or
delayed; provided, however, that either Party may use the name of the other
Party in any document required to be filed to obtain Regulatory Approval or to
comply with applicable laws, rules or regulations.
9.12. LIMITATION OF LIABILITY. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR
ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL OR INDIRECT DAMAGES ARISING OUT OF THIS
AGREEMENT, HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY.
26
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first set forth above.
ATLANTIC TECHNOLOGY VENTURES, INC.
By: /s/ Xxxxxxxx X. Xxxxx
--------------------------------------------
Name: Xxxxxxxx X. Xxxxx, Esq.
Title: President and Chief Executive Officer
INDEVUS PHARMACEUTICALS, INC.
By: /s/ Xxxxx X. Xxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxx, M.D.
Title: President and Chief Executive Officer
27
EXHIBIT 1.6
XXXXXXXX LICENSE
EXHIBIT 1.6 EXECUTION COPY
XXXXXXXX LICENSE
LICENSE AGREEMENT
This Agreement is made and entered into between Xx.
Xxxxxx Xxxxxxxxx ("LICENSOR") an individual U.S. citizen residing at
c/o The University of Massachusetts, The Department Of Biology, The
University of Massachusetts Medical Center, 00 Xxxx Xxxxxx Xxxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx, 00000 and Channel Pharmaceuticals, Inc., a
Delaware corporation (LICENSEE"), having offices at c/o Atlantic
Pharmaceuticals, Inc., 000 Xxxxxx Xxxx., Xxxxx 000, Xxxxxxxxxx,
Xxxxxxxx, 00000.
Whereas, LICENSOR is the owner of the entire right,
title and interest in the United States Patents and United States
Patent Application described in Exhibit A attached hereto, and the
inventions described and/or claimed therein; and
Whereas, LICENSEE is desirous of obtaining an
exclusive worldwide license in order to practice the above referenced
invention covered by said patent rights in the United States and
foreign countries, and to manufacture, have manufactured, use and sell
in the commercial market the products made in accordance therewith; and
Whereas, LICENSOR is desirous of granting such a
license to LICENSEE in accordance with the terms of this Agreement; and
Whereas, LICENSEE and LICENSOR are concurrently
entering into a SUBSCRIPTION AGREEMENT of even date herewith (the
"SUBSCRIPTION AGREEMENT") providing for the issuance to LICENSOR of
15,000 shares of LICENSEE's common stock, par value $.001 per share
("Common Stock"), constituting one and one half percent (1.5%) of
LICENSEE's Common Stock on a fully diluted basis as of the date hereof
(before giving effect to any financing by LICENSEE, including any
financing provided to LICENSEE by Atlantic Pharmaceuticals, Inc.) (the
"Shares") in partial consideration to the license and other rights
granted hereunder.
Now, therefore, in consideration of the foregoing and
the mutual agreements contained herein, the parties agree as follows:
27-1
ARTICLE I
DEFINITIONS
1.1 "Patent Rights" shall mean (i) the United States
Patent Application described in Exhibit A attached hereto, the
inventions described and/or claimed therein, and anv substitutions,
divisions, continuations, continuations-in-part, patents issuing
thereon or reissues or re-examinations thereof and any and all foreign
patents and patent applications corresponding thereto; (ii) all patent
applications to the extent assigned to LICENSOR and to the extent
LICENSOR is able, under its obligations to third parties, to grant
rights to LICENSEE and on which Inventor is a named inventor, the
inventions described and/or claimed therein and any substitutions,
divisions, continuations, continuations-in-part, patents issuing
thereon or reissues or re-examinations thereof, which relate to the
design, development. and/or manufacture of any products incorporating
the technology identified in (i) to the extent that their use would be
in any way dominated by the claims in (i) and any and all foreign
patents and patent applications corresponding thereto; (iii) all patent
applications to the extent assigned to LICENSOR and to the extent
LICENSOR is able, under its obligations to third parties, to grant
rights to LICENSEE and on which Inventor is a named Inventor, the
inventions described and/or claimed therein and any substitutions,
divisions, continuations, continuations-in-part, patents issuing
thereon, or reissues or re-examinations thereof which relate to any
improvements in the technology incorporated in (i) or (ii) to the
extent that their use would be in any way dominated by the claims in
(i) and any and all foreign patents and patent applications
corresponding thereto referred to in (i), (ii) and (iii) above, when
filed or issued, will be automatically incorporated in and added to
this Agreement and shall periodically be added to Appendix A attached
to this Agreement and made a part hereof; provided, however, that
failure to periodically add such foreign patents and/or patent
applications thereto shall not be considered to exclude such foreign
patents and/or patent applications from the meaning of "Patent Rights."
1.2 "Licensed Processes" shall mean all technologies,
methods, formulas, plans or processes and any improvements thereof,
relating to or which are covered in whole or in part by any claim
contained in the Patent Rights.
27-2
1.3 "Licensed Products" shall mean products or
components thereof claimed in Patent Rights or products or components
thereof made in accordance with or by means of any Licensed Process.
