Exhibit 10.33
Private & Confidential
DATED 21 OCTOBER 2004
PENN PHARMACEUTICAL SERVICES LIMITED (1)
PENN T LIMITED (2)
CELGENE CORPORATION (3)
PENN PHARMACEUTICALS HOLDINGS LIMITED (4)
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TECHNICAL SERVICES AGREEMENT
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ADDLESHAW GODDARD
CONTENTS
CLAUSE PAGE
1 Interpretation........................................................2
2 Provision of Services.................................................8
3 Payment of the Fees and other payment matters........................11
4 Penn T Employees and the Premises....................................11
5 Order Process and Forecasting........................................12
6 Procurement and storage of Raw Materials, Consumables
and Finished Products..............................................12
7 Manufacture, Testing and supply......................................13
8 Dispatch of Finished Products........................................14
9 Sub-contracting by PPSL..............................................16
10 Confidentiality and Data Protection..................................16
11 Publicity............................................................18
12 Provision of information and defects in Finished Product.............18
13 Records and reporting................................................19
14 Intellectual Property................................................20
15 Warranties and limitation of liability...............................21
16 Change Control.......................................................23
17 Insurance............................................................24
18 Step-In Rights.......................................................25
19 Duration.............................................................27
20 Termination..........................................................27
21 Supply after Termination and Termination Assistance..................29
22 Force majeure........................................................29
23 Assignment...........................................................30
24 Guarantee............................................................30
25 Notices..............................................................31
26 Waiver...............................................................31
27 Entire Agreement.....................................................31
28 Void provision.......................................................31
29 Variation............................................................31
30 Costs................................................................31
31 Third Party Rights...................................................32
32 Dispute Resolution Procedure.........................................32
33 Governing Law and Jurisdiction.......................................32
4 Quality Agreement
5 Part 1 -Trademarks
Part 2 - Trademark Assignment
THIS AGREEMENT is executed and delivered as a deed on 21 October 2004
BETWEEN
(1) PENN PHARMACEUTICAL SERVICES LIMITED (registered in England and Wales,
Company No. 1331447) whose registered office is at Units 23/24
Tafarnaubach Industrial Estate, Tredegar, Gwent, Wales, NP22 3AA
(PPSL);
(2) PENN T LIMITED (registered in England and Wales, Company No. 4272045)
whose registered office is at Units 23/24 Tafarnaubach Industrial
Estate, Tredegar, Gwent, Wales, NP22 3AA (PENN T);
(3) CELGENE CORPORATION (registered in the State of Delaware), whose
principal place of business is at 7 Powder Horn Drive, Warren, New
Jersey 07059 USA; and
(4) PENN PHARMACEUTICALS HOLDINGS LTD (registered in England and Wales
Company No. 04294120) whose registered office is at Units 23/24
Tafarnaubach Industrial Estate, Tredegar, Gwent, Wales, NP22 3AA
(PPHL).
WHEREAS
(A) PPSL has knowledge, experience and regulatory approval to perform a
wide variety of services to companies in the pharmaceutical industry,
including but not limited to the manufacture, quality control,
packaging and distribution of medicinal products and holds appropriate
licences and authorisations to carry out such services;
(B) Penn T has a requirement, in relation to certain of its medicinal
products, for the provision of such services.
(C) PPSL and Penn T have entered into this Agreement with the intent that
PPSL shall provide certain services to Penn T upon and subject to the
terms of this Agreement.
(D) This Agreement sets out the general provisions relating to the Services
and the Technical Documents (as defined below) set out specific
technical aspects of the Services required to manufacture particular
formulations of Thalidomide.
IT IS AGREED as follows:
1 INTERPRETATION
1.1 In this Agreement the following capitalised terms shall save where the
context otherwise requires, have the following meanings:
AFFILIATE means, with respect to any party, any person or entity which,
directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such party. A person or
entity shall be deemed to control a corporation (or other entity) if
such person or entity possesses, directly or indirectly, the power to
direct or cause the direction of the management and policies of such
corporation (or other entity) whether through the ownership of voting
securities, by contract or otherwise
API means the active pharmaceutical ingredient required to manufacture
a formulation of Thalidomide
AUDIT REPRESENTATIVES means Penn T's appointed independent accounting
firm and any other technical and manufacturing inspectors or
consultants which Penn T appoints from time to time
BATCH means one (1) production lot of Finished Products
BATCH RECORD means the document created as and after each Batch is
manufactured that, if complete and accurate, reflects and incorporates
all aspects of the Master Batch Formula, the Certificate of Analysis,
and any MD Reports issued, with respect to such Batch
BUDGETED FEES means the estimated annual costs to PPSL of providing the
Services, apportioned to reflect the agreed percentage to be recharged
to Penn T. The table of Budgeted Fees for the first Quarter of this
Agreement is set forth in Appendix 1 to schedule 2
CALENDAR QUARTER means a period of three (3) calendar months commencing
on 1st January, 1st April, 1st July or 1st October as applicable save
that the Parties agree that the first Calendar Quarter shall commence
on the Commencement Date and end on the 31 Decemboer 2004
CELGENE PHARMION AGREEMENT means the licence agreement dated 16
November 2001 between Celgene (1) Pharmion GmbH (2) and Pharmion Corp
(3) (as amended and restated from time to time)
CERTIFICATE OF ANALYSIS means a certificate issued by PPSL stating that
a Batch has been manufactured in accordance with the Master Batch
Formula and stating the Test results
CGMPS means current Good Manufacturing Practices promulgated by any
Relevant Authority
CHANGE CONTROL means the change control provisions set forth in clause
16
COMMENCEMENT DATE means the date of this Agreement
CONSUMABLES means all materials or products required by PPSL in order
for PPSL to provide the Services other than the Raw Materials
CUSTOMER means a customer of Penn T who contracts with Penn T directly
for the supply of Finished Products
DCF means the dedicated containment facility provided by PPSL at the
Premises for the manufacture of Finished Product
DRUG MASTER FILE or DMF means the drug master file that relates to the
API
EMPLOYMENT REGULATIONS means the Transfer of Undertakings (Protection
of Employment) Regulations 1981;
EXCLUDED SERVICES means
(a) any services (including manufacture) related to Thalidomide
analogs, homologs or pro-drugs;
(b) analytical development, stability programs, any testing other than
Testing, formulation development, research, development and customised
clinical packaging which is not carried out in the DCF whether any such
services relate to Thalidomide or otherwise; and
(c) any services which fall outside what PPSL reasonably determine are
PPSL's core capabilities from time to time including, without
limitation any services related to parenterals; sterile products;
transdermals or inhalation products.
FDA means the United States Food and Drug Administration
FEES means the Pass Through Costs and Services Costs payable for the
Services set forth in schedule 2, as amended from time to time
FFDCA means the United States Federal Food Drug and Cosmetic Act
FINISHED PRODUCTS means any formulation of Thalidomide together with
the required Packaging and Labelling as set forth in the Technical
Documents as relevant, manufactured in accordance with this Agreement
FORCE MAJEURE means any event beyond the reasonable control of a Party
which prevents such Party being able to perform its obligations under
this Agreement including without limitation act of God, fire, flood,
storm, revolution, act of terrorism, riot or civil commotion (but
excluding strikes or industrial disputes of that Party's employees and
excluding any event which could have been avoided if such Party had
implemented reasonable risk management processes which are common
industry practice)
HAZARDOUS WASTE means all waste that is defined as hazardous by
Relevant Law, to the extent that such waste arises out of PPSL's
Processing or Packaging of Finished Products in accordance with this
Agreement
IN-PROCESS MATERIALS means the API and the Materials with respect to a
Batch during the time period beginning at the time PPSL begins
Processing Finished Products in accordance with the Master Batch
Formula and ending at the PPSL Approval Date
INTELLECTUAL PROPERTY means patents, registered designs, trade marks
and service marks (whether registered or not and including applications
for any of the foregoing), copyright, design right, rights in and to
software including source codes, rights in and to the technical
information and other confidential information and know-how, rights in
and to databases and all other intellectual property rights and similar
property rights of whatever nature subsisting in any part of the world
INTELLECTUAL PROPERTY RIGHTS means all rights existing anywhere in the
world in and to Intellectual Property
KNOW-HOW means all designs, specifications, datasheets, techniques,
operating procedures and materials, processes, inventions, formulations
and formulae, performance data, product and pre-clinical and clinical
trial data and records, calculations and other manufacturing and
technical data and information
LABEL or LABELLING means (1) written, printed or graphic materials, as
set forth in the Master Packaging Record or (2) the act of supplying
written, printed or graphic materials, as set forth in the Master
Packaging Record, including (i) upon the Finished Product, (ii) upon
any container or wrapper utilized with the Finished Product, or (iii)
accompanying the Finished Product, including, without limitation,
package inserts
LABORATORY means the laboratory determined pursuant to clause 8.4
LICENCES means the licences, authorisations and permits under Relevant
Law from time to time required to be held by PPSL to perform the
Services including without limitation being:
Wholesale Dealers Import - WI/4351/2
Wholesale Dealers - WL/4351/1
Manufacturer's Licence - ML/4351/1
Manufacturer's Special Licence - ML/4351/1
Manufacturer's Authorisation - IMP - MA (IMP) 4351
LIFE OF THIS AGREEMENT means the period commencing on the Commencement
Date and continuing until determined in accordance with clauses 19 and
20, during which this Agreement is in full force and effect
MASTER BATCH FORMULA means, for any Finished Product, the document
containing the formulas for API and Materials and the description of
the Process required to manufacture such Finished Product as set forth
in the Technical Documents relevant to such Finished Product
MASTER BATCH RECORD means, for any Batch, the Master Batch Formula,
Master Packaging Record
MASTER PACKAGING RECORD means, for any Finished Product, the document
containing the procedures and specification for Packaging and Labelling
such Finished Product as set forth in the Technical Documents relevant
to such Finished Product
MATERIALS means the excipients listed in the Master Batch Formula
required for incorporation into the Finished Products during
Processing, including, without limitation, capsules and any other
packaging materials, but excluding API
MD REPORT or MANUFACTURING DEVIATION REPORT means a report indicating
any deviation from the Processing and/or Packaging procedures set forth
in the Master Batch Record
MSDS means the Material Safety Data Sheet for API
NON-CONFORMING BATCH means any Batch that does not comply with the
applicable Specification or Master Batch Record or any Batch processed
in violation of cGMPs
NON-HAZARDOUS WASTE means all rejected Finished Product or In-Process
Materials or waste arising out of Processing and/or Packaging,
including without limitation, rejected or unusable Materials or API,
disposable manufacturing equipment (including filters used in
Processing and Packaging), wash rinse, and previously used or discarded
protective clothing, except to the extent that any of the foregoing is
Hazardous Waste
OFFICE FACILITIES means a lockable office space on the Premises with
secure document storage and all such office equipment, services and
utilities (including, for the avoidance of doubt electricity, gas and
water) as Penn T shall reasonably request. Such office space shall have
all the amenities enjoyed generally by PPSL and its employees including
access to such telephone lines and ISDN/broadband connections as Penn T
may reasonably require but excluding access to the PPSL local area
network or PPSL data storage whether electronic or otherwise
PACKAGE or PACKAGING means the procedures used in packing the Finished
Products into containers, bottles, cartons, shipping cases or any other
like matter, or the materials thereof, as set forth in the applicable
Master Packaging Record
PASS THROUGH COSTS means the costs incurred by PPSL as detailed in
paragraph 1(c) of schedule 2 and any other costs expressed as a Pass
Through Cost elsewhere in this Agreement but shall not include any
costs incurred in the name of Penn T and at no cost to PPSL
PARTIES means PPSL and Penn T
PAYMENT TERMS means the payment provisions set forth in clause 3 and
schedule 2
PENN PHARMION AGREEMENT means the agreement dated 7 March 2001 between
Pharmion GmbH (1) and Penn T (2) as amended and restated from time to
time (including by a subsequent agreement dated 16 November 2001) and
any other amendments or related agreements
PENN T EMPLOYEES means the Penn T Personnel who are officers or
employees of Penn T
PENN T INFORMATION means all information and data including, without
limitation, proprietary information and materials (whether or not
patentable) regarding Penn T's or its Customers' technology, products,
business information or objectives, as well as trade secrets and
information equivalent to them of Penn T and its Customers (including,
but not limited to, formulae, processes, methods, knowledge and
Know-how) in connection with the manufacture, sale of or other dealing
in the Finished Products or any other product formulations containing
Thalidomide or Thalidomide analogs, homologs or prodrugs
PENN T PERSONNEL means officers, employees, agents, representatives or
sub-contractors of Penn T or a company within the Celgene group or the
Customers, including without limitation the Audit Representatives
PHARMION THALIDOMIDE means any formulation or product containing
thalidomide as the active ingredient, as distributed by Pharmion Corp
or GmbH from time to time and for the time being including, without
limitation, that distributed under the Penn Pharmion Agreement and the
Celgene Pharmion Agreement
PPSL APPROVAL DATE means the date on which PPSL's quality assurance
department approves each Batch for shipment in compliance with the
Master Batch Record
PPSL INFORMATION means all information and data including, without
limitation, proprietary information and materials (whether or not
patentable) regarding PPSL's or PPSL's customers' (excluding Penn T or
Celgene) technology, products, business information or objectives, as
well as trade secrets and information equivalent to them (including,
but not limited to, formulae, processes, methods, knowledge and
Know-how) which is made known by PPSL to any Penn T Personnel.
