EXHIBIT 10.35
LICENCE & DEVELOPMENT AGREEMENT
-------------------------------
AGREEMENT, effective as, of, this 15th January 1993 (hereinafter referred to as
the "EFFECTIVE DATE"), by and between SCHEIN PHARMACEUTICAL, INC., 1800 Northern
Boulevard, Roslyn, NY 11576, U.S.A., (hereinafter referred to as "LICENSEE") and
ETHICAL HOLDINGS LIMITED, a company registered in the United Kingdom and having
its principal place of business at Cambridgeshire Business Park, Ely,
Cambridgeshire, CB7 4EE, England (hereinafter referred to as "ETHICAL").
WITHESSETH THAT:
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WHEREAS, ETHICAL has developed improved formulations of nifedipine for **** ***
***** daily administration in man (hereinafter defined as the "PRODUCT"),
combining active drug agents in a patented pharmaceutical formulation capable of
delivering the drug agents in a controlled release manner after oral
administration to man; and
WHEREAS, ETHICAL and LICENSEE have signed a Letter of Intent dated 12th November
1992 and LICENSEE desires to sell the PRODUCT (hereinafter defined) in the
TERRITORY; and
WHEREAS, ETHICAL owns valuable ETHICAL KNOW-HOW (hereinafter defined) and has
sought PATENT RIGHTS (hereinafter defined) relating to pharmaceutical
formulations designed to provide controlled release of active constituents from
solid dosage forms; and
WHEREAS, LICENSEE desires to aid the final product development and registration
with the U.S. FDA and LICENSEE will make the regulatory filing and the NDA/ANDA
will be held in the LICENSEE's name;
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NOW THEREFORE, in consideration of the foregoing and the mutual covenants and
conditions set forth herein, the parties hereto mutually agree as follows:
ARTICLE I. DEFINITIONS
The following terms shall have the meanings set forth in this Article I:
A. "ETHICAL" means ETHICAL HOLDINGS LTD, Cambridgeshire Business Park, Angel
Drove, Ely, Cambs, CB7 4EE.
B. "LICENSEE" means SCHEIN PHARMACEUTICAL, INC., 1800 Northern Boulevard,
Roslyn, NY 11576, USA.
C. "EFFECTIVE DATE" means 15th January 1993.
D. "ETHICAL KNOW-HOW" means all confidential scientific and medical information,
technical data and marketing studies in ETHICAL'S possession or from time to
time invented or developed or acquired by or on behalf of ETHICAL or under
the control of ETHICAL (other than LICENSEE KNOW-HOW) relating specifically
to the registration, marketing, manufacture, use or sale of PRODUCT
including, but not limited to, toxicological, pharmacological, analytical and
clinical data, bioavailability studies, product forms and formulations,
control assays and specifications, methods of preparation and stability data
and specifically including all information contained in all health
registration dossiers to be filed in various countries of the European
Community (EC) and shall further include all Third Party data which ETHICAL
has access to and is free to disclose without restriction or compensation to
such Third Party. Not withstanding the foregoing, the term 'ETHICAL KNOW-HOW'
shall not be deemed to refer to information and
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data of the type which would not be required to be maintained as confidential
by either party pursuant to the provision of Subsections B1 or 2 of Article
XI.
E. "LICENSEE KNOW-HOW" means all confidential scientific and medical information
and technical data from time to time, developed or acquired by or on behalf
of LICENSEE (other than ETHICAL KNOW-HOW) relating specifically to the
manufacture or use of the PRODUCT, including, but not limited to,
toxicological, pharmacological, analytical and clinical data, bioavailability
studies, product forms and formulations, control assays and specifications,
methods of preparation and stability data, and specifically including all
information contained in all health registration dossiers filed in the
TERRITORY by the LICENSEE. Not withstanding the foregoing, the term 'LICENSEE
KNOW-HOW' shall not be deemed to refer to information and data of the type
which would not be required to be maintained as confidential by either party
pursuant to the provision of Subsections B1 or 2 of Article XI.
F. "PATENT RIGHTS" means the **** patent application number ********* ***** **
**** ******* **** and any patent issued thereon and any and all ****** ******
*** ********** ****** patents and patent applications filed by or issued to
ETHICAL and licensed or assigned to ETHICAL relating to controlled release
formulations for oral administration in man, or the manufacture or use of
them, together with any and all patents that may issue or may have issued
therefrom, including any and all divisions, continuations, continuations-in-
part extensions, additions or reissues of or to any of the aforesaid patent
applications.
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G. "PRODUCT" means controlled release tablets based on the PATENT RIGHTS and
ETHICAL KNOW-HOW, containing nifedipine manufactured according to the
technology protected in the PATENT RIGHTS defined above to by used for human
therapy and exhibiting a similar pharmacokinetic profile to **********
******* nifedipine tablets sold in the TERRITORY at the EFFECTIVE DATE under
the trade name ************* and as further defined in Appendix 1.
H. "FINISHED PRODUCT" means PRODUCT in final consumer package.
I. "TERRITORY" shall mean the United States of America, including its
territories and possessions.
J. "NET SALES" of the PRODUCT shall mean the gross sales of FINISHED PRODUCT
actually invoiced by the LICENSEE or LICENSEE's sublicensee hereunder to
INDEPENDENT THIRD PARTY, less chargebacks and rebates specifically related to
volume sales of the PRODUCT (up to a maximum of 15% of gross sales), the
total ordinary and customary trade discounts (but not including cash
discounts for prompt payment), rebate for inventory price protection covering
the last 30 (thirty) days' sales by customers claiming such rebates to
counter competitive pressures, excise taxes, other consumption taxes,
customs duty, credits or allowances actually granted on account of rejection
or return of FINISHED PRODUCT.
K. "INDEPENDENT THIRD PARTY" means any party other than ETHICAL and LICENSEE and
their subsidiaries or affiliates.
