1
EXECUTION COPY EXHIBIT 10.9
CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH
RESPECT TO THE PORTIONS
OF THIS EXHIBIT AS
INDICATED HEREIN.
Dated 11th June, 1999
ELAN PHARMACEUTICAL TECHNOLOGIES
A DIVISION OF ELAN CORPORATION, PLC
AND
ELAN PHARMA INTERNATIONAL LIMITED
AND
MINIMED INC.
DEVELOPMENT, LICENCE AND SUPPLY AGREEMENT
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CONTENTS
CLAUSE 1 Preliminary
CLAUSE 2 The Licence
CLAUSE 3 Intellectual Property
CLAUSE 4 Competing Products
CLAUSE 5 Development of the system and Product
CLAUSE 6 Project Team and Project Management
CLAUSE 7 Registration of the Product
CLAUSE 8 Marketing and Promotion of the Product
CLAUSE 9 Supply of the system
CLAUSE 10 Manufacture of the product
CLAUSE 11 Financial Provisions
CLAUSE 12 Payments, Reports and Audits
CLAUSE 13 Duration and Termination
CLAUSE 14 Warranty and Indemnity
CLAUSE 15 Customer Complaints and Product Recall
CLAUSE 16 Miscellaneous Provisions
CLAUSE 17 Conditions
Schedule 1 Elan Patent Rights
Schedule 2 Evaluation study
Schedule 3 The Project
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Schedule 4 Current System Specifications
Schedule 5 Project System Specifications
Schedule 6 Product Specifications
Schedule 7 Royalty Payments
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THIS AGREEMENT is made on 11th June, 1999.
BETWEEN:
(1) ELAN PHARMACEUTICAL TECHNOLOGIES, a division of Elan Corporation, a
company incorporated in Ireland having its registered office at Lincoln
House, Lincoln Place, Dublin 2, Ireland;
(2) ELAN PHARMA INTERNATIONAL LIMITED, a company incorporated in Ireland
having its registered office at WIL House, Shannon Business Park,
Shannon, Co. Clare, Ireland; and
(3) MINIMED INC., a company incorporated under the laws of the State of
Delaware having its principal place of business at 12744 San Fernando
Road, Sylmar, California CA 91342, United States of America.
RECITALS:
A. ELAN is beneficially entitled to the use of various patents, including
the ELAN PATENTS, which have been granted or are pending under the
International Convention in relation to the development and production
of subcutaneous micro-infusion pump devices, methods of drug delivery
using such devices and drug specific dosage forms for pharmaceutical
products, devices and processes.
B. ELAN is knowledgeable in the development of subcutaneous micro-infusion
drug delivery systems, methods of drug delivery using such devices and
drug specific dosage forms and has developed a unique range of delivery
systems and devices designed to provide improved delivery of newer and
better formulations of medicaments.
C. MINIMED is a world leader in the design, development and manufacture of
advanced infusion systems, primarily for the treatment of diabetes.
D. ELAN has developed a subcutaneous micro-infusion drug delivery system
as a method of drug delivery. MINIMED wishes ELAN to further develop
the SYSTEM for MINIMED as a method of drug delivery incorporating the
COMPOUND. ELAN is willing to use its technology to do so and to grant
MINIMED an exclusive licence of the ELAN PATENTS and ELAN KNOW-HOW to
package, import, use, offer for sale, distribute and sell the PRODUCT
in the TERRITORY.
E. ELAN and MINIMED are desirous of entering into an agreement to give
effect to the arrangements described at Recitals C and D.
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NOW IT IS HEREBY AGREED AS FOLLOWS:
CLAUSE 1 - PRELIMINARY
1.1 DEFINITIONS: In this Agreement unless the context otherwise requires:
AFFILIATE shall mean any corporation or entity controlling or
controlled or under common control with ELAN or MINIMED, as the case
may be. For the purposes of this Agreement, "control" shall mean the
direct or indirect ownership of more than 50% of the issued voting
shares or other voting rights of the subject entity to elect directors,
or if not meeting the preceding criteria, any entity owned or
controlled by or owning or controlling at the maximum control or
ownership right permitted in the country where such entity exists.
BASAL AND BOLUS SYSTEM shall mean ELAN's ambulatory subcutaneous
infusion drug delivery system for direct attachment to the body of a
patient, which is capable of delivering factory pre-programmed
continuous amounts combined with incremental amounts of drug upon
activation, either manually or automatically, as disclosed and
described in the ELAN PATENTS set forth in Schedule 1.
