EXHIBIT 10.2
Portions of this Exhibit have been redacted and are the subject of a
confidential treatment request filed with the Secretary of the Securities and
Exchange Commission.
MANUFACTURING AND SUPPLY AGREEMENT
THIS MANUFACTURING AND SUPPLY AGREEMENT ("Agreement") is made effective as
of June 4, 2004 ("Effective Date"), by and between OSI Pharmaceuticals, Inc., a
Delaware corporation, having its executive offices at 00 Xxxxx Xxxxxxx Xxxx,
Xxxxxxxx, XX 00000, together with its Affiliates as permitted in the
Collaboration Agreement ("OSI"), and Genentech, Inc., a Delaware corporation,
having its principal place of business at Xxx XXX Xxx, Xxxxx Xxx Xxxxxxxxx,
Xxxxxxxxxx 00000, together with its Affiliates as permitted in the Collaboration
Agreement ("Genentech"). OSI and Genentech are sometimes referred to herein
individually as a "Party" and collectively as the "Parties."
BACKGROUND
WHEREAS, OSI and Genentech entered into a Development and Marketing
Collaboration Agreement on January 8, 2001, as amended on June 4, 2004 (the
"Collaboration Agreement"), pursuant to which, among other things, the Parties
agreed to enter into a Manufacturing and Supply Agreement;
WHEREAS, OSI and Genentech wish to set the terms and conditions in this
Agreement under which OSI shall provide Clinical Supplies and Commercial
Supplies of Licensed Product for the completion of preclinical work, clinical
trials and, upon approval by the FDA, sale of Licensed Products in the
Territory;
NOW, THEREFORE, in consideration of the mutual covenants set forth in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:
ARTICLE 1.
DEFINITIONS
The following terms, whether used in the singular or plural, shall have the
meanings assigned to them below for purposes of this Agreement. Other
capitalized terms that are used in this Agreement and not defined in this
Section are defined in the Collaboration Agreement.
1.1 "API" means the bulk form of the Licensed Product that has been
manufactured by OSI or an Acceptable Contract Manufacturer pursuant
to this Agreement, and that has been manufactured in compliance with
cGMP and conforms to the API Specifications.
1.2 "API Specifications" means specifications developed for API,
including, without limitation, testing methods and acceptance
criteria, as approved by the FDA.
1.3 "Acceptable Contract Manufacturer" shall mean the third party
manufacturers approved in accordance with the provisions of Section
4.1.
1.4 "Assumption Notice" shall have the meaning set forth in Section
6.2.4 below.
1.5 "Batch" means the quantity of API or Finished Product produced from
a single run.
1.6 "Certificate of Compliance" means, as further specified in the
Quality Agreement, a document prepared by OSI for each shipment that
contains the following minimum information: (a) manufacturing date,
and OSI Lot number, (b) expiration date, and (c) certification that
such Finished Product was manufactured in accordance with cGMP, the
API Specifications and the Finished Product Specifications. The
Parties shall from time to time agree upon a format for the
Certificate of Compliance to be used under this Agreement.
1.7 "Clinical Requirements" means the quantities of Finished Product and
Placebo needed for the conduct of pre-clinical and/or clinical
studies (including any post-marketing clinical studies, regardless
of how they are accounted for in Exhibit B to the Collaboration
Agreement) of the Licensed Product in the Territory.
1.8 "Collaboration Agreement" shall have the meaning set forth in the
preamble to this Agreement.
1.9 "Commercial Requirements" means the quantities of Finished Product
needed for the promotion and sale of Licensed Product in the
Territory.
1.10 "Commercially Reasonable Efforts" means prompt efforts and resources
consistent with prudent business judgment.
1.11 "Effective Date" means the date set forth in the first paragraph of
this Agreement and shall be the effective date of this Agreement.
1.12 "Facility" means any facility approved by the Joint Project Team at
which API or Finished Product is manufactured, packaged, labeled,
stored or shipped.
1.13 "Finished Product" means packaged, labeled final dosage units of the
Licensed Product that has been manufactured in compliance with cGMP
and conforms to the Finished Product Specifications.
1.14 "Finished Product Specifications" means specifications for Finished
Product, including, without limitation, testing methods, packaging,
labeling, dosage and acceptance criteria, as approved by the FDA.
1.15 "Lot Number" means OSI's unique identifying number for each Batch of
Finished Product or Placebo.
1.16 "Manufacturing Documentation" means all documents and records
describing or otherwise related to the Manufacturing Process or any
part of the Manufacturing Process, including, without limitation,
documents and records consisting of or containing piping and
instrumentation diagrams, software logic and descriptions, batch
records, standard operating procedures, including, without
limitation, standard
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operating procedures for in-process quality control testing,
facility layout schematics, equipment and instrumentation
specifications and process trend and variability data.
1.17 "Manufacturing Process" means the production process for the
manufacture of API and/or Finished Product, as such process may be
changed from time to time.
1.18 "Market Launch" means for purposes of forecasting, that period of
time that begins on the Effective Date and ends the date that is
** following the date Commercial Supplies are first shipped to
wholesalers.
1.19 "Outbound Costs" means any outbound costs associated with the
delivery of Finished Product or Placebo, including without
limitation freight, duty, insurance and, if required, warehousing.
1.20 "Placebo" means an inactive formulation simulating the Finished
Product, for use in clinical and/or pre-clinical studies.
1.21 "Quality Agreement" means, as applied to Clinical Supplies, the
December 4, 2002 Good Manufacturing Practices (GMP) Quality
Agreement between the Parties and, upon execution of the Quality
Agreement currently being negotiated between the Parties relating to
specific details of the manufacture of Clinical and Commercial
Supplies, the latter Quality Agreement only.
1.22 "Recall" means a recall, market withdrawal or correction relating to
Finished Product.
1.23 "Remedial Plan" shall have the meaning set forth in Section 6.2.1.
1.24 "Rolling Monthly Forecast" means a rolling twelve (12) month
forecast specifying Genentech's Commercial and Clinical
Requirements, broken down by quantity of each dosage strength,
starting with the calendar month following the due date of such
forecast.
1.25 "Supply Chain Group" shall have the meaning set forth in Section
3.1.
1.26 "Three Year Forecast" means a three (3) year annual non-binding
forecast of Genentech's Clinical Requirements and Commercial
Requirements, broken down by quantity of each dosage strength,
starting with the calendar year following the due date of such
forecast broken down by month, and the second calendar year
following the due date broken down by quarter.
1.27 "Triggering Events" shall have the meaning set forth in Section 6.1.
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1.28 "Tripartite Agreement" shall have the meaning set forth in Recital 6
of the Collaboration Agreement.
ARTICLE 2.
SUPPLY OF FINISHED PRODUCT AND PLACEBO
2.1 Subject to OSI's and Genentech's compliance with the terms and
conditions set forth in this Agreement, the Collaboration Agreement and
the Quality Agreement, OSI shall supply to Genentech, during the Term and
in the Territory, and Genentech agrees to purchase from OSI, all of
Genentech's Clinical Requirements and Commercial Requirements in the
Territory, except as set forth in Article 6. Finished Product shall be
supplied in varying dosage strengths and presentations, including **
tablets, unless otherwise agreed by the Parties. The foregoing obligation
to supply shall include, but not be limited to, the manufacture of API,
the manufacture of tablets from such API, the manufacture of Placebo, and
the labeling, packaging and shipping of Finished Product and Placebo.