L. "AGREEMENT" means this agreement duly signed by the Parties.
* redacted pursuant to confidential treatment request
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M. "DEVELOPMENT PROGRAMME" shall mean the detailed schedule as set forth as
Appendix 2 hereto which describes the planned development activities, project
deliverables and timetable presently believed to be required to obtain
regulatory approval to market, promote and distribute the PRODUCT in the
TERRITORY. Without limiting the generality of the foregoing, the DEVELOPMENT
PROGRAMME outlines the obligations of ETHICAL with respect to pre-clinical
studies and the obligations of LICENSEE with respect to manufacturing
development, including compliance with "Good Manufacturing Practice"
requirements applicable in the TERRITORY. The DEVELOPMENT PROGRAMME may be
amended from time to time by the mutual consent of the parties in light of
periodic progress reviews and regulatory requirements. Neither party shall be
required to perform development work with respect to the PRODUCT except as
set forth in the DEVELOPMENT PROGRAMME as from time to time is in effect.
N. "FDA" means the Unites States Food and Drug Administration.
0. "MARKETING AUTHORISATIONS" means the consent or approval of the FDA and any
applicable comparable state agencies required to market or distribute the
FINISHED PRODUCT in the TERRITORY.
ARTICLE II. WARRANTY
ETHICAL warrants that it is exclusive owner of all rights, title and interest
in and to the PATENT RIGHTS and ETHICAL KNOW-HOW and that it is free to
enter into this AGREEMENT and to carry out all of the provisions hereof
including its agreement to grant to LICENSEE an exclusive licence with respect
to the PRODUCT in the TERRITORY.
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ARTICLE III. LICENCE GRANT
A. Subject to C below ETHICAL hereby grants to LICENSEE the exclusive right
under the PATENT RIGHTS and ETHICAL KNOW-HOW RIGHTS with the right to grant
sub-licenses, to make and/or manufacture, use, promote and sell the PRODUCT
and FINISHED PRODUCT in the TERRITORY.
B. Subject to C below, ETHICAL hereby grants to LICENSEE the exclusive right to
use ETHICAL's KNOW-HOW for marketing and selling the PRODUCT in the
TERRITORY.
C. For the avoidance of doubt, ETHICAL shall have a continuing right to make,
have made and use for its own investigational and developmental purposes
(but not sell, directly or indirectly in, or to the TERRITORY) the PRODUCT
in the TERRITORY. If ETHICAL acquires or develops rights to additional
claims or indications for the PRODUCT, it shall make these available to
LICENSEE as part of the licence granted hereunder, without additional
compensation to ETHICAL provided that any additional development costs for
such claims or indications are mutually agreed.
D. All proprietary rights and rights of ownership with respect to the PATENT
RIGHTS, and ETHICAL KNOW-HOW shall at all times remain solely with ETHICAL
and LICENSEE shall have no proprietary rights in or to the PATENT RIGHTS,
and ETHICAL KNOW-HOW other than those specifically granted herein. All
proprietary rights to LICENSEE KNOW-HOW belong to and shall at all times
remain solely with LICENSEE, other than as specifically provided herein.
E. LICENSEE shall exert its best reasonable efforts to commercialise and to
create a demand for the PRODUCT and FINISHED PRODUCT in the TERRITORY under
its own trademark and other private labels, consistent
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with the market potential for the PRODUCT in the TERRITORY determined by
LICENSEE in a commercially reasonable manner. LICENSEE shall own and retain
all right, title, and interest in and to any trademark or trademarks used by
it in the TERRITORY in connection with the PRODUCT.
F. LICENSEE will be responsible for ensuring that the sale and supply by
LICENSEE of the PRODUCT and FINISHED PRODUCT within the TERRITORY is in
accordance with the legal and regulatory requirements of the TERRITORY,
subject to the compliance by ETHICAL with its representations and
obligations under this AGREEMENT.
G. For the term of this AGREEMENT, ETHICAL agrees that it will not, directly or
indirectly, market, sell, or distribute in the TERRITORY or develop or
assist in the development for use, marketing, sale or distribution in the
TERRITORY any PRODUCT or FINISHED PRODUCT except as provided in this
AGREEMENT.
ARTICLE IV. PAYMENT PRIOR TO COMMERCIALISATION
A. In consideration of the development and technical support to the LICENSEE in
the TERRITORY for the PRODUCT, the LICENSEE agrees to pay ETHICAL a total of
US$3,750,000 (three million, seven hundred & fifty thousand U.S. dollars),
("LICENSEE payments"), of which ETHICAL has already received from LICENSEE
the sum of ******** ****** ******* *** ***** ******** **** ******** The
remainder will be paid in instalments as follows:
a) ******* ****** ******** **** ******** upon signing of this
contract. In the event that scientific results do not indicate
that the PRODUCT objectives can be obtained, LICENSEE may nominate
an alternative project and apply the payments made under Article
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IV A (a) to such future project, less ETHICAL's out-of-pocket expenses
for PRODUCT development for the period starting 1st January 1993 through
completion of the pilot biostudies described below. This right so to
nominate expires at the due date of the payment required under Article
IV (b).
b) ******** ***** ******* * ****** **** ******** **** ******** upon
LICENSEE's completion of a pilot bioavailability study in no less than
12 (twelve) subjects demonstrating concentration time profile for the 30
mg strength PRODUCT satisfactory to progress the project on to ANDA or
NDA programme.
c) ******** ***** ******* * ****** **** ******** **** ******** upon
LICENSEE's completion of a pilot bioavailability study in no less than
12 (twelve) subjects demonstrating concentration time profile for the **
** strength PRODUCT satisfactory to progress the project on to ANDA or
NDA programme.
d) ******** **** ******* ******** **** ******** upon satisfactory
manufacturing technology transferred to LICENSEE or a LICENSEE affiliate
as witnessed by the production of necessary bio-batches according to the
PRODUCT specification agreed to in writing by LICENSEE and ETHICAL
following successful completion of the pilot bioavailability study
referred to in subsection (b) or (c) above.
e) ******** ****** ******* ******** **** ******** upon LICENSEE's filing
to the FDA of an application for approval of a ** ** strength PRODUCT.
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f) ******** ***** ******* ******** **** ******** upon LICENSEE's filing to
the FDA of an application for approval of a ** ** strength PRODUCT.
g) ******** ****** ******* ******** **** ******** upon FDA approval of
either strength.
B. These payments are not to be regarded as a pre-payment against royalty as
described under Article V. It is further understood that LICENSEE shall not
be liable to make any payment provided above in Subsection A except upon the
occurrence of the milestone therein specified for such payment.