PPSL KNOW-HOW means Know-How of PPSL or PPSL's customers (excluding
Celgene and Penn T) utilised by PPSL prior to the Commencement Date and
any Know-How developed by PPSL during the provision of the Services
which is of general application to PPSL's business
PREMISES means Units 23/24 Tafarnaubach Industrial Estate, Tredegar,
Gwent, Wales NP22 3AA and shall include the DCF
PROCESS or PROCESSING means the procedures, or any part thereof,
involved in manufacturing the Finished Product from the API and
Materials as set forth in the Master Batch Formula
QUALITY ASSURANCE or QA means the sum of the organised arrangements
made with the object of ensuring Finished Products are of the required
quality
QUALIFIED PERSON or QP means any person eligible to act as a "Qualified
Person" under EU Directive 2001/83/EC and named as such on any of the
Licences
QUALITY AGREEMENT means the quality agreement between PPSL and Penn T
setting out the quality control (being the organisation, documentation
and release procedures which ensure that the necessary and relevant
tests are actually carried out and that the materials are not released
for use, nor products released for sale or supply, until their quality
has been judged to be satisfactory) and QA responsibilities of PPSL and
Penn T as set forth in schedule 4
RAW MATERIALS means API and Materials
RECALL means a recall, field correction, market withdrawal, stock
recovery or other similar action in relation to a Finished Product
RELEVANT AUTHORITY means any regulatory authority or agency anywhere in
the world, the regulatory requirements stipulated by which are
applicable to the performance or receipt of Services including without
limitation the FDA and its equivalents in other jurisdictions
RELEVANT LAW means all applicable statutory, sub-ordinate legislation,
rules or regulations to which a Party is subject from time to time,
including the rules, regulatory submissions, regulatory approvals,
regulatory standards, codes of conduct, codes of practice, guidance and
accreditation terms stipulated by any Relevant Authority to which any
Party is subject from time to time including without limitation the
FFDCA and its equivalents in other jurisdictions
RESTRICTED SERVICE means to manufacture, sell or otherwise deal in the
Finished Products or any other product formulations containing
Thalidomide or Thalidomide analogs, homologs or prodrugs thereof and
RESTRICTED SERVICES shall be construed accordingly
RESTRICTED PRODUCTS means the thalidomide drugs known as Thalomid(R),
Sauramide and Pharmion Thalidomide
SAA means the share acquisition agreement entered into on or around the
date hereof between Craig Rennie and others (1), Celgene UK
Manufacturing Limited (2) and Celgene (3).
SAURAMIDE means the formulation of Thalidomide with the specification
set forth in the Technical Documents relevant to Sauramide
SAURAMIDE DEDUCTION means the amount calculated pursuant to paragraph
1(d) of schedule 2
SECONDARY RESTRICTED PRODUCTS means any formulation containing
thalidomide or thalidomide analogs, homologs or prodrugs thereof
including, without limitation, any formulation that contains
thalidomide but excluding the thalidomide drugs known as Thalomid,
Sauramide and Pharmion Thalidomide
SERVICES means the services to be carried out by PPSL as detailed in
schedule 1 and the Technical Documents
SERVICES COSTS means the costs incurred by PPSL, as detailed in
paragraph 1(b) of schedule 2
SPECIFICATION means, for each Finished Product, the appropriate
standards of identity, strength, quality and purity for the Materials,
API, In-Process Materials and Finished Product, and the Tests thereof,
as set forth in the Quality Agreement and in the Technical Documents
relevant to such Finished Product
STEP-IN means the right of Penn T to take over the provision of the
Services or any part thereof in accordance with clause 18
TECHNICAL DOCUMENTS means any one of or combination of the Quality
Agreement the Specification for any Thalidomide formulation, Master
Batch Formula, Master Packaging Record and any other technical protocol
or technical details of how the Services are to be performed or how the
Premises are to be maintained each of which are agreed, amended or
supplemented by the Parties from time to time
TERRITORY means all territories covered in any and all agreements
entered into by (or assigned or novated to) Penn T or Celgene and which
relate to the formulation, storage, supply, sale or distribution of any
Restricted Product or any Finished Product and any other agreement with
any third party to do the same
TESTS or QC TESTS means the analytical procedures to be performed as
applicable on the Raw Materials, Consumables, In-Progress Materials and
Finished Products to determine whether such Raw Materials, Consumables,
In-Progress Materials and Finished Products are in accordance with the
applicable Specification, as such tests are set forth in the Technical
Documents
THALIDOMIDE means the drug commonly known as thalidomide which is
represented by the chemical name a-(N-phthalimido)glutarimide
(+/-)2-(2,6-dioxo-3-piperidyl)isoindoline-1,3-dione.
TRADEMARKS means the trademarks set forth in Part 1 of Schedule 5
YEAR means a 12 month period ending on any anniversary of the
Commencement Date.
1.2 In addition:
(a) the recitals, schedules and Technical Documents form part of
this Agreement and references to this Agreement include the
recitals, schedules and Technical Documents;
(b) references to recitals, clauses and schedules are to recitals
and clauses of and schedules to this Agreement; references in
a schedule to paragraphs are to the paragraphs of that
schedule; and a reference to a clause or paragraph number is,
unless otherwise specified, a reference to all its sub-clauses
or sub-paragraphs;
(c) words importing a gender include every gender and references
to the singular include the plural and vice versa;
(d) words denoting persons include individuals and bodies
corporate, partnerships, unincorporated associations, limited
liability company, trust, business trust, association, joint
stock company, joint venture, pool, syndicate, sole
proprietorship, unincorporated organization, governmental
authority or any other form of entity not specifically listed
herein;
(e) references to this Agreement or any other document are to this
Agreement or that document as in force for the time being and
as amended, supplemented, varied or replaced from time to time
in accordance with the requirements of this Agreement or that
document (as the case may be);
(f) a reference to any body is:
(i) if that body is replaced by another organisation,
deemed to refer to that replacement organisation; and
(ii) if that body ceases to exist, deemed to refer to that
organisation which most substantially serves the same
purposes as the original body;
(g) a reference to a statute or statutory provision shall be
construed as including a reference to any subordinate
legislation (as defined by section 21(1) Interpretation Act
1978) made from time to time under the statute or statutory
provision whether on, before or after the Commencement Date;
(h) a reference to a statute, statutory instrument or any other
subordinate legislation shall unless otherwise stated be
construed as including a reference to that statute, statutory
instrument or subordinate legislation as in force at the
Commencement Date and as from time to time modified or
consolidated, superseded, re-enacted or replaced after the
Commencement Date; and
(i) references in this Agreement to a party shall, except where
the context requires otherwise, include its successors in
title and permitted assignees.
1.3 The headings and contents table in this Agreement are for convenience
only and do not affect its interpretation.
2 PROVISION OF SERVICES
2.1 In consideration of the payment by Penn T of the Fees, PPSL hereby
agrees to provide the Services to Penn T in accordance with the
Technical Documents and upon the terms and conditions set out in this
Agreement.
2.2 Except pursuant to this Agreement, PPSL shall not, and shall procure
that its Affiliates shall not directly or indirectly carry out any of
the Restricted Services for the Life of this Agreement save that
neither PPSL nor its Affiliates shall be in breach of this Agreement
where any one of them provides any Restricted Service to Celgene or any
of Celgene's Affiliates.
2.3 PPSL shall not, and shall procure that its Affiliates shall not
directly or indirectly carry out any of the Restricted Services for a
period of 2 years following termination of this Agreement, save that
neither PPSL nor its Affiliates shall be in breach of this Agreement
where any one of them provides any Restricted Service to Celgene or any
of Celgene's Affiliates.
2.4 Except as otherwise agreed between the Parties, or in relation to the
manufacture of Sauramide under the licence granted by Celgene in clause
14.3(b), PPSL shall use the DCF exclusively for the manufacture of the
Finished Products and not for any other purpose whatsoever, for the
Life of the Agreement.
2.5 At the request of Penn T, PPSL shall assist Penn T in obtaining a
Wholesale Dealers licence and any other licences for its business
carried on at the Premises considered to be necessary by Penn T in
order for Penn T to carry on its business, meet its obligations with
Customers and/or to perform any of the Services itself and the cost of
such assistance shall be at no cost to Penn T.
2.6 In the performance of the Services, PPSL shall make available the
services of the QP and shall ensure that the QP shall carry out his/her
duties in accordance with all Relevant Law and within the "Code of
Practice for Qualified Persons" produced jointly by the professional
and regulatory bodies for the pharmaceutical industry.
2.7 If Penn T requires additional or alternative work from PPSL not
specified herein, and such work is required or is necessary for the
commercial or clinical manufacture of any formulation of Thalidomide
such work and the fees for such work shall be determined through Change
Control. Any other services, including without limitation the Excluded
Services, if accepted by PPSL in its sole discretion shall, unless
otherwise agreed between the Parties, be performed under a separate
agreement and is beyond the scope of this Agreement.
2.8 The Services shall be provided by the PPSL personnel approved by Penn T
prior to the Commencement Date and PPSL shall consult with Penn T in
relation to any proposed changes to such personnel and, for the
avoidance of doubt, Penn T's approval shall not be required for any
such change. PPSL acknowledges that certain of its personnel and in
particular Craig Rennie; Keren Winmill; Paul Thomas; Steve Evans and
Richard Barnett are key to the provision of the Services and PPSL shall
use its best endeavours to retain and incentivise these key personnel
in the normal course of its business, provided that nothing in this
clause 2.8 shall fetter the rights and discretion of the management of
PPSL to make decisions relating to such employees which are in the best
interests of PPSL and its business. PPSL acknowledges that Penn T may
also wish to provide additional incentives to such personnel through
PPSL at Penn T's costs.
2.9 Notwithstanding clauses 2.2 and 2.3 above, PPSL undertakes with Penn T
that without the prior consent in writing of Penn T, PPSL will not and
will procure that its Affiliates will not, except pursuant to this
Agreement and, in particular, in order for it to perform its
obligations to carry out the Service hereunder directly or indirectly,
whether by itself, its employees (whilst an employee of PPSL) or agents
(whilst acting as an agent for PPSL) and whether on its own behalf or
on behalf of any other person, firm or company, during the Life of the
Agreement :
RESTRICTED PRODUCTS
(a) (subject to clause 2.12) carry on, be employed or otherwise
engaged, concerned or interested in, any business which is
engaged in (or arranges with any third party for) the
manufacture, procurement of manufacture, distribution or sale
of the Restricted Products or any of them in the Territory (a
COMPETING BUSINESS);
(b) in relation to the manufacture, production, distribution or
sale of Restricted Products or any of them in the Territory,
solicit or canvass, accept orders from or otherwise deal with
any person, firm, company or other organisation who was a
customer of Penn T, at any time during the Life of the
Agreement and with whom any PPSL employee had personal
dealings;
(c) solicit or entice away or endeavour to solicit or entice way
or hire from Penn T, any person employed or otherwise engaged
by the same in the manufacture, procurement of manufacture,
distribution or sale of the Restricted Products or any of them
in the Territory, whether or not that person would commit any
breach of his contract of employment by reason of his leaving
the service of the same;
SECONDARY RESTRICTED PRODUCTS
(d) (subject to clause 2.12) carry on, be employed or otherwise
engaged, concerned or interested in, any business which is
engaged in (or arranges with any third party for) the
manufacture, procurement of manufacture, distribution or sale
of the Secondary Restricted Products or any of them in the
Territory (a SECONDARY COMPETING BUSINESS);
(e) in relation to the manufacture, production, distribution or
sale of Secondary Restricted Products or any of them in the
Territory, solicit or canvass, accept orders from or otherwise
deal with any person, firm, company or other organisation who
was a customer of Penn T, at any time during the Life of the
Agreement and with whom any employee of PPSL had personal
dealings;
(f) solicit or entice away or endeavour to solicit or entice way
or hire from Penn T, any person employed or otherwise engaged
by the same in the manufacture, procurement of manufacture,
distribution or sale of the Secondary Restricted Products or
any of them in the Territory, whether or not that person would
commit any breach of his contract of employment by reason of
his leaving the service of the same.