ARTICLE 3.
SUPPLY CHAIN MANAGEMENT
3.1 Formation of the Supply Chain Group. Within thirty (30) days of the
Effective Date, the Parties will establish a Supply Chain Group (the
"SCG") to oversee and manage the supply of Finished Product and the
other activities set forth in this Agreement. Each of OSI and
Genentech shall appoint up to five (5) representatives to the SCG.
Such representatives will include individuals with expertise and
responsibilities in the areas of manufacturing, supply chain
management, quality control, quality assurance and regulatory
affairs. Either Party may replace any or all of its representatives
at any time upon prior written notice to the other Party.
3.2 Responsibilities of the Supply Chain Group. The SCG shall perform
the following functions:
3.2.1 determine minimum safety stocks of Finished Product and
minimum inventory levels to be maintained by each of OSI and
Genentech;
3.2.2 review and discuss OSI's internal strategy for inventory
management and for the supply process, relating to the supply
of Finished Product to Genentech, in the manner contemplated
by this Agreement;
3.2.3 review and discuss Genentech's forecasts and the delivery
schedules for Finished Product; and
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3.2.4 performing such other tasks and undertaking such other
responsibilities, to the extent related to or within the SCG's
purview, as may be specifically delegated to the SCG by the
Joint Project Team.
3.3 Chairperson of the SCG. The SCG shall be chaired by an OSI member of
the SCG, as selected by OSI. The responsibilities of the SCG
Chairperson shall be determined by the SCG but shall in any event
include the following: (i) setting meeting agendas; (ii) calling
emergency meetings of the SCG upon the request of either Party;
(iii) coordinating presentation of disputes between members of the
SCG to the Joint Project Team pursuant to Section 3.4 herein; and
(iv) recording, preparing and, within a reasonable time, issuing
minutes of the SCG meetings, which meeting minutes shall be
submitted for approval by the members of the SCG. The SCG
Chairperson's additional responsibilities and authority shall be
limited to administrative matters and such SCG Chairperson shall not
have the right or authority to make decisions for the SCG itself.
3.4 Meetings and Decisions of the Supply Chain Group. The SCG will meet
monthly or more frequently as agreed by the SCG. The SCG will keep
the Joint Project Team updated on a regular basis as to the
activities being conducted under the SCG's purview. All decisions of
the SCG shall be in accordance with the terms of this Agreement, the
Collaboration Agreement and the Quality Agreement, and shall be made
on a consensus basis, with the representatives of each party
collectively having one vote. If the SCG is unable to resolve a
dispute regarding any issue, the SCG shall present such issue to the
Joint Project Team for resolution.
ARTICLE 4.
ACCEPTABLE CONTRACT MANUFACTURERS
4.1 Selection and Management of Acceptable Contract Manufacturers. OSI
shall be responsible for submitting to the Joint Project Team names
of third party manufacturers for the potential performance of some
or all of its obligations set forth in Article 2. With such names,
OSI shall also provide information about such third party
manufacturers sufficient to enable the Joint Project Team to
effectively discuss and evaluate the manufacturer. Genentech may,
but is not required, to also submit the names of, and sufficient
information regarding, third party manufacturers to the Joint
Project Team for consideration. The Joint Project Team shall
evaluate the desirability of those third party manufacturers and
make recommendations to the Joint Steering Committee for a
determination. In the event the Joint Project Team, after discussion
and evaluation, does not come to a consensus regarding a particular
third party manufacturer, OSI shall have the right to directly
recommend such manufacturer to the Joint Steering Committee. The
Joint Steering Committee shall then approve or disapprove the use of
each recommended third party manufacturer; provided that in the case
of the approval of third party manufacturers for Clinical Supplies,
OSI shall have final decision making authority. If and when a third
party manufacturer is approved in accordance with this Section 4.1,
it shall become an Acceptable Contract Manufacturer hereunder and
OSI may then (once an agreement is executed pursuant
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to Section 4.2 below) use such Acceptable Contract Manufacturer to
perform any of the supply or manufacture obligations herein. The
third party manufacturers set forth in Exhibit A hereto shall be
deemed Acceptable Contract Manufacturers as indicated therein. For
the avoidance of doubt, the manufacturing and supply agreements with
these third party manufacturers must be approved by the Joint
Project Team in accordance with Section 4.2. OSI shall be
responsible for overseeing and managing the relationship with all
Acceptable Contract Manufacturers.
4.2 Negotiation of Contracts with Acceptable Contract Manufacturers. OSI
shall prepare, review, negotiate and manage manufacturing and supply
agreements for API and Finished Product with Acceptable Contract
Manufacturers, provided however that OSI shall provide Genentech
with each significant draft of such agreement, and within ** of
receipt, Genentech shall comment on such draft and Genentech's input
will be taken into consideration during such preparation and
negotiation process. In addition, all such manufacturing and supply
agreements for API and Finished Product with Acceptable Contract
Manufacturers shall be subject to approval by the Joint Project Team
or if such approval is not obtained, by referral to the Joint
Steering Committee for resolution. If the Joint Steering Committee
is unable to resolve the matter (i) in the case of an agreement for
Clinical Supplies, ultimate decision making authority shall rest
with OSI or (ii) in the case of an agreement for Commercial
Supplies, the matter shall be resolved in accordance with Article 16
of the Collaboration Agreement.
4.3 Contents of Agreements with Acceptable Contract Manufacturers. Each
manufacturing and supply agreement for API and Finished Product with
an Acceptable Contract Manufacturer shall contain such terms as are
necessary and customary for having a third party manufacture,
conduct manufacturing validation activities, package, label, store
and/or ship, as the case may be, pharmaceutical products. For
illustrative purposes, the topics set forth in Exhibit B, attached
hereto are generally included in such agreements, although
agreements shall vary depending on the relationship and the
circumstances.
4.4 Third Party Supply Agreements to be Separate from Development
Agreements. The Parties acknowledge that development activities,
such as but not limited to chemical process development, formulation
development and analytical development, are outside the scope of
this Agreement (although such activities are governed by the
Collaboration Agreement) and shall be addressed in agreements
separate from the agreements with Acceptable Contract Manufacturers
for supply of Licensed Product to be supplied to Genentech
hereunder.
4.5 Genentech as a Third Party Beneficiary in Agreements with Acceptable
Contract Manufacturers. OSI shall ensure that each agreement with an
Acceptable Contract Manufacturer shall explicitly name Genentech as
a third party beneficiary of all of OSI's rights and all of the
Acceptable Contract Manufacturer's obligations under such agreement
upon written notice to the Acceptable Contract Manufacturer by OSI
explicitly stating that Genentech may directly enforce any such
rights and obligations. OSI agrees that it shall provide the written
notice discussed in the preceding sentence
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to an Acceptable Contract Manufacturer promptly following the
failure to cure a supply failure and the receipt of an Assumption
Notice from Genentech as set forth in Section 6.2 below.
ARTICLE 5.