CFR shall mean the US Code of Federal Regulations 21, as amended from
time to time.
cGCP, cGMP, cGLP shall mean respectively current Good Clinical
Practice, current Good Manufacturing Practice and current Good
Laboratory Practice, respectively, as defined in the FFDCA.
COMPOUND shall mean formulations of insulin and/or its analogues,
either alone or in combination with each other. Insulin analogues shall
include any insulin peptide fragments that possess significant effects
on blood glucose and which are for the treatment of diabetes.
CONTINUOUS SYSTEM shall mean ELAN's ambulatory subcutaneous infusion
drug delivery system for direct attachment to the body of a patient
having a flexible diaphragm drug reservoir, which is capable of
delivering factory pre-programmed continuous amounts of drug upon
activation as disclosed and described in the ELAN PATENTS set forth in
Schedule 1 attached hereto.
CURRENT SYSTEM SPECIFICATIONS shall mean the existing specifications
for the SYSTEM as set forth in Schedule 4.
DEVELOPMENT COST shall mean the fully allocated cost, which is the sum
total of all development and other related costs for the SYSTEM
incurred after the EFFECTIVE DATE, including direct labour, direct
materials and supplies,
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variable labour, overhead and attributable administration, quality
control, quality assurance and other costs, whether incurred by ELAN,
its agents or any sub-contractor of ELAN; such costs to be calculated
in accordance with generally accepted accounting principles and such
costs shall only be incurred as the parties shall from time to time
agree.
DEVICE REGULATORY APPLICATION shall mean applications for approval to
market the SYSTEM with the COMPOUND which MINIMED will file with the
RHA in any country of the TERRITORY as the parties may from time to
time determine hereunder, including any supplements or amendments
thereto.
DEVICE REGULATORY APPROVAL shall mean the final approval by the RHA to
market the SYSTEM with the COMPOUND in any country of the TERRITORY,
including pricing and reimbursement approval and any other approval
which is required to launch the SYSTEM with the COMPOUND in the normal
course of business.
DMF shall mean Device or Drug Master File, as defined in the CFR
Section 314.420 or 814 and/or its equivalent in the other countries of
the TERRITORY.
EFFECTIVE DATE shall mean 11th June, 1999.
ELAN shall mean Elan Pharmaceutical Technologies, a division of Elan
Corporation, plc, Elan Pharma International Limited and any of their
AFFILIATES.
ELAN BACKGROUND TECHNOLOGY shall mean ELAN PATENTS, and/or ELAN KNOW
HOW. Notwithstanding anything contained in this Agreement to the
contrary, ELAN BACKGROUND TECHNOLOGY shall consist of ELAN KNOW-HOW,
and ELAN PATENTS controlled by Elan Corporation plc doing business as
Elan Pharmaceutical Technologies, and shall exclude (a) inventions,
patents and know-how owned, licensed or controlled by AFFILIATES of
Elan Corporation, plc (other than Elan Pharmaceutical Technologies),
including, without limitation, Elan Pharmaceuticals Inc., Athena
Neurosciences, Inc., Carnrick Laboratories, Targon Corporation and
Neurex Corporation, and (b) the Nanosystems Technology (as defined in
Clause 4.2.).
ELAN IMPROVEMENTS shall mean any and all improvements or enhancements,
patentable or otherwise, that have been conceived, created, developed
and/or otherwise invented solely by ELAN or jointly by at least one
employee of ELAN and at least one employee of MINIMED, and which can be
usefully applied to the SYSTEM and/or the PRODUCT, including the
manufacture thereof, except for (i) improvements relating exclusively
to the COMPOUND, (ii) any improvements that are subject to contractual
obligations of ELAN to third parties or (iii) improvements or
enhancements based on MINIMED BACKGROUND INFUSION SYSTEM TECHNOLOGY
made solely by MINIMED. If the inclusion of an ELAN IMPROVEMENT is
restricted or limited by a third
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party agreement, ELAN shall use reasonable commercial efforts to
exclude or where applicable minimize any such restriction or
limitation.