2.10 Notwithstanding clauses 2.2 and 2.3 above, PPSL undertakes with Penn T
that without the prior consent in writing of Penn T, PPSL will not and
will procure that its Affiliates will not, directly or indirectly,
whether by itself, its employees (whilst an employee of PPSL) or agents
(whilst acting as an agent for PPSL) and whether on its own behalf or
on behalf of any other person, firm or company, for a period of 2 years
following termination of this Agreement:
RESTRICTED PRODUCTS
(a) (subject to clause 2.12) carry on, be employed or otherwise
engaged, concerned or interested in, any business which is
engaged in (or arranges with any third party for) the
manufacture, procurement of manufacture, distribution or sale
of the Restricted Products or any of them in the Territory (a
COMPETING BUSINESS);
(b) in relation to the manufacture, production, distribution or
sale of Restricted Products or any of them in the Territory,
solicit or canvass, accept orders from or otherwise deal with
any person, firm, company or other organisation who was a
customer of Penn T, at any time during the Life of the
Agreement and with whom any PPSL employee had personal
dealings;
(c) solicit or entice away or endeavour to solicit or entice way
or hire from Penn T, any person employed or otherwise engaged
by the same in the manufacture, procurement of manufacture,
distribution or sale of the Restricted Products or any of them
in the Territory, whether or not that person would commit any
breach of his contract of employment by reason of his leaving
the service of the same;
SECONDARY RESTRICTED PRODUCTS
(d) (subject to clause 2.12) carry on, be employed or otherwise
engaged, concerned or interested in, any business which is
engaged in (or arranges with any third party for) the
manufacture, procurement of manufacture, distribution or sale
of the Secondary Restricted Products or any of them in the
Territory (a SECONDARY COMPETING BUSINESS);
(e) in relation to the manufacture, production, distribution or
sale of Secondary Restricted Products or any of them in the
Territory, solicit or canvass, accept orders from or otherwise
deal with any person, firm, company or other organisation who
was a customer of Penn T, at any time during the Life of the
Agreement and with whom any employee of PPSL had personal
dealings;
(f) solicit or entice away or endeavour to solicit or entice way
or hire from Penn T, any person employed or otherwise engaged
by the same in the manufacture, procurement of manufacture,
distribution or sale of the Secondary Restricted Products or
any of them in the Territory, whether or not that person would
commit any breach of his contract of employment by reason of
his leaving the service of the same.
2.11 Subject to clauses 2.12 and 11, PPSL undertakes with Penn T that it
will not at any time during the Life of the Agreement directly or
indirectly, whether by itself, its employees (whilst employed by PPSL)
or agents (whilst agents of PPSL) or otherwise howsoever in the course
of carrying on any trade or business, claim, represent or otherwise
indicate any present association with Penn T.
2.12 The restrictions in clause 2.9, 2.11 and 2.10 shall not operate to
prohibit PPSL or any of its directors, officers or employees, from
holding in aggregate up to 3 per cent of the shares of any company
operating a Competing Business or a Secondary Competing Business (as
the case may be), the shares of which are listed or dealt in on a
recognised stock exchange.
2.13 If a covenant is held to be illegal, invalid or unenforceable but would
be legal, valid or enforceable if some part were deleted or the period
or area of application were reduced or modified, then the covenant
shall apply with such modification as may be necessary to make it
legal, valid and enforceable.
3 PAYMENT OF THE FEES AND OTHER PAYMENT MATTERS
3.1 In consideration of the matters set forth in clause 2 Penn T agrees
during the Life of this Agreement to pay the Fees in accordance with
the Payment Terms.
3.2 The Services Costs are exclusive of value added tax and value added tax
shall be added to the Fees where appropriate. Any further tax or duty
(other than corporation tax or other tax on profits) which directly
affect PPSL's operating costs to provide the Services and which it
would not have incurred except by reason of providing the Services,
shall be recharged to Penn T as Pass Through Costs.
3.3 Penn T shall be entitled to set off and withhold any payment in
satisfaction or part satisfaction of any bone fide claim for breach of
this Agreement.
3.4 In the event of late payment of any sum due to either Party, such Party
may without prejudice to its other rights and remedies hereunder charge
interest at the rate of 2% per annum above the base lending rate from
time to time of The Royal Bank of Scotland. Such interest will accrue
from the date upon which payment was due until payment in full. Such
interest shall continue both before and after judgment.
3.5 If PPSL fails to deliver Finished Product by the agreed date or
otherwise breaches the Agreement and such breach causes Penn T to incur
liability to its Customers, PPSL shall, subject to clauses 15.6 and
15.10 and provided that Penn T complies with 15.11, indemnify Penn T
against such liability.
3.6 If Penn T fails to make any payment that is due under this Agreement or
Celgene fails to make any payment under its parent company guarantee to
PPSL, such that the monies owing would give PPSL a right to terminate
this Agreement pursuant to clause 20.3, PPSL may, without prejudice to
its other rights and remedies suspend all Services until such payments
with interest thereon have been paid.
4 PENN T EMPLOYEES AND THE PREMISES
4.1 Penn T shall have the right to locate up to three (3) Penn T Employees
at the Premises in order to perform any function relating to this
Agreement or its business with Customers from time to time and the
identity of such individuals shall, subject to clause 4.4, be at the
sole discretion of Penn T. Penn T may locate additional Penn T
Personnel in the Premises with the consent of PPSL, such consent not to
be unreasonably withheld or delayed. Penn T shall give PPSL reasonable
advance notice in writing of the identity of all Penn T Personnel to be
located at the Premises from time to time.
4.2 PPSL shall make the Office Facilities available at the Premises to Penn
T Personnel in accordance with the terms of this Agreement. PPSL shall
allow Penn T Personnel full access to and from the Premises so far as
the same is reasonably required by Penn T, subject to compliance with
clauses 4.4 and 4.5 below.
4.3 PPSL shall be responsible for the maintenance, repair, servicing and
upkeep of the Office Facilities. PPSL will give notice to Penn T of any
scheduled or emergency maintenance, repairs, shutdowns and alterations
which may affect Penn T's use of the Office Facilities. PPSL will use
reasonable efforts to accommodate the requirements of Penn T in this
respect, except in the case of genuine emergencies.
4.4 PPSL shall have the right to refuse access to the Premises to:
(a) any Penn T Personnel who does not comply with the standard
policies, safety procedures and regulations applicable to the
Premises and notified to Penn T Personnel from time to time;
and
(b) any Penn T Personnel who is a competitor of or who is an
officer or employee of a competitor of PPSL (but excluding
Penn T Employees).
4.5 Penn T shall and shall ensure the Penn T Personnel shall use the Office
Facilities and Premises in accordance with PPSL's standard policies,
safety procedures and regulations applicable to PPSL personnel, which
are notified to Penn T from time to time.
4.6 PPSL shall be responsible for identifying, obtaining and maintaining
all consents, licences and permits (including any consents which may be
required from PPSL's bankers or holders of security over PPSL's assets)
which may be required to allow Penn T to locate the Penn T Personnel at
the Premises as envisaged by this clause 4 and in the event that Penn T
exercises its Step-In Rights pursuant to clause 18.
5 ORDER PROCESS AND FORECASTING
5.1 Not less than forty-five (45) days prior to the first day of each
Calendar Quarter, Penn T shall prepare and provide PPSL with a written
forecast of its estimated Finished Product requirements for each of the
following four (4) Calendar Quarters. Subject in all cases to clause
5.2, Penn T shall not without the prior written consent of PPSL,
increase the quantity estimated for the first Calendar Quarter of each
forecast by more than twenty-five percent (25%) from the quantity
estimated for the second Calendar Quarter of the previous forecast.
5.2 Penn T shall not provide to PPSL any forecast, estimating Penn T's
Finished Product requirement, if such requirement is in excess of the
manufacturing capacity of the DCF and PPSL shall provide Penn T with
details of such capacity on request.
5.3 If Penn T places any order for Finished Product, the delivery time for
which would require PPSL to manufacture Finished Product in excess of
the manufacturing capacity of the DCF, the delivery time shall be
adjusted only to the extent necessary to allow for such manufacturing
capacity restraint and PPSL shall fully co-operate with Penn T in
relation to any expansion of the DCF or other increase in the
manufacturing capacity of PPSL in relation to Finished Products, the
process and capital costs of which shall be determined through Change
Control.
5.4 Penn T shall purchase manufacturing services hereunder by submitting
firm purchase orders to PPSL. Each purchase order shall be in writing
in a form reasonably acceptable to PPSL, and shall specify the Finished
Products ordered, the quantity ordered, the required delivery date
(which shall not be a date sooner than 90 days after the date of such
purchase order) and delivery terms.
5.5 The minimum size of any order for Finished Products shall be a single
Batch with larger orders being in whole number multiples of a Batch. In
the event of a conflict between the terms and conditions of any
purchase order and this Agreement, the terms and conditions of this
Agreement shall prevail.
5.6 Each Calendar Quarter, PPSL shall manufacture, supply and deliver to
Penn T such quantities of Finished Products as Penn T orders under
clause 5.4 above. PPSL shall, subject to clause 5.2, use its
commercially reasonable efforts to manufacture and supply to Penn T any
quantities of Finished Products in excess of one hundred percent (100%)
of the quantity ordered for such Calendar Quarter under clause 5.4
above, provided that Penn T has furnished PPSL with the necessary
amount of Raw Materials.
5.7 If PPSL becomes aware of any circumstances that may cause PPSL to
default in its obligation above to deliver such quantities of
conforming Finished Products as Penn T forecasted for any Calendar
Quarter, PPSL shall give Penn T prompt written notice describing such
circumstances, together with a proposed course of action to remedy such
failure.
6 PROCUREMENT AND STORAGE OF RAW MATERIALS, CONSUMABLES AND FINISHED
PRODUCTS
6.1 As required by Penn T, PPSL shall procure on behalf of Penn T, such Raw
Materials as are required for the provision of the Services. Penn T
shall notify PPSL of the quantity of any Raw Materials to be purchased
and the identity of the supplier with which the order should be placed.
Penn T hereby authorises PPSL to execute purchase orders for Raw
Materials on Penn T's behalf and Penn T shall be directly liable to any
third party supplier for payment for such Raw Materials.
6.2 PPSL shall purchase all Consumables as are required for the provision
of the Services and shall recharge such Consumables to Penn T at cost.
6.3 Unless otherwise agreed in writing, PPSL will arrange as necessary for
clearance through customs of all Raw Materials shipped to PPSL.
6.4 PPSL shall use reasonable endeavours to ensure any goods or services
which PPSL procures for or purchases and recharges to Penn T shall be
at the best price available and, subject to clause 9.4, Penn T shall be
entitled to require PPSL to use alternative suppliers or service
providers.
6.5 Title to all Raw Materials, In-progress Materials and Finished Products
shall remain with Penn T at all times.
6.6 PPSL shall hold Raw Materials, Consumables, In-Process Materials and
Finished Products in a safe, secure and suitable environment at the
Premises and in accordance with recognised industry standards and all
Relevant Laws.
6.7 PPSL shall keep all API segregated from other materials within its
ownership or reasonable control so as to maintain the integrity of the
substance and shall not allow any samples of the substance to be used
or Tested by any party not under its direct supervisory control for any
purposes.
