Exhibit 10.1
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
SERVICES AND SUPPLY AGREEMENT
-----------------------------
This is a Service and Supply Agreement ("Agreement") effective as of
September 26, 2000, and amended as of December 1, 2000 by and between
CollaGenex Pharmaceuticals, Inc. a corporation of Delaware, having a place
of business at 41 University Drive, Newtown, Pennsylvania 18940
("CollaGenex"), and Pharmaceutical Manufacturing Research Services, Inc., a
corporation of Pennsylvania, having a place of business at 423 Sargon Way,
Horsham, PA 19044 ("PMRS"). This Agreement will be revised after review and
negotiations with the United States Food and Drug Administration.
BACKGROUND
----------
A. CollaGenex desires to engage the facilities and services of PMRS
for the manufacture Bulk Product in Exhibit A, using Active
Ingredient provided by CollaGenex.
B. CollaGenex shall have the appropriate rights and registrations to
manufacture or have manufactured, market or distribute the Bulk
Product and Final Product.
C. PMRS has appropriate facilities and the ability to manufacture
the Bulk Product according to the Specifications in Exhibit A.
D. PMRS desires to manufacture the Bulk Product and supply the Bulk
Product and Testing of Final Product to CollaGenex, subject to
the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the promises
herein, the parties, intending to be legally bound, agree as follows:
ARTICLE 1 - DEFINITIONS
-----------------------
1.1 "Affiliate" shall mean (i) any corporation or business entity where
fifty percent (50%) or more of the voting stock of which is and
continues to be owned directly or indirectly by any party hereto; (ii)
any corporation or business entity which directly or indirectly owns
fifty percent (50%) or more of the voting stock of any party hereto.
1.2 "Active Ingredient" shall mean the doxycycline hyclate supplied by
CollaGenex to PMRS for the manufacture of Product as provided in this
Agreement.
1
1.3 "CGMP" shall mean (i) those current Good Manufacturing Practice
regulations required by the FDA in the production of pharmaceutical
products as published in 21 Code of Federal Regulations ("CFR"), Parts
210 and 211 and all applicable rules, regulations, guides and
guidances, as amended; and (ii) any other rules, regulations or laws
of a governmental agency where manufacturing will take place or the
Final Product will be made available.
1.4 "Specifications" shall mean the requirements and standards pertaining
to Bulk and Final Product as set forth in EXHIBIT A.
1.5 "Bulk Product" shall mean the unpackaged finished tablets containing
the active ingredient described in NDA 50-783, Periostat(R)
(doxycycline hyclate tablets) 20 mg, and as specified and described in
EXHIBIT A.
1.6 "Bulk Product COA" shall mean a Certificate of Analysis, in the same
form attached as EXHIBIT B.
1.7 "Final Product" shall mean the packaged Product described in NDA
50-783, Periostat(R)(doxycycline hyclate tablets) 20 mg, and as
specified and described in EXHIBIT A.
1.8 "Final Product COA" shall mean a Certificate of Analysis, in the same
form attached as EXHIBITS C.1, C.2 and C.3.
1.9 "Batch Records" shall mean all records and documentation (i) necessary
to comply with all applicable laws, rules and regulations (whether
domestic or foreign) that govern this Agreement and (ii) verifying
that PMRS has completed and adhered to both the CollaGenex Quality
Assurance Requirements and approved PMRS manufacturing instructions
used to 1) prepare the blend and compress into tablet cores and 2)
film coat the tablet cores attached as referenced in NDA 50-783.
During the term of this Agreement and for the period of seven (7)
years following the expiration of termination of this Agreement, PMRS
shall make available to CollaGenex any copies of records, reports,
documents and Batch Records in connection with this Agreement.
1.10 "FDA" shall mean the United States Food and Drug Administration, or
comparable governmental state or local authority.
1.11 "NDA" shall mean New Drug Application.
1.12 "SNDA" shall mean Supplemental New Drug Application.
1.13 "SUPAC" shall mean Scale Up and Post Approval Changes.
1.14 "Fee" shall mean the prices as set forth in EXHIBIT D.
2
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ARTICLE 2 - RIGHTS TO INFORMATION, ORDERS, PRICING, PAYMENT
-----------------------------------------------------------
AND CONFORMANCE
---------------
2.1 Requirements
------------
(a) CollaGenex shall provide PMRS with written orders for Product at
least [**] days prior to the requested manufacturing date.
CollaGenex's purchase orders shall (i.) reference this Agreement;
(ii.) be submitted in writing; (iii.) state the quantity of Bulk
Product to be manufactured and delivered by PMRS to CollaGenex and/or
CollaGenex's agents; and (iv.) specify the delivery location of the
Bulk Product. Such purchase orders shall be non-binding until
CollaGenex receives written confirmation from PMRS pursuant to Section
2.1 (b).