FORECASTING AND SUPPLY PROCEDURES
5.1 Forecast Due Dates. On **, Genentech shall provide to OSI both a
first official Rolling Monthly Forecast and a first Three-Year
Forecast. Genentech shall thereafter provide to OSI during the term
of this Agreement: (a) an updated Rolling Monthly Forecast on ** or
the subsequent business day if ** is a Saturday, Sunday or a holiday
on which a majority of banks are closed in New York, NY; and (b) an
updated Three-Year Forecast on **, or the subsequent business day if
** is a Saturday, Sunday or a holiday on which a majority of banks
are closed in New York, NY. If OSI does not receive a forecast on
the date it is due, OSI shall make reasonable efforts to contact the
appropriate contacts at Genentech to inquire as to its whereabouts
(i.e., an e-mail to the person responsible for providing such
forecast, with copies to the Genentech members of the SCG). For
Rolling Monthly Forecasts, in the event OSI does not receive a
response from Genentech within **, the last Rolling Monthly Forecast
received by OSI shall remain in effect.
5.2 Variances. Genentech will use Commercially Reasonable Efforts in
preparing all forecasts provided hereunder to minimize variances
between forecasts. As such, Genentech may modify the Clinical
Requirements and the Commercial Requirements in each updated Rolling
Monthly Forecast only in accordance with the following limitations,
unless OSI agrees to a larger variance:
Maximum percentage variance for Maximum percentage variance for
an aggregate calendar quarter from an aggregate calendar quarter from
Number of months previous Rolling Monthly Forecast previous Rolling Monthly Forecast
prior to delivery DURING MARKET LAUNCH AFTER MARKET LAUNCH
----------------------------- ---------------------------------------- ---------------------------------------
** ** **
** ** **
** ** **
** ** **
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For the sake of clarity, an example illustrating how the above forecast
variances function is attached hereto as Exhibit C.
Notwithstanding the foregoing limitations, both Parties acknowledge that
market conditions, unexpected demand, new science and technology, the
economy, and other factors beyond either Party's control, could lead to
variances in Commercial Requirements and/or Clinical Requirements beyond
those set forth above. In such event, the Parties will discuss such
unexpected variances and OSI shall use Commercially Reasonable Efforts to
accommodate them.
5.3 Delivery of Purchase Orders. Beginning no earlier than the filing of
the final clinical section of the NDA with the FDA, Genentech shall
deliver binding purchase orders for each calendar month to OSI at
least three (3) months prior to the requested delivery date,
separately requesting Commercial Requirements, Clinical Requirements
for Finished Product and Clinical Requirements for Placebo, all in
accordance with the amounts provided in the then current Rolling
Monthly Forecast. With respect to Clinical Supplies, Genentech shall
also provide fully approved labeling requirements for such Clinical
Supplies. Each purchase order shall also specify delivery dates and
delivery location (CPT (Incoterms 2000) to either Genentech's South
San Francisco manufacturing facility or another destination
specified by Genentech, but limited to one location per purchase
order). Genentech agrees that orders for Commercial Requirements
shall be by full case of Finished Product; Clinical Requirements for
Finished Product and/or Placebo may be by partial case. The Parties
agree that title to the Finished Product shall pass from OSI to
Genentech upon the delivery of such Finished Product from OSI to
Genentech or Genentech's designated destination. As of the Effective
Date, a full case consists of **, although such composition may be
changed upon mutual agreement between the Parties.
5.4 Delivery Dates. OSI shall deliver Finished Product and Placebo in
accordance with purchase orders issued by Genentech in accordance
with Section 5.3 above. If OSI reasonably expects any delay in
shipment to Genentech, it shall promptly inform Genentech of such
expected delay, shall immediately update the delivery schedule and
shall use Commercially Reasonable Efforts to minimize the delay.
5.5 Change Orders. If Genentech requests a change to a purchase order
after such purchase order is received by OSI, other than to delay
the delivery date for the product ordered in such purchase order,
OSI shall not be obligated to accommodate such change, but shall use
Commercially Reasonable Efforts to do so.
5.6 Disposition and Invoicing. OSI shall ship the Finished Product and
Placebo to Genentech's South San Francisco facility or to such other
location as Genentech may specify in the relevant purchase orders.
Finished Product and Placebo shall be
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delivered CPT (Incoterms 2000) Genentech's South San Francisco,
California manufacturing facility (or other delivery location) on
the applicable CPT delivery dates specified in the purchase order.
OSI shall arrange for the delivery of Finished Product and Placebo
using a reliable carrier of its choosing. OSI shall be responsible,
and pay third parties directly, for all Outbound Costs to
Genentech's South San Francisco, California facility or other
delivery location specified in the purchase orders, and Genentech
shall be responsible, and pay third parties directly, for all
Outbound Costs from Genentech's South San Francisco, California
manufacturing or other delivery location under Genentech's control.
All Outbound Costs will, however, eventually be shared in accordance
with Article 7. OSI shall pack and address Finished Product and
Placebo in accordance with the applicable purchase order. OSI will
send, with each shipment of the Finished Product and Placebo, as a
minimum, OSI's Certificate of Compliance for each Batch and a
packing list containing OSI's material description/code, Genentech's
purchase order number, OSI's Lot Number and manufacturing date, NDC
number, Genentech's Item Number, unit of measure and total quantity
delivered per dosage strength. On the day of shipment of the
Finished Product and/or Placebo, OSI shall send to Genentech by
facsimile a copy of the packing list, invoice, and xxxx of lading.
OSI shall not ship any Commercial Supplies to Genentech until a
Quality Agreement has been executed.
5.7 Inventory Management.
5.7.1 OSI is responsible for inventory management and manufacturing
planning to ensure that the starting materials, API, and
tablets are manufactured to meet the forecasted demand. On
**, and then within ** after each **, OSI shall provide to
Genentech on a ** an inventory report that includes QA status
and quantity of all starting materials, intermediates, API,
and tablets, a manufacturing plan, and a delivery schedule for
Finished Product.
5.7.2 Within ** after Genentech delivers the Three-Year Forecast to
OSI, the Parties, through the SCG, shall use Commercially
Reasonable Efforts to establish minimum inventory levels of
the following Licensed Product materials: (i) starting
materials, (ii) API, (iii) Finished Product maintained by OSI,
and (iv) Finished Product maintained by Genentech. Such
minimum inventory levels shall be reviewed from time-to-time,
but no less than once every **.
5.8 Shelf Life of Product at Time of Shipment. OSI shall ensure that at
the time of shipment to Genentech, and to the extent Genentech does
not delay the delivery date of shipment beyond that date specified
in the purchase order, any delivered Finished Product shall have at
least ** of its shelf life remaining. Notwithstanding the foregoing,
in the event the shelf life for Finished Product is less than **,
Finished Product delivered shall have at least ** of its shelf life
remaining. OSI shall use
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Commercially Reasonable Efforts to perform such stability studies as
may be required to extend the shelf life for Finished Product
periodically (eventually to **) and, in connection with such
efforts, OSI shall use Commercially Reasonable Efforts to file any
documents as they become available with the FDA that are needed to
extend the shelf life of Finished Product beyond the shelf life
initially approved by the FDA. Costs to conduct stability studies to
extend the shelf life shall be considered Development Costs under
the Collaboration Agreement and shall be treated in accordance
therewith.
ARTICLE 6.