7 MANUFACTURE, TESTING AND SUPPLY
7.1 PPSL shall verify the quantity and quality of all API received by PPSL
according to the methods and procedures set forth in the Specification
within sixty (60) days of receipt by PPSL of the API. Within such sixty
(60) day period and promptly following any determination of a
discrepancy by PPSL, PPSL shall inform Penn T in writing of and provide
supporting documents in relation to any discrepancies in the quantity
and/or quality of the API received and the documents accompanying each
shipment of the API.
7.2 If PPSL notifies Penn T of a discrepancy in the quantity or quality of
the API within the sixty (60) day period described in clause 7.1 above,
Penn T shall use its best efforts to either ship to PPSL, or authorise
PPSL to purchase pursuant to clause 6.1 above additional API within the
time period necessary for PPSL to manufacture Finished Product in
accordance with the completion date for delivery of Finished Product
pursuant to the applicable purchase order.
7.3 If PPSL fails to inform Penn T of any discrepancy in the quantity or
quality of the API within the sixty (60) day period described in clause
7.1 above or if there is damage to the API within the foregoing sixty
(60) day period and PPSL cannot demonstrate that such damage occurred
prior to delivery to PPSL or if any such damage is the result of PPSL's
failure to handle the API in accordance with the terms of this
Agreement, then PPSL shall (a) at PPSL's option return the API to Penn
T or dispose of the same according to Penn T's instructions and (b) at
Penn T's option, either (i) purchase from Penn T replacement API for a
value equal to Penn T's then current API cost for the API that is lost,
damaged or destroyed, or (ii) credit Penn T on it's next invoice for an
amount equal to Penn T's then-current cost for such API.
7.4 In respect of any Raw Materials, Consumables, In-Progress Materials and
Finished Products PPSL shall perform such Tests and analysis as are
necessary for this Agreement or as are requested by Penn T, but
excluding any Excluded Services, and shall maintain the confidentiality
of such Test results in accordance with clause 10.
7.5 PPSL shall Process, Test (unless PPSL is requested by Penn T to conduct
a full analysis), Package and Label the Finished Products in conformity
with the Master Batch Record. Unless otherwise required by Relevant
Law, PPSL shall not make any changes to the Master Batch Record or
Tests without prior written consent from Penn T, which consent shall
not be unreasonably withheld. Penn T shall notify PPSL in writing of
any proposed changes to the Master Batch Record or Tests. PPSL shall
use reasonable commercial efforts to promptly implement changes
directed by Penn T to the Master Batch Record or Tests including, but
not
limited to, any required capital equipment expenditures. PPSL shall
notify Penn T and obtain prior written approval (such approval shall
not be unreasonably withheld) for any proposed changes related to the
Finished Product outside the Master Batch Record or Tests prior to
their implementation by PPSL.
7.6 PPSL shall manufacture the Finished Products in accordance with cGMPs
and all Relevant Law.
7.7 PPSL shall provide all Labelling and Packaging for the Finished
Products and such Labelling and Packaging shall be in accordance with
the Master Packaging Record. PPSL shall afford Penn T the opportunity
to approve, on a sample basis, and Penn T shall review and approve the
Labels for the Finished Products. Should Penn T desire or be required
to make any change to any such Labels, Penn T shall revise and update
all artwork and text associated with such change and provide such
changes to PPSL. PPSL shall make all commercially reasonable and
necessary arrangements to print such changed Labels and shall provide
printer's proofs to Penn T for review and approval. Penn T shall
promptly provide PPSL with any necessary corrections thereto or notify
PPSL of its approval of such proofs.
7.8 PPSL shall keep accurate and complete records of all stock of Raw
Materials and Finished Products and shall furnish to Penn T a stock
report on an annual basis on request by Penn T.
8 DISPATCH OF FINISHED PRODUCTS
8.1 Upon production of Finished Products pursuant to this Agreement, PPSL
shall pack, dispatch and deliver Finished Products to the Customer's
delivery destination as detailed on the relevant purchase order or
otherwise as instructed by Penn T.
8.2 Unless otherwise agreed in writing, risk in the Raw Materials shall
pass to PPSL when the Raw Materials are delivered at the Premises and
risk in the Raw Materials, In-Progress Materials and Finished Products
shall remain with PPSL until the Finished Products are delivered to the
Customer's delivery destination as detailed on the relevant purchase
order or otherwise as instructed by Penn T, whereupon risk will pass to
the Customer and/or Penn T as appropriate.
8.3 The Batch Records shall be accepted as complete and accurate unless
Penn T notifies PPSL in writing within forty-five (45) days of delivery
of Finished Products that Penn T Customer has determined that either
the Finished Products do not conform to the Specification or that the
Batch Records are not complete, provided, however, in the case of
Finished Product having latent defects, which upon diligent examination
in accordance with all quality control Testing procedures set out in
the Specifications and Quality Agreement upon receipt could not have
been discovered, Penn T must give notice to PPSL within twenty (20)
days after discovery of such latent defect, setting forth the specific
basis for such rejection. Upon written notification by Penn T of a
deficient Batch Record or Non-Conforming Batch, PPSL shall review the
specific basis for such rejection and upon acceptance of such
rejection, PPSL shall correct the deficiency to the Batch Record or
undertake additional, approved, manufacturing activity, including
recovery of materials by weight, sorting or de-Labelling and
re-Labelling (but excluding any reworking) within forty-five (45)
business days of such notification with no additional cost to Penn T
(subject to clause 8.4 below).
8.4 If prior to either Penn T's acceptance of the Batch Record, or Penn T's
notification to PPSL of latent defects, the Parties disagree concerning
whether the Finished Product meets Specification or whether the Batch
Records are complete, Penn T may ask PPSL's Qualified Person to provide
details and test data about the quality and the manufacturing
procedures relating to the Finished Goods in question. If, contrary to
the determination of PPSL's QP, Penn T determines that the Finished
Products do not meet the Specification or that the Batch Record is
incomplete, either Party may request, in writing, at any time, that an
independent laboratory be used to determine whether the Finished
Product meets the Specification and whether the Batch Record is
complete. Thereafter, the Parties shall promptly name a reputable and
mutually acceptable independent laboratory that has been qualified for
the appropriate testing method(s) set forth in the applicable
regulatory licence application and in the absence of agreement by the
Parties within fourteen (14) days, the dispute shall be referred to the
laboratory used by the Home Office Forensic Science Service from time
to time (or if this laboratory cannot undertake the Service in a timely
fashion by an alternative
laboratory nominated by the Home Office Forensic Science Service). The
Laboratory shall Test the Finished Product for compliance with the
Specification, and such Test results obtained by the Laboratory shall
be final and binding.
8.5 If the Laboratory determines that the Finished Product meets
Specification, Penn T shall:
(a) pay to PPSL the amount invoiced for such Finished Product, and
all other expenses reasonably attributable or resulting from
the Laboratory referral; and
(b) pay to the Laboratory the amount of the fees charged by the
Laboratory for such Testing.
8.6 If the Laboratory determines that such sample fails to conform to the
applicable Specification, then PPSL shall:
(a) undertake additional, approved manufacturing as described in
clause 8.3 above as soon as reasonably practicable and in any
event within forty-five (45) business days after receipt of
the Laboratory findings;
(b) pay to the Laboratory the amount of the fees charged by the
Laboratory for such Testing and all other expenses reasonably
attributable or resulting from the Laboratory referral;
(c) purchase at PPSL's cost the required additional Raw Material
and Consumables necessary to manufacture conforming Finished
Product;
(d) explain to Penn T in writing the reason for the failure,
provide copies of all Test data and reports and produce an
investigation report in accordance with the Quality Agreement;
and
(e) within 30 days offer the occurrence of the problem report to
Penn T the steps to be taken to prevent a re-occurrence of the
problem.
8.7 If PPSL fails to deliver to Penn T the quantity of conforming Finished
Products that Penn T orders under any purchase order on the agreed
delivery date or if none stated within ninety (90) days of the date of
the purchase order, after providing written notice to PPSL, Penn T
shall where the circumstances described in clause 8.8 do not apply,
have the right to purchase substitute Finished Products from a third
party in substitution for the quantity of conforming Finished Products
which PPSL failed to deliver hereunder. PPSL shall reimburse Penn T
within 14 days for the difference between the cost of obtaining such
substitute Finished Products (plus any commercially reasonable charges,
expenses or commissions incurred by Penn T in connection with effecting
cover, and any other reasonable expenses incident to such failure),
less the price which would have been due to PPSL for the manufacture of
the like quantity of Finished Products if supplied by PPSL hereunder
provided always that Penn T shall use commercially reasonable efforts
to purchase the substitute Finished Products at the best price
available in the open market and on the best commercial terms
available.
8.8 PPSL shall not be liable for delays in delivery of Finished Product or
any other breach of this Agreement to the extent that such delay in
delivery or other default is directly caused by an act or omission of
Penn T (including without limitation Penn T Personnel) or Celgene
provided such act or omission:
(a) was notified and detailed to Penn T as soon as the act or
omission occurred; and
(b) was not thereafter rectified by Penn T as soon as reasonably
practicable.
8.9 Neither Party shall be required to comply with any provision of this
Agreement or with the instructions of the other or the instructions of
Celgene or a Customer if such compliance would cause that Party to be
in violation of any Relevant Law.
8.10 PPSL shall, on reasonable written notice and at Penn T's sole cost,
dispatch any remaining Raw Materials, In-Progress Materials or Finished
Products to Penn T or arrange for the destruction of Raw Materials,
In-Progress Materials or Finished Products so requested by Penn T to be
so destroyed whether upon the expiry date of the Raw Materials or
otherwise. PPSL shall ensure destruction of Raw Materials, In-Progress
Materials or Finished Products in accordance with all Relevant Law and
shall upon written request furnish Penn T promptly with a certificate
of such destruction.
9 SUB-CONTRACTING BY PPSL
9.1 PPSL may not sub-contract any part of the Services except to a
sub-contractor approved in writing in advance by Penn T and on
condition that the sub-contractor enters into a contract with PPSL
which:
(a) incorporates all the applicable terms of this Agreement; and
(b) the right to visit the site and audit the records of the
sub-contractor to the extent necessary for Penn T to exercise
its rights of audit under this Agreement.
provided that this clause shall not apply to PPSL's sub-contractors who
supply PPSL with services or goods which do not impact on the quality
of Finished Products or affect either Party's ability to comply with
Relevant Law and which fall into the following categories: the supply
of Consumables, calibration services, specialist maintenance services,
qualification services relating to air cleanliness in manufacturing
rooms, treatment services for portable water, waste management
services, freight services, pest control services, security services
and IT services.
9.2 Where the Services or part thereof are sub-contracted by PPSL, PPSL
shall carry out such reconciliations, checks and testing as are
reasonable to verify the integrity of the work carried out by such
sub-contractor and to verify that all unused materials including but
not limited to Raw Materials provided by PPSL to such sub-contractor
are duly returned to PPSL.
9.3 PPSL shall be responsible for the delivery of its sub-contractors
service and PPSL shall, subject to clauses 15.6 and 15.10 and provided
that Penn T complies with clause 15.11, indemnify Penn T against any
liability, costs expenses incurred or losses suffered by Penn T arising
from any act or omission of its sub-contractors.
9.4 Penn T shall have the right to require PPSL to sub-contract any part of
the Service, which is already sub-contracted, to a sub-contractor of
Penn T's choice provided:
(a) PPSL may veto any required subcontractor that cannot meet
PPSL's standard technical requirements; and
(b) PPSL shall have the right to terminate its contract with any
required subcontractor if the subcontractor is in breach of
its contract with PPSL and as a direct result PPSL is in
breach of this Agreement.
10 CONFIDENTIALITY AND DATA PROTECTION
10.1 Subject to clause 10.2, PPSL shall keep the Penn T Information
confidential and Penn T shall keep the PPSL Information confidential
and both Penn T and PPSL shall keep the terms of this Agreement
confidential and in respect of the other Party's information
(INFORMATION) neither PPSL or Penn T shall :
(a) make use of the Information, except in connection with the
provision of the Services; or
(b) disclose the Information to any third party for a period of 10
years from the date of receipt of such Information.