(b) Upon receipt of a CollaGenex purchase order, PMRS shall confirm in
writing (the "PMRS Confirmation") within fifteen (15) calendar days
said purchase order and fix the manufacturing and shipping dates by
written confirmation to CollaGenex.
(c) PMRS shall allocate sufficient production resources and adopt
sufficient planning procedures in order to meet CollaGenex's ordered
requirements of the Product and shall provide CollaGenex with fixed
manufacturing and shipping dates, which shall be binding on the
parties under the terms and conditions of the Agreement.
(d) PMRS shall not provide toll manufacturing services or other
contract manufacturing services for any finished pharmaceutical
product containing the Active Ingredient for any party other than
CollaGenex without prior written permission from CollaGenex during the
term of this Agreement.
2.2 Forecasts and Orders
--------------------
(a) CollaGenex shall place orders as specified in Section 2.1(a) and
each order shall at minimum be for [**] kgs Bulk Product.
(b) PMRS shall supply CollaGenex with Bulk Product in accordance with
EXHIBIT A.
(c) PMRS agrees to deliver the Bulk Product in such quantities on the
basis and on such delivery dates as are specified in CollaGenex 's
purchase order with not less than [**] days advance notice. CollaGenex
agrees to provide PMRS with an initial non-binding annual forecast and
rolling quarterly updates to keep PMRS informed of changing needs and
better plan for resource allocation.
3
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
(d) BACK UP MANUFACTURING CAPACITY: In the event that PMRS is unable
to provide Bulk Product in accordance with this Agreement, PMRS shall
locate, identify and qualify (including assistance with technology
transfer) an alternate manufacturing site for the production of the
Bulk Product at CollaGenex's sole expense and upon their written
authorization. PMRS' assistance will in no way limit any remedies that
CollaGenex may have whether in law or equity.
In any event, PMRS shall use its best efforts to adjust its production
capacity to accommodate CollaGenex's forecast for the Product.
2.3 Price: Payment, Shipment
-------------------------
(a) The Fee for the Bulk Product ordered and accepted under this
Agreement is as set forth in EXHIBIT D.
(b) CollaGenex agrees to pay PMRS based on PMRS' invoice for the Bulk
Product in accordance with Section 2.3(a) above net [**] days from the
later of the receipt by CollaGenex, or its agent, of released Bulk
Product or the receipt of the invoice. All payments hereunder shall be
made in U.S. Dollars. CollaGenex agrees to pay PMRS a [**]% down
payment at the placement of the order.
(c) Bulk Product and/or Final Product shall be deemed to be at all
times and at all stages of manufacture the property of CollaGenex.
(d) Service changes requested by CollaGenex must be consistent with
SUPAC requirements of current NDA, or an approved SNDA, or marketing
authorizations or analogous approvals granted by regulatory bodies,
whether domestic or foreign. Where disputed, a mutually agreed upon
third party or the FDA shall be consulted regarding regulatory impact
of changes. Where changes require submission of a SNDA, the
requirements of this paragraph do not become binding until the
approval of the submitted SNDA. Where changes require additional
expense, revalidation of any process or method validation, CollaGenex
will be responsible for these additional costs; provided, however,
CollaGenex in its sole determination may, without incurring any
liability to PMRS, cancel any purchase order that requires such
additional changes.
2.4 Testing: Certificate of Analysis and Conformance:
--------------------------------------------------------
(a) PMRS shall provide a Bulk Product COA and such other documents as
may be requested or required by regulatory bodies, whether domestic or
foreign, to CollaGenex, prior to shipment as set forth in EXHIBIT B.
(b) PMRS shall provide the results of such analysis along with
supporting data. PMRS shall provide CollaGenex with a recommendation
to release the batch and complete Batch Records.
4
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
(c) CollaGenex shall be under no obligation to accept any shipment of
Bulk Product without an accompanying Bulk Product COA and Batch
Records.
(d) BULK PRODUCT ACCEPTANCE: Prior to the shipment of any batch of
Bulk Product by PMRS to CollaGenex or CollaGenex's designated
packager, CollaGenex shall have [**] calendar days to examine (i) the
completed Batch Records and Bulk Product COA provided to CollaGenex
pursuant to Section 2.4; or (ii) samples of the Bulk Product, to
determine whether the Bulk Product conforms to Specifications. In the
event that CollaGenex accepts a batch or batches of Bulk Product,
CollaGenex will authorize PMRS to ship the batch or batches of Bulk
Product to its designated packager by providing PMRS with a written
release authorization. This written release authorization shall
thereby enable PMRS to invoice CollaGenex for the batch, or batches,
accepted.