1.4 "Net Sales" shall mean the amount billed or
invoiced on sales of Licensed Products or Licensed Processes less:
(a) Customary trade, quantity or cash discounts and
non-affiliated brokers' or agents' commissions
actually allowed and taken;
(b) Amounts repaid or credited by reason of rejection
or return;
(c) transportation, insurance, brokerage and handling
charges paid or reimbursed by LICENSEE or its
Affiliates;
(d) amounts withheld by foreign governments;
(e) tariffs, import/export duties, sales, use, value
added and other excise or turnover taxes and
other governmental charges imposed on the sale of
Licensed Products or Licensed Processes, the
provision of services using Licensed Products or
Licensed Processes, or on the production,
importation, exportation, use or distribution of
Licensed Products or Licensed Processes;
(f) sales commissions; and/or
(g) bad debt deductions actually written off during
the period.
Net Sales shall not include amounts paid or sales between or among
LICENSEE or its Affiliates. In the event of a use or sale of Licensed
Products or Licensed Processes solely for clinical testing or research
and development purposes for which LICENSEE receives no revenue, then
no royalty shall be due or payable to LICENSOR pursuant to Article 3
hereof or otherwise.
1.5 "Affiliates" shall mean any company, corporation,
or business of which LICENSEE owns or con-
27-3
trols at least fifty percent (50%) of the voting stock or which owns or
controls at least fifty percent (50%) of the voting stock of LICENSEE.
1.6 "Field" shall mean all potential fields of use of
the Patents Rights, the Licensed Products, and the Licensed Processes.
1.7 "Sublicensee" shall mean an entity which LICENSEE
has granted (a) the right to manufacture and market the Licensed
Products, (b) the right to practice the Licensed Processes, or (c) the
right: to sublicense the Licensed Processes to others.
ARTICLE 2
GRANT
2.1 LICENSOR hereby grants to LICENSEE and LICENSEE
accepts, subject to the terms and conditions hereof, a worldwide
exclusive (even against LICENSOR) license in the Field, under the
Patent Rights, to make and have made, to use and have used, to sell and
have sold, to distribute and have distributed, and to market and have
marketed the Licensed Products, and to practice the Licensed Processes,
for the life of the Patent Rights. Such license shall include the right
to grant sublicenses. LICENSOR agrees it will not assign, encumber,
grant a license to and/or permit a lien to exist upon, the Patent
Rights in any territory for any Field to or by any third party and will
not himself practice the Patent Rights other than for his own
non-commercial research purposes. Licensor agrees, on behalf of
himself, his successors and any other person or entity who or which may
claim a right in or under the Patent Rights, that any purported
transfer or encumbrance of rights shall be null and void and of no
effect.
2.2 LICENSOR hereby grants to LICENSEE the right to
extend the licenses granted in paragraph 2.1 to one or more Affiliates,
subject to the terms and conditions hereof.
2.3 LICENSOR hereby represents and warrants to
LICENSEE that LICENSOR is the sole owner of the Patents Rights as
reflected on Exhibit A on the date hereof, no person or entity has or
will have any rights of any kind with respect to such Patent Rights
except for the rights of LICENSEE pursuant to this Agreement, and
accordingly, LICENSOR has full legal right to grant to LICENSEE the
license provided for herein, and such grant does not and
27-4
will not violate or conflict with the rights of any person or entity.
ARTICLE 3
ROYALTIES AND FEES
3.1 LICENSEE shall pay to LICENSOR, during the term
of the license of paragraph 2.1, a royalty of three percent (3%) of
the Net Sales of all Licensed Products sold by LICENSEE and its
Affiliates. LICENSEE shall pay to LICENSOR, during the term of the
license of paragraph 2.1, a royalty of eight percent (8%) of the
royalties which LICENSEE and its Affiliates receive from Sublicensees
for sublicenses of the Licensed Products or Licensed Processes. No
multiple royalties shall be due because the sale or sublicense of any
Licensed Product or Licensed Process is described in more than one
sentence of this Section 3.1. In the event of any such overlap, the
sentence which most accurately describes the relevant transaction at
issue shall prevail. On Net Sales or sublicenses between LICENSEE and
its Affiliates, royalties shall be payable only on the resale or
resublicense by such Affiliate.
3.2 As further consideration for the license and
other rights granted to LICENSEE hereunder, (a) upon the execution of
this Agreement LICENSEE shall issue to LICENSOR the Shares and (b)
LICENSEE shall pay to LICENSOR a license issue fee of Twenty-Four
Thousand Dollars ($24,000), one-half of which shall be paid by
LICENSEE to LICENSOR on the date of the execution of this Agreement,
and the other half of which shall be paid by LICENSEE to LICENSOR upon
the earlier of (i) a closing or closings of a private placement of
debt or equity in Atlantic Pharmaceuticals, Inc., a Delaware
corporation ("Atlantic") , in which aggregate gross proceeds to
Atlantic exceed Eight Million Dollars and (ii) the six month after the
date hereof.