10.2 The provisions of clause 10.1 shall not prevent either Party from using
any Information to the extent that such Information:
(a) has come into the public domain otherwise than by reason of a
breach by the receiving party, its directors, officers,
employees or agents of the terms of this clause;
(b) has been obtained by the receiving party from any other source
having a right of further disclosure or;
(c) in the case of Penn T only, was already known to Penn T at the
time of such disclosure to it;
(d) is required to be disclosed by the receiving party by Relevant
Law including but not limited to disclosure for regulatory
purposes, provided however that the receiving party shall so
notify the disclosing party of its intent and cooperate with
the disclosing party on reasonable measures to protect the
confidentiality of the Information;
(e) in the case of Penn T only, is required to be disclosed by
Penn T to its Customers; or
(f) in the case of PPSL only, is required for the manufacture,
distribution, sale and export of Sauramide pursuant to the
licence provided by Celgene in clause 14.3(b).
10.3 PPSL shall ensure that none of Penn T's Information shall be used by
the directors, officers, agents, employees, consultants or contractors
of PPSL, except on like terms of confidentiality as aforesaid, and that
the Penn T Information and the Raw Materials shall be kept fully
private and confidential by them. Further PPSL, prior to disclosure of
Penn T's Information to any directors, officers, agents, employees,
consultants or contractors of PPSL, shall ensure that each such person
is bound in writing to observe confidentiality provisions which are
substantially the same as this clause.
10.4 Penn T shall ensure that none of the PPSL Information shall be used by
the directors, officers, agents, employees, consultants or contractors
of Penn T or Celgene, except on like terms of confidentiality as
aforesaid, and that the PPSL Information shall be kept fully private
and confidential by them. Further Penn T, prior to disclosure of PPSL's
Information to any directors, officers, agents, employees, consultants
or contractors of Penn T or Celgene, shall ensure that each such person
is bound in writing to observe confidentiality provisions which are
substantially the same as this clause.
10.5 For the purposes of this clause 10 "Data Controller", "Data Processor",
"Data Subject", "Personal Data" and "processing" shall have the
meanings ascribed to them in the Data Protection Act 1998.
10.6 The Parties acknowledge that PPSL will act in the capacity of Data
Processor on behalf of Penn T (as Data Controller) in respect of any
Personal Data that PPSL receives from Penn T and which is processed by
PPSL in the course of providing the Services.
10.7 PPSL agrees that it shall:
(a) only process such Personal Data in accordance with the
instructions of Penn T from time to time;
(b) implement appropriate technical and organisational measures to
protect Personal Data against unauthorised or unlawful
processing and accidental destruction or loss;
(c) at all times process Personal Data in connection with the
Services in accordance with the Data Protection Act 1998;
(d) not transfer its data processing function outside of the
European Economic Area or outsource it to a third party
without the prior written consent of Penn T;
(e) permit Penn T on reasonable notice to audit the procedures of
PPSL for the purpose of ensuring compliance with this clause
10 and to take any reasonable steps to satisfy itself that
PPSL is so complying;
(f) promptly notify Penn T of any queries from Data Subjects, the
Information Commissioner or any other law enforcement or
regulatory authority;
(g) promptly and without further charge provide such information
and assistance to Penn T as Penn T may reasonably require to
enable it to act in accordance with the rights of Data
Subjects.
10.8 The provisions of this clause 10 shall survive termination of the
Agreement.
11 PUBLICITY
11.1 Subject to the provisions of clause 10 and clause 11.2, Penn T and
Celgene each hereby agrees to permit PPSL to use the name of or refer
to Penn T and/or Celgene and the fact that PPSL provides Services to
Penn T, whether verbally or in writing, in any of PPSL's publicity
material, including but not limited to PPSL's submissions to secure new
business or in promoting or marketing itself, provided that in each
case no details of any individual project undertaken for Penn T shall
be disclosed.
11.2 Prior to any disclosure or publicity under clause 11.1, Penn T and
Celgene shall be entitled to review the form and substance of the
material and Penn T and Celgene shall have the right to require PPSL to
amend the materials for reason of accuracy, use of Intellectual
Property or confidentiality.
12 PROVISION OF INFORMATION AND DEFECTS IN FINISHED PRODUCT
12.1 Each Party acknowledges that it has an obligation to furnish the other
Party promptly with any information in its possession which is relevant
to the provision of the Services. If PPSL becomes aware that it
requires any further information in order to allow it to perform the
Services it shall notify Penn T in a timely fashion and Penn T shall
furnish the additional information to PPSL as soon as reasonably
practicable.
12.2 PPSL and Penn T shall make available (or cause to be made available) to
each other as soon as practicable (but in any event within one (1) day)
of receipt of regulatory correspondence regarding regulatory letters,
recalls, adverse experiences and all other regulatory correspondence
bearing on the safety and efficacy of the Finished Products which may
concern chemistry, manufacturing or control issues.
12.3 Penn T will promptly submit to PPSL all Finished Product safety and
efficacy enquiries, Finished Product quality complaints and adverse
drug event reports received by it which may concern chemistry,
manufacturing or control issues, together with all available evidence
and other information relating thereto. Except as otherwise required by
Relevant Law, Penn T will be responsible for investigating and
responding to all such enquiries, complaints and adverse events
regarding Finished Product. It shall be the responsibility of Penn T to
comply with all applicable Relevant Law including but not limited to
legal and regulatory reporting requirements regarding adverse drug
events and Finished Product quality matters, except where such events
or matters are caused by acts or omissions of PPSL or PPSL's
Affiliates, in which case Penn T may, consistent with applicable
Relevant Law, require PPSL's assistance in such compliance. Penn T will
forward a copy of all applicable legal and regulatory submissions
required under Relevant Law relating to the provision of the Services
within ten (10) business days of receipt of the submission from its
Customers. PPSL shall promptly notify Penn T where any Relevant
Authority contacts PPSL or any member of the Penn Group directly
concerning the Services or the Finished Products.
12.4 In the event Penn T or any of its Customers believe it may be necessary
to conduct a Recall with respect to any Finished Products which were
manufactured by PPSL for Penn T pursuant to this Agreement, PPSL and
Penn T shall consult with each other as to how best to proceed, it
being understood and agreed that the final decision as to any Recall of
any Finished Product shall be made by Penn T or its Customers,
provided, however, that PPSL shall not be prohibited hereunder from
taking any action that it is required to take by Relevant Law. Penn T
and its Customers shall bear all costs in connection with any such
Recall; provided, however, that PPSL shall reimburse Penn T for
reasonable out-of-pocket expenses incurred by Penn T in connection with
any such Recall to the extent attributable to any negligence, breach of
this Agreement or breach of Relevant Law or error on the part of PPSL
or as a result of a latent defect to the extent such latent defect is
attributable to PPSL.
12.5 Pursuant to any reported complaint and/or adverse drug event, if the
nature of the reported complaint and/or adverse drug event requires
Testing, PPSL will, at Penn T's reasonable request and expense, perform
analytical Testing according to the Specification of corresponding
retention samples and provide the results thereto to Penn T as soon as
reasonably practicable and in any event within 28 days or the time
period specified by the Relevant Authority, whichever is shorter,
provided however PPSL shall be responsible for the cost of such Testing
and reporting to the Relevant Authority to the extent that if it is
determined that such reported complaint and/or adverse drug event is
attributable to any negligence, breach of this Agreement or breach of
Relevant Law or error on the part of PPSL.
12.6 PPSL shall assist Penn T or its Customer in reporting to any Relevant
Authority the results of the Testing referred to in clause 12.5.
13 RECORDS AND REPORTING
13.1 Penn T acknowledges that PPSL must retain originals and/or copies of
certain documents generated by it in relation to the Services in order
to comply with Relevant Law and PPSL agrees to provide Penn T promptly
upon reasonable written request and at Penn T's cost with copies of the
same.
13.2 During the Life of this Agreement, and for a period of at least 36
months or such longer period thereafter required by Relevant Law, PPSL
will maintain a complete audit trail of all data created in the normal
course of business relating to this Agreement and all data referred to
in the Quality Agreement which is required by such Relevant Law
including financial and non-financial transactions, Test results and
scientific and technical data relating to the Services.
13.3 Penn T (and its Audit Representatives) will have the right to perform
audits and inspections of PPSL during normal business hours:
(a) on an annual basis (with effect from the date falling twelve
(12) months from the Commencement Date), for stock taking
purposes in respect of Finished Products, In-Process
Materials, Raw Materials and Consumables;
(b) on an annual basis (with effect from the date falling twelve
(12) months from the Commencement Date) in order to carry out
verification of the accuracy of all Fees, accounting practices
and invoices relating to this Agreement;
(c) on an annual basis (with effect from the date falling twelve
(12) months from the Commencement Date) for examination of
PPSL's performance of the Services, including PPSL's
manufacturing and Testing practices and procedures in
accordance with the Quality Agreement and any other audit
activity to the extent required pursuant to any Relevant Law;
(d) On a quarterly basis (with effect from the date falling three
(3) months from the Commencement Date), for inspection of Penn
T's books of accounts; and
(e) at any time where Penn T has reasonable grounds to suspect
that circumstances exist which merit investigation, including
without limitation reasonable suspicion by Penn T that PPSL is
not complying with its accounting and record keeping
obligations or is otherwise in breach of this Agreement or
"FOR CAUSE" as described in clause 19 of the Quality
Agreement.
13.4 Penn T shall use its reasonable endeavours to ensure that its Audit
Representatives perform any audit or inspection of PPSL in a reasonable
manner so as not to have a material adverse effect on the performance
of the Services or other business of PPSL.
13.5 PPSL will provide full co-operation to Penn T and its Audit
Representatives for the purposes of any audit or inspection including
providing access to the Premises, any PPSL personnel, data, records and
systems (excluding PPSL's IT system and local area network) relating to
the Services to the extent necessary for Penn T to carry out the audit
as set out in this clause 13.5.
13.6 On completion of an audit, the Audit Representative will prepare a
written audit report detailing its findings. If any audit or inspection
reveals any error, incorrect cost allocation or calculation or
overcharging, PPSL shall, within thirty (30) days of the audit report,
reimburse Penn T for the amount overpaid by Penn T.
13.7 If any audit or inspection reveals any sub-standard or defective
accounting practices, manufacturing process or environmental or
technical conditions relating to the Services and the Premises, PPSL
shall at its cost, and in consultation with Penn T and the Audit
Representative, promptly implement such changes as Penn T shall
reasonably require.
13.8 The fees and expenses of the Audit Representative shall be paid by Penn
T provided however that if the audit reveals an error or miscalculation
in excess of the lesser of (pound)3,000 or 3% of the Fees paid in the
month to which the error relates, then PPSL shall pay Penn T's and the
Audit Representatives' fees and expenses. PPSL shall provide such
assistance as Penn T and its Audit Representatives reasonably require
at no cost to Penn T provided that Penn T shall reimburse PPSL its
costs in accordance with the Payment Terms:
(a) for any audits required by Penn T in addition to those
described in clause 13.3 above; or
(b) for any audit carried out pursuant to clause 13.3(e) above the
results of which show PPSL in compliance with its accounting
and record keeping obligations and/or is not otherwise in
breach of this Agreement.
13.9 If there is a dispute in relation to any audit findings or report, then
the Parties will resolve such dispute in accordance with the provisions
of clause 32.
14 INTELLECTUAL PROPERTY
14.1 Provision of the Services by PPSL to Penn T will not entitle PPSL to
acquire any Intellectual Property Rights in the Finished Products or in
their use or any licence to use such Intellectual Property Rights other
than as required to perform its obligations under this Agreement.
14.2 The ownership of all Intellectual Property Rights and Know-How in the
Finished Products and the manufacture thereof pursuant to this
Agreement shall at all times remain with Celgene.
14.3 Celgene hereby grants to PPSL and its sub-contractors a non-exclusive
licence to use Celgene Intellectual Property Rights:
(a) for the life of this Agreement and to the extent necessary to
perform the Services in accordance with this Agreement; and
(b) to manufacture, distribute, sell and export Sauramide on the
terms of this Agreement making the necessary amendments to
take account that PPSL will manufacture Sauramide for its own
account and PPSL shall indemnify Penn T and Celgene on the
terms of clause 14.6.
14.4 The licence granted by Celgene under 14.3(b) may be terminated by
Celgene at any time on 30 days written notice and following termination
PPSL shall assign all PPSL's Intellectual Property relating to the
manufacture and sale of Sauramide including without limitation the
Trademarks, on the terms set forth in Part 2 of Schedule 5.