(e) NONCONFORMING BULK PRODUCT REJECTION: In the event that any batch
of the Product shall fail to so conform to the Specifications,
CollaGenex shall, prior to any rejection of the batch, consult with
PMRS, regarding the nonconformity with a view towards resolving the
nonconformity. If CollaGenex and PMRS are not able to mutually resolve
the nonconformity, CollaGenex may reject the batch within [**] days of
notice to PMRS of the nonconformity, by giving written notice thereof
to PMRS, which notice shall specify the nonconformity. If CollaGenex
rejects a batch of Bulk Product pursuant to Section 2.4(d), PMRS shall
thereupon, at its sole, cost and CollaGenex's option: (1) use
reasonable best effort to replace as quickly as possible, but in no
event longer than [**] days of rejection and (2) refund to
CollaGenex's account for CollaGenex's acquisition cost of the Active
Ingredient and any other costs incurred by CollaGenex relating to such
non-conforming batches.
(e) Final Product Testing: PMRS shall provide CollaGenex with a Final
Product COA and such other documents as may be requested or required
by regulatory bodies, whether domestic or foreign, to CollaGenex,
prior to shipment as set forth in EXHIBIT C.1 (100 count bottles), C.2
(blisters) or C.3 (1000 count bottles). If the Final Product does not
conform to the Specification, PMRS will immediately notify CollaGenex
and the parties will consult with each other, regarding the
nonconformity with a view towards resolving the nonconformity.
2.5 GRANT OF LIMITED RIGHTS: CollaGenex grants to PMRS, for the term of
this Agreement, a non-exclusive, non-transferable limited license to use
the information provided by CollaGenex and the trademarks associated with
the Final Product solely for the purpose to manufacture and package the
Products for CollaGenex under this Agreement. Such license shall
immediately terminate upon expiration or termination of this Agreement and
PMRS shall immediately stop using such information and return such
information to CollaGenex.
5
ARTICLE 3 - WARRANTIES, COVENANTS AND INDEMNIFICATION
------------------------------------------------------
3.1 General Warranty and Indemnification.
-------------------------------------
(a) PMRS warrants that (i) the Bulk Product is manufactured in
accordance with CGMPs and any other applicable law, rule or
regulation (whether domestic or foreign); and (ii), at the time
of delivery of the Bulk Product, the Bulk Product will (A) comply
with the Specifications, and (B) shall be free from defects in
materials and workmanship.
(b) PMRS agrees to defend, indemnify and hold CollaGenex and its
Affiliates, directors, employees and agents harmless from and
against any claims, liabilities, damages, costs or expenses
(including reasonable attorney's fees) resulting from any claims
arising solely from (i) the fault or negligence of PMRS; or (ii)
from any misrepresentation or material breach of warranty of PMRS
contained herein or in any EXHIBIT or schedule hereto, or in any
other statement, certificate or document furnished or to be
furnished to CollaGenex pursuant hereto or in connection with the
transactions contemplated hereby, or (iii) from any material
breach of any covenant or obligation of PMRS contained in this
Agreement.
(c) CollaGenex agrees to defend, indemnify and hold PMRS and its
Affiliates, directors, employees and agents harmless from and
against any claims, liabilities, damage, costs or expenses
(including reasonable attorney's fees) resulting from any claim
by a third party arising solely from (i) issues regarding the
safety or efficacy of the Bulk and Final Product with the
exception of claims that arise from the negligence or wrong doing
of PMRS or claims for which PMRS is otherwise obligated to
indemnify CollaGenex under this Agreement, (ii) any
misrepresentation of package materials, illegal distribution of
Bulk and Final Product, or material breach or warranty of
CollaGenex contained herein, or in any EXHIBIT or schedule
hereto, or in any other statement, certificate or document
furnished or to be furnished to PMRS pursuant hereto or in
connection with the transactions contemplated hereby, or (iii)
any material breach of any covenant or obligation of CollaGenex
contained herein.
(d) The obligations to indemnify, defend and hold harmless set
forth above in this Section 3 will not apply to the extent the
indemnified party was responsible for giving rise to the matter
upon which the claim for indemnification is based and will not
apply unless the indemnified party (i) promptly notifies the
indemnifying party of any matters in respect of which the
indemnity may apply and of which the indemnified party has
knowledge; (ii) gives the indemnifying party full opportunity to
control the response thereto and the defense thereof, including
any agreement relating to the settlement thereof, provided that
the indemnifying party shall not settle any such claim or action
without the prior written consent of the indemnified party (which
shall not be unreasonably withheld or delayed); and (iii)
cooperates with the indemnifying party, at the indemnifying
party's cost and expense in the defense or settlement thereof.
The indemnified party may participate, at its own expense, in
such defense and in any settlement discussions directly or
through counsel of its choice on a monitoring, non-controlling
basis.