ARTICLE V. RUNNING ROYALTIES
LICENSEE shall pay to ETHICAL running royalties as follows:
A. ** ****** ******** of the NET SALES.
B. LICENSEE shall promptly give notice to ETHICAL of the date of first
commercial sale of the PRODUCT in the TERRITORY.
C. In the event the royalty rates set forth immediately above exceed those
allowable by applicable law or governmental rule or regulation, they shall
be so modified as to conform to the maximum royalty rate(s) allowable.
D. The obligation to pay running royalties hereunder shall terminate with
respect to sales of the PRODUCT which follow the termination of this
AGREEMENT (except for those royalties contemplated by Article IX hereof).
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E. Royalty terms may be subject to review and renegotiation in the event of
intensive competitive pressures, and the parties undertake to conduct such
review and renegotiation in good faith.
ARTICLE VI. PAYMENT OF RUNNING ROYALTIES
A. Running royalties due to ETHICAL under Article V of this AGREEMENT shall
accrue when the FINISHED PRODUCT is invoiced by the LICENSEE in accordance
with the provisions below:
B. Running royalties accruing hereunder shall be due and payable on the 45th
(forty-fifth) day following the close of each fiscal quarterly period of
LICENSEE.
C. Running royalties accruing hereunder shall be paid in U.S. dollars to
ETHICAL or ETHICAL's designee, acceptable to ******** in its reasonable
business judgment, duly named by ETHICAL in written notice to LICENSEE.
D. Running royalties accruing hereunder shall be paid in United States Dollars.
E. If, at any time, legal restrictions in the TERRITORY prevent the prompt
payment of running royalties or any portion thereof accruing hereunder, the
parties shall meet to discuss suitable and reasonable alternative methods of
reimbursing ETHICAL the amount of such running royalties.
ARTICLE VII. ROYALTY REPORTS
A. Each payment of running royalties made to ETHICAL hereunder shall be
accompanied by a written report, prepared and signed by a financial officer
of LICENSEE, showing the NET SALES for the months of the
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quarterly period for which payment is being made. In the event that no
running royalty is due ETHICAL hereunder for any such quarterly period,
LICENSEE shall so report.
B. LICENSEE shall maintain and keep for a period of at least 3 (three) years
or, if shorter, for such period as required by applicable U.S. federal or
state law, complete and accurate records in sufficient detail to enable any
running royalties which shall have accrued hereunder to be determined.
C. Upon the request of ETHICAL, but not exceeding once in any one yearly
period, LICENSEE shall permit an independent public accountant, selected by
ETHICAL and acceptable to LICENSEE, which acceptance shall not be
unreasonably withheld, to have access to such of the records of LICENSEE as
may be necessary to verify the accuracy of the royalty reports and payments
submitted to ETHICAL hereunder. Any such inspection of LICENSEE's records
shall be at ETHICAL's expense, except that if any such inspection reveals a
deficiency in an amount of running royalty actually paid to ETHICAL
hereunder in any quarterly period of ** ***** ******** or more of the amount
of such running royalty actually due to ETHICAL hereunder, then the expense
of such inspection shall be borne by LICENSEE instead of by ETHICAL. Any
amount of deficiency shall be paid promptly to ETHICAL.
ARTICLE VIII. REGISTRATION OF THE LICENSED PRODUCT
A. ETHICAL and LICENSEE have agreed that PRODUCT development should progress as
specified in Appendices 1, 2 and 3.
B. LICENSEE shall bear the cost of all application fees to government
authorities for MARKETING AUTHORISATIONS including, without limitation,
* redacted pursuant to confidential treatment request
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new drug applications ("NDA") and abbreviated new drug applications ("ANDA")
filed with FDA or any other fees concerning approvals from government
authorities necessary to commercialise the PRODUCT in the TERRITORY. The
Marketing Authorisations and all NDA's and ANDA's in the TERRITORY shall be
the sole and exclusive property of LICENSEE.
C. During the course of this AGREEMENT, LICENSEE may wish ETHICAL to develop
additional strengths of the product which ETHICAL will undertake on terms
and conditions mutually acceptable to both parties according to the
principles of this AGREEMENT, with the exception of a 20mg formulation of
nifedipine for ***** daily administration.
ARTICLE IX. DURATION - TERMINATION
A. DURATION
This AGREEMENT shall come into force as of the EFFECTIVE DATE and remain in
force for the term of the all patents issued in the TERRITORY relating to
the PRODUCT and included in the PATENT RIGHTS or for 16 (sixteen) years from
first commercial sale, whichever is the longer.
This AGREEMENT shall automatically be extended thereafter for successive 2
(two) year terms unless either party notifies the other of its decision not
to renew this AGREEMENT at least 12 (twelve) months prior to the
commencement of any such renewal term. Following any such termination
LICENSEE shall have the right to manufacture and distribute the PRODUCT in
the TERRITORY on a non-exclusive basis for which LICENSEE would pay to
ETHICAL a KNOW-HOW charge equal to ** ****** of NET SALES of the PRODUCT in
the TERRITORY.
* redacted pursuant to confidential treatment request
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B. TERMINATION FOR CAUSE
Either party hereto may terminate this AGREEMENT upon 90 (ninety) days
written notice calculated from the date of receipt of such notice to the
other party of its intention to do so in the event of violation or breach of
any of the material provisions of this AGREEMENT. Should, however, the other
party remedy the default upon which said notice is based within the said 90
(ninety) day period, the notice shall be without effect and this AGREEMENT
shall continue in full force and effect.
C. (1) In the event this AGREEMENT is terminated prior to the date of its
expiration in the TERRITORY due to fault of LICENSEE, LICENSEE shall
promptly make an accounting to ETHICAL of the inventory of all PRODUCT
which it has on hand in the TERRITORY, if any, as of the date of such
termination and said parties shall thereafter have the right for a
period of 6 (six) months after said termination to sell such inventory
of PRODUCT provided that the NET SALES thereof shall be subject to the
royalty provisions of Article V and so payable to ETHICAL. Thereafter,
any remaining inventory of PRODUCT shall be disposed of by mutual
agreement in accordance with regulatory requirements.