ELAN KNOW-HOW shall mean all knowledge, information, trade secrets,
data and expertise which is not generally known to the public, owned by
ELAN, or to which ELAN has rights under the terms of a licence or
licences in force on the EFFECTIVE DATE or developed or to be developed
before or during the TERM, which permit(s) disclosure of same to
MINIMED, relating to the SYSTEM and/or the PRODUCT, whether or not
covered by any patent, copyright, design patent, trademark, trade
secret or other industrial or any intellectual property rights.
In the event that ELAN acquires or merges with a third party entity,
ELAN KNOW-HOW shall not include any know-how to the extent that such
know-how relates to a product containing the COMPOUND which has been
approved for marketing or is in development by the said third party
entity. For the avoidance of doubt, the occurrence of any such
acquisition or merger shall not affect the licence of the ELAN KNOW-HOW
granted to MINIMED hereunder. Notwithstanding the foregoing, to the
extent ELAN KNOW-HOW is acquired or otherwise accessed by ELAN after
the EFFECTIVE DATE which in good faith is determined could be
beneficial to the parties relative to the PRODUCT, the parties shall in
good faith endeavour to incorporate such ELAN KNOW-HOW into the
PRODUCT.
ELAN PATENTS shall mean the patents and patent applications as set
forth in Schedule 1, that are owned or licensed by or on behalf of
ELAN. ELAN PATENTS shall also include all extensions, continuations,
continuations-in-part, divisionals, patents-of-additions,
re-examinations, re-issues, supplementary protection certificates and
foreign counterparts of such patents and patent applications and any
patents issuing thereon and extensions of any patents licensed
hereunder.
In the event that ELAN acquires or merges with a third party entity,
ELAN PATENTS shall not include any patent rights to the extent that
such patent rights relate to a product containing the COMPOUND which
has been approved for marketing or is in development by the said third
party entity. For the avoidance of doubt, the occurrence of any such
acquisition or merger shall not affect the licence of the ELAN PATENTS
granted to MINIMED hereunder. Notwithstanding the foregoing, to the
extent any ELAN PATENT is acquired or otherwise accessed by ELAN after
the EFFECTIVE DATE which in good faith is determined could be
beneficial to the parties relative to the PRODUCT, the parties shall in
good faith endeavour to incorporate any such patents into the PRODUCT.
ENFORCEMENT PROCEEDINGS shall mean the proceedings referred to in
Clause 3.4.2.
EVALUATION STUDY shall mean the study which shall be attached as
Schedule 2 which will be performed by MINIMED on the SYSTEM in
accordance with Clause 2.2.
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FFDCA shall mean the US Federal Food, Drug and Cosmetic Act of 1934,
and the regulations promulgated thereunder, as may be amended from time
to time.
FIELD shall mean the treatment or amelioration of diabetes by
subcutaneously delivering the COMPOUND using the SYSTEM.
GROSS INCOME shall mean the monetary amount or non cash consideration
payable by an independent third party to MINIMED:-
(i) for the granting of rights, whether by license, sublicense or
otherwise, by MINIMED to any independent third party relating
to the PRODUCT, including license fees, royalties on sales and
other ongoing fees, and
(ii) the NSP of the PRODUCT.
GROSS PROFIT shall mean GROSS INCOME less MANUFACTURING COST.
IN MARKET shall mean the sale of the PRODUCT by MINIMED or its
AFFILIATES to an unaffiliated third party such as (i) an end-user
consumer of the PRODUCT or (ii) a wholesaler, distributor, managed care
organisation, hospital or pharmacy or other third party payor for final
commercial sale by such party to the consumer, and shall exclude in any
event the transfer pricing of the PRODUCT by MINIMED to an AFFILIATE or
a permitted sub-licensee.
IND shall mean Investigational New Drug Application as such term is
defined in the CFR Section 312 and/or its equivalent in the other
countries of the TERRITORY.
INITIAL PERIOD shall mean the initial period of this Agreement, as more
fully described in Clause 13.
MAJOR MARKETS shall mean the USA, Germany, France and Japan and such
additional countries as may be agreed by the parties from time to time.
MANUFACTURING AGREEMENT shall mean the License and Manufacturing
Agreement of even date entered into between ELAN and MINIMED.
MANUFACTURING COST shall have the meaning assigned to it in the
MANUFACTURING AGREEMENT.
MINIMED shall mean MINIMED and any of its AFFILIATES.