6
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
3.2 Environmental Health and Safety Warranty
----------------------------------------
(a) PMRS warrants that all Bulk Product sold and shipped pursuant
to this agreement shall be manufactured in accordance with all
applicable federal, state and local environmental, health and
safety laws and regulations in effect at the time and place of
manufacture of the Bulk Product. Further, PMRS warrants that all
waste, including but not limited to all hazardous waste,
generated at the time of manufacture of the Bulk Product shall be
disposed of in accordance with Section 3.7 (a) and all applicable
federal, state and local laws and regulations.
(b) Not withstanding any other provision of this Agreement, PMRS
will defend, indemnify and hold CollaGenex harmless against any
and all liability, damage, loss, cost or expense (including
reasonable attorney's fees) arising from or related to any third
party claim, demand for reimbursement, suit or action threatened
or brought CollaGenex which arises from the alleged release or
threat of release of a hazardous substance at the place of
manufacture of the Bulk Product. PMRS' obligations under this
Article shall include any liability, damage, loss, cost or
expense (including reasonable attorney's fees) arising from PMRS'
breach of the warranties set forth herein. Upon receipt of any
such claim, demand, suit or action, CollaGenex shall promptly
notify PMRS.
3.3 Manufacturing of the Product.
----------------------------
(a) PMRS shall manufacture and deliver the Bulk Product to
CollaGenex at all times in full compliance with CGMP's, by a
fully validated process, with the Specifications, and in
accordance with CollaGenex Quality Assurance Requirements. PMRS
shall maintain and furnish to CollaGenex and at CollaGenex's
request, any governmental agency (whether domestic or foreign),
all records as are necessary and appropriate to demonstrate
compliance with CGMPs. PMRS shall manufacture the Bulk Product in
a facility maintaining a current drug establishment registration
with FDA as set forth in 21 CFR, Part 207 and which has been
inspected and approved by the United Kingdom Medicines Control
Agency or other analogous regulatory body. PMRS will require
reasonable advance notice of which countries' regulations
CollaGenex wishes PMRS to be in compliance with and that meeting
compliance requirements will be at CollaGenex's expense.
(b) CollaGenex shall have the right, on reasonable advance notice
and during normal business hours, to inspect and audit PMRS'
facilities, operations and books and records to confirm
compliance with the covenants contained in this Agreement. Annual
audits will be allowed by PMRS during term of Agreement.
Additional audits will be conducted at a mutually agreed upon
times and CollaGenex's expense. CollaGenex PMRS shall respond in
writing to CollaGenex regarding any items of noncompliance with
CGMP, identified by CollaGenex in written reports during such
inspections or audits within [**] days of CollaGenex notice
thereof. PMRS shall use best efforts to remedy any such items of
noncompliance with CGMP within [**] days of notice thereof. PMRS
shall provide CollaGenex with copies of PMRS' fire and property
insurance company's inspection and loss reports for CollaGenex 's
use solely for internal control practices. CollaGenex has the
right to have a representative at PMRS at anytime CollaGenex
7
manufacturing activities are undertaken who can observe any
manufacturing or testing operations of the CollaGenex Product.
(c) Except as stated otherwise in this Agreement, PMRS will
supply all of the components and bulk packaging components for
the manufacture of Product, including but not limited to:
facilities, tools, equipment, labor and supervision to
manufacture Product, release testing, stability testing, annual
reporting on stability testing (based upon the first three (3)
commercial batches and one batch annually thereafter), and in
accordance with CollaGenex Quality Assurance Requirements, all of
which are included in the Fee as set forth in EXHIBIT D.
3.4 Regulatory Matters.
------------------
(a) PMRS shall maintain all regulatory and governmental permits,
licenses and approvals that may be necessary to manufacture and
ship the Bulk Product to CollaGenex at CollaGenex's expense. PMRS
shall not contact the regulatory and governmental agencies
regarding the manufacture of Bulk Product without prior oral or
written notification of CollaGenex.
(b) CollaGenex will be responsible for any reporting of matters
regarding the manufacture of Bulk Product and Final Product to
the FDA or other appropriate governmental authorities in
accordance with pertinent laws and regulations except as stated
elsewhere in this Agreement. PMRS shall provide CollaGenex with
copies of any documentation, information records, log and/or
notebooks relating to the manufacturing and testing of the Bulk
Products and testing of the Final Product requested by
CollaGenex. PMRS shall advise CollaGenex within twenty four (24)
hours of any occurrences or information which arises out of PMRS'
manufacturing and testing activities, whether or not occurring
with Bulk Products and Final Product, which have or could
reasonably be expected to have adverse regulatory compliance
and/or reporting consequences concerning Bulk and Final Products.