(2) In the event this AGREEMENT is terminated prior to the date of its
expiration due to fault of ETHICAL, LICENSEE shall have the unrestricted
right to continue to use and sublicense the PATENT RIGHTS and ETHICAL
KNOW-HOW RIGHTS, and to make, manufacture, use, promote and sell the
PRODUCT and FINISHED PRODUCT in the TERRITORY for the duration as
defined in Article IX A above without any royalty or other compensation
to ETHICAL.
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D. (1) If, within 6 (six) months after receipt of Marketing Authorisations for
the PRODUCT in the TERRITORY, LICENSEE has not commenced commercial
sales of the PRODUCT, then ETHICAL may terminate the AGREEMENT effective
immediately upon giving notice to LICENSEE.
(2) Should LICENSEE proceed to commercialise the PRODUCT in the TERRITORY
and then choose to abandon commercialisation of the PRODUCT in the
TERRITORY for any reasons, then LICENSEE shall promptly notify ETHICAL
of such abandonment of commercialisation, and ETHICAL may terminate this
AGREEMENT, effective immediately upon giving notice to LICENSEE.
(3) Should LICENSEE make the determination, for any reason, that it does not
intend to commercialise the PRODUCT in the TERRITORY, then LICENSEE
shall promptly notify ETHICAL of the same and ETHICAL may terminate this
AGREEMENT immediately upon giving notice to LICENSEE.
E. Upon any early termination of this AGREEMENT in full due to the fault of
LICENSEE, ETHICAL shall have the right to use, including license to any
Third Party(ies), any LICENSEE KNOW-HOW and any other information, and data
developed by or for LICENSEE with respect to the PRODUCT subject to
compensation arrangements to LICENSEE mutually acceptable to LICENSEE and
ETHICAL (including without limitation royalty payments in respect of such
LICENSEE KNOW-HOW).
F. In the event any of the patents included in the PATENT RIGHTS is found by a
court of applicable jurisdiction to be invalid or unenforceable in the
TERRITORY and as a result thereof an INDEPENDENT THIRD PARTY would be
entitled to manufacture or distribute and thereafter commercialises
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the PRODUCT in the TERRITORY utilising any technology covered by the PATENT
RIGHTS, then LICENSEE in its discretion may terminate this AGREEMENT or, at
LICENSEE's election, continue this AGREEMENT in full force and effect **** *
********* ** ******* ********* ** *** *** ******** ******** Such termination
would not be subject to Article IX C (2) of this AGREEMENT.
G. Termination of this AGREEMENT, due to the fault of either party, shall be
without prejudice to any other rights or remedies then or thereafter
available to either party under this AGREEMENT or otherwise.
H. The rights granted either party to terminate this AGREEMENT prior to the
expiration of its term shall not be affected in any way by that party's
waiver of or failure to take action with respect to any previous default
hereunder.
ARTICLE X. PRODUCT MANUFACTURE
LICENSEE undertakes to manufacture PRODUCT and FINISHED PRODUCT in the TERRITORY
in accordance with prevailing "Good Manufacturing Practice" in the TERRITORY.
ARTICLE XI. INFORMATION TRANSFER: CONFIDENTIALITY AND COOPERATION
A. Within 30 (thirty) days following the signing of this AGREEMENT, ETHICAL
shall provide to LICENSEE copies of relevant ETHICAL KNOW-HOW.
B. Each party shall hold in strict confidence any tangible information relating
to the PRODUCT marked confidential received from the other party (or oral
information which is reduced to tangible form within 30 (thirty) days of
disclosure and noted to be confidential), unless such information:
1. Is already in its possession.
* redacted pursuant to confidential treatment request
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2. Is already in the public domain or knowledge at the time of disclosure
or later comes into the public domain or knowledge without fault on the
part of the recipient.
3. Is subsequently disclosed to the recipient by a third party who did not
acquire it in confidence from the other party.
4. Is required to be disclosed in connection with any legal proceedings or
in order to obtain permission to manufacture or market the PRODUCT in
the TERRITORY.
This provision shall remain valid for a period of seven years after
termination of this AGREEMENT.
C. For the period starting with the EFFECTIVE DATE and ending with the first
commercial sale of the PRODUCT in the TERRITORY, ETHICAL shall report to
LICENSEE on a monthly basis the progress of the DEVELOPMENT PROGRAMME, as
defined in Appendix 2, of the PRODUCT. LICENSEE will provide a project
update to ETHICAL on a quarterly basis. ETHICAL will use its best efforts to
carry out the DEVELOPMENT PROGRAMME in accordance with the timetable set
forth in Appendix 2. ETHICAL will carry out the DEVELOPMENT PROGRAMME in
accordance with applicable laws and regulations of the TERRITORY, including,
without limitation, FDA regulations. All costings included in the
DEVELOPMENT PROGRAMME shall be jointly reviewed every * ***** ****** by
ETHICAL and LICENSEE.
D. ETHICAL will on a continuous basis provide to LICENSEE any ETHICAL KNOW-HOW
developed, information acquired or development planned in relation to the
PRODUCT and all improvements and modifications of the PRODUCT from time to
time invented, developed or acquired by or on
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behalf of ETHICAL. Prior to the date of first commercial sale of the PRODUCT
in the TERRITORY, LICENSEE shall provide to ETHICAL a summary of its
marketing plans for the PRODUCT.
E. ETHICAL shall make available to LICENSEE, on a reasonable consultation basis
without charge to LICENSEE, such advice of its technical personnel as may
reasonably be requested by LICENSEE in connection with the PRODUCT. It is
been understood that LICENSEE will reimburse all reasonable out-of-pocket
expenses incurred by ETHICAL attending meetings requested by LICENSEE.
F. LICENSEE shall disclose to ETHICAL and ETHICAL shall disclose to LICENSEE
all reports or other knowledge they may possess with respect to "adverse
drug experiences" (as defined in regulations promulgated by the FDA), mis-
labelling, stability failures or microbiological contamination with respect
to the PRODUCT (whether occurring within or outside of the TERRITORY) within
10 (ten) days of becoming aware of same. With respect to "serious adverse
drug experiences" (as defined in 21 CFR $312.32 and $314.80 promulgated by
the FDA), LICENSEE shall disclose to ETHICAL and ETHICAL shall disclose to
LICENSEE all reports and other knowledge they may possess as soon as
possible and in no event later than two business days of the receipt of such
report or notification of the serious adverse drug experience. The content
of such disclosure shall comply with all FDA regulations applicable to
notification to the FDA with respect to such matters. Each party shall
promptly deliver to the other, copies of all correspondence which such
party may send to, or receive from, the FDA with respect to the PRODUCT.