3.3 LICENSEE will also pay to LICENSOR a fee of One
Hundred Thousand Dollars ($100,000) upon the expiration of the last to
expire of the patents included in the Patent Rights if (i) Licensed
Products shall have received a new drug approval during the term of
the patents included in the Patent Rights, (ii) Licensed Products
shall have generated sales for LICENSOR during the term of this
Agreement in excess of One Hundred Thousand Dollars ($100,000) and
(iii) at least one U.S. patent shall have been granted with respect to
the Patent Rights.
27-5
ARTICLE 4
REPORTING
4.1 LICENSEE shall report to LICENSOR the date of
first sale of Licensed Products (or results of Licensed Processes) in
each country within thirty (30) days of occurrence.
4.2 LICENSEE shall provide LICENSOR within sixty (60)
days after each of the calendar half-years ending June 30 and December
31, reports setting forth, for the preceding six (6)-month period, the
amount of Licensed Products sold by LICENSEE and its Affiliates in each
country, the Net Sales thereof, the amount of Sublicensee royalties
received by LICENSOR and its Affiliates and the amount of royalty due
to LICENSOR with respect to the foregoing. With each such royalty
report, LICENSEE shall include the payment of the royalty due. Such
report shall include a detailed listing of all deductions from Net
Sales, sublicensee income, or royalties as specified herein. If no
royalties are due to LICENSOR for any reporting period, then no written
report shall be required. All royalties due hereunder shall be payable
in United States dollars. Conversion of foreign currency to U.S.
dollars shall be made at the conversion rate existing in the United
States, as quoted in The Wall Street Journal, three (3) days prior to
the date that such royalty payments by LICENSEE was due to LICENSOR.
Payments which are more than thirty (30) days past due and which are
not the subject of a good faith controversy between the parties hereto
shall be subject to an interest charge of one percent (1%) per month.
4.3 LICENSOR agrees that at all times, both during
the term and after the termination of this Agreement, it will keep in
confidence and trust all information provided to it hereunder by
LICENSEE or provided to it by any third party pursuant to Section 5.1
hereof (the "Proprietary Information"), and it will not use or disclose
any Proprietary Information or anything directly relating to such
proprietary Information without the written consent of the LICENSEE.
LICENSOR acknowledges that the Proprietary Information constitutes a
unique and valuable asset of the LICENSEE, which is secret and
confidential and which will be communicated to LICENSOR in confidence
and that any disclosure or other use of the Proprietary Information
other than for the sole benefit of the LICENSEE would be wrongful and
would cause irreparable harm to the LICENSEE.
27-6
ARTICLE 5
RECORD KEEPING
5.1 LICENSEE shall keep, and shall require its
Affiliates and sublicensees to keep, accurate and correct records of
Licensed Products or Licensed Processes made, used, or sold under this
Agreement, to the extent appropriate to determine the amount of
royalties due hereunder to LICENSOR. Such records shall be retained for
at least three (3) years following a given reporting period. Up to two
times a year, on reasonable prior written notice to LICENSEE, such
records shall be available during normal business hours for inspection
at the expense of LICENSOR by an accountant selected by LICENSOR and
agreed to by LICENSEE (which agreement shall not be unreasonably
withheld) for the sole purpose of verifying reports and payments
hereunder. In the event that any such inspection shows an
underreporting and underpayment for any twelve (12) month period in
excess of the greater of five percent (5%) or $50,000, then LICENSEE
shall pay the cost of such examination. LICENSEE shall be entitled to
receive from LICENSOR copies of all reports prepared by or on behalf of
LICENSOR in the exercise by LICENSOR of its rights hereunder.
ARTICLE 6
DOMESTIC AND FOREIGN PATENT FILING AND MAINTENANCE
6.1 LICENSOR shall take responsibility for the
preparation, filing, prosecution and maintenance of any and all patent
applications and patents included in Patent Rights and shall use his
best efforts to promptly procure the broadest possible patents in the
U.S. and in all countries designated by LICENSEE pursuant to Section
6.2; provided however that LICENSOR shall first consult with LICENSEE
as to the preparation, filing, prosecution and maintenance of such
patent applications and patents and shall furnish to LICENSEE copies of
documents relevant to any such preparation, filing, prosecution or
maintenance. LICENSOR and LICENSEE shall jointly agree on patent
counsel to prepare, file, prosecute and maintain such patents and
patent applications which shall be, in the absence of an agreement to
the contrary, the law firm of Xxxxxx & Xxxxxxx in new York, New York.
6.2 Without limiting the provisions of Section 6.1,
LICENSOR and LICENSEE shall cooperate fully in the preparation, filing,
prosecution and maintenance of the Patent Rights including without
limitation, the execution
27-7
of all papers and instruments necessary or desirable to enable LICENSOR
to apply for, to prosecute and to maintain patent applications and
patents in LICENSOR's name in any country. Each party shall provide to
the other prompt notice as to all matters which come to its attention
and which may affect the preparation, filing, prosecution or
maintenance of any such patent applications or patents. Either party
may give notice to the other of any foreign country in which such party
wishes to seek patent protection for all or any part of the Patent
Rights. In the case of such a designation by LICENSEE (and the
provision of reasonable assurance of payment by it of the expenses to
be incurred) LICENSOR may not refuse to seek such patent protection in
the country so designated.
