1
EXHIBIT 10.9.1
October 16, 1998
Salix Pharmaceuticals, Inc.
2500 West Bayshore Road
Suite 205
Palo Alto, CA 94303
Attn: Mr. Randy Hamilton
President and CEO
RE: Co-Participation Agreement
Dear Randy:
This letter agreement (the "Letter Agreement") amends the
Co-Participation Agreement between Astra AB ("Astra") and Salix Pharmaceuticals,
Inc. ("Salix") dated as of April 30, 1993 (the "Co-Participation Agreement") as
follows:
1. Defined Terms. All capitalized terms used herein without
definition shall have the meanings ascribed to such terms in the
Co-Participation Agreement.
2. Definitions.
(a) The definition of "Applications" in Section 1.1 of the
Co-Participation Agreement is hereby amended and restated in its entirety as
follows:
"Applications" means any use for gastrointestinal disease in
humans excluding the treatment of, inhibition of or prevention against
neoplasia, dysplasia, hyperplasia, abherrent crypts, polyps, adenomas, carcinoma
and other forms of cancer of the gastrointestinal tract.
(b) Section 1.1 of the Co-Participation Agreement is hereby
amended to add the following definitions in alphabetical order:
"IND" means an Investigational New Drug Application made in
accordance with applicable regulations and requirements of the FDA as from time
to time in effect.
"Transferred NDA" means the New Drug Application (as approved
by FDA) with respect to the Developmental Product and any supplemental NDAs with
respect to the Product to be transferred to Astra on the terms and conditions
set forth in Section 2.6 of the Co-Participation Agreement, including such
changes thereto and supplemental NDAs as may thereafter be submitted or filed by
Astra.
3. NDA. Section 2.6 of the Co-Participation Agreement is hereby
amended and restated in its entirety as follows:
"Upon completion of the Dossier, Salix shall file the NDA for
the Developmental Product with the FDA and shall apply for and pursue obtaining
approval for the
2
Salix Pharmaceuticals, Inc.
October 16, 1998
Page - 2 -
marketing and sale of the Developmental Product in the U.S., which includes the
responsibility to fund, perform and complete any Phase IV studies required by
the FDA as a condition for such FDA approval. The Project Team and Astra shall
have input into the conduct and performance of any such Phase IV study, subject
to Salix's right to final say under terms similar to those set forth in Section
2.3 of the Co-Participation Agreement. Upon FDA approval of the NDA for
Developmental Product, Salix shall transfer the Transferred NDA to Astra and
thereafter, with respect to the Transferred NDA regarding the Product for the
Applications, Astra shall have (i) the overall right and responsibility for the
management of the FDA relationship and all communications with the FDA and, (ii)
subject to the terms of the Co-Participation Agreement, full legal
responsibility to the FDA for all aspects of ownership and maintenance thereof,
including, without limitation, all adverse event reporting and other required
obligations. Upon the request of Astra, Salix shall provide to Astra and to the
FDA all additional data and information in Salix's possession (and not
previously provided to Astra) required for maintaining approval of the
Transferred NDA. Notwithstanding the foregoing, following FDA approval of the
NDA for the Developmental Product and the transfer to Astra of the Transferred
NDA, Astra and Salix shall cooperate to establish FDA approved labeling for the
Product and to resolve relevant issues regarding the Transferred NDA, subject to
Astra's right to final determination with respect to such issues. Astra will not
take any action to transfer or change any part or aspect of such Transferred NDA
(including, without limitation, any aspect of any Drug Master File,
manufacturing method or specification) to the extent such actions would
reasonably adversely effect Salix's supply and manufacture of Product under the
Co-Participation Agreement without the prior written consent of Salix (such
consent not to be unreasonably withheld); provided, however, that changes to the
Transferred NDA that are required by the FDA shall not be subject to the
foregoing prohibition and such changes shall be completed at Astra's sole cost
and expense; provided, further, however, that changes to the Transferred NDA
that are required by the FDA with respect to supply or manufacture of Product
shall be completed at Salix's sole cost and expense. Upon the written request of
Salix, Astra will seek, at Salix's sole cost and expense, approval of such
changes, amendments and variations to such Transferred NDA as are reasonably
requested by Salix (i) to obtain approval of additional suppliers and bulk
manufacturers of Product and (ii) to reflect changes in the manufacturing
process for Product to the extent Astra would not be materially and adversely
affected by such changes. Notwithstanding the foregoing, the rights granted to
Astra hereunder shall be in respect of Product only and Salix reserves all of
its rights with respect to any indications or applications for Balsalazide other
than the Applications to the extent set forth in the Co-Participation
Agreement."
4. IND. Section 2 of the Co-Participation Agreement is hereby
amended to add Section 2.8 as follows:
"2.8 Salix shall own the IND for Balsalazide and the
Developmental Product (including all underlying data); provided, however, that
Astra shall have the right to use, obtain full and unrestricted access to, and
license on a non-exclusive, royalty-free basis, if
3
Salix Pharmaceuticals, Inc.