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G. During the term of this AGREEMENT, at least semi-annually, ETHICAL shall
furnish to LICENSEE any ETHICAL KNOW-HOW and any other information and data
developed or acquired by or under the control of ETHICAL with respect to the
PRODUCT. ETHICAL hereby acknowledges and agrees that LICENSEE may use,
within the TERRITORY, all such ETHICAL KNOW-HOW and information and data
without restriction and without additional compensation to ETHICAL, other
than as provided in this AGREEMENT, to make, have made, use and sell the
PRODUCT in the TERRITORY.
H. During the term of this AGREEMENT, at least semi-annually, LICENSEE shall
furnish to ETHICAL any LICENSEE KNOW-HOW and any other information and data
developed or acquired by or under the control of LICENSEE with respect to
the PRODUCT, subject to the following sentence. LICENSEE shall be under no
obligation to provide any LICENSEE KNOW-HOW, information or data to ETHICAL
hereunder (i) if the disclosure of such would be in violation of any
obligation LICENSEE owes to any THIRD PARTY, or (ii) until and unless
LICENSEE and ETHICAL have entered into a mutually acceptable arrangement
providing compensation to LICENSEE for ETHICAL's use of any such LICENSEE
KNOW-HOW, information or data. Notwithstanding the foregoing, LICENSEE
agrees to provide to ETHICAL, at no charge to ETHICAL, a summary (without
data) of the results of the bioavailability studies referred to in Article
IV hereof.
ARTICLE XII. INFRINGEMENT
A. (1) ETHICAL and LICENSEE each agree to notify the other in writing of any
alleged infringement or potential infringement of any PATENT
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RIGHTS or any information or allegations impacting on the validity of
any such Rights, in the TERRITORY promptly after becoming aware of the
same.
(2) Should ETHICAL elect to take action in its own name against an alleged
infringer, then all recoveries from such action shall inure to the
benefit of the parties in accordance with their mutual agreement taking
into consideration the profits lost by ETHICAL and LICENSEE in respect
of the sales accounted for by the infringer and ETHICAL shall bear the
cost and expense of any such action.
(3) If, within 30 (thirty) days after receipt by ETHICAL of notification of
alleged infringement, ETHICAL does not take action against an alleged
infringer or potential infringer and has failed to notify LICENSEE in
writing of its intent promptly to commence an action to terminate the
alleged infringement or potential infringement, then LICENSEE shall
have the right to commence such action on its own behalf at its own
cost and expense and to use ETHICAL's name in connection therewith, in
which case any recoveries shall inure to the benefit of LICENSEE.
(4) ETHICAL AND LICENSEE, each at the request of the other, shall assist
each other and cooperate in any action taken, other than direct
financial assistance, against an alleged infringer or potential
infringer.
B. (1) ETHICAL hereby represents that, to the best of its knowledge, none of
the PATENT RIGHTS or ETHICAL KNOW-HOW infringe on the patent or other
legally protected proprietary rights of any Third Party, and it has not
received any notice or claim of any such infringement
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worldwide. ETHICAL agrees to hold LICENSEE harmless from any
judgements, losses or costs (including reasonable attorneys' fees)
incurred in the event a claim or legal action is asserted against
LICENSEE to the effect that the manufacture, use or sale of the PRODUCT
infringes the PATENT RIGHTS or other legally protected proprietary
rights of THIRD PARTIES.
(2) ETHICAL and LICENSEE shall each give to the other prompt written notice
of any claim or action made against either of them alleging that any
of the PATENT RIGHTS infringe the rights of an INDEPENDENT THIRD PARTY
and arising from the manufacture, use or sale of the PRODUCT in the
TERRITORY. ETHICAL and LICENSEE agree to cooperate and collaborate with
each other in undertaking a full investigation of the situation and in
taking such action as they shall agree is appropriate in the
circumstances.
C. ETHICAL shall be solely responsible for and bear the cost of the prosecution
and maintenance of the PATENT RIGHTS.
D. The provisions of this Article XII shall survive termination of this
AGREEMENT.
ARTICLE XIII. TRANSFER OF RIGHTS AND OBLIGATIONS
- ------------------------------------------------
This AGREEMENT, in whole or in part, shall not be assignable by either party
hereto to any INDEPENDENT THIRD PARTY without the prior written consent of the
other party hereto except that either party may assign this AGREEMENT to an
affiliated company or the successor or assignee of substantially all of its
business. It is expressly understood and agreed by the parties hereto that the
assignor of any rights hereunder shall remain bound by its duties and
obligations hereunder.
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ARTICLE XIV. DISCLOSURE
ETHICAL and LICENSEE shall have the right, subject to the written approval of
the other, to disclose to any Third Party(ies) in connection with any
announcement, news release, or for any other reason the existence of this
AGREEMENT entered into with the LICENSEE, but not the terms hereof.
Notwithstanding the foregoing, each party shall have the right to make such
disclosures relating to this AGREEMENT as may be required by applicable laws and
regulations.
ARTICLE XV. FORCE MAJEURE
ETHICAL and LICENSEE shall not be liable for delays if such delays are due to
force majeure case, such as strikes, disputes with workmen, failure of supplies
from ordinary sources, fire, floods earthquakes, governmental regulation against
the aims of this AGREEMENT, war, legislation or any other cause, either similar
or dissimilar to the foregoing, beyond the reasonable control of the parties
which cannot be overcome by due diligence.
ARTICLE XVI. NOTICES
Any notice or report required or permitted to be given or made under this
AGREEMENT by either party to the other shall be in writing, sent by hand or by
registered or express mail or courier, postage prepaid, telex or telefax,
addressed to such other party at its address indicated at the beginning of this
AGREEMENT or to such other address as the addressee shall have last furnished in
writing to the addressor, and shall be effective upon receipt by the addressee.
