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EXHIBIT 10.3
NEW PRODUCT LICENSE RIGHT OF FIRST REFUSAL AGREEMENT
THIS NEW PRODUCT LICENSE RIGHT OF FIRST REFUSAL AGREEMENT entered into
on August 2, 1995, by and between ONCOGENE SCIENCE, INC., a Delaware
corporation ("Licensor"), and CALBIOCHEM-NOVABIOCHEM CORPORATION, a California
corporation ("Licensee").
WITNESSETH
WHEREAS, Licensor is a biopharmaceutical company which is engaged in
its Cambridge, Massachusetts facility in both a diagnostics business and a
research products business;
WHEREAS, the research products business markets research reagents,
kits and other research tools to the academic research, industrial research,
and clinical research markets;
WHEREAS, Licensor has entered into an Asset Purchase Agreement (the
"Purchase Agreement"), dated as of June 26, 1995, with Licensee and
Calbiochem-Novabiochem International, Inc., a Delaware corporation, pursuant to
which Licensor has agreed to sell its research products business (the
"Business"), while retaining the right in connection with its diagnostics
business to manufacture and sell research products to the clinical research
market and diagnostic products to the clinical diagnostics market;
WHEREAS, Licensee has agreed to purchase the Business and to conduct
the Business in the academic research, industrial research, and clinical
research markets, recognizing that Licensor will continue to have the right to
manufacture and sell products to the clinical research market and diagnostic
products to the diagnostic market;
WHEREAS, pursuant to the Purchase Agreement, Licensor has agreed to
grant Licensee a right of first refusal to purchase a license to make, use and
sell all research products developed by Licensor's cancer diagnostics business
where the Licensor has the right to grant such a license, and such license
shall be exclusive insofar as such rights pertain to Research other than
Clinical Research and shall be co-exclusive with Licensor insofar as such
rights pertain to Clinical Research;
NOW THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth, the parties, intending to be legally bound, hereby agree
as follows:
1. Definitions.
(a) The term "Clinical Research" shall refer to Research
engaged in by medical centers, independent reference laboratories and
comprehensive cancer centers where research is performed utilizing, for the
most part, human samples to establish clinical correlation with a diagnosis,
prognosis, or monitoring application.
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(b) The term "Diagnostic" shall refer to diagnosis,
prognosis or other evaluation of patients where such use, if performed in the
United States, would typically require approval by the United States Food and
Drug Administration.
(c) The term "Research" shall refer to the use of
research products in life science research by research companies (including,
without limitation, pharmaceutical and biotechnology companies), institutions
(including medical centers, independent reference laboratories and
comprehensive cancer centers), and universities. The term "Research"
specifically excludes any Diagnostic use.
(d) The term "Research Products" shall refer to research
reagents, kits and other research tools developed by Licensor in its cancer
Diagnostic business.
2. Right of First Refusal.
(a) Licensor shall notify Licensee on a monthly basis of
all Research Products developed during the preceding month ("Licensable
Products"). Licensee shall have a period of thirty (30) days after delivery of
such notice to make further inquiry of Licensor regarding the Licensable
Products and to notify Licensor that it elects to purchase a license from
Licensor to make, use and sell some or all of such Licensable Products (a "New
Product License").
(b) Each time Licensee timely elects to purchase a New
Product License with respect to a Licensable Product, Licensor and Licensee
shall promptly execute and deliver a license agreement with respect to such New
Product License in the form of Exhibit "A" attached hereto (the "Form of New
Product License"), containing (i) such additional information with respect to
the Licensable Product and the intellectual property rights associated
therewith as shall be appropriate to effectuate the purposes of this Agreement
and the Purchase Agreement and (ii) such other additions or modifications as
the parties shall agree. Under each New Product License, Licensee shall pay a
one time license fee of five thousand dollars ($5,000) plus an additional five
percent (5%) royalty on gross sales (in addition to any royalties owed to third
parties) for the greater of the life of the intellectual property licensed or
ten (10) years.
(c) In connection with the notification contemplated by
Section 2(a) hereof, Licensor shall inform Licensee whether any Licensable
Product is of such a nature that Licensor will require Sections 1(a) and 3(a)
of the Form of New Product License (regarding Bulk Quantity sales) to be
included in the New Product License regarding such Licensable Product.
(d) Licensor shall have no obligation to execute and
deliver a license agreement covering any Licensable Product where such
execution and delivery would violate the terms of any agreement or license to
which Licensor is a party or any applicable law or regulation. To the extent
that any such contractual or legal restriction would permit a grant
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of a narrower license than contemplated by this Agreement, appropriate
modifications shall be made to the New Product License Form, and Licensor and
Licensee shall execute and deliver a license agreement in the form of the New
Product License Agreement, as so modified, containing the additional
information and other additions and modifications provided for in Section 2(b).
(e) In the event that Licensee does not timely elect to
purchase a New Product License with respect to a Licensable Product, it shall
have no further right to obtain a license with respect to such Licensable
Product.