PMRS will provide information required for the annual report
submission and provide it in a timely manner to CollaGenex
(c) PMRS shall be responsible for handling and responding to any
appropriate governmental agency inspections of PMRS with respect
to the manufacturing and testing of the Bulk Products and testing
of the Final Product as required by governmental authority or in
recognition of its role as the manufacturer and tester of Bulk
Products and tester of Final Products. PMRS shall provide to
CollaGenex any information reasonably requested by CollaGenex and
all information requested by any governmental agency in
connection with any governmental inspection related to the
manufacturing and testing of Bulk Products and testing of Final
Product. PMRS shall immediately advise CollaGenex of any requests
by any governmental agency for such inspections with respect to
the Bulk and Final Product.
(d) PMRS will not make changes relating to the manufacturing
process and testing of the Bulk Products and testing of the Final
Product or relating to any of the materials, components,
functions, or controls of the manufacturing and testing of the
Bulk Product and testing of the Final Product without prior
written consent of CollaGenex. In the event that PMRS believes
that such change is necessary, PMRS will provide CollaGenex with
written notice detailing such proposed change. In no event shall
any change be
8
implemented until PMRS has received written approval from
CollaGenex unless stated otherwise in this Agreement.
(e) In the event that PMRS is inspected by the FDA, the Canadian
and Mexican Drug Regulatory Authorities or any other governmental
agency (whether domestic or foreign), PMRS shall promptly (within
twenty four (24) hours) notify CollaGenex of any violations or
deficiencies relating to the manufacturing facility at which Bulk
Product was manufactured, packaged or stored, or the Final
Product was tested, and shall promptly (within one (1) business
day) disclose to CollaGenex all relevant portions of any notice
of observations or potential violations (e.g. FDA form 483,
etc.). PMRS will use its best efforts to provide CollaGenex
within five (5) business days a copy of PMRS' response. In
addition, PMRS will supply to CollaGenex written monthly reports
of the status on any commitments made as a result of these
inspections.
(f) PMRS certifies it did not and will not use in any capacity
the services of any person, including any firm or individual,
debarred or subject to debarment under the Generic Drug
Enforcement Act of 1992, amending the Food Drug and Cosmetic Act
at 21 USC 335a. PMRS agrees to notify CollaGenex immediately in
the event any person providing services to PMRS under the scope
of this work of this Agreement is debarred or becomes subject to
debarment.
3.5 Complaints and Recalls
----------------------
(a) Final Product complaint reports received by PMRS will be
faxed within one (1) business day to:
CollaGenex Pharmaceuticals, Inc.
41 University Drive
Newtown, PA 18940
Attn: Christopher V. Powala
Senior Director, Regulatory Affairs
Phone: 215-579-7388
Fax: 215-579-8577
Final Product complaint reports received by CollaGenex either
directly or from a commercial marketer concerning manufacture of
the Final Product will be faxed within one (1) business day to:
PMRS
423 Sargon Way
Horsham, PA 19044
Attn: Patrick McNally, Director, Quality Assurance
Phone: 215-957-9400
fax: 215-957-6161
(b) PMRS will investigate, within 5 working days, all complaints
associated with the manufacture of the Bulk Product and provide a
written summary to CollaGenex within ten (10) business days on
all aspects of the product testing except microbial testing,
where a written summary will be provided to CollaGenex within
thirty (30) business
9
days. CollaGenex will investigate all other product complaints
associated with the Final Product.
(c) In the event PMRS believes a recall, field alert, withdrawal
or field correction may be necessary for any Bulk Products and
Final Product provided under this Agreement, PMRS shall
immediately notify CollaGenex. In the event that CollaGenex
initiates a recall, field alert, withdrawal or field correction
for Final Product, provided under this Agreement, CollaGenex
shall so notify PMRS. PMRS will not act to initiate a recall,
field alert, product withdrawal or field correction without prior
written consent from CollaGenex.
3.6 Environmental
-------------
(a) PMRS shall properly dispose of any and all hazardous waste
materials directly involved with the manufacture and testing of
Bulk Product and testing of the Final Product in full compliance
with all applicable federal and local regulations. Any hazardous
waste generated or resulting from the activities performed
hereunder, if any, will be disposed of using a
CollaGenex-PMRS-approved contractor at CollaGenex's expense. Any
expense hereunder to CollaGenex will be pre-approved. However, it
the creation of any hazardous waste is due to the error of PMRS
personnel or failure of equipment, any expenses incurred will be
at the expense of PMRS.
(b) PMRS shall promptly notify CollaGenex in writing of any
unauthorized release, spill or emission of a reportable amount of
hazardous materials, used or generated from the activities
performed hereunder; and, of any alleged environmental violation
or litigation relating to the facility for the activities
performed hereunder.