14.5 Notwithstanding any other provision of this Agreement, Celgene
acknowledges that it has full responsibility for the safety and
efficacy of the In-Progress Materials, API and Finished Products
manufactured in accordance with this Agreement and provided that PPSL
complies with clause 15.11 Celgene shall indemnify PPSL and keep PPSL
indemnified against all costs, losses, liabilities, claims, actions,
proceedings, damages and expenses (including without limitation
reasonable legal fees and expenses) incurred by PPSL (LOSSES) or claims
(including but not limited to any claims, actions or litigation brought
by third parties relating to the use of Intellectual Property Rights in
the Finished Products) or proceedings of whatsoever nature involving
PPSL (CLAIMS) in connection with or arising out of the use of the API
or Finished Products by PPSL, Celgene or any third party (which third
parties shall include but not be limited to sub-contractors, assigns
and agents in addition to Customers, consumers
and end users) provided that this indemnity shall not operate to the
extent that such Losses or Claims have arisen out of a failure by PPSL
to comply with the terms of this Agreement or to the extent PPSL has
acted negligently or with wilful misconduct or has failed to comply
with Relevant Law.
14.6 Subject always to clauses 15.6 and 15.10 and provided that Penn T and
Celgene each comply with clause 15.11, PPSL shall indemnify Penn T and
Celgene and keep Penn T and Celgene indemnified against all Losses and
Claims in connection with or arising out of use by any third party of
Sauramide which has been manufactured, supplied or distributed by PPSL
save that this indemnity shall not apply to any Sauramide which has
been manufactured for Penn T.
15 WARRANTIES AND LIMITATION OF LIABILITY
15.1 During the term of this Agreement, Penn T hereby acknowledges that it
shall at all times be responsible for the safety and efficacy of the
API, and Finished Products and warrants as follows:
(a) the API shall, at the time it is shipped to PPSL:
(i) not be adulterated or misbranded within the meaning
of any Relevant Law;
(ii) not be articles that may not, under any Relevant Law,
including Section 505 of the FFDCA be introduced into
interstate commerce;
(iii) have been manufactured, processed, and packed in
compliance with all requirements under all Relevant
Law; and
(iv) conform to the Specification for the API as
documented on the certificate of analysis included
with each delivery of API.
15.2 PPSL warrants:
(a) that the Services will be carried out with reasonable skill
and care and will conform to the Technical Documents; and
(b) that it shall manufacture, Process, Test, Package and Label
the Finished Products in accordance with the Specification and
the Technical Documents and with any Relevant Law.
15.3 PPSL hereby further warrants as follows:
(a) The Finished Product shall, at the time it is shipped to Penn
T or the Customer:
(i) not be adulterated or misbranded within the meaning
of any Relevant Law including the FFDCA;
(ii) not be articles that may not, under any Relevant Law,
including Section 505 of the FFDCA, be introduced
into interstate commerce;
(iii) have been manufactured, processed, and packed in
compliance with all requirements under all Relevant
Law including the FFDCA and cGMP; and
(iv) conform to the Specification for the Finished
Products
(b) PPSL shall comply in all material respects with any Relevant
Law applicable to the manufacture of the Finished Product, the
handling of the Hazardous Waste prior to pick-up by the waste
contractor, and the handling and disposal of the Non-Hazardous
Waste and the provision of the Services;
(c) that PPSL shall maintain in effect and comply with the
Licences and all permits, licenses, orders, applications and
approvals required by any Relevant Authority and necessary for
the manufacture, Processing, Testing, Packaging and Labelling
and PPSL shall manufacture, Process, Test and Label in
accordance with all such permits, Licenses, orders,
applications and approvals;
(d) that without limiting the other provisions of this Agreement,
PPSL shall use its commercially reasonable efforts at all
times to minimize Finished Product delivery time.
15.4 PPSL will promptly, at its own cost and at Penn T's option, re-perform
Services as soon as practicable or credit Penn T with the relevant Fees
for any Services or part thereof provided that Penn T can show, to
PPSL's reasonable satisfaction, that the Services have been performed
defectively and not in accordance with Technical Documents.
15.5 Except as provided for in this Agreement any warranties, (whether
express or implied by statute or common law or a previous course of
dealing or trade custom or usage or otherwise howsoever) including but
without limitation those of satisfactory quality or of fitness for a
particular purpose (even if that purpose is made known expressly or by
implication to PPSL) are (insofar as is permitted by law) hereby
excluded.
15.6 Subject to clauses 14.5, 15.7 and 15.8 under no circumstances shall any
Party be liable for any indirect, special or consequential loss or loss
of business opportunity or reputation howsoever arising whether in
contract, tort (including negligence) or breach of statutory duty or
otherwise.
15.7 The Parties, PPHL and Celgene each acknowledges that notwithstanding
any other provision of this Agreement, none of PPSL, Penn T, Celgene or
PPHL seeks to exclude or limit liability for loss arising from death or
personal injury caused by negligence or for fraud or in respect of any
other liability arising out of or in connection with this Agreement
which cannot be excluded or restricted by law.
15.8 The Parties, PPHL and Celgene each acknowledges that notwithstanding
any other provision of this Agreement, none of PPSL, Penn T, Celgene or
PPHL seek to exclude liability for, and each of PPSL and PPHL on the
one hand and Penn T and Celgene on the other hereby indemnifies each
other for losses arising out of any act, omission, breach of its
obligations, negligence or wilful misconduct of the indemnifying party,
which relate to or arise from a claim by a third party against the
indemnified party :
(a) in relation to a death or personal injury claim asserted by
such third party;
(b) in relation to any other claims (excluding claims relating to
Intellectual Property) but subject to the limits set out in
clauses 15.6 and 15.9.
15.9 Subject to clauses 14.5, 15.7 and 15.8 the aggregate liability of each
of Penn T, Celgene and PPHL (whether in contract, tort (including
negligence) or breach of statutory duty or otherwise) to each other for
any loss or damage of whatever nature and howsoever caused shall be
limited to and in no circumstances shall exceed (pound)600,000 (six
hundred thousand pounds) in aggregate for the Life of this Agreement
15.10 Subject to clauses 15.7 and 15.8 the aggregate liability of PPSL
(whether in contract, tort (including negligence) or breach of
statutory duty or otherwise) to Penn T or Celgene for any loss or
damage of whatever nature and howsoever caused shall be limited to and
in no circumstances shall exceed the greater of:
(a) (pound)600,000 (six hundred thousand pounds) in aggregate for
the Life of this Agreement; or
(b) in relation to a bona fide claim brought against PPSL for
which PPSL has insurance, monies recovered by PPSL from its
insurer; or
(c) in relation to a bona fide claim brought against PPSL for
which PPSL has insurance, monies which would have been
recovered by PPSL from its insurer had PPSL taken all
appropriate steps in a timely manner to make a claim under any
relevant insurance policy;
(d) in relation to a bona fide claim brought against PPSL for
which PPSL has insurance (other than any claim to which clause
15.10(e) relates), monies which would have been recovered by
PPSL from its insurer had PPSL's actions or omissions not
voided such policy; or
(e) in relation to a bona fide claim brought against PPSL for
which PPSL has insurance, the lesser of, monies which would
have been recovered by PPSL from its insurer had PPSL's
innocent actions or omissions not voided such policy, or
(pound)1,000,000 (one million pounds).
15.11 The party (INDEMNITEE) that intends to claim indemnification under this
Agreement shall notify the other party (INDEMNITOR) promptly in writing
of any action, claim or liability in respect of which the indemnitee
believes it is entitled to claim indemnification, provided that the
failure to give timely notice to the indemnitor shall not release the
indemnitor from any liability to the indemnitee. The indemnitor shall
have the right, by notice to the indemnitee, to assume the defence of
any such action or claim within the fifteen (15) day period after the
indemnitor's receipt of notice of any action or claim with counsel of
the indemnitor's choice and at the sole cost of the indemnitor. If the
indemnitor so assumes such defence, the indemnitee may participate
therein through counsel of its choice, but at the sole cost of the
indemnitee. The party not assuming the defence of any such claim shall
render all reasonable assistance to the party assuming such defence,
and all reasonable out-of-pocket costs of such assistance shall be for
the account of the indemnitor. No such claim shall be settled other
than by the party defending the same, and then only with the consent of
the other party which shall not be unreasonably withheld or delayed;
provided that the indemnitee shall have no obligation to consent to any
settlement of any such action or claim which imposes on the indemnitee
any liability or obligation which cannot be assumed and performed in
full by the indemnitor, and the indemnitee shall have no right to
withhold its consent to any settlement of any such action or claim if
the settlement involves only the payment of money by the indemnitor or
its insurer and the indemnitor established to the indemnitee's
reasonable satisfaction that funds are, or have been made, available
for such purpose.
15.12 All recommendations and advice given by or on behalf of PPSL to Penn T
as to methods of storing, using or applying Raw Materials or Finished
Products, the purposes for which Raw Materials or Finished Products may
be applied and the suitability of using Raw Materials or Finished
Products in any process or in connection with any other materials are,
subject to such recommendations and advice being expressly detailed in
the Technical Documents as part of the Services, given without
liability on the part of PPSL.
15.13 The provisions of this clause 15 shall survive termination of the
Agreement.
16 CHANGE CONTROL
16.1 If either Penn T or PPSL wishes to propose any amendment or
modification to this Agreement (a "Change") then it will notify the
other of that fact by sending a written notification ("Change
Request"), specifying in reasonable detail the nature of the Change.
16.2 As soon as reasonably practicable (but in any event within 14 days)
after sending or receipt of a Change Request), PPSL will provide Penn T
with a brief written proposal in relation to the relevant Change (a
"Change Proposal") including, but not limited to:
(a) summary of the scope of the Change;
(b) brief details of the likely impact, if any, of the Change
Request on the existing Services or PPSL's obligations under
this Agreement; and
(c) an estimate of the likely cost of implementation and/or
on-going operation of the relevant Change.
16.3 Where the Change is required by Relevant Law or where the Change is
required or is necessary for the commercial or clinical manufacture of
any formulation of Thalidomide, PPSL shall, as soon as practicable,
provide to Penn T a Change Control Notice as set forth in clause 16.4
below. Where the Change relates to any other service including without
limitation Excluded Services it shall be at PPSL's discretion whether
to proceed under this Agreement or negotiate with Penn T the terms of a
separate agreement.
16.4 If, following receipt of the Change Proposal, Penn T wishes to proceed
with the proposed Change, it will notify PPSL in writing of such
intention (assuming that all requisite details are not already set out
in the Change Proposal). Within 30 days after receiving written notice
from Penn T to proceed with the proposed Change, PPSL shall provide
Penn T with a detailed written proposal (a "CHANGE CONTROL NOTICE")
including, but not limited to the following matters:
(a) full details of the proposed subject matter of the Change
Request including any outline specifications, requirements for
equipment, special conditions, deliverables or other
variations of this Agreement required;
(b) details of the impact, if any, of the Change Request on any
existing Services or PPSL's obligations under this Agreement;
(c) an itemised statement of the estimated charges made on the
basis of the Fees calculation in Schedule 2 for the
implementation and/or ongoing operation of the relevant
Change; and
(d) a timetable for the implementation, together with any
proposals for acceptance, of the Change Request.
16.5 Penn T will review the proposed Change Control Notice as soon as
reasonably possible after its receipt and in any event within 15 days
will either accept or reject the proposed Change Control Note. If the
Change Control Notice has not been formally rejected within such 15 day
period, it shall be deemed accepted. If Penn T rejects the Change
Control Notice, the Parties shall negotiate in good faith to agree the
provisions of the Change Control Notice and where no agreement is
reached within thirty (30) days of receipt by Penn T of the Change
Control Notice, the issue shall be resolved in accordance with clause
32.
16.6 If Penn T accepts the proposed Change Control Notice, PPSL will make
the Change in accordance with that Change Control Notice and the
provisions of this Agreement. A Change Control Notice shall be treated
as accepted when it is signed by Penn T and PPSL and will constitute an
amendment to this Agreement.
16.7 Neither Penn T or PPSL shall have any obligation to effect any proposed
Change until the relevant Change Control Notice is agreed by Penn T and
pursuant to clause 16.6.
16.8 Changes agreed in accordance with the procedure above shall constitute
a variation of this Agreement in satisfaction of clause 29.