MINIMED BACKGROUND COMPOUND TECHNOLOGY shall mean MINIMED COMPOUND
PATENTS and MINIMED COMPOUND KNOW HOW conceived prior to the EFFECTIVE
DATE or independently developed by MINIMED. For purposes of
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clarity, the parties acknowledge that MINIMED SYSTEM IMPROVEMENTS shall
not constitute MINIMED BACKGROUND INFUSION SYSTEM TECHNOLOGY hereunder.
MINIMED BACKGROUND INFUSION SYSTEM KNOW-HOW shall mean all knowledge,
information, trade secrets, data and expertise which is not generally
known to the public, owned or licensed by MINIMED prior to the
EFFECTIVE DATE or independently developed by MINIMED, relating to
infusion systems, whether or not covered by any patent, copyright,
design, trademark or other industrial or intellectual property rights.
MINIMED BACKGROUND INFUSION SYSTEM PATENTS shall mean all patents and
patent applications that are owned by, or licensed to MINIMED prior to
the EFFECTIVE DATE or independently developed by MINIMED, relating to
infusion systems but excluding any MINIMED SYSTEM IMPROVEMENTS. MINIMED
PATENTS shall also include all extensions, continuations,
continuations-in-part, divisionals, patents-of-additions,
re-examinations, re-issues, supplementary protection certificates and
foreign counterparts of such patents and patent applications and any
patents issuing thereon and extensions of any patents licensed
hereunder.
MINIMED BACKGROUND INFUSION SYSTEM TECHNOLOGY shall mean MINIMED
INFUSION SYSTEM PATENTS and MINIMED INFUSION SYSTEM KNOW HOW conceived
prior to the EFFECTIVE DATE or independently developed by MINIMED.
MINIMED COMPOUND IMPROVEMENTS shall mean any improvements or
enhancements, patentable or otherwise, relating exclusively to the
COMPOUND which are owned or licensed by MINIMED.
MINIMED COMPOUND KNOW-HOW shall mean all knowledge, information, trade
secrets, data and expertise which is not generally known to the public,
owned or licensed by MINIMED or to be developed or licensed by MINIMED
prior to the EFFECTIVE DATE relating exclusively to the COMPOUND,
whether or not covered by any patent, copyright, design, trademark or
other industrial or intellectual property rights.
MINIMED COMPOUND PATENTS shall mean all patents and patent
applications, that are owned by, or licensed to MINIMED relating
exclusively to the COMPOUND. MINIMED PATENTS shall also include all
extensions, continuations, continuations-in-part, divisionals,
patents-of-additions, re-examinations, re-issues, supplementary
protection certificates and foreign counterparts of such patents and
patent applications and any patents issuing thereon and extensions of
any patents licensed hereunder.
MINIMED SYSTEM IMPROVEMENTS shall mean any and all improvements or
enhancements, patentable or otherwise, that have been conceived,
created,
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developed and/or otherwise invented solely by MINIMED which can be
usefully applied to the SYSTEM and/or the PRODUCT and which is based
upon ELAN BACKGROUND TECHNOLOGY and/or ELAN IMPROVEMENTS. For purposes
of clarity, the parties acknowledge that (i) MINIMED COMPOUND
IMPROVEMENTS, and (ii) any such improvements or enhancements that are
based on MINIMED BACKGROUND INFUSION SYSTEM TECHNOLOGY made solely by
MINIMED do not constitute MINIMED SYSTEM IMPROVEMENTS hereunder.
NDA shall mean the new drug application, abbreviated new drug
application, or any other application acceptable to the RHA for
marketing approval for the COMPOUND with the SYSTEM, which MINIMED will
file with the RHA in the TERRITORY, including any supplements or
amendments thereto.
NDA APPROVAL shall mean the final approval of an NDA by the RHA to
market a the COMPOUND with the SYSTEM in the TERRITORY.
NSP shall, subject to the provisions of Clauses 11.3.5, mean in the
case of PRODUCT sold by MINIMED or an AFFILIATE or a permitted
sub-licensee, that sum determined by
Confidential portion omitted and filed separately with the Commission
PRODUCT shall mean the SYSTEM containing, or packaged with, the
COMPOUND.
PRODUCT SPECIFICATIONS shall mean the specifications for the PRODUCT
set by the parties for the DEVICE REGULATORY APPLICATIONS and which
shall be attached as Schedule 6, as well as such other specifications
such as interim specifications which may be required during the PROJECT
and such additional specifications for the PRODUCT as may be agreed by
the parties in writing.