SUPPLY FAILURES
6.1 OSI Failure to Comply with Manufacturing Obligations "Triggering
Events". In the event of the occurrence of any of the following
events (each a "Triggering Event"), the provisions of Section 6.2
shall apply:
6.1.1 **.
6.1.2 Other FDA Actions that would Result in Inability to Supply.
For the purposes of Section 6.2, it shall be a Triggering
Event if the FDA takes actions against OSI or any of its
Acceptable Contract Manufacturers that will cause OSI to be
unable to supply Finished Product and/or Placebo such that it
is reasonably likely that the supply failures set forth in
Section 6.1.3 or Section 6.1.4 will occur.
6.1.3 Material Failure to Supply. For the purposes of Section 6.2,
it shall be a Triggering Event if OSI fails to supply Clinical
Requirements or Commercial Requirements to Genentech by
providing less than ** of the amount set forth in any month's
purchase order (to the extent the purchase order was within
the allowed variances set forth in Section 5.2).
6.1.4 Chronic Failure to Supply. For the purposes of Section 6.2, it
shall be a Triggering Event if OSI fails to supply Clinical
Requirements or Commercial Requirements to Genentech by
providing less than ** but more than ** of the amount set
forth in ** purchase orders or in any ** purchase orders in
any ** (to the extent the relevant purchase orders were within
the allowed variances set forth in Section 5.2).
6.2 Consequences of Failure to Comply with Manufacturing Obligations. If
any of the Triggering Events set forth in Section 6.1 above occur,
then with respect to the particular formulation of Licensed Product
and Placebo at issue (e.g., tablets, IV
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injectable) and without limiting any of Genentech's other rights or
remedies in contract, law or equity, the following provisions shall
apply (subject to the last sentence of Section 6.1.1):
6.2.1 Within five (5) calendar days following the occurrence of a
Triggering Event, OSI shall submit a remedial plan to the
Joint Project Team (or the appropriate subteam designated by
the Joint Project Team) setting forth OSI's plan to remedy the
supply failure at issue (the "Remedial Plan"). Within
forty-eight (48) hours of receipt of a Remedial Plan, the
Joint Project Team members shall provide comments to OSI.
Within ten (10) calendar days following the occurrence of a
Triggering Event, OSI shall submit the Remedial Plan to the
Joint Steering Committee and the Joint Steering Committee
shall promptly provide comments to OSI. OSI shall implement
such Remedial Plan and shall keep the Joint Steering Committee
informed as to its progress with a minimum of weekly status
reports.
6.2.2 Following presentation of the Remedial Plan to the Joint
Steering Committee as described in Section 6.2.1 above, in the
event the Parties agree, or in the event Genentech reasonably
believes, that the Remedial Plan will not fully cure the
supply failure within ** following the occurrence of the
applicable Triggering Event, Genentech shall have the right,
but not the obligation, to begin the process of preparing and
establishing an alternative source(s) of Licensed Product
and/or Placebo. Notwithstanding the foregoing, in order to
avoid interfering with OSI's attempts to cure the supply
failure at issue, with respect to Licensed Product, during
this **, (a) Genentech may not contact DiPharma or Sumika Fine
for the purpose of utilizing such Acceptable Contract
Manufacturer(s) to manufacture its alternative supply, and (b)
with regard to Xxxxxxx Pharma, Genentech may only work with
such manufacturer separate and apart from OSI's relationship
with such manufacturer. In the event Genentech so decides to
begin such process, promptly following notice from Genentech,
OSI shall prepare documents to file with the FDA (but only
actually file with the FDA at this time if the Parties
mutually agree) as may be necessary to 1) convert the NDA to a
shared NDA (held jointly by OSI and Genentech) and 2) transfer
responsibility for the CMC portion (and only the CMC portion)
of the NDA to Genentech. In addition, OSI shall reasonably
assist Genentech with any requested technology transfer as set
forth in Sections 6.2.4(c)(i) and (ii) below, provided
however, that OSI shall not be obligated to engage in any
activities that would interfere with its efforts in
implementing the Remedial Plan.
6.2.3 In the event OSI cures a supply failure caused by the
occurrence of a Triggering Event within ** following such
occurrence, OSI shall retain all of its rights and obligations
to supply Licensed Product and Placebo as set forth
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herein and in the Collaboration Agreement as existed prior to
the occurrence of the Triggering Event. In addition, Genentech
shall resume acquiring all of its Clinical Supplies and/or
Commercial Supplies from OSI to the extent it was so obligated
prior to the applicable Triggering Event.
6.2.4 In the event OSI does not cure a supply failure caused by the
occurrence of a Triggering Event within ** following such
occurrence, Genentech shall have the right, but not the
obligation, to assume some or all of OSI's obligation to
supply Licensed Product and Placebo as set forth in, and in
accordance with, this Agreement and the Collaboration
Agreement by providing notice of such to OSI (an "Assumption
Notice"). It is agreed, however, that such right shall expire
in the event OSI cures the particular supply failure prior to
Genentech providing an Assumption Notice. In the event
Genentech provides OSI with an Assumption Notice, the
following terms shall apply:
(a) Regulatory Documents. If OSI has not done so already,
OSI shall promptly file with the FDA such documents as
may be necessary to 1) convert the NDA to a shared NDA
(held jointly by OSI and Genentech) and 2) transfer
responsibility for the CMC portion (and only the CMC
portion) of the NDA to Genentech.
(b) Acceptable Contract Manufacturers. At Genentech's
request, OSI shall promptly provide all applicable
Acceptable Contract Manufacturers with notification that
Genentech will be assuming all rights and obligations
set forth in the agreements with such Acceptable
Contract Manufacturers as set forth in Section 4.5
above. Genentech shall thereafter solely manage and
oversee the relationship and manufacturing activities at
such Acceptable Contract Manufacturers. OSI shall
reasonably assist Genentech at the Acceptable Contract
Manufacturer(s) site(s) to ensure as smooth of a
transition of management and oversight as possible.
(c) Technology Transfer. The Parties shall immediately
establish and implement a reasonable technology transfer
plan between OSI and Genentech to enable Genentech and
its third party contract manufacturer(s) to manufacture
the applicable API, Finished Product and/or Placebo with
minimal interruption in supply requirements. The
technology transfer plan shall include: (i) an
obligation on OSI (and if requested by Genentech, OSI
shall cause its Acceptable Contract Manufacturer(s)) to
physically transfer such technology, including without
limitation any and all Manufacturing Documentation, to
Genentech or its designated contract manufacturer(s),
(ii) disclosure of the Manufacturing Process for the API
and the API Specifications and/or the Finished Product
and Finished Product Specifications, as applicable, to
Genentech or the designated contract manufacturer, (iii)
specific responsibilities of the Parties in connection
with technology transfer and implementation of the
Manufacturing Process at the
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facility of the contract manufacturer selected by
Genentech, (iv) reasonable milestones for the transfer
of technology and disclosure of information by OSI and
its Acceptable Contract Manufacturer, (v) implementation
of reasonable timelines for achieving such milestones,
and (vi) criteria for assessing the progress and success
of the project as it progresses. Notwithstanding the
foregoing obligations relating to Acceptable Contract
Manufacturer(s) in subsection (i) and (ii) immediately
above, in the event OSI is unable, despite Commercially
Reasonable Efforts, to bind an Acceptable Contract
Manufacturer in its agreement with such Acceptable
Contract Manufacturer to transfer all of the above items
and information owned or controlled by such Acceptable
Contract Manufacturer to Genentech upon an uncured
supply failure, the above noted responsibilities shall
only apply to those items and information necessary for
the proper equipment validation and transferring of
manufacture of API and Finished Product to Genentech or
its designated manufacturer. OSI shall use Commercially
Reasonable Efforts to complete its responsibilities in a
timely manner under and in accordance with such
technology transfer plan, provided that, in any event,
all items and information discussed above in this
subsection shall be provided to Genentech within thirty
(30) days following receipt by OSI of an Assumption
Notice.