(c) Notwithstanding any other provision of this Agreement,
CollaGenex personnel may review and request copies from PMRS
records and procedures, and may conduct environmental health and
safety audits and inspections of those portions of the PMRS
facility used for the (i) the storage, manufacturing and testing
of the Bulk Products and testing of the Final Product; (ii) any
raw materials for the manufacturing and testing of the Bulk
Products and testing of the Final Product; (iii) any
intermediates; and (iv) any waste, including but not limited to
all hazardous waste, generated from the manufacture and testing
of the Bulk Products and testing of the Final Product. The
scheduling of such visits will be at reasonable times and with
prior written notice to PMRS. Inspections shall scheduled to
verify PMRS' compliance with the Warranties set forth in Article
3. CollaGenex conduct of any document review or facility
inspection pursuant to this Agreement shall in no way limit or
reduce PMRS' obligations under Article 3 of this Agreement.
3.7 INTELLECTUAL PROPERTY - PMRS represents and warrants to
CollaGenex that PMRS is entitled to manufacture and deliver the
Product to CollaGenex as provided in this Agreement and does not
infringe any patent, trademark or other proprietary right of
others. PMRS shall indemnify and hold CollaGenex harmless from
and against any claims, liabilities or damages associated with
any such claim of infringement.
10
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
3.8 Developments-New technologies, inventions, processes
methodologies, processes and know-how (herein after
"Developments") may be developed by PMRS during the performance
of this agreement. CollaGenex shall have ownership of all such
Developments, including any patents, know-how and any other
intellectual property, directly related to CollaGenex's Bulk
Products and Final Product. PMRS shall take any actions
reasonably requested by CollaGenex to perfect CollaGenex's right
and title in and to the Developments, including but not limited
to signing any documents and providing testimony.
3.9 OTHER THAN AS EXPRESSLY PROVIDED FOR IN THIS AGREEMENT, NEITHER
PARTY MAKES ANY OTHER WARRANTIES, EITHER EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
ARTICLE 4 - TERM AND TERMINATION
--------------------------------
4.1 This Agreement shall have an initial term commencing on the date
first set forth above, and ending on September 15, 2003 (3
years). This Agreement shall be automatically extended for
consecutive one (1) year periods, unless either party notifies
the other, in writing, of its intention not to renew at least
twelve (12) months prior to the expiration of the initial term of
this Agreement or any succeeding term, as the case may be.
4.2 Either party may terminate the Agreement by giving sixty (60)
days notice to the other party if the other party is in breach of
any material term of this Agreement and fails to cure that breach
within such sixty (60) day period.
4.3 This Agreement may be terminated upon thirty (30) days prior
written notice by one party at any time during this Agreement if
the other party shall file in any court pursuant to any statue of
any government in any country a petition in bankruptcy or
insolvency or for reorganization or for an arrangement or the
appointment of a receiver of trustee of the party or of its
assets; or if any other party proposes a written agreement of
composition for extension of its debts; or if the other party
shall be served with an involuntary petition against it, filed in
any insolvency proceeding, and such petition shall not be
dismissed within sixty (60) days after filing thereof; or if the
other party shall be a party to any dissolution or liquidation,
or if the other party shall make an assignment for the benefit of
its creditors; or if the other party is subject to any final
order of debarment which can be expected to have a material
adverse effect on the sales of the Product.
4.4 CollaGenex may terminate this Agreement, in whole or in part,
with (30) thirty days written notice to PMRS. All payments made
to PMRS by CollaGenex towards this Agreement will be
nonrefundable. There will be a cancellation fee of $[**] for each
year of the contract.
11
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
4.5 Other than for termination by CollaGenex pursuant to Sections
4.2, 4.3 or 6.3, upon termination of this Agreement, CollaGenex
shall purchase from PMRS, at cost, all raw materials and
packaging materials with Specifications and purchased within the
preceding [**]months by PMRS for use in manufacturing the Bulk
Product. Finished goods shall be purchased by CollaGenex from
PMRS at the price established pursuant to Section 2.3(A). Any
Bulk Product in the process of manufacture by PMRS on the
termination date shall be completed and delivered to CollaGenex
in accordance with the terms of this Agreement.
ARTICLE 5 - CONFIDENTIALITY
---------------------------
5.1 All information provided by CollaGenex to PMRS (the "receiving
party") in connection with this Agreement shall be maintained in
strict confidence by PMRS. This information shall remain the
property of CollaGenex and PMRS shall not use the same for or on
behalf of any entity other than CollaGenex. At the termination of
this Agreement, PMRS shall promptly return without retaining any
copies of extracts thereof, except as required by law, to
CollaGenex any physical embodiments (including copies) of any
such information.
5.2 All information provided by PMRS to CollaGenex (the "receiving
party") in connection with this Agreement shall be maintained in
strict confidence by CollaGenex. Such information shall remain
the property of PMRS, and CollaGenex shall not make use of any
such information except for the purposes for which it was
provided. At the termination of this Agreement, CollaGenex shall
promptly return, without retaining any copies of extracts
thereof, except as required by law, to PMRS any physical
embodiments (including copies) of any such information.