17 INSURANCE
17.1 Subject to clause 17.2 below, PPSL shall effect and maintain for the
Life of this Agreement and for a period of three (3) years or such
shorter period as directed by Penn T following the termination of this
Agreement, the following annual policies of insurance:
(a) product liability cover for not less than ten million pounds
((pound)10,000,000) per event and in the aggregate;
(b) employers liability insurance with cover of not less than ten
million pounds ((pound)10,000,000) per occurrence or series of
occurrences arising out of any one cause;
(c) public liability cover for not less than two million pounds
((pound)2,000,000) per event; and
(d) commercial combined insurance cover for not less than:
(i) five million pounds ((pound)5,000,000) in aggregate
for the Premises buildings;
(ii) five million pounds ((pound)5,000,000) in aggregate
for machinery, plant and all other contents;
(iii) five hundred thousand pounds ((pound)500,000) in
aggregate for stock and materials in trade;
(iv) two million five hundred thousand pounds
((pound)2,500,000) in aggregate for customer goods
held at the Premises,
and PPSL shall ensure Penn T's interest is noted on the relevant
policies.
17.2 If Penn T, at its own cost, effects and maintains during the Life of
this Agreement insurance in its own name which provides equivalent
cover for PPSL's liabilities relating to the provision of the Services
then for so long as such cover is in place Penn T may require PPSL to
cancel such equivalent parts of its insurance policies and the Services
Costs shall be reduced accordingly.
17.3 PPSL shall, when requested by Penn T, promptly provide copies of the
policies and certificates of insurance evidencing that such insurance
cover meets or exceeds the levels set out in clause 17.1 above and that
the premiums in respect of such insurance are fully paid. Where Penn T
is not satisfied that PPSL has adequate or appropriate levels of
insurance in place so as to satisfy its obligations under this clause
17, Penn T shall be entitled to effect, on behalf of PPSL, such
insurance cover as it believes is reasonably necessary so as to allow
for adequate or appropriate levels of insurance. Penn T shall be
entitled to recover the costs and expense of effecting such insurance
(including but not limited to any premiums paid) by way of a reduction
to the Fees.
17.4 Without prejudice to clause 15.10, the Parties shall, not less than
once every six (6) months, jointly review PPSL's compliance with the
requirements of the insurance policies detailed in clause 17.1 and PPSL
shall implement such recommendations agreed between the Parties in
connection with the requirements of any insurance policy and/or best
practice in the provision of the Services.
18 STEP-IN RIGHTS
18.1 During the Life of this Agreement, Penn T may exercise a right of
Step-In in respect of the Services or any part of them where:
(a) it is otherwise entitled to terminate this Agreement in any of
the circumstances in clause 20.2 (termination for cause);
(b) for reasons which resulted in Penn T being unable to meet its
sales orders from Customers and its Customers could not supply
Finished Products to end users without depleting stocks of
Finished Products held in reserve for Force Majeure or other
disaster recover purposes and, as a result of such
circumstance, the continued performance of the Services or
part thereof by PPSL would in its reasonable opinion be
seriously prejudiced, provided that such depletion of stocks
was caused by a breach of the Agreement by PPSL.
18.2 If Penn T wishes to Step-In, it must notify PPSL in writing of the
following matters (and shall use reasonable endeavours to provide such
notification not less than fourteen (14) days prior to the date the
action will commence):
(a) the action it intends to take which will be limited as Penn T
reasonably requires to allow Penn T to remedy the problem
and/or to ensure continued supply of Finished Product in
circumstances where Penn T reasonably believes that PPSL is
unable to resume and ensure such continued supply as
contemplated under this Agreement;
(b) the reason for taking such action;
(c) the date from which such action shall commence;
(d) the time period that it believes to be necessary for such
action which shall be no longer than the period of Step-In
determined pursuant to clause 18.11 below; and
(e) to the extent practicable, the anticipated effect on PPSL and
its obligations to provide the Services during the period such
action is being taken and the process for PPSL to resume
provision of the Services.
18.3 In exercising the right of Step-In, Penn T shall have the right to
enter the DCF and such of the Premises as is necessary for it to
exercise its rights of Step-In.
18.4 Without prejudice to the generality of clause 4.6, PPSL shall obtain
and maintain for the Life of this Agreement, all necessary third party
consents to allow Penn T to exercise its rights of Step-In.
18.5 PPSL shall give all reasonable assistance to Penn T whilst Penn T is
exercising its right of Step-In including providing the services of the
Qualified Person and any other person named on the Licences. Once Penn
T ceases to exercise its right of Step-In, Penn T shall allow PPSL to
re-assume the provision of the Services within a reasonable period of
time thereafter.
18.6 In respect of the Services in respect of which the right of Step-In is
exercised:
(a) PPSL shall be relieved from its obligations to provide such
Services and from any liability for not providing such
Services and/or for any consequences of such non-performance
to the extent required as a result of the Step-In; and
(b) the charges from Penn T to PPSL shall equal the amount PPSL
would receive if it were satisfying all its obligations and
providing the Services affected by the exercise of the right
of Step-In in full, less an amount equal to all Penn T's
reasonable costs of operation in taking the action.
18.7 Where Penn T is exercising its right of Step-In, it shall act in
accordance with all Relevant Law and cGMP and good industry practice
and in accordance with any pre-notified internal policies and standards
of PPSL whilst at the Premises.
18.8 PPSL shall grant to Penn T a non-exclusive licence to use PPSL's
Intellectual Property as may be necessary to enable Penn T to exercise
its right of Step-In and Penn T shall not use such Intellectual
Property for any other purpose whatsoever.
18.9 Penn T shall:
(a) take reasonable care of any assets of PPSL used during the
period of Step-In;
(b) be responsible for any deterioration assets used by Penn T
during the period of Step-In, save for any deterioration
resulting from their normal and proper use;
(c) use all reasonable endeavours not to disturb others who affect
the provision of the Services or any other PPSL personnel more
than is required for the purposes of exercising its right of
Step-In; and
(d) use all reasonable endeavours not to disrupt other aspects of
PPSL's business not related to the Services or obligations
assumed by PPSL under this Agreement.
18.10 Penn T may engage the services of an Affiliate or a third party to
assist in the performance of Step-In, provided such third party is
given prior written approval in advance by PPSL (such approval not to
be unreasonably withheld or delayed).
18.11 Penn T shall be entitled to exercise its right of Step-In for such time
as is required to rectify the breach or breaches in respect of which
its right of Step-In was exercised provided that the Step-In shall not
continue beyond a period of twenty-four (24) months from commencement
of the Step-In.
18.12 Where Penn T has exercised its right of Step-In, it shall not be
entitled to cease and re-commence a specific Step-In in order to extend
the time periods in clause 18.11.
19 DURATION
This Agreement shall come into effect on the Commencement Date and
shall subject to the provisions of clause 20 below remain in full force
and effect for a period of ten (10) years.
20 TERMINATION
20.1 Penn T shall have the right to terminate this Agreement for convenience
by giving PPSL not less than 12 months' notice in writing, provided
that such notice shall not expire prior to the fifth (5th) anniversary
of the Commencement Date.
20.2 Without prejudice to clause 22.5, Penn T may without prejudice to its
other rights or remedies hereunder forthwith terminate this Agreement
and/or the provision of all or any Services pursuant to this Agreement
by notice in writing to PPSL if PPSL:
(a) commits a material breach (which shall include without
limitation any persistent breach which by its persistence
becomes material) of any of its obligations hereunder and does
not remedy such breach within twenty-eight (28) days after
written notice has been given to it by Penn T (specifically
referring to this clause 20) requiring such remedy; or
(b) breaches any of its obligations hereunder and its liability as
a result of such breach would exceed the caps on its liability
referred to in clause 15.10; or
(c) becomes insolvent or enters into liquidation or receivership
or is the subject of an application for an administration
order or suffers an administrative receiver to be appointed in
relation to the whole or any part of its assets or makes a
composition or arrangement with its creditors or suffers any
judgement to be executed in relation to any of its property or
assets.
20.3 Without prejudice to clause 22.5, PPSL may, without prejudice to its
other rights or remedies hereunder, forthwith terminate this Agreement
by notice in writing to Penn T if:
(a) Penn T:
(i) fails to pay all undisputed sums due and owing under
this Agreement in accordance with the Payment Terms
and does not remedy such breach within twenty-eight
(28) days after written notice has been given to it
by PPSL; or
(ii) is in breach of clause 23.4 below.
20.4 PPSL shall forthwith notify Penn T in the event that:
(a) there is in contemplated a Relevant Transaction (as that
phrase is defined in the schedules to the SAA); or
(b) there is a material adverse change in its financial condition
such that it becomes likely that it will not be able to pay
its debts as and when they fall due for payment or perform its
obligations under this Agreement.
20.5 Any termination of this Agreement (whether under this clause or
otherwise) shall not relieve any Party, PPHL or Celgene of the
obligations under this Agreement which are expressed to continue after
termination.
20.6 Upon termination of this Agreement, Penn T agrees to pay PPSL for the
Services which have been performed by PPSL prior to termination of this
Agreement.
20.7 If Penn T terminates this Agreement for cause under 20.2(a) or if PPSL
terminates this Agreement for cause under clause 20.3 the Party in
breach shall, subject to clause 15.10(a), pay to the other
(pound)600,000 by way of liquidated damages which the Parties agree is
a fair estimate of the actual damages which Party each will suffer.
20.8 Subject to clause 20.9 where this Agreement is terminated pursuant to
clause 20.1 or 20.3 Penn T shall pay PPSL's reasonable costs arising
from the cessation of the Services including without limitation staff
redundancy costs and decommissioning the DCF, subject to PPSL taking
steps to mitigate such costs fully, and Penn T shall indemnify PPSL
against all and any costs, expenses (including reasonable legal fees),
liabilities, damages and losses arising out of any claim, action or
proceeding which arises or is alleged to arise or is made against PPSL
or its Affiliates by virtue of the termination of this Agreement
pursuant to clause 20.1 or 20.3.
20.9 On termination of this Agreement for whatever reason Penn T shall pay
to PPSL such amount as is required for PPSL to maintain its product
liability insurance post termination in accordance with clause 17.1.
20.10 The Parties believe that neither the exercise of Step-In rights by Penn
T or any other use by Penn T of the services of any PPSL employee
either before or after the termination of this Agreement shall amount
to a relevant transfer for the purposes of the Employment Regulations
(a "TRANSFER") and accordingly they agree that no employee of PPSL
shall transfer from the employment of PPSL into the employment of Penn
T by virtue of such Transfer.
20.11 Notwithstanding clause 20.10 and subject to clauses 15.11 and 20.8, if,
as a result of any event mentioned in clause 20.10 and/or the
application of the Employment Regulations, any past or present employee
of PPSL is transferred or claims to have transferred to the employment
of Penn T:
(a) Penn T may within one month of the Transfer give notice to
such person to terminate such employment; and,
(b) in the event that Penn T exercises such entitlement PPSL shall
indemnify Penn T against all claims and losses arising out of
any such termination or the transfer of liabilities and duties
or the alleged transfer of liabilities and duties in relation
to such employee or in relation to any claim brought by such
employee against Penn T which claim and/or liability has
arisen by virtue of any act or omission of PPSL prior to the
Transfer of such employee, provided that Penn T shall;
(i) prior to giving notice to terminate any such person's
employment, notify PPSL of the person's transfer and
its intention to dismiss; and
(ii) allow PPSL 30 days to re-engage such person (and
shall not during any such period take any steps to
terminate the employment of any such person); and
(iii) in circumstances where it is not possible for PPSL to
re-engage such person within the prescribed 30 day
period, Penn T shall use its reasonable endeavours to
agree the method and procedure for termination with
PPSL with a view to mitigating any liability of PPSL
arising out of this clause.