6.3 LICENSEE shall reimburse LICENSOR for all
reasonable out-of-pocket expenses LICENSOR may incur during the term of
this Agreement for the preparation, filing, prosecution and maintenance
of the Patent Rights in accordance with Sections 6.1 and 6.2 hereof
unless, after providing written notice to LICENSEE, LICENSOR is
notified in writing by LICENSEE in. advance of any such action that
such action should not be taken. LICENSOR shall submit a written
request to LICENSEE for such reimbursement. LICENSEE shall reimburse
LICENSOR for all such reasonable expenses within sixty (60) days of
receipt of LICENSOR's request therefor.
ARTICLE 7
INFRINGEMENT
7.1 With respect to any Patent Rights, LICENSEE
and/or its Sublicensees shall have the right to prosecute in their own
names and at their own expense any infringement thereof. LICENSOR
agrees to notify LICENSEE promptly of each infringement of the Patent
Rights of which LICENSOR is or becomes aware. Failure by either party
to commence an action which is contemplated by this Section 7.1 shall
not constitute a breach of this Agreement.
7.2 If LICENSEE or its Sublicensee elects to commence
an action as described above or if an action is commenced against the
LICENSEE or its Sublicensee by a third party, LICENSOR shall have the
right either to join the action as a co-plaintiff or co-defendant or to
assign to LICENSEE all of LICENSOR's right, title and interest,
expressly including the right to xxx for past infringement thereof, in
each patent which is a part of the
27-8
Patent Rights and is the subject of such action. In the event LICENSOR
joins the action as a co-plaintiff, LICENSEE shall nevertheless control
the action provided that LICENSEE will endeavor to consult with
LICENSOR as to the prosecution of such action. In the event that
LICENSOR makes an assignment of such patent, such assignment shall be
irrevocable, and such action on that patent or patents shall thereafter
be brought or continued without LICENSOR as a party, unless LICENSOR is
a legally indispensable party. Notwithstanding any such assignment to
LICENSEE by LICENSOR and regardless of whether LICENSOR is or is not an
indispensable party, LICENSOR shall cooperate fully with LICENSEE, at
LICENSEE'S expense, in connection with any action commenced by LICENSEE
or any sublicensee. In the event that any patent is assigned to
LICENSEE by LICENSOR pursuant to this paragraph, LICENSEE shall
continue to meet its obligations under this Agreement, including
without limitation its obligation pay royalties, as if the assigned
patent or patent application were still licensed to LICENSEE.
7.3 If LICENSEE or its Sublicensee elects to commence an
action as described above, LICENSEE may cover up to fifty percent
(50%) of the costs and expenses or such action (include reasonable
attorneys fees and including the coverage of LICENSOR'S costs) by
reducing the royalty due to LICENSOR hereunder by up to fifty percent
(50%). In the event that such fifty percent (50%) costs and expenses
exceed the amount of royalties reduced by LICENSEE for any calendar
year, LICENSEE may to that extent reduce the royalties due to LICENSOR
from LICENSEE in succeeding calendar years, but never by more than
fifty percent (50%) of the royalty due in any one calendar year.
7.4 Recoveries or reimbursements from such action
(regardless of whether LICENSEE or LICENSOR receives the award) shall
first be applied to reimburse LICENSEE and LICENSOR for litigation
costs not paid from royalties (if any) and then to reimburse LICENSOR
for royalties withheld. Any remaining recoveries or reimbursements
shall be paid to LICENSEE.
7.5 In the event that LICENSEE and its Sublicensee, if any,
elect not to exercise their right to prosecute an infringement of the
Patent Rights pursuant to the above paragraphs, LICENSOR may do so at
its own expense, controlling such action and retaining all recoveries
therefrom.
27-9
ARTICLE 8
TERMINATION OF AGREEMENT
8.1 This Agreement, unless extended or terminated as
provided herein, shall remain in effect until the last to expire patent
in the Patent Rights; provided, however, that LICENSEE'S obligation to
pay royalties pursuant to Section 3.1 will terminate as to any Licensed
Products or Licensed Processes when the Patent Rights to which they
relate expire or are abandoned.