(f) Information of Licensor related to Licensable
Products reviewed by Calbiochem pursuant to Section 2(a) hereof, but with
respect to which no New Product License is entered into, shall be referred to
herein as "confidential information." Licensee shall keep confidential (a) any
and all confidential information and shall not use such information for any
purpose unrelated to its consideration of Licensable Products hereunder,
without the prior written consent of Licensor, both during the term of this
Agreement and for a period of ten (10) years following the termination of this
Agreement. Licensee shall take all reasonable steps to insure such
confidential treatment and nonuse. Notwithstanding the foregoing, such
obligations of confidential treatment and nonuse shall not apply to information
which Licensee shall sustain the burden of proving is (a) in the possession of
Licensee prior to receipt thereof from the transmitting party as shown by
Licensee's written records, (b) already available or becomes available to the
public through no fault of Licensee, (c) received by Licensee from a third
party having a right to disclose it, or (d) is required to be disclosed by
subpoena or other legal process or applicable law or regulation.
3. Product Purchases.
(a) In the event Licensee timely elects to purchase a New
Product License from Licensor with respect to a Licensable Product and Licensor
produces an initial batch of such Licensable Product, Licensee shall have the
right to purchase from Licensor, and Licensor shall be obligated to sell to
Licensee, out of such initial batch, a quantity of up to one-half of such
initial batch at a purchase price equal to one hundred seventy-five dollars
($175) per milligram, but not greater than two thousand five hundred dollars
($2,500) for one-half of the initial batch.
(b) In the event Licensee timely elects to purchase a New
Product License from Licensor with respect to a Licensable Product and Licensee
produces an initial batch of such Licensable Product, Licensor shall have the
right to purchase from Licensee, and Licensee shall be obligated to sell to
Licensor, out of such initial batch, a quantity of up to one-half of such
initial batch at a purchase price equal to one hundred seventy-five dollars
($175) per milligram, but not greater than two thousand five hundred dollars
($2,500) for one-half of the initial batch.
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(c) The purchase price set forth in paragraphs (a) and
(b) above shall be adjusted annually, on the anniversary dates of this
Agreement, to reflect an appropriate adjustment for inflation. In the event
that the parties shall be unable to agree on an appropriate inflationary
adjustment, the purchase price shall be adjusted by the amount of increase (or
decrease) in the Consumer Price Index as promulgated by the United States
Department of Labor.
4. Term of the Agreement. This Agreement, and the right to
purchase a New Product License, shall expire five (5) years after the date of
this Agreement or at the time (and in the event) Licensor shall no longer be
engaged in the cancer Diagnostic business. Termination of this Agreement does
not terminate any New Product License, each of which shall continue or
terminate in accordance with its terms.
5. Notices. All notices, requests, demands and other
communications under this Agreement shall comply with the requirements of
Section 15.9 of the Purchase Agreement.
6. Entire Agreement. This Agreement, together with the Purchase
Agreement and the agreements, exhibits, schedules, certificates and instruments
referred to therein or delivered in connection therewith, constitutes the
entire agreement and understanding between the parties hereto with respect to
the transactions contemplated by the Purchase Agreement and supersedes all
prior oral or written agreements and understandings relating to such subject
matter.
7. Modifications and Amendments. The terms and provisions of
this Agreement may be modified or amended only by written agreement executed by
both parties hereto.
8. Waivers and Consents. The terms and provisions of this
Agreement may be waived, or consent for the departure therefrom granted, only
by written document executed by the party entitled to the benefits of such
terms or provisions. No such waiver or consent shall be deemed to be or shall
constitute a waiver or consent with respect to any other terms or provisions of
this Agreement, whether or not similar. Each such waiver or consent shall be
effective only in the specific instance and for the purpose for which it was
given, and shall not constitute a continuing waiver or consent.
9. Assignment. The rights and liabilities under this Agreement
may be assigned by Licensor, and this Agreement shall be binding on and inure
to the benefit of its successors and assigns. Licensee may assign its rights
and responsibilities only with the prior written approval of Licensor, which
Licensor may withhold in its sole discretion; provided, however, that Licensee
may assign this Agreement and its rights and obligations hereunder, without
Licensor's consent, in connection with the sale of all or substantially all of
Licensee's assets related to its research products business.
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10. Benefit. Nothing in this Agreement shall be construed to
create any rights or obligations except between the parties hereto, and no
person or entity shall be regarded as a third-party beneficiary of this
Agreement.
11. Governing Law. This Agreement and the rights and obligations
of the parties hereunder shall be construed in accordance with and governed by
the law of the State of New York, without giving effect to the conflict of law
principles thereof.
12. Severability. If any provision of this Agreement shall be
void as contrary to applicable law, it is agreed that such provision shall be
omitted from this Agreement and that the remainder hereof shall be and remain
in full force and effect as if such omitted provision had not been included
herein.
13. Independence of Parties. Nothing contained in this Agreement
shall be construed to place Licensor and Licensee in a relationship as
partners, joint venturers, employer and employee or principal and agent, nor
shall Licensee be considered in any sense an affiliate of Licensor.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.
Licensor: Licensee:
ONCOGENE SCIENCE, INC. CALBIOCHEM-NOVABIOCHEM
CORPORATION
By: /s/ Steven J. Peltzman By: /s/ Stelios B. Papadopoulos
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Steven M. Peltzman Stelios B. Papadopoulos
President and Chief Chairman and Chief
Operating Officer Executive Officer
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