(d) License. OSI shall grant, and shall be deemed to grant,
at no additional charge, a sublicensable license to
Genentech (and its designated contract manufacturer(s))
to make and have made such Licensed Product and Placebo
under intellectual property Controlled by OSI. In
addition, OSI shall obtain licenses (if any) from the
Acceptable Contract Manufacturer(s) or another Third
Party necessary for Genentech or such contract
manufacturer(s) to make and have made the Licensed
Product and Placebo.
(e) Cooperation and Assistance. OSI shall (and shall cause
its Acceptable Contract Manufacturer to) provide all
cooperation and assistance reasonably requested by
Genentech to enable it (or the designated contract
manufacturer) to assume with as little disruption as
reasonably possible, the continued manufacture of the
Licensed Product and/or Placebo. Such cooperation and
assistance shall be provided in a prompt and timely
manner (having regard to the nature of the cooperation
or assistance requested).
6.2.5 OSI Rights After Supply Failure. In the event Genentech
assumes manufacturing and supply obligations as set forth in
Section 6.2.4, Genentech shall, subject to the following
terms, supply any Clinical Requirements OSI may have. OSI
shall, ** following such assumption, provide Genentech with
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** This portion has been redacted pursuant to a confidential treatment
request.
13
forecasts in accordance with Article 5 above. Notwithstanding
the foregoing, the Parties agree that, during any period of a
supply shortage, satisfaction of Commercial Requirements shall
take precedence over satisfaction of Clinical Requirements,
provided that Genentech shall make Commercially Reasonable
Efforts to satisfy both Commercial and Clinical Requirements.
6.2.6 Other Documents and Actions. Each Party shall execute such
documents, make such filings or recordings with the FDA or
other regulatory agencies, and take other actions and provide
such cooperation and assistance as is reasonably necessary, to
effectuate the actions invoked in Section 6.2.
6.2.7 Breach of the Collaboration Agreement. In the event Genentech
assumes responsibility for manufacturing Licensed Product
pursuant to this Article 6 due to a supply failure, without
limiting any other rights or remedies Genentech may have
hereunder or under the Collaboration Agreement, and without by
implication or otherwise granting Genentech any new rights
under this Section 6.2.7, absent other breaches of the
Collaboration Agreement that could give rise to termination
pursuant to Section 14.2 of the Collaboration Agreement, and
absent significant damage to the potential success of the
Licensed Product which damage is primarily caused by the
circumstances that gave rise to Genentech having the right to
assume responsibility for the manufacture of Licensed Product,
OSI's failure to supply Licensed Product to Genentech shall
not give rise to a termination pursuant to Section 14.2 of the
Collaboration Agreement if such failure was caused by factors
outside of the control of OSI.
ARTICLE 7.
COST OF GOODS MANUFACTURED
7.1 Costs Incurred Under this Agreement. Except as provided otherwise
herein or in the Collaboration Agreement, as approved by the Joint
Project Team, all costs incurred by each Party in connection with
the performance of its obligations herein, including 100% of the
Fully Burdened Manufacturing Costs incurred in the manufacture of
API and Finished Product (as per Section B.4.5 of Exhibit B to the
Collaboration Agreement), shall be shared (a) in accordance with
Section 7.1 of, and Exhibit B to, the Collaboration Agreement for
costs relating to Commercial Supplies or Clinical Supplies, (b) in
accordance with Exhibit A to the Tripartite Agreement for costs
relating to Clinical Supplies, or (c) proportioned appropriately
between (a) and (b).
For purposes of clarifying certain provisions contained in Exhibit B
to the Collaboration Agreement, either party holding Finished
Product and Placebo shall be permitted to charge the collaboration a
reasonable and customary charge to compensate it for its logistical
product support costs actually incurred. Such costs are not
includable in Fully Burdened Manufacturing Costs (per unit or in
total) but will be charged to costs of sales under the Collaboration
Agreement in the period incurred by such Party. Further, such costs
will include direct costs borne by that Party (and
14
not invoiced to a Third Party) for logistics, warehousing,
transport, customs clearance and storage of Finished Product. Unless
and until the Parties mutually agree otherwise, the Parties will use
a ** annual rate (** simple interest rate each quarter) on the
average book value of Finished Product and Placebo held during that
period by that Party as consideration for the logistical product
support costs outlined herein. Such amount is subject to an annual
reconciliation, review and adjustment by the Joint Finance
Committee.
7.2 Cost Forecasting. In November of each calendar year, commencing with
the first such month following the receipt of results from a
successful phase III clinical trial, the JPT will approve a standard
cost per tablet to be used for purposes of Genentech purchasing, and
OSI supplying and invoicing the collaboration with Finished Product
and Placebo, for the following year. Within ninety (90) days
following the end of the year, OSI will provide the JPT, for its
approval, a final reconciliation of (and any required adjustments to
the standard costs used for) its actual Fully Burdened Manufacturing
Cost (FBMC) in total and per unit for such period for Finished
Product or Placebo, which will be charged or credited to the
collaboration (along with associated General And Administrative
Costs) in the respective quarter in which such adjustment is
approved. In all cases, information on the FBMC standard and actual
costs per unit will be provided to the JPT in a level of detail
reasonably sufficient to analyze and approve such costs.
7.3 Limitations. FBMC shall be limited to direct costs of manufacturing
by OSI and/or its Acceptable Contract Manufacturer, and will not
include any xxxx-up or profit element in addition to the direct
manufacturing costs. To illustrate, FBMC will include only customary
amounts of yield losses (i.e. recovery) in the ordinary course of
business, will not include any idle capacity charges or costs, will
not include any inventory write-offs or failed Batch charges
(otherwise includable in Other Operating Income/Expense), nor will
it include any carrying charges to compensate for financing and
logistical product support costs. Costs incurred by either Party
that result from that Party's negligence, recklessness, intentional
wrongful acts or negligent or willful omissions shall not be shared
pursuant to Section 7.1.
7.4 Payments. Genentech shall deliver purchase orders for Commercial
Requirements and Clinical Requirements to OSI in accordance with
Article 5 herein. Upon shipment of Commercial Requirements and
Clinical Requirements to Genentech, OSI will issue an invoice to
Genentech for the established standard FBMC value for such material,
with payment terms of ** from the invoice date, payable in US
dollars. Genentech will charge the collaboration upon the sale or
usage of such Commercial Requirements or Clinical Requirements (as
either cost of sales, marketing costs or development costs). OSI
will charge the collaboration upon the usage of Clinical Supplies
for Joint Project Team approved studies conducted by OSI.