8.2 (a) The following events shall constitute an
event of default under this Agreement (an "Event of Default"):
(i) LICENSEE shall become more than sixty (60)
days in arrears in payment of royalties or expenses due pursuant to
this AGREEMENT which are not the subject of a bona fide dispute between
LICENSOR and LICENSEE and which have not been paid within forty five
(45) days after LICENSEE has received notice of such arrearage from
LICENSOR; or
(ii) LICENSEE shall consent to the appointment
of a receiver, trustee or liquidator of itself or of a substantial part
of its property, or LICENSEE shall admit in writing its inability to
pay its debts generally as they come due or shall make a general
assignment for the benefit of creditors; or
(iii) LICENSEE shall file a voluntary petition in
bankruptcy or a voluntary petition or an answer seeking reorganization
in a proceeding under any bankruptcy laws (as now or hereafter in
effect) or an answer admitting the material allegations of a petition
filed against LICENSEE in any such proceeding; or
(iv) an order, judgment or decree shall be
entered in any proceeding by any court of competent jurisdiction
appointing, without the consent of LICENSEE, a receiver, trustee or
liquidator of LICENSEE or of any substantial part of its property, or
sequestering any substantial part of its property, and any such order,
judgment or decree of appointment or sequestration shall remain in
force undismissed, unstayed or unvacated for a period of 90 days after
the date of entry thereof;
(v) a petition against LICENSEE in a proceeding
under applicable bankruptcy laws or other
27-10
insolvency laws as now or hereafter in effect, shall be filed and shall
not be withdrawn or dismissed within 90 days thereafter, or if, under
the provisions of any law providing for reorganization or winding-up of
corporations which may apply to LICENSEE, any court of competent
jurisdiction shall assume jurisdiction, custody or control of LICENSEE
or of any substantial part of its property and such jurisdiction,
custody or control shall remain in force unrelinquished, unstayed or
unterminated for a period of 90 days;
(vi) LICENSEE breaches this AGREEMENT in any
material respect (other than a breach covered by paragraph 8.2 (a) (i)
and does not cure such breach within sixty (60) days after written
notice thereof from LICENSOR or, with respect to any breach incapable
of being fully cured within 'such sixty (60) day period, has not made
substantial good faith efforts to cure any such breach within thirty
(30) days after written notice thereof from LICENSOR;
(b) LICENSEE may, at its option, terminate this
AGREEMENT at any time by doing all of the following:
(i) Cease making, having made, using and
selling any Licensed Products or Licensed Processes; and
(ii) Revoke all sublicenses causing all
sublicensees to cease making, having made, using and selling
Licensed Products or Licensed Processes; and
(iii) Give notice to a LICENSOR of such
cessation and of LICENSEE's election to terminate; and
(iv) Tender payment of all accrued
royalties.
8.3 On the occurrence of an Event of Default, and if
such Event of Default has not been remedied within sixty (60) days
after notice in writing of such Event of Default has been given to the
LICENSEE by LICENSOR, LICENSOR may terminate this Agreement by written
notice.
8.4 Any sublicenses granted by LICENSEE under this
Agreement shall provide for termination or assign-
27-11
ment to LICENSOR, at the option of LICENSOR, of LICENSEE's interest
therein upon termination of this Agreement.
ARTICLE 9
ASSIGNMENT
9.1 This Agreement, the Patent Rights and the other
rights and duties appertaining hereto may not be assigned by either
party without first obtaining the written consent of the other. Any
such purported assignment, without the written consent of the other
party, shall be null and void and of no effect. Notwithstanding the
foregoing, LICENSEE may assign this Agreement (i) to a purchaser,
merging or consolidating corporation, or acquiror of substantially all
of LICENSEE's assets or business and/or pursuant to any reorganization
qualifying under section 368 of the Internal Revenue Code of'1986 as
amended, as may be in effect at such time, or (ii) to an Affiliate of
LICENSEE.
ARTICLE 10
GENERAL
10.1 LICENSOR represents and warrants that it owns
the entire right, title, and interest in the patent applications or
patents comprising the Patent Rights and that LICENSOR has the
authority to issue licenses under said Patent Rights. LICENSOR does not
warrant-the validity of the Patent Rights licensed hereunder and makes
no representations whatsoever with regard to the scope of the licensed
Patent Rights or that such Patent Rights may be exploited by LICENSEE,
an Affiliate, or Sublicensee without infringing other patents provided,
however, that LICENSOR has no reason to believe that the Patent Rights
are invalid or that exploitation by LICENSEE, an Affiliate or
Sublicensee of the Patent Rights will infringe other patents.
10.2 LICENSOR EXPRESSLY DISCLAIMS ANY AND ALL IMPLIED
OR EXPRESS WARRANTIES AND MAKES NO EXPRESS OR IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS OF THE TECHNOLOGY, LICENSED PROCESSES OR
LICENSED PRODUCTS CONTEMPLATED BY THIS AGREEMENT FOR ANY PURPOSE.
10.3 (a) LICENSEE shall indemnify, defend and hold
harmless LICENSOR and his heirs and assigns (the "Indemnitees"),
against any liability, damage, loss or expenses (including reasonable
attorneys' fees and ex-
27-12
penses of litigation) incurred by or imposed upon the Indemnities or
any one of them in connection with claims, suits, actions, demands or
judgments arising out of any theory of product liability (including,
but not limited to, actions in the form of tort, warranty, or strict
liability) concerning any product, process or service made, used or
sold pursuant to any right or license granted under this Agreement. The
above indemnification shall apply whether or not such liability,
damage, loss or expense is attributable to the negligent activities of
the Indemnitees but shall not apply if such liability, damage, loss or
expense is attributable to the willful misconduct of any Indemnitee.