5.3 The covenants of the receiving party contained in Sections 5.1
and 5.2 shall not apply to information which: (i) is already in
the public domain at the time of disclosure; (ii) becomes part of
the public domain through no action or omission of the receiving
party after disclosure to the receiving party; (iii) is already
known to the receiving party at the time of disclosure, as
evidenced by the receiving party's written records; (iv) had been
or is disclosed to the receiving party in good faith by a third
party who was or is not, at the time of disclosure, under any
obligation of confidence to the other party hereto at the time
the third party disclosed such information; or (v) is required to
be disclosed by law, provided that it gives the disclosing party
reasonable prior written notice sufficient to permit the
disclosing party to contest such disclosure.
5.4 This Article 5 shall survive termination of this Agreement
for a period of [**] years.
12
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ARTICLE 6 - MISCELLANEOUS
-------------------------
6.1 CORPORATE ORGANIZATION AND AUTHORITY - Each party represents and
warrants that it is a company duly organized, validly existing,
and in good standing under the laws of the jurisdiction wherein
it is organized, and that it has all necessary power and
authorization to assume the obligations under this Agreement, and
to discharge them pursuant to the terms hereof.
6.2 PUBLIC ANNOUNCEMENTS - Neither party shall make any publicity
releases, interviews, or other dissemination of information
concerning this Agreement or its terms, or either party's
performance hereunder, to communication media, financial
analysts, or others without the approval of the other party,
which approval shall not unreasonably be withheld. Either party
may upon notice to the other make any disclosure in filings with
regulatory agencies as required by law or applicable court order;
provided that the other party shall have the opportunity to
notify such disclosures and filings.
6.3 FORCE MAJEURE - Neither party shall be liable to the other if,
and to the extent, that the performance or delay in performance
of any of its obligations under this Agreement is prevented,
restricted, delayed or interfered with due to circumstances
beyond the reasonable control of such party, including, but not
limited to, government legislation, fires, floods, explosions,
epidemics, accidents, acts of God, wars, riots, strikes,
lockouts, or other concerted acts of workers and/or acts of
government. The party claiming an event of force majeure shall
promptly notify the other party in writing, and provide full
particulars of the cause of event and the date of first
occurrence thereof, as soon as possible after the event and also
keep the other party informed of any further developments. The
party so affected shall use its best efforts to remove the cause
of non-performance, and both the parties shall resume performance
hereunder with the utmost dispatch when such cause is removed
unless this Agreement is previously terminated under Article 4
hereof. If performance is suspended as a result of such
contingencies or causes for a period of [**] days or longer,
CollaGenex shall have the right to terminate this Agreement
citing Force Majeure upon written notice to PMRS at any time
thereafter with no liability to PMRS.
6.4 ENTIRE AGREEMENT This Agreement and the documents referred to
herein constitutes the entire agreement between the parties
pertaining to the subject matter hereof, and supersedes, on its
effective date, all prior and contemporaneous agreements,
representations and understandings of the parties in connection
herewith. No agent of either party is authorized to make any
representation, promise, or warranty not contained in this
Agreement.
6.5 AMENDMENT AND WAIVER - This Agreement may be amended only in
writing, which specifically states that such an amendment is its
purpose, and which is signed by both parties. No course of
dealing between the parties or failure by either party to
exercise any right or remedy hereunder shall constitute an
amendment to this Agreement or a waiver of any other right or
remedy or the later exercise of any right or remedy.
13
6.6 GOVERNING LAW - This Agreement shall be governed by and construed
in accordance with the substantive law of the Commonwealth of
Pennsylvania without regard to its rules for conflicts of law.
6.7 SUCCESSORS AND ASSIGNS - The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns; provided, however,
that no party may assign, delegate or otherwise transfer any of
its rights or obligations under this Agreement without first
receiving the prior written consent of the other party hereto,
except that either party may assign and delegate its rights and
duties hereunder without obtaining such consent (i) to any
affiliate or subsidiary of such party, or (ii) to any party or
entity which acquires substantially all of the business or assets
of such party if such party guarantees the performance of the
acquiring party and the acquiring party expressly assumes the
assigning party's obligations hereunder.
6.8 NATURE OF AGREEMENT - In operating under the Agreement, each
party shall act independently and this Agreement shall not be
construed as creating any partnership, joint venture or
incorporated business entity. Neither party shall have any
authority to incur any liability or obligation whatsoever on
behalf of the other.