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** This portion has been redacted pursuant to a confidential treatment
request.
15
ARTICLE 8.
COMPLAINTS; REGULATORY INQUIRIES
8.1 Complaints. The Parties shall promptly notify each other of
complaints received. The details of such notification, as well as
the process by which the Parties shall resolve such complaints,
shall be set forth in the Quality Agreement.
8.2 Notification to Other Party of Regulatory Correspondence. Each Party
shall as soon as possible, but in any event within two (2) business
days, notify the other Party in writing of, and shall provide the
other Party with copies of, any correspondence and other
documentation received or prepared by such Party in connection with
any of the following events: (i) receipt of a regulatory letter,
Warning Letter, or similar item, from the FDA or any other
regulatory authority, directed to the manufacture, packaging, and
storage of API or Finished Product, or in connection with any
general cGMP inspections applicable to any Facility and (ii) any
written regulatory comments from the FDA or any other regulatory
authority related to the manufacture of API or resulting Finished
Product requiring a response or action by a Party.
8.3 Regulatory Correspondence Requiring a OSI Response. In the event OSI
receives any regulatory letter or other written comments from any
federal, state or local regulatory authority directed to its
manufacture of API or Finished Product requiring a response or
action by OSI, including, but not limited to, receipt of a Form 483
(Inspectional Observations) or a Warning Letter, OSI shall work
together with Genentech in preparing any response related to OSI's
manufacture of API or Finished Product. OSI shall provide Genentech
with a copy of each such response for Genentech's review and comment
prior to OSI's submission of its detailed written response. OSI
shall give all due consideration to any Genentech comments to each
such proposed OSI response provided Genentech timely responds.
8.4 Inspections. In the event any Facility is inspected, or OSI is
notified that the Facility(ies) will be inspected; by
representatives of any federal, state or local regulatory agency
directed to OSI's manufacture of API or Finished Product, OSI shall
notify Genentech within one (1) business day after receipt of notice
of such inspection, and shall supply Genentech with copies of any
correspondence or portions of correspondence which relate to API or
Finished Product. The Parties shall meet jointly with the Acceptable
Contract Manufacturer as soon as practicable, but in any event prior
to the inspection if possible, to discuss an appropriate strategy
for the conduct of such inspection. Genentech may send, and upon the
request of OSI shall send, representatives to the applicable
Facility to participate to the extent OSI is participating (unless
the Parties mutually agree to a greater or lesser level of
participation) in any portion of such inspection directed to API or
Finished Product.
16
ARTICLE 9.
RECALLS
Each Party shall notify the other promptly (and in any event within
two (2) business days of determination or receipt of written notice,
as the case may be) if any Batch of Finished Product is the subject
of a Recall. As holder of the NDA, OSI shall be primarily
responsible for conducting all Recalls; provided however that the
Parties shall jointly put together a corrective action plan and
timeline and Genentech shall cooperate with OSI as needed in the
conduct of the Recall. Except for Recalls necessitated solely by one
Party's negligence or willful wrongdoing, the costs incurred by both
Parties in conducting the Recall and the costs of replacing the
affected API and/or Finished Product shall be shared in accordance
with Article 7. In the event the Recall is caused solely by one
Party's negligence or willful wrongdoing, such Party shall reimburse
the other for all costs and expenses reasonably incurred by such
Party with respect to such Recall and shall be solely responsible
for the cost of replacing the affected API and/or Finished Product.
OSI shall use Commercially Reasonable Efforts to replace any
affected Finished Product as soon as possible, but in any event,
within ** of the date on which the Recall was effected, unless
the Parties agree that market conditions suggest a smaller amount of
Finished Product should be provided.
ARTICLE 10.
QUALITY; VALIDATION; AUDIT RIGHTS
10.1 Responsibility for Quality Assurance, Quality Control and Stability.
As between Genentech and OSI, OSI shall be primarily responsible for
conducting any and all quality assurance, quality control and
stability testing of API and Finished Product as is customary in the
industry and as may be required by applicable law, including without
limitation, such quality assurance and quality control activities
set forth in the Quality Agreement and under cGMP. Notwithstanding
the foregoing, Genentech shall have the right, but not the
obligation, to perform its own testing on samples from any
particular Batch of API or Finished Product or any individual
shipment of Finished Product, at its own discretion utilizing the
analytical methods referenced in the API and/or Finished Product
Specifications. Upon written notice from Genentech, OSI shall (a)
initiate a transfer to Genentech or its designated third party on a
timely basis the validated analytical methods utilized in the API
and/or Finished Product Specifications and (b) provide samples from
the requested Batches or shipments. Genentech will then conduct or
have conducted any testing it performs on the samples using such
methods following successful transfer to Genentech or its designated
third party. The exchange of such results and any further actions
related thereto shall be set forth in the Quality Agreement.
10.2 Validation of Facility; Utilities and Equipment, and Manufacturing
Processes. OSI shall ensure cGMP validation status of the
Facilities, the utilities and equipment used
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** This portion has been redacted pursuant to a confidential treatment
request.
17
in the manufacture of API and Finished Product at the Facilities, as
well as validation status of all Manufacturing Processes.
10.3 Audit Rights.
10.3.1 Audits of OSI. Genentech shall have the right, but not the
obligation, to audit OSI's quality control records, quality
assurance records, stability records, validation records,
and/or Facilities, but only to the extent related to the
manufacture, packaging, labeling, storing or shipping of
Commercial Supplies and/or Clinical Supplies. Audits of OSI
shall be conducted in accordance with the relevant provisions
of the Quality Agreement and shall be limited to ** per
calendar year. Audits of OSI shall be requested by Genentech
in writing in advance, but shall be scheduled by OSI at a
mutually convenient time (Genentech generally schedules audits
three months in advance). The costs associated with conducting
an audit of OSI shall be borne by Genentech, unless material
problems are discovered during such audit. For an audit that
reveals a material problem, the costs associated with such
audits shall be shared by the Parties in accordance with
Article 7.
10.3.2 Audits of Acceptable Contract Manufacturers. Genentech shall
have the right, but not the obligation, to participate in
audits of OSI's Acceptable Contract Manufacturer's quality
control records, quality assurance records, stability records,
validation records, and/or Facilities, but only to the extent
related to the manufacture, packaging, labeling, storing or
shipping of Commercial Supplies and/or Clinical Supplies.
Audits of shall be conducted in accordance with the relevant
provisions of the Quality Agreement. OSI shall, at its option,
have its own representative lead such audit, provided however
that such lead may not limit the scope of the audit or lead in
a manner that would have a negative impact on the
effectiveness of the audit. For routine audits and for initial
audits of a particular Acceptable Contract Manufacturer, OSI
shall provide minimum notification of three (3) months to
Genentech. For other more time sensitive audits (such as
for-cause audits), OSI shall provide as much notification to
Genentech as is practicable, provided that such notification
is at least thirty (30) days.
10.3.3 Audits of Genentech's Distribution Systems. OSI shall have
the right, but not the obligation, to audit Genentech's
quality control records, quality assurance records, and/or
Facilities, but only to the extent related to the storing or
shipping of Commercial Supplies and/or Clinical Supplies.