October 16, 1998
Page - 3 -
necessary, Salix's IND for Balsalazide and the Developmental Product (including
all underlying data) for the purpose of maintaining the Transferred NDA."
5. Transferred NDA Access. Section 2 of the Co-Participation
Agreement is hereby amended to add Section 2.9 as follows:
"2.9 Salix shall have the right to reference, use, obtain full
and unrestricted access to, and license on a non-exclusive, royalty-free basis,
if necessary, the Transferred NDA solely for the purpose of registering and
maintaining regulatory filings that do not constitute use for the Applications;
provided; however, that all contact with the FDA relating to the Transferred NDA
shall be conducted exclusively through and by Astra. Within thirty (30) days
after the request of Salix, Astra shall provide notification to FDA and other
applicable regulatory authorities to allow Salix to exercise its rights under
this Section."
6. Phase III/IV Clinical Study. Section 6 of the Co-Participation
Agreement is hereby amended to add Section 6.7 as follows:
"Salix is presently conducting a study in the United States,
CP079701, comparing Balsalazide with Asacol(R) (the "Study"). Salix agrees to
conduct and complete the Study in the manner set forth in the protocol titled "A
PHASE III RANDOMIZED, DOUBLE-BLIND, DOSE-RESPONSE COMPARISON OF COLAZIDE(R)
(BALSALZIDE DISODIUM) 6.75 G DAILY VS. ASACOL(R) (MELSALAMINE) 2.4 G DAILY IN
PATIENTS WITH ACTIVE MILD OR MODERATE ULCERATIVE COLITIS" and dated December 19,
1997 (including, without limitation, completing the Study with 150 "evaluable"
(per protocol) patients as specified therein). In consideration therefor, Astra
shall pay Salix $3 million as follows: (i) $1 million within 15 days after the
date of this Letter Agreement; (ii) $1 million within 15 days after the last
patient out of the Study; and (iii) $1 million within 15 days after completion
and submission to Astra of a complete study report on the Study. Salix shall
keep Astra fully informed as to the status and conduct of the Study (including,
without limitation, periodic reports on the Study's progress and forecasted time
and date for completion of the Study) and shall provide to Astra full and
unrestricted access to such results of the Study. In addition, Salix shall
permit Astra to use the results of such Study and to disclose the same to third
parties in connection with the use, regulatory approval and sale of the Product
in any jurisdiction or territory in which Astra has rights to the Product."
7. Supply of Product. The last sentence of Section 12.7 of the
Co-Participation Agreement is hereby amended to delete the word "after" and
replace such word with "within".
8. Patent Term Restoration. Section 21 of the Co-Participation
Agreement is hereby amended to add Section 21.5 as follows:
4
Salix Pharmaceuticals, Inc.
October 16, 1998
Page - 4 -
"21.5 Salix and Astra shall cooperate with each other in
obtaining patent term restoration or supplemental protection certificates or
their equivalents in the U.S. where applicable to the Product."
9. Astra Associate. Salix acknowledges that Astra
Pharmaceuticals, L.P. ("APLP") is an "Astra Associate" for purposes of the
Co-Participation Agreement and that the rights and obligations of Astra therein
and in this Letter Agreement may be exercised or discharged, as the case may be,
by APLP. Astra and Salix each acknowledge that any notice or communication
received by Salix from APLP shall be deemed as received from Astra for purposes
of the Co-Participation Agreement. For purposes of notices under the
Co-Participation Agreement, all notices to Astra shall require a copy thereof to
APLP at 725 Chesterbrook Blvd., Wayne, PA 19087-5677, facsimile transmission
number 610-695-1924 and marked for the attention of General Counsel.
10. Effectiveness. Except as set forth in this Letter Agreement,
the Co-Participation Agreement shall remain in full force and effect and
unchanged and is hereby confirmed in all respects.
11. Governing Law. This Letter Agreement shall be governed by and
construed in accordance with the laws of the State of New York, excluding any
choice of law rules which may direct the application of the law of any other
jurisdiction.
12. Counterparts. This Letter 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.
If the foregoing is acceptable to you, please evidence your
agreement by executing a copy of this Letter Agreement and returning same to the
undersigned.
Very truly yours,
ASTRA AB
(publ)
By: /S/ Carl-Gustaf Johansson
---------------------------------
Name: Carl-Gustaf Johansson
Title: N/A
ACCEPTED and AGREED to
this 16th day of October, 1998:
SALIX PHARMACEUTICALS, INC.
5
Salix Pharmaceuticals, Inc.
October 16, 1998
Page - 5 -
By: /S/ Randy W. Hamilton
-------------------------------
Name: Randy W. Hamilton
Title: President and CEO