6.9 NOTICE - Any notice, demand, waiver, consent, approval or other
communication which is required or permitted to be given to any
party hereunder shall be in writing and shall be deemed delivered
if sent to the party personally, if sent to the party by
Facsimile (i.e. by Fax), upon receipt of confirmation of "good"
transmission; or if sent by registered or certified air mail
(return receipt requested) (or its equivalent), with postage and
registration or certification fees thereon prepaid, or by an
internationally recognized courier company, addressed to the
party at its address set forth below or to such other address as
the receiving party may notify the sending party in writing on
the third day after dispatch:
If to CollaGenex:
Mr. Robert Ashley
Senior Vice President, Commercial Development
41 University Drive
Newtown, PA 18940
Telephone: 215-579-7388
Fax: 215-579-8577
If to PMRS:
Mr. Edwin Thompson
President
423 Sargon Way
Horsham, PA 19044
Telephone: 215-957-9400
Fax: 215-957-6161
14
IN WITNESS WHEREOF, the parties hereto have affixed hereunto their
authorized signature as follows:
COLLAGENEX PHARMACEUTICALS, INC. (COLLAGENEX):
By: /s/ Robert A. Ashley
--------------------
Name: Robert A. Ashley
Title: Senior Vice President, Commercial Development
Date: September 26, 2000
PHARMACEUTICAL MANUFACTURING RESEARCH SERVICES INC. (PMRS):
By: /s/Edwin R. Thompson
---------------------
Name: Edwin R. Thompson
Title: President
Date: September 26, 2000
15
EXHIBIT A: BULK PRODUCT DESCRIPTION:(FINAL VERSION BASED UPON NEGOTIATIONS
WITH FDA)
White to off-white, film coated tablets, engraved on one side with `PS 20'
monogram that contain doxycycline hyclate equivalent to 20 mg doxycycline
delivered in 300 kg lot sizes (~1.5 million tablets/lot) in polyethylene
lined fiber drums with desiccant pouches)
Final Product Description:
White to off-white, film coated tablets, engraved on one side with 'PS 20'
monogram that contain doxycycline hyclate equivalent to 20 mg doxycycline
delivered in HDPE bottles with desiccant pouches, induction seal liners and
CRC caps as 60 and 100 count packages; or in HDPE bottles with desiccant
pouches, induction seal liners and screw caps as 1000 count packages; or in
blisterpacks composed of aluminum foil and PVC/ACLAR.
TABLET RELEASE AND STABILITY SPECIFICATIONS:
Test Specification
---- -------------
Description White to off White, round, film
coated tablet with "PS 20" monogram
Identication Conforms to standard
Odor Practically odorless
Hardness Report
Friability NMT 1%, USP <1218>
Assay 90-120% Label Claim
Uniformity of Dosage Units Conforms, USP <905>
Total Impurities/Degradants (% Area) NMT 5%
Water NMT 8.5%
Dissolution Q: 85% in 90 Minutes
USP <711>
16
EXHIBIT B: BULK PRODUCT COA
(final version based upon negotiations with FDA)
17
EXHIBIT C.1: FINAL PRODUCT COA-100 COUNT HDPE BOTTLE
(final version based upon negotiations with FDA)
18
EXHIBIT C.2: FINAL PRODUCT COA-BLISTERPACK
(final version based upon negotiations with FDA)
19
EXHIBIT C.3: FINAL PRODUCT COA-1000 COUNT HDPE BOTTLE
(final version based upon negotiations with FDA)
20
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
EXHIBIT D-(final version based upon negotiations with FDA to
set expiration dating)
FEE SCHEDULE (Interim)
Order Volume: [**] tablets $[**]/tablet
[**] tablets $[**]/tablet
[**] tablets $[**]/tablet
21
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
December 1, 2000
Ed Thompson
President, PMRS Inc.
423 Sargon Way
Horsham, PA 19044
Dear Ed,
Accompanying this letter is a check for $[**]. This check is a deposit by
CollaGenex of the funds required by PMRS to acquire the equipment (e.g. a metal
detector and exterior vent system) to meet the requirements of the UK Medicine
Control Agency to manufacture Periostat for sale in the United Kingdom.
The following terms are associated with this deposit:
1. It is agreed that this investment by CollaGenex is the total amount that
CollaGenex will be required to deposit to accommodate the requirements of the
MCA.
2. It is agreed that the sum of $[**] will be deducted by PMRS from the final
invoice from PMRS to CollaGenex under the current manufacturing agreement
between PMRS and CollaGenex for the manufacturing of Periostat. This Agreement
(signed September 26, 2000 and amended and corrected December 1, 2000) is also
appended for reference. This Agreement presently expires on September 15, 2003,
so the deduction of $[**] will take place from the invoice for product
manufactured immediately prior to September 2003.
3. Immediately on receipt and signature of this letter PMRS will respond to the
MCA confirming its intent to comply with the requirements highlighted during the
MCA Inspection by Ms Liz Wall which took place in November 2000.
All other terms and conditions remain as per the attached Services and Supply
Agreement.
For PMRS:
/s/Edwin Thompson
- ------------------------------------
Mr. Edwin Thompson, President
For CollaGenex Pharmaceuticals Inc.
/s/Robert A. Ashley
- ------------------------------------
Robert A. Ashley
Senior Vice President
22