(b) LICENSEE agrees, at its own expense, to
provide attorneys reasonably acceptable to LICENSOR to defend against
any actions brought or filed against any party indemnified hereunder
with respect to the subject of indemnity contained herein, whether or
not, such actions are rightfully brought.
10.4 The interpretation and application of the
provisions of this Agreement shall be governed by the laws of the State
of Illinois without regard to principles of conflicts of laws.
10.5 LICENSEE agrees to comply with all applicable
laws and regulations. In particular, it is understood and acknowledged
that the transfer of certain commodities and technical data is subject
to United States laws and regulations controlling the export of such
commodities and technical data, including all Export Administration
Regulations of the United States Department of Commerce. These laws and
regulations, among other things, prohibit or require a license for the
export of certain types of technical data to certain specified
countries. LICENSEE hereby agrees and gives written assurance that it
will comply with all United States laws and regulations controlling the
export of commodities and technical data, that it will be solely
responsible for any violation of such by LICENSEE or its Affiliates or
Sublicensees, and that it will defend and hold LICENSOR harmless in the
event of any legal action of any nature occasioned by such violation.
10.6 Written notices required to be given under this
Agreement shall be addressed as follows:
If to LICENSOR: Xx. Xxxxxx Xxxxxxxx
c/o University of Massachusetts
Dept of Biochemistry
University of Massachusetts Medical Center
27-13
00 Xxxx Xxxxxx Xxxxx
Xxxxxxxxx, XX 00000
If to LICENSEE: H. Xxxxxxxx Xxxx, M.D.
Chief Executive Officer
Channel Therapeutics, Inc.
c/o Atlantic Pharmaceuticals, Inc.
000 Xxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx X. Xxxxxx, Esq.
Secretary
Channel Therapeutics, Inc.
c/o The Castle Group, Ltd.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
or such other address as either party may request in writing.
10.7 Should a court of competent jurisdiction later
consider any provision of this Agreement to be invalid, illegal, or
unenforceable, it shall be considered severed from this Agreement. All
other provisions, rights and obligations shall continue without regard
to the severed provision, provided that the remaining provisions of
this Agreement are in accordance with the intention of the parties.
10.8 (a) In the event of any controversy or claim
arising out of or relating to any provision of this Agreement or the
breach thereof, the parties shall try to settle such conflicts amicably
between themselves. Subject to the limitation stated in the final
sentence of this Section 9.8, any such conflict which the parties are
unable to resolve shall be settled through binding arbitration
conducted in accordance with the rules of the American Arbitration
Association.
(b) The demand for arbitration shall be filed within
a reasonable time after the controversy or claim has arisen, and in no
event after the date upon which institution of legal proceedings based
on such controversy or claim would be barred by the applicable statute
of limitation. The arbitration shall be held in Boston, Massachusetts.
27-14
(c) At the request of either party, arbitration
proceedings will be conducted in the utmost secrecy; in such case, all
documents, testimony and records shall be received, heard and
maintained by the arbitrator in secrecy under seal, available for the
inspection only of the parties and their respective attorneys and their
respective experts who shall agree in advance and in writing to receive
all-such information confidentially and to maintain such information in
secrecy until such information shall become generally known.
(d) The award through arbitration shall be final and
binding. Either party may enter any such award in a court having
jurisdiction or may make application to such court for judicial
acceptance of the award and an order of enforcement, as the case may
be. Notwithstanding the foregoing, either party may, without recourse
to arbitration, assert against the other party a third-party claim or
cross-claim in any action brought by a third party, to which the
subject matter of this Agreement may be relevant.
10.9 This Agreement and the SUBSCRIPTION AGREEMENT
constitute the entire understanding between the parties and neither
party shall be obligated by any condition or representation other than
those expressly stated herein or therein or as may be subsequently
agreed to by the parties hereto in writing.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their duly authorized representatives.
The effective date of this Agreement is March 28, 1994.
XX. XXXXXX XXXXXXXX
/s/ Xxxxxx Xxxxxxxx
------------------------------------
CHANNEL THERAPEUTICS, INC.
/s/ H. Xxxxxxxx Xxxx
------------------------------------
By: H. Xxxxxxxx Xxxx, M.D.
Its: Chief Executive Officer
27-15
SCHEDULE 1.12
DIAGRAM OF [CT-3]
[*]
* CONFIDENTIAL TREATMENT REQUESTED
SCHEDULE 1.25
PATENT ASSETS
===================================================================================================================================
Country Filed Serial # Issued Patent # Inventors
===================================================================================================================================
[**]
[**] [**] [**] [**] [**] [**]
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[**] [**] [**] [**] [**] [**]
[**]* [**] [**] [**] [**]
*Application for restoration on file.