Page 21
ARTICLE XV11. FURTHER ASSURANCES
From and after the date hereof, without further consideration, ETHICAL and
LICENSEE shall, from time to time during the term of this AGREEMENT, upon
request by the other, perform all actions and execute, acknowledge and deliver
all such further documents or instruments as may be required to give effect to
the purpose and intent of this AGREEMENT. Without limiting the generality of the
foregoing, the obligations of ETHICAL and LICENSEE are undertaken with a
principle objective of complying with all pertinent provisions of applicable
law, orders and regulations relating to the manufacture, use or sale in the
TERRITORY of pharmaceutical products; the obligation of ETHICAL shall include
the attendance by representatives of ETHICAL, upon reasonable advance request by
LICENSEE, at meetings with the FDA with respect to the NDA and causing
representatives of any supplier of the PRODUCT to similarly attend such
meetings. All out-of-pocket expenses incurred in attending such meetings will be
paid by LICENSEE.
ARTICLE XVIII. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS
Except as otherwise specifically provided in this AGREEMENT, all
representations, warranties and agreements contained in this AGREEMENT shall
survive the execution and delivery of this AGREEMENT and remain in full force
and effect regardless of any investigation made by or on behalf of either
ETHICAL or LICENSEE.
ARTICLE XIX. ARBITRATION
All disputes arising in connection with the AGREEMENT shall be settled under the
Rules of Conciliation and Arbitration of the International Chamber of Commerce
by one or more arbitrator in accordance with the said RULES, as follows:
Page 22
Each of the parties shall designate its arbitrator within 15 (fifteen) days from
notification by registered letter. The two arbitrators thus designated shall
designate a third arbitrator within 30 days from designation of the second
arbitrator, the said third arbitrator shall preside over the arbitration court.
Arbitration should be held in London if ETHICAL initiates the request and if
LICENSEE initiates the request arbitration should be held in New York.
ARTICLE XX. DISCLAIMER OF AGENCY
The parties acknowledge that each of LICENSEE and ETHICAL are independent
contractors and nothing herein contained shall be deemed to create any
relationship in the nature of agency, joint venture, partnership or similar
relations between LICENSEE and ETHICAL.
ARTICLE XXI. SEVERABILITY
Whenever possible, each provision of this AGREEMENT shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this AGREEMENT should be prohibited or invalid under applicable law, such
provision shall be ineffective to the extent of such invalidity without
invalidating the remainder of such provision or the remaining provisions of this
AGREEMENT to the extent such modification does not impair or change the intent
of the parties hereto.
ARTICLE XXII. PARAGRAPH HEADINGS
The subject headings of the Articles of this AGREEMENT are included for the
purposes of convenience only, and shall not affect the construction or
interpretation of any of its provisions.
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ARTICLE XXIII. ENTIRE AGREEMENT; AMENDMENT
This AGREEMENT contains the entire understanding of the parties with respect to
the matters contained herein and supersedes any previous agreements and may be
altered or amended only by a written instrument duly executed by both parties
hereto.
IN WITNESS WHEREOF, the parties hereto have executed this AGREEMENT in duplicate
originals.
ETHICAL HOLDINGS LTD SCHEIN PHARMACEUTICAL, INC
BY: /s/ Dr. G. W. Guy BY: /s/ Steven Getraer
------------------------- -----------------------
PRINT: Dr. G. W. Guy PRINT: Steven Getraer
---------------------- --------------------
DATE: 16th January 1993 DATE: Jan 16 1993
----------------------- ---------------------
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APPENDIX I - PRODUCT DEFINITION
** ** ***** ******* ** ** * **** ******** ** ** ********** ** *** **** ********
******* ********* **
** ************** ********* ******* ** *** ********* **** ******** *******
************ ** ******* **** ***** ************** ** *** *** *** *********** **
************ *** ******
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APPENDIX 2 - DEVELOPMENT PROGRAMME
(See following pages)
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[ * ]
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APPENDIX 3 - OBLIGATIONS OF PARTIES UNDER DEVELOPMENT
PROGRAMME
*******
** *********** ********* ************ *************
** ********** ** ******** ************* *********
** ********** ** *********** ************* *********
** ***** ********* ***********
** ********* ******* ***********
** *********** ********
******** ***** *********** ******* ********
** *** *********** ***** ***** *********
** ********** *********** **** *********
** *** *********** *** ******** ******** *********
** *** ******** *************** *******
** ******* *** **** ********************* ********
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EXHIBIT 10.35
AMENDMENT TO THE LICENCE AND DEVELOPMENT
----------------------------------------
AGREEMENT BETWEEN SCHEIN AND ETHICAL
------------------------------------
DATED 15TH JANUARY 1993 (the "Amendment Agreement")
---------------------------------------------------
This Amendment Agreement is made the 4th day of November 1994 (the "Effective
Date") between Ethical Holdings plc, whose registered office is at Corpus
Christi House, 9 West Street, Godmanchester, Cambs., PE18 8HG, U.K ("Ethical"),
and Schein Pharmaceutical, Inc., whose registered office is at 100 Campus Drive,
Florham Park, NJ. 017932, U.S.A. ("Schein").
WITNESSETH THAT
---------------
Whereas, Ethical Pharmaceuticals, a wholly owned subsidiary of Ethical, whose
registered office is at Gemini House, Bartholomew's Walk, Cambridgeshire
Business Park, Angel Drove, Ely, Cambs., CB7 4EA ("Ethical Pharmaceuticals")
has entered into a Licence Agreement and separate Supply Agreement with UCB
S.A. of Avenue Louise B-1050, Brussels, Beligium ("UCB"), both dated 28th
February 1992 (together the "Agreements") in respect of a once a day controlled
release formulation of nifedipine to be used for human therapy; and
Whereas, Ethical and Schein have entered into a Licence and Development
Agreement, dated 15th January 1993, in respect of an AB rated generic nifedipine
formulation at *** ********** to be similar to the U.S. marketed ********* **
(the "Licence and Development Agreement"); and
Whereas, Ethical and UCB have agreed in principle that Ethical Pharmaceuticals
shall fully reacquire the licences and rights granted to UCB under the
Agreements; and
Whereas, Ethical and Schein wish to amend the Licence and Development Agreement
as set forth herein.