Audits of Genentech shall be conducted in accordance with the
relevant provisions of the Quality Agreement and shall be
limited to ** per calendar year. Audits of Genentech shall be
requested by OSI in writing in advance, but shall be scheduled
by Genentech at a mutually convenient time (Genentech
generally schedules audits three months in advance). The costs
associated with conducting an audit of Genentech shall be
borne by OSI, unless material problems are discovered during
such audit. For an audit that reveals a
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** This portion has been redacted pursuant to a confidential treatment
request.
18
material problem, the costs associated with such audits shall
be shared by the Parties in accordance with Article 7.
ARTICLE 11.
GENERAL REPRESENTATIONS AND WARRANTIES
11.1 Genentech. Genentech hereby represents and warrants to OSI that:
11.1.1 Genentech has the corporate power and authority and the legal
right to enter into this Agreement and to perform its
obligations under this Agreement; and
11.1.2 to the best of its knowledge after reasonable inquiry,
Genentech has a sufficient number of employees with such
expertise and experience as is necessary or appropriate to
fulfill its obligations set forth in this Agreement.
11.2 OSI. OSI hereby represents and warrants to Genentech that:
11.2.1 OSI has the corporate power and authority and the legal right
to enter into this Agreement and to perform its obligations
under this Agreement; and
11.2.2 to the best of its knowledge after reasonable inquiry, OSI
has a sufficient number of employees with such expertise and
experience as is necessary or appropriate to fulfill its
obligations set forth in this Agreement.
ARTICLE 12.
MANUFACTURER PRODUCT WARRANTIES
12.1 Manufacturer Warranties: OSI hereby warrants to Genentech that:
12.1.1 to the best of its knowledge after reasonable inquiry, OSI
has made Genentech aware of any known hazards involved in
handling the API and Finished Product, and will continue to
make Genentech aware of such matters in the future;
12.1.2 to the best of OSI's knowledge after reasonable inquiry, as
of the Effective Date, (a) OSI has the legal right to grant
Genentech the licenses and transfer the technology set forth
in Section 6.2.4 above, (b) OSI has not entered into any
obligation that would prohibit OSI from granting the licenses
and transferring the technology set forth in Section 6.2.4
above and shall not enter into any obligation in the future
that would prohibit OSI from granting such licenses and
transferring such technology, and (c) OSI is free to supply
to Genentech the Manufacturing Documentation; and
12.1.3 to the best of its knowledge after reasonable inquiry, the
Facilities are and shall be maintained in accordance with
cGMP and in such condition as will allow OSI and/or the
Approved Contract Manufacturers to manufacture the
19
API and/or Finished Product and in compliance with and
conformance to cGMP and the API Specifications and/or the
Finished Product Specifications.
12.2 Product Warranties by OSI. OSI hereby warrants to Genentech that the
Finished Product, at the time of delivery to Genentech, shall:
(a) conform to the Finished Product Specifications;
(b) be manufactured in compliance with the requirements of
cGMP;
(c) be manufactured in compliance with the requirements of
all applicable national, state and local laws,
ordinances and governmental rules and regulations of the
United States;
(d) complies with OSI's standard operating procedures; and
(e) be transferred free and clear of any liens or
encumbrances of any kind to the extent arising through
or as a result of the acts or omissions of OSI, its
Affiliates or their respective agents.
ARTICLE 13.
INSURANCE
13.1 Insurance. Upon the signing of this Agreement, OSI shall maintain:
13.1.1 COMMERCIAL GENERAL LIABILITY insurance, including contractual
liability, in the minimum amount of ** each occurrence
combined single limit for bodily injury and property damage
("CGL") with an annual aggregate of **. This insurance shall
include completed operations coverage; and
13.1.2 PRODUCTS LIABILITY insurance, including contractual
liability, with a minimum limit of ** each occurrence
combined single limit for bodily injury and property damage
with an annual aggregate of ** ("Products Liability").
13.1.3 Prior to first shipment of Commercial Supplies to
wholesalers, OSI will increase their limits for the following
insurance: (a) the Commercial General Liability insurance,
including contractual liability, shall be increased to a
minimum amount of ** each occurrence combined single limit
for bodily injury and property damage ("CGL") with an annual
aggregate of **), and (b) the Products Liability insurance,
including contractual liability, shall be increased to a
minimum limit of ** each occurrence combined single limit for
bodily injury and property damage with an annual aggregate of
** ("Products Liability").
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** This portion has been redacted pursuant to a confidential treatment
request.
20
13.2 Special Requirements.
13.2.1 Genentech shall be named as additional insureds under the
above insurance policies.
13.2.2 Occurrence Forms. The insurance policies shall be carried
under an occurrence form. However, if the insurance policies,
specifically the CGL and/or Products Liability policies are
written on a "claims-made" policy form, then the CGL and/or
Property insurance coverage(s) shall be maintained by OSI for
at least five (5) years following termination of this
Agreement.
13.2.3 The CGL insurance shall provide coverage for API and Finished
Product in OSI's care, custody and control.
13.2.4 Each of the above insurance policies shall be primary
insurance as respects OSI's participation under this
Agreement.
13.2.5 All of the above insurance coverage shall be maintained with
an insurance company or companies having an A.M. Best's rating
of ** or higher.
13.2.6 Each Party reserves the right (a) to reasonably require the
other Party to carry additional insurance coverage and/or
carry higher limits of coverage (at such amounts to be agreed
upon by the Parties) if material terms of this Agreement
change such that Genentech and not OSI would be manufacturing
and supplying Licensed Product and/or, in either Party's
reasonable opinion, the other Party's operations by or on
behalf of itself or its third party manufacturer create higher
than normal hazards, and (b) to reasonably require to name
additional parties in interest as additional insureds.
13.3 Notice of Insurance. Within thirty (30) days from the execution of
this Agreement, OSI shall provide Genentech a certificate insurance
reflecting the above requirements. Renewal certificates shall
continue to be provided throughout the term of this Agreement, and
in case of cancellation, non-renewal and/or material change, a
thirty (30) day written notice shall be provided to Genentech.
ARTICLE 14.
TERM; TERMINATION
14.1 Term. The term of this Agreement (the "Term") shall commence on the
Effective Date and shall continue until such time as the
Collaboration Agreement is either terminated or expired.
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** This portion has been redacted pursuant to a confidential treatment
request.
21
14.2 Survival. If Section 6.2.4(d) was invoked prior to the termination
of this Agreement, then the rights and licenses granted thereunder
shall survive the termination or expiration of this Agreement. In
addition, to the extent OSI had not already secured any needed
licenses from Acceptable Contract Manufacturers and/or Third
Parties, it shall promptly do so, but OSI shall not be obligated to
secure additional licenses on an ongoing basis once such initial
licenses have been obtained. Notwithstanding the foregoing, in the
event OSI terminates the Collaboration Agreement pursuant to Section
14.2 of the Collaboration Agreement, then this Section 6.2.4(d)
shall survive termination of this agreement only to the extent
necessary for Genentech to fulfill its obligations under Section
14.2(c) of the Collaboration Agreement, and in the event Genentech
terminates the Collaboration Agreement pursuant to Section 14.4 of
the Collaboration Agreement, Section 6.2.4(d) shall not survive
termination of this Agreement.
ARTICLE 15.