[**] [**] [**] [**] [**] [**]
[**] [**] [**] [**] [**] [**]
[**] [**] [**] [**] [**] [**]
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[**] [**] [**] [**] [**] [**]
[**]* [**] [**] [**] [**] [**]
*The British Patent Office has allowed Atlantic's application for restoration, subject to payment of outstanding renewal fees, &
recordation of the exclusive license and licensee's name change. These matters will be taken care of by the [**].
[**] [**] [**] [**] [**] [**]
[**]
[**] [**] [**] [**] [**] [**]
[**] [**] [**] [**] [**] [**]
[**] [**] [**] [**] [**] [**]
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[**] [**] [**] [**] [**] [**]
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[**] [**] [**] [**] [**] [**]
[**]
[**] [**] [**] [**] [**] [**]
**CONFIDENTIAL TREATMENT REQUESTED
EXHIBIT 3.7
-----------
LIST OF AGREEMENTS
------------------
License Agreements
1. Channel Pharmaceuticals and Xx. Xxxxxx Xxxxxxxx - March 28th, 1994
Consulting Agreements
1. [*]
2. Channel Pharmaceuticals and Xx. Xxxxxx Xxxxxxxx - September 27th, 1995
Material Transfer Agreements
1. [*]
2. [*]
3. [*]
4. [*]
5. [*]
6. [*]
7. [*]
8. [*]
9. [*]
10. [*]
Research Service Agreements
1. [*]
2. [*]
3. [*]
4. [*]
5. [*]
6. Quintiles Master Service Agreement - January 1998
7. Product Development Proposal - Atlantic Pharmaceuticals and Pharmaceutics
International, Inc. - February 1997
8. [*]
9. [*]
Additional Documents
1. [*]
2. [*]
3. [*]
4. Assignment of Patent Application Serial # [*] and Serial # [*]
* CONFIDENTIAL TREATMENT REQUESTED
EXHIBIT 4.2
FORM OF PRESS RELEASE
FOR IMMEDIATE RELEASE
Contact:
Xxxxxxx X. Xxxxxx Xxxxxxx X. Xxxx
Executive Vice President and CFO VP, Corp. Communications
(000) 000-0000 (000) 000-0000
INDEVUS LICENSES WORLDWIDE RIGHTS
TO ANTI-INFLAMMATORY AND ANALGESIC COMPOUND
Company also updates status of other compounds in pipeline
LEXINGTON, MA, July 1, 2002 -- Indevus Pharmaceuticals, Inc. (NASDAQ: IDEV)
today announced that it has licensed exclusive worldwide rights from Atlantic
Technology Ventures, Inc. (OTC BB:ATLC.OB) to CT-3, a novel anti-inflammatory
and analgesic compound currently in clinical development.
CT-3, a new chemical entity also known as ajulemic acid, is a non-psychoactive
synthetic derivative of tetrahydrocannabinol (THC). The principle mechanism of
action of the compound appears to be the potent inhibition of the inflammatory
cytokines, particularly interleukin-1a and TNF-alpha. The compound has
significant activity in multiple pre-clinical models of pain and inflammation.
Unlike most available non-steroidal anti-inflammatory agents (NSAIDS), in
pre-clinical studies CT-3 does not appear to produce gastrointestinal
ulceration.
An IND (investigational new drug application) has been filed with the U.S. Food
and Drug Administration (FDA) for CT-3, and an initial Phase 1 clinical trial
designed to assess the safety of CT-3 showed that it was well tolerated, with no
clinically significant adverse events and no evidence of psychotropic activity.
The compound is currently being studied in Europe in a small Phase II study in
patients with chronic neuropathic pain.
"We are excited about the potential of a novel potent NSAID which lacks the
ulcerogenic effects of traditional compounds," said Xxxxx X. Xxxxxx, M.D.
chairman, president and chief executive officer of Indevus. "CT-3 has the
potential to be an important new medication for painful inflammatory conditions
such as arthritis, post-operative pain, musculoskeletal injuries, headache and
neuropathic pain. Furthermore, the compound
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-2-
possesses activity in preclinical models of multiple sclerosis and the cutaneous
inflammation associated with exposure to the chemical warfare blister agent
sulfur mustard. The U.S. Army Medical Research Institute is pursuing further
work on this important application. The overall field of inflammation and pain
management is large and not fully satisfied, and we believe a compound such as
CT-3 may have broad applications in these major markets."
The acquisition of CT-3 by Indevus includes an up-front licensing payment,
development milestones and royalty payments from Indevus to Atlantic. Indevus is
responsible for the clinical development, regulatory activities and
commercialization of this compound. A director of Indevus is a shareholder of
Atlantic Technology Ventures. The transaction was approved by all of the
disinterested directors of Indevus.
Atlantic Technology Ventures is a biopharmaceutical company engaged in the
development of biomedical and pharmaceutical products and related technologies
for use in cancer, infection, ophthalmic disorders, pain and inflammation and
dermatological conditions. Atlantic's strategy is to identify nascent medical
products and technologies that have the potential to address unmet market needs,
rapidly develop these through a definitive proof-of-principle, then partner,
license or sell them to realize significant revenue.