NOW THEREFORE, in consideration of the above premises and the covenants
contained herein, the parties mutually agree as follows:
1. CONDITION PRECEDENT
-------------------
As a condition precedent it is agreed that this Amendment Agreement shall
automatically terminate and be of no effect and no payment shall be due
under Section 7 hereof unless, on or before 30th November 1994, it has been
proved to the reasonable satisfaction of Schein's in-house legal counsel
(with such satisfaction to be evidenced in writing) that Ethical
Pharmaceuticals has fully reacquired the licences and rights granted to UCB
under the Agreements. If such condition precedent is not satisfied, the
Licence and Development Agreement will continue in full force and effect
without modification.
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Subject to the condition precedent having been met the Licence and Development
Agreement is amended as follows:
2. ARTICLE I. DEFINITIONS
----------------------
2.1 Paragraph F is deleted in its entirety and replaced with the following
F. "MULTIPOR PATENT RIGHTS" means the patents and patent
applications set forth in Schedule 1 attached hereto. "EUROPEAN
PATENT RIGHTS" means the patent and patent applications set forth
in Schedule 2 attached hereto. In both cases such definition
shall include any and all United States and non-United States
patents and patent applications filed by or issued to ETHICAL and
licensed and/or assigned to ETHICAL relating to controlled
release formulations for oral administration in man, or the
manufacture or use of them, together with any and all patents
that may issue or may have issued therefrom, including any and
all divisions, continuations, continuations in part, extensions,
additions or reissues of or to any of the aforesaid in any
country in which Ethical has filed, or hereinafter files,
patents. The term "PATENT RIGHTS" shall include both the MULTIPOR
PATENT RIGHTS and the EUROPEAN PATENT RIGHTS.
2.2 Paragraph G is deleted in its entirety and replaced with the
following:
G. "PRODUCT", shall mean controlled release ** ** *** ** ** tablets
containing nifedipine based on the MULTIPOR PATENT RIGHTS and
ETHICAL KNOW-HOW, manufactured according to the technology
protected in the PATENT RIGHTS, to be used for human therapy and
exhibiting a similar pharmacokinetic profile to **********
******* nifedipine tablets sold in the Unites States at the
EFFECTIVE DATE under the trade name ********* **, as further
defined in Appendix 1 (the "MULTIPOR PRODUCT") and once a day
controlled release ** ** *** ** ** ******* containing nifedipine
based on the EUROPEAN PATENT RIGHTS and ETHICAL KNOW-HOW
manufactured according to the technology protected in the PATENT
RIGHTS (the "EUROPEAN PRODUCT"). For the avoidance of doubt, the
term PRODUCT shall also include all other formulations of
controlled release nifedipine in the event that ETHICAL has the
unrestricted right to licence, free of charge, such formulations
to SCHEIN.
2.3 Paragraph I is deleted in its entirety and replaced with the
following:
I. "TERRITORY" means each and every country in the world, with the
exception of Canada, South Korea and mainland China.
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2.4 Paragraph J is deleted in its entirety and replaced with the
following:
J. "NET SALES" means the gross sales of a PRODUCT actually invoiced
by LICENSEE or LICENSEE's sublicensee hereunder to an INDEPENDENT
THIRD PARTY, less charge backs and rebates, the total ordinary
and customary trade discounts (but not including cash discounts
for prompt payments), rebate for inventory price protection to
counter competitive pressures, excise taxes, other consumption
taxes, customs duty, credits and allowances actually granted on
account of rejection or return.
2.5 Paragraph M "Development Programme" shall be read as if it contained
the word Schedules in place of the word Schedule.
2.6 Paragraph O is deleted in its entirety and replaced with the
following:
O. "MARKETING AUTHORISATIONS" means the United States Food and Drug
Administration and any applicable comparable governmental
agencies whose approval or consent is required to market,
distribute and sell the PRODUCT in any country in the TERRITORY.
3. ARTICLE V. RUNNING ROYALTIES
----------------------------
3.1 Paragraph A is deleted in its entirety and replaced with the
following:
A. ** ****** ******** of the NET SALES. This rate may be subject to
review and renegotiation in the event of intensive competitive
pressures, local pricing policies in any particular country in
the TERRITORY or any other factor which, in either parties'
reasonable commercial opinion, justify a review and
renegotiation, and the parties undertake to conduct such review
and renegotiation in good faith. Until such review and
renegotiation has reached an agreed settlement, the running
royalty will continue at the rate of ** ****** *********
3.2 Paragraph E is deleted in its entirety.
4. ARTICLE IX. DURATION - TERMINATION
-----------------------------------
4.1 Paragraph A is deleted in its entirety and replaced with the
following:
A. This AGREEMENT shall come into force as of the EFFECTIVE DATE and
shall remain in force in respect of each PRODUCT in each country
in the TERRITORY for a period of 16 (sixteen years) from the date
of the first commercial sale to an INDEPENDENT
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THIRD PARTY of each PRODUCT in such country or the life of any
patents issued in the applicable country in the TERRITORY
relating to a PRODUCT and included in the PATENT RIGHTS,
whichever is the longer.
This AGREEMENT shall automatically be extended thereafter for
successive 2 (two) year terms unless either party notifies the
other of its decision not to renew this AGREEMENT at least 12
(twelve) months prior to the commencement of any such renewal
term; provided, however, that the failure to extend this
AGREEMENT with regard to one PRODUCT in any country in the
TERRITORY shall in no way affect the extension of this AGREEMENT
in any other country in the TERRITORY in respect of that PRODUCT
for which no notice has been given. Following any such
termination, LICENSEE shall have the right to manufacture and
distribute the PRODUCT named in the notice in that country of the
TERRITORY on a non-exclusive basis, for which LICENSEE will pay
to ETHICAL a KNOW-HOW charge equal to 4% (four percent) of
the NET SALES of the PRODUCT in that country in the TERRITORY.