MISCELLANEOUS
15.1 Counterparts. This Agreement and any amendment hereto may be
executed in any number of counterparts, each of which shall for all
purposes be deemed an original and all of which shall constitute the
same instrument. This Agreement shall be effective upon full
execution by facsimile or original, and a facsimile signature shall
be deemed to be and shall be as effective as an original signature.
15.2 Injunctive Relief. Both Parties agree that the breach of certain
obligations under this Agreement would cause irreparable harm to the
other Party and that monetary remedies would be inadequate in the
event of breach. Without limiting the generality of the foregoing
sentence, the Parties specifically agree that a breach by OSI of
Section 6.2.4 would cause irreparable harm and Genentech, upon such
breach, shall be entitled to the granting of equitable relief in the
form of specific performance with respect to Section 6.2.4.
15.3 Collaboration Agreement Governance and Preference. The Parties agree
that all terms of the Collaboration Agreement shall continue to
govern all activities, rights and obligations set forth in this
Agreement and shall apply, to the extent relevant, to all
activities, rights and obligations set forth in this Agreement. (By
way of example, but without limiting the applicability of all
Collaboration Agreement provisions, a delay in the performance of
obligations hereunder that was caused by an act of God would be
subject to the terms of Section 17.5 of the Collaboration
Agreement). Notwithstanding the foregoing, in the event of any
conflict between the provisions of this Agreement and the
Collaboration Agreement, the provisions of this Agreement shall
control. In addition, the terms of this Agreement shall prevail in
the event of a conflict between this Agreement and the Quality
Agreement, unless the term at issue in the Quality Agreement
explicitly states that it is to take precedence over the terms of
this Agreement.
22
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of
the Effective Date.
GENENTECH, INC. OSI PHARMACEUTICALS, INC.
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxx X. Xxx Xxxxxxxx
--------------------------------- -------------------------------------
Name: Xxxxx X. Xxxxxxxx Name: Xxxxxx X. Xxx Xxxxxxxx
Title: President, Product Development Title: Vice President and Chief Financial
Officer
Date: June 7, 2004 Date: June 4, 2004
23
EXHIBIT A
PRE-DESIGNATED ACCEPTABLE CONTRACT MANUFACTURERS
The following third party manufacturers shall be deemed Acceptable
Contract Manufacturers for Clinical Supplies as of the Effective Date:
Name Facility Address Responsibilities
--------------------------------- ------------------ ------------------
Dinamite Dipharma S.p.A. ** **
Raylo Chemicals Inc. ** **
Sumika Fine Chemicals Co. Ltd. ** **
Xxxxxxx Pharma AG ** **
McKesson HBOC BioServices ** **
Cardinal Health Clinical Services ** **
Cardinal Health
Pharmaceutical Development ** **
SSCI Inc. ** **
X. Xxxxxxxx-Xx Xxxxx Ltd ** **
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** This portion has been redacted pursuant to a confidential treatment
request.
The following third party manufacturers shall be deemed to be Acceptable
Contract Manufacturers for Commercial Supplies as of the Effective Date:
Name Address Responsibilities
------------------------------------ ----------------- -------------------------------
Dinamite Dipharma S.p.A. ** **
Sumika Fine Chemicals Co. Ltd. ** **
Xxxxxxx Pharma A.G. ** **
Cardinal Health Packaging Services ** **
Cardinal Health
Pharmaceutical Development ** **
SSCI Inc. ** **
X. Xxxxxxxx-Xx Xxxxx Ltd ** **
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** This portion has been redacted pursuant to a confidential treatment
request.
EXHIBIT B
TOPICS GENERALLY INCLUDED IN AGREEMENTS WITH THIRD PARTY MANUFACTURERS
(FOR ILLUSTRATIVE PURPOSES)
- supply and shipping of API and Finished Product;
- quality control, analytical methods, QA Batch release and documentation of
API and Finished Product; and
- prior written approval of OSI for significant deviations (1);
- administration of material transfers between Acceptable Contract
Manufacturers;
- providing and subsequently reviewing and approving any change in the
specifications, methods, processes and/or procedures set forth in the
Quality Agreement or Acceptable Contract Manufacturers' Drug Master File
- cooperation and assistance by Acceptable Contract Manufacturers to secure
regulatory approval of such manufacturers as suppliers of Licensed
Product;
- providing forecasts of quantity requirements and firm orders to Acceptable
Contract Manufacturers (which shall reflect Genentech's forecasts and
purchase orders described herein);
- record keeping including maintaining copies of appropriate certificates of
analyses and manufacturing Batch records;
- audit rights with respect to Acceptable Contract Manufacturers, including
but not limited to inspecting Acceptable Contract Manufacturers'
facilities and records to verify compliance with obligations and statutory
and regulatory requirements (including those with respect to which OSI is
subject);
--------------------
(1) Significant deviations such as: Operations outside of validated limits
and/or license requirements; Process discrepancies that adversely impact other
product process steps, lots or products; Process discrepancies that potentially
adversely impact a released lot, whether distributed or not; Suspected
introduction of adventitious agents/contaminants into API or Finished Product
intended for human use; Pattern of out of trend analytical results; Use of
expired or out-of-limit components; Evidence of unsuitability of equipment used;
Product reprocessing/reworking outside of pre-approved manufacturing
instructions; Repetition of product processing steps outside of pre-approved
manufacturing instructions; Evidence of unsuitability of facilities/utilities
used; Potential product recalls; Significant adverse trends relating to customer
complaints, non-conforming material, and GMP compliance issues; Environmental
Monitoring failures.
- right to direct activities and to be present at Acceptable Contract
Manufacturers' manufacturing facilities;
- reviewing and approving product labeling and packaging for Commercial
Requirements and Clinical Requirements, including, without limitation,
with respect to regulatory requirements;
- administering payment procedures such that (A) Acceptable Contract
Manufacturers are being paid on a timely basis and (B) costs and expenses
under the Agreement are properly dealt with under Exhibit B to the
Collaboration Agreement;
- assurances that the Acceptable Contract Manufacturers shall not
manufacture, either for commercial supply or clinical supply, for itself
or any Third Party, any hazardous or extremely potent compound or
composition of matter which may put at risk the manufacturer's obligations
to manufacture and supply API or Finished Product; and
- such other rights and obligations as may be requested to be included in
such agreement by the JPT and/or JSC.
EXHIBIT C
FORECAST VARIANCE ILLUSTRATION
During Market Launch:
Forecast 1 is issued on **:
Annual Rolling Monthly Forecast is for **
Three Year Forecast is issued for **
Forecast 2 is issued on **
Forecast is for **
Three Year Forecast issued for **
Forecast 3 is issued on **
Forecast is for **
Forecast 4 is issued on **
Forecast is for **
On **, aggregate Firm PO's written in ** for deliveries in ** and ** match
aggregate Forecast 2 for ** by **.
On **, aggregate from ** in Forecast 2 matches aggregate from ** in
Forecast 1 by **.
On **, aggregate from ** in Forecast 2 matches aggregate from ** year
Forecast issued on ** by **.
On **, aggregate from ** in latest ** year Forecast issued in ** matches
aggregate from ** year Forecast issued on ** by **.
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** This portion has been redacted pursuant to a confidential treatment
request.