Status of additional Indevus products
CT-3 is the latest addition to the Indevus product portfolio, which also
includes: trospium, in Phase III for overactive bladder; pagoclone, in Phase III
for panic disorder and Phase II for generalized anxiety disorder; PRO 2000, in
Phase II for the prevention of the sexual transmission of HIV; dersalazine, in
Phase I for inflammatory bowel disease; and citicoline for stroke, which has
completed several Phase III clinical trials.
Trospium
As recently announced, enrollment has been completed in a Phase III, 524-patient
clinical trial with trospium in overactive bladder. The co-primary endpoints of
the trial are the comparisons of the reduction in the frequency of urination and
the reduction in incontinence episodes among trospium-treated patients versus
placebo patients. Data from this trial is expected in the fall, and assuming a
positive outcome, the Company expects to file a New Drug Application for
trospium by the end of 2002. This data will expand the current clinical trial
database for trospium, which comprises over 2200 patients in Europe. European
trials include two double-blind, placebo-controlled dose-ranging studies, five
double-blind, placebo-controlled studies and several comparative trials, one of
which was a long-term comparative 52-week study on safety, tolerability and
efficacy.
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Pagoclone
Following the return of exclusive, worldwide rights to pagoclone from Pfizer Inc
on June 7, 2002, Indevus has initiated corporate partnering discussions for this
compound. Decisions regarding the continued clinical development and partnering
of pagoclone for generalized anxiety and panic disorders will be based on
additional analyses of a total data package from six clinical trials and will
include ongoing consultation with Aventis, S.A., licensor of this drug. Aventis
has a contractual right for a period of 90 days from the termination of the
agreement between Pfizer and Indevus to elect to develop pagoclone under the
terms established in that agreement.
Dersalazine
Dersalazine, for inflammatory bowel disease, is undergoing Phase I clinical
testing in the U.K. Plans for future Phase II testing in ulcerative colitis will
be dependent on the successful completion of this trial.
Citicoline
Two important meta-analyses of clinical trials with citicoline presented at the
27th International Stroke Conference in February 2002 suggest that treatment
with this drug may reduce infarct growth after stroke and reduce rates of death
or disability over a long term. The first of these analyses retrospectively
analyzed seven controlled trials enrolling 1,963 patients who received oral or
intravenous citicoline at doses ranging from 500 to 2000 milligrams daily and
showed that treatment with citicoline was associated with a significant
reduction in rates of death or disability at long-term follow-up. On a combined
basis across these trials, 54.6 percent of citicoline patients experienced death
or disability, compared with 66.4 percent of placebo patients, p*0.00001.
The second of these analyses retrospectively analyzed data regarding infarct
growth following stroke from two clinical trials in a total of 214 patients.
Doses of 500 milligrams/day and 2000 milligrams/day were used in these trials.
The mean volume increase in infarct size was 84.7 percent for the placebo group,
34.0 percent for the 500 milligram group and 1.8 percent for the 2,000 milligram
group, p=0.015.
As a result of corporate partnering interest following these findings, Indevus
has signed a non-binding memorandum of agreement with a privately held
biotechnology company to fund the further development of citicoline. The
finalization of this agreement is contingent upon the negotiation of a
definitive contract and agreement on the design and clinical endpoints of an
additional large Phase III trial.
PRO 2000
Government agencies in the U.S. and the U.K. have selected PRO 2000, a topical
microbicide to prevent the sexual transmission of HIV, for testing in large,
logistically complex Phase II and Phase III trials planned to begin in 2002 and
2003. The U.K.'s Department for International Development provided the most
recent financial support for the clinical testing of PRO 2000 through a grant of
approximately $22.7 million made to an international research collaboration.
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* equals less than
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-4-
Indevus Pharmaceuticals is engaged in the development and commercialization of a
portfolio of products and product candidates, including multiple compounds in
late-stage clinical development. The Company's lead products under development
include trospium for overactive bladder, pagoclone for panic/anxiety disorders,
PRO 2000 for the prevention of infection by HIV and other sexually transmitted
pathogens, and dersalazine for inflammatory bowel disease.
Except for the descriptions of historical facts contained herein, this press
release contains forward-looking statements that involve risks and uncertainties
that could cause the Company's actual results and financial condition to differ
materially from those anticipated by the forward looking statements. These risks
and uncertainties are set forth in the Company's filings under the Securities
Act of 1933 and the Securities Exchange Act of 1934 under "Risk Factors" and
elsewhere, and include, but are not limited to: uncertainties relating to
clinical trials, including the Phase III trial with trospium; regulatory
approval and commercialization of our products; the early stage of products
under development; need for additional funds and corporate partners; history of
operating losses and expectation of future losses; product liability and
insurance uncertainties; risks relating to the Redux-related litigation;
dependence on third parties for manufacturing and marketing; competition; risks
associated with contractual arrangements; limited patent and proprietary rights;
and other risks.
Page 4 of 4