4.2 Paragraph C.(2) is deleted in its entirety and replaced with the
following:
(2) In the event this AGREEMENT is terminated prior to the date of
its expiration due to fault of ETHICAL, LICENSEE shall have the
unrestricted right to continue to use and sublicence the PATENT
RIGHTS and ETHICAL KNOW HOW and to make, manufacture, use,
promote and sell the PRODUCT and FINISHED PRODUCT in the
TERRITORY for the duration as defined in Article IX A above in
which case Article V A shall be read as if it contained the
figure of **** **** *** * **** ********
4.3 Paragraph D is deleted in its entirety and replaced with the
following:
D. On a continuous basis the parties shall jointly review
telephonically (and at least once a year by face to face
meetings) the efforts being made by LICENSEE to obtain MARKETING
AUTHORISATIONS and commercialise the PRODUCT in each country in
the TERRITORY and LICENSEE shall keep ETHICAL informed on whether
or not it has made, or may forseeably make the determination that
it does not intend to obtain MARKETING AUTHORISATION or
commercialise a PRODUCT in any country of the TERRITORY. In the
event that it is agreed that LICENSEE is no longer making, or no
longer intends to make or is no longer able to make such efforts
then LICENSEE's right to commercialise that PRODUCT in that
country shall automatically terminate and ETHICAL shall have such
commercialisation rights together with
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the rights as further detailed in Article IX E subject to
LICENSEE's rights to compensation as also detailed therein.
4.4 The words "which would have a material impact on the NET SALES of a
PRODUCT and such impact can be shown" are added after the words
"technology covered by the PATENT RIGHTS" in the first sentence of
paragraph F of Article IX.
5. ARTICLE X. PRODUCT MANUFACTURE
------------------------------
5.1 Paragraph X is deleted in its entirety and replaced with the
following:
A. LICENSEE undertakes to manufacture or have manufactured the
MULTIPOR PRODUCT in the TERRITORY and shall ensure such
manufacturing shall comply with prevailing Good Manufacturing
Practice for sale of such PRODUCT in the relevant country in the
TERRITORY. LICENSEE may request ETHICAL to supply the Multipor
coating materials required in connection with the manufacture of
the MULTIPOR PRODUCT.
B. In the event that ETHICAL, or upon mutual agreement, an
INDEPENDENT THIRD PARTY manufacturer is to supply a PRODUCT to
the LICENSEE the supply price will be fully absorbed
manufacturing costs plus *** ******** ********, such costs to be
defined and set out in a separate supply agreement, to be
mutually agreed upon between the parties.
C. Once in any yearly period, at the request of the LICENSEE,
ETHICAL shall permit an independent public accountant selected by
LICENSEE and acceptable to ETHICAL, such acceptance not to be
unreasonably withheld, to have access (subject to reasonable
confidentiality undertakings) to such of the records and
documentation of ETHICAL as may be necessary to verify that the
supply price being charged to the LICENSEE is equal to the fully
absorbed manufacturing costs plus *** ******** ******** as set
out in Article X paragraph B above.
6. ARTICLE XI INFORMATION TRANSFER: CONFIDENTIALLY AND COOPERATION
---------------------------------------------------------------
6.1 The words "and shall comply with the laws and regulations of any
relevant country in the TERRITORY in which the PRODUCT is promoted,
marketed, distributed and sold" are added after the word "matters" at
the end of the penultimate sentence in paragraph F of Article XI.
6.2 The last sentence of paragraph D is deleted in its entirety.
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7. CONSIDERATION FOR THE AMENDMENT
-------------------------------
7.1 In consideration of Ethical entering into this Amendment Agreement,
Schein agrees to pay Ethical a total of $1.55 million (one million,
five hundred and fifty thousand U.S. dollars) in instalments as
follows:
7.1.1 ******** ****** ******* *** ****** ******** **** ******** on
the signing of this Amendment Agreement.
7.1.2 ******** ****** ******* *** ***** ******** **** ******** on the
delivery by Ethical or its designee of commercial quantities of
the EUROPEAN PRODUCT, sufficient to enable Schein to initiate
commercialisation in the United Kingdom.
7.2 The cost of the ** ** EUROPEAN PRODUCT DEVELOPMENT PROGRAMME,
(approval for the United Kingdom) is $300,000 (three hundred thousand
U.S. dollars which will be payable in quarterly instalments of
******* ****** ******** **** ******** each, beginning 28th February
1995. Any additional costs incurred in carrying out further work in
accordance with the regulatory requirements of individual countries in
the TERRITORY shall be agreed in advance and paid by Schein within 30
(thirty) days of receipt of invoice.
7.3 Any payments made in accordance with Article IV of the Licence and
Development Agreement shall be with respect to the achievement of
milestones in connection with the MULTIPOR PRODUCT only.
8. The attached Schedule 3 is added to Appendix 2 of the Licence and
Development Agreement.
For the avoidance of doubt, it is agreed that if there is a conflict then the
provisions of this Amendment Agreement shall take precedence over the provisions
of the Licence and Development Agreement which, except as otherwise amended by
the terms herein, shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused the Amendment Agreement to be
executed by their duly authorised representatives at the Effective Date above.
Signed [SIGNATURE ILLEGIBLE] [SIGNATURE ILLEGIBLE]
--------------------- ---------------------
For and on behalf of For and on behalf of
Ethical Holdings plc Schein Pharmaceutical Inc.
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SCHEDULE I
----------
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SCHEDULE 3
----------
ETHICAL PHARMACEUTICALS LTD - PATENT LIST
-----------------------------------------
********** **** ******* ***********
******* **********
******* ******* ****** ******
*************** *************
***** ****** ******
****** ************ *********** ******
******************* ******************
** *********
************* *** *********** *********** **************
********* *******
******* ******
******
******* *****
****** *********** **********
********* ******** ************ ********
******** ****** ******* *** ******* ********
****** *********** ******* ************
********* *******
******* ******
******* ********
***** ********
***** ***** *********
*** *********** *******
****** *******
*** ******* ******
CORRECT AT: 26 September 1994
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ETHICAL PHARMACEUTICALS LTD - PATENT LIST
-----------------------------------------
********** **** ******* ***********
******* *********** **********
****** ************ *********** ******
******************* ******************
****** *******
******* **********
******* **********
***
** *********
*********
*****
******** ***** *********
********* ***** ******
********* ***** ********
*********** ***** *********
******* ***** ****
******** ***** ******
******* *** ** ********* ****
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