20.12 Subject to clauses 15.11 and 20.8, if, as a result of any event
mentioned in clause 20.10 and/or the application of the Employment
Regulations, any past or present employee of PPSL is transferred or
claims to have transferred to the employment of Penn T and Penn T does
not terminate the employment of such employee within one month of
becoming aware of such transfer and Penn T gives notice to PPSL that it
wishes to retain the transferred employee, then:
(a) The indemnity in clause 20.11 shall no longer apply to such
employee;
(b) PPSL shall indemnify Penn T against all liability for
emoluments and outgoings in respect of the employment of such
employee prior to the Transfer (including all wages, bonuses,
commissions, PAYE, national insurance contributions and
pension contributions) and against any claims and losses in
connection with such employee(s) in respect of redundancy,
unfair dismissal and any other claim whatsoever within the
jurisdiction of an employment tribunal, wrongful dismissal,
breach of contract, personal injury, industrial disease or any
other claim whatsoever which has arisen by virtue of any act
or omission of PPSL prior to the Transfer; and
(c) Penn T shall indemnify PPSL against all liability for
emoluments and outgoings in respect of the employment of such
employee after the Transfer (including all wages, bonuses,
commissions, PAYE, national insurance contributions and
pension contributions) and against any claims and losses in
connection with such employee(s) in respect of redundancy,
unfair dismissal and any other claim whatsoever within the
jurisdiction of an employment tribunal, wrongful dismissal,
breach of contract, personal injury, industrial disease or any
other claim whatsoever which has arisen by virtue of any act
or omission of Penn T after the Transfer.
21 SUPPLY AFTER TERMINATION AND TERMINATION ASSISTANCE
21.1 If PPSL continues to supply any Service to Penn T after the termination
of this Agreement this shall not be construed as a waiver of such
termination or as a renewal of this Agreement.
21.2 Upon termination or expiration of this Agreement PPSL shall:
(a) provide Penn T with such assistance as it may reasonably
require to allow the Services to continue so far as possible
without interruption and to facilitate the orderly transfer of
the Services to Penn T or to its nominated sub-contractor;
(b) deliver to such location as Penn T shall specify PPSL's
inventory of Raw Materials, packaging, labelling, In-Process
Materials and Finished Products that conform to the
Specification and the Technical Documents;
(c) Subject to the provisions of clause 10 provide for transfer of
Know-How reasonably required for the provision of the
Services, which may, as appropriate include information,
records and documents. To facilitate the transfer of Know-How
from PPSL to Penn T, PPSL shall explain the procedures and
operations in the Technical Documents, and other standards and
procedures to Penn T's, or Penn T's contractor's, operations
personnel; and
(d) assist Penn T in obtaining any required licences in order for
Penn T to perform the Services itself including if required,
seconding the Qualified Person to work for Penn T in such
reasonable location, for such reasonable duration and at such
rates as the Parties shall agree.
21.3 The information which PPSL will provide to Penn T to further effect the
obligations in clause 21.2(b) include:
(a) copies of procedures and operations manuals, including the
Technical Documents and the Specification;
(b) subject to confidentiality obligations, copies of agreements
with third party suppliers of goods and services provided such
agreements are to be wholly transferred to Penn T;
(c) key support contact details for third party supplier
personnel.
21.4 For the purposes of this clause 21 (except where specifically stated to
the contrary), the costs of the assistance to be provided by PPSL shall
be borne by Penn T where termination is pursuant to clause 20.1 or as
applicable by the Party whose breach gave rise to the termination.
22 FORCE MAJEURE
22.1 If Penn T or PPSL (the "Affected Party") is prevented or delayed from
performing any of its obligations under this Agreement (whether in
whole or in part) by reason of a Force Majeure event it shall as
promptly as practicable given the nature of the event notify the other
Party (the "Unaffected Party") in writing of the circumstances
constituting the Force Majeure event and shall keep the Unaffected
Party regularly informed of the progress until resuming full
performance of its obligations.
22.2 The Affected Party shall take all reasonable steps to minimise the
adverse effects of the event of Force Majeure on the performance of its
obligations under this Agreement and, in the case of PPSL, shall, to
the extent feasible and practical, provide workarounds which in Penn
T's reasonable opinion are satisfactory.
22.3 Subject to clause 22.4, the Affected Party shall not be treated as
being in breach of this Agreement if and to the extent that its failure
to perform this Agreement results from Force Majeure.
22.4 Clause 22.3 shall only apply where the Affected Party complies with its
obligations under clause 22.1 or 22.2 above.
22.5 If the event of Force Majeure prevents the Affected Party from
complying with this Agreement for a period of two months then the
Unaffected Party may at the expiry of such two month period, provided
the Affected Party is at such time still unable to comply, give notice
in writing to the Affected Party terminating forthwith this Agreement.
If PPSL is the Affected Party, it shall be under a continuing
obligation to co-operate with Penn T in transferring the work to
another supplier or otherwise ensuring that Penn T's business needs
continue to be met despite the event of Force Majeure at Penn T's cost,
to the extent applicable and only at the rates set forth for the
Services in Schedule 2.
22.6 Where following an event of Force Majeure to which this clause applies
the Affected Party is able to resume performance of its obligations it
shall notify the Unaffected Party accordingly and as soon as
practicable resume performance of the affected obligations.
23 ASSIGNMENT
23.1 This Agreement shall not be assignable by PPSL without the prior
written consent of Penn T.
23.2 PPHL's guarantee shall not be assignable by PPSL without the prior
written consent of Penn T.
23.3 This Agreement may be assigned to a third party by Penn T provided
that:
(a) Penn T notifies PPSL of such assignment; and
(b) such third party agrees to perform fully Penn T's obligations
under this Agreement; and
(c) such third party is not a direct competitor of PPSL.
23.4 If Penn T assigns this Agreement to a third party, Celgene's Guarantee
shall terminate provided that Penn T shall ensure that Penn T's
assignee provides a replacement guarantor who will give a guarantee on
substantially the same terms as Celgene's guarantee and provided that
such replacement guarantor is of such financial standing that PPSL in
its reasonable opinion considered adequate in order to be able to
perform under the guarantee.
24 GUARANTEE
24.1 Celgene shall, and Penn T shall ensure that Celgene shall, on the
Commencement Date, give a guarantee as set out in schedule 3 part 1
(Celgene's guarantee) and shall ensure that such guarantee is
maintained in place in full force and effect in accordance with its
terms.
24.2 PPHL shall, and PPSL shall ensure that PPHL shall, on the Commencement
Date, give a guarantee as set out in schedule 3 part 2 (PPHL's
guarantee) and shall ensure that such guarantee is maintained in place
in full force and effect in accordance with its terms.
24.3 PPHL shall procure that any company which gains control (as that phrase
is defined in the schedules to the SAA) of PPHL as a result to any
management buy-out of PPHL shall replace PPHL in PPHL's guarantee and
PPHL shall forthwith inform Penn T of such change of control.
25 NOTICES
25.1 Any notice to be served by either Party hereunder shall be sent by
pre-recorded delivery or registered post or by facsimile transmission
to the other at the address stated at the head of this Agreement or the
facsimile numbers detailed below and shall be deemed to have been
received by the other:
(a) if sent by pre-paid recorded delivery or registered post, one
week after posting; or
(b) if sent by facsimile transmission, on the date sent provided
that the correct answer back code is received and a
confirmatory copy is sent by pre-paid recorded delivery or
registered post on the date of transmission,
PPSL fax number: 01495 713 613 (Attention: Chief Executive Officer)
PPHL fax number: 01495 713 613 (Attention: Chief Executive Officer)
Penn T fax number: 0207 071 9000 (Barlow Lyde & Gilbert - Attention:
John Cadman)
Celgene fax number: (732) 805 3931 (Attention: President and Chief
Operating Officer)
with a copy to : Proskauer Rose LLP, (Attention: Robert A. Cantone -
Fax No: 202 969 2900
25.2 A party may change the details recorded for it in this clause by notice
to the other in accordance with this clause 11.
25.3 Notices sent by email are not valid for the purposes of this Deed but
this clause shall not invalidate any other lawful mode of service.
26 WAIVER
No waiver by either Party of any of the requirements hereof or of any
of its rights hereunder shall release the other from full performance
of its remaining obligations stated herein.
27 ENTIRE AGREEMENT
This Agreement and the provisions of any Technical Documents, and any
variation of this Agreement in writing signed by Penn T and PPSL, and
any changes to this Agreement agreed through Change Control contain the
entire understanding between PPSL, Penn T, Celgene and PPHL relating to
the Services and supersedes all or any previous agreements between Penn
T and PPSL.
28 VOID PROVISION
Should any provision of this Agreement be void or voidable the
existence or avoidance thereof shall not prejudice the enforceability
of the remaining provisions hereof.
29 VARIATION
No variation or modification of this Agreement shall be binding until
agreed to in writing by PPSL and Penn T.
30 COSTS
The Parties, PPHL and Celgene shall each bear its own costs and
expenses incidental to the negotiation hereof and the preparation and
carrying into effect of this Agreement.
31 THIRD PARTY RIGHTS
A person who is not a party to this Agreement has no rights under the
Agreements (Rights of Third Parties) Act 1999 to enforce any term of
this Agreement but this does not affect any right or remedy of the
third party which exists or is available apart from that Act.
32 DISPUTE RESOLUTION PROCEDURE
32.1 In this clause 32, the word Party shall be interpreted as meaning any
of PPSL, Penn T, PPHL or Celgene and the word Parties shall be
interpreted as including PPSL, Penn T, PPHL and Celgene.
32.2 Except as mentioned in this clause 32 and except in relation to seeking
an interim injunction or other urgent relief or except where
commencement of court proceedings is required to prevent expiry of any
limitation period, neither Party may commence court proceedings in
respect of a dispute under this Agreement unless that Party has first
complied with this clause 32.
32.3 All disputes between the Parties arising out of or relating to this
Agreement shall, in the first instance, be referred to the Parties'
respective contract managers for resolution.
32.4 If any dispute has not been resolved by the Parties' respective
contract managers within a maximum of fourteen (14) days after it has
been referred in accordance with clause 32.3, then the Parties shall
each refer the matter to their respective divisional directors (or
equivalent) for determination.
32.5 If any dispute has not been resolved by the Parties' divisional
directors (or equivalent) within a maximum of fourteen (14) days after
it has been referred in accordance with clause 32.4, then the Parties
shall refer the matter to their respective Chief Executive Officers (or
equivalent) ("CEOS") for resolution.
32.6 If any dispute has not been resolved by the Parties' respective CEOs
within a maximum of twenty eight (28) days after it has been referred
in accordance with clause 32.5, then, in the event that the Parties
mutually agree to resolve the dispute by mediation the provisions of
clause 32.7 shall apply.
32.7 Where the Parties agree that it may be beneficial, they will seek to
resolve a dispute through mediation using the services of the Centre
for Effective Dispute Resolution to facilitate the mediation process.
If the dispute is not resolved through negotiation or mediation the
Parties agree that the English courts will have non-exclusive
jurisdiction in connection with the resolution of the dispute.
33 GOVERNING LAW AND JURISDICTION
33.1 This Agreement, regardless of where executed shall be governed and
interpreted in accordance with English Law.
33.2 Each Party, PPHL and Celgene, submits to the exclusive jurisdiction of
the Courts of England and Wales in relation to all claims, disputes,
differences or other matters arising out of or in connection with this
Agreement.
33.3 Each Party, PPHL and Celgene irrevocably waives any right that it may
have:
(a) to object on any ground to an action being brought in the
Courts of England and Wales, to claim that the action brought
in the Courts of England and Wales has been brought in an
inconvenient forum, or to claim that the Courts of England and
Wales do not have jurisdiction. The waiver contained in this
clause 33.3 includes (without limitation) a waiver of all
formal and substantive requirements of any otherwise competent
jurisdiction in relation to this clause 33.3(a)
(b) to oppose the enforcement of any judgment of any court of
England and Wales whether on any ground referred to in clause
33.3(a) or otherwise.
EXECUTED AND DELIVERED by PPSL, Penn T, PPHL and Celgene as a deed on the date
first stated above.
Executed and delivered as a deed by )
PENN PHARMACEUTICAL SERVICES LIMITED ) ....................
acting by
/s/ Craig Rennie
..........................................
(a director) and
/s/ David Henderson
..........................................
(a director/secretary)
Executed and delivered as a deed by )
PENN T LIMITED ) ....................
acting by
/s/ Craig Rennie
..........................................
(a director) and
/s/ David Henderson
..........................................
(a director/secretary)
Executed and delivered as a deed by )
CELGENE CORPORATION ) ....................
acting by
/s/ Robert J. Hugin
..........................................
(a director) and
/s/ Robert J. Hugin
..........................................
(a director/secretary)
Executed and delivered as a deed by )
PENN PHARMACEUTICALS HOLDINGS LIMITED ) ....................
acting by
/s/ Craig Rennie
..........................................
(a director) and
/s/ David Henderson
..........................................
(a director/secretary)