PROJECT shall mean all activity in order to develop the SYSTEM and the
PRODUCT in accordance with the plan shown in Schedule 3, as may be
amended from time to time as agreed by the parties in writing.
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PROJECT SYSTEM SPECIFICATIONS shall mean the specifications for the
SYSTEM which shall be set by the parties for the DEVICE REGULATORY
APPLICATIONS and which shall be attached as Schedule 5, as well as such
other specifications such as interim specifications which may be
required during the PROJECT and such additional specifications for the
SYSTEM as may be agreed by the parties in writing.
PROJECT TEAM shall mean the group to be established pursuant to
Clause 6.
RHA shall mean any relevant government health authority (or successor
agency thereof) in any country of the TERRITORY whose approval is
necessary to market the SYSTEM, COMPOUND and/or PRODUCT, as applicable,
in the relevant country of the TERRITORY.
SYSTEM shall mean the CONTINUOUS SYSTEM and/or, subject to Clause 2.2,
the BASAL AND BOLUS SYSTEM.
TECHNOLOGICAL COMPETITOR shall mean, with respect to ELAN, a
pharmaceutical company or corporation having a substantial or primary
part of its business in research, development and manufacturing of
oral, transdermal or device drug delivery systems and which licenses
such drug delivery systems to third parties for the development of
pharmaceutical products. TECHNOLOGICAL COMPETITOR shall mean, with
respect to MINIMED, a company or corporation having a substantial or
primary part of its business in research, development and
manufacturing, or distributing, devices or products (a) for the
infusion or injection of insulin or insulin analogues or (b) for the
measurement of glucose in the treatment of diabetes.
TERM shall mean the term of this Agreement, as set out in Clause 13.
TERRITORY shall mean all of the countries of the world.
$ shall mean United States Dollars.
"US" or "USA" shall mean the United States of America.
1.2 INTERPRETATION: In this Agreement:
1.2.1 the singular includes the plural and vice versa, the masculine
includes the feminine and vice versa and references to natural
persons include corporate bodies, partnerships and vice versa.
1.2.2 any reference to a Clause or Schedule, unless otherwise
specifically provided, shall be respectively to a Clause or
Schedule of this Agreement.
1.2.3 the headings of this Agreement are for ease of reference only
and shall not affect its construction or interpretation.
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CLAUSE 2 - THE LICENCE
2.1 LICENCE TO MINIMED:
2.1.1 Subject to the terms of this Agreement, ELAN hereby grants to
MINIMED and MINIMED hereby accepts for the TERM an exclusive
licence to the ELAN BACKGROUND TECHNOLOGY and ELAN
IMPROVEMENTS to package, import, use, offer for sale and sell
and otherwise distribute the PRODUCT for the FIELD in the
TERRITORY.
2.2. PROOF OF CONCEPT STUDY
2.2.1 As soon as is reasonably practicable, ELAN shall supply a
maximum of 100 units of the CONTINUOUS SYSTEM which have been
modified to an agreed upon specification to provide continuous
delivery of the COMPOUND for a 72 hour period, to MINIMED for
the purpose of performing the EVALUATION STUDY. Within 8 weeks
of the receipt of such units of CONTINUOUS SYSTEM, MINIMED
shall perform and complete the EVALUATION STUDY on the
CONTINUOUS SYSTEM for the purpose of establishing that the
continuous basal subcutaneous infusion of the COMPOUND using
the CONTINUOUS SYSTEM provides similar or better glucose
control for Type 2 insulin using patients than existing oral
products which are used for the treatment of diabetes mellitus
and marketed in the US as of the EFFECTIVE DATE.
2.2.2. In the event that MINIMED fails to perform or complete the
EVALUATION STUDY within 8 weeks of receipt of the CONTINUOUS
SYSTEM pursuant to Clause 2.2.1. or the EVALUATION STUDY
achieves the target results as agreed to by ELAN and MINIMED
and set out therein, ELAN and MINIMED shall proceed with the
development of the CONTINUOUS SYSTEM and the PRODUCT for the
FIELD in accordance with this Agreement. In such event,
MINIMED shall have, for a period from the EFFECTIVE DATE up
until 12 months from the first commercial launch of the
PRODUCT in a MAJOR MARKET, a fully paid-up exclusive option to
an exclusive license to the ELAN BACKGROUND TECHNOLOGY and
ELAN IMPROVEMENTS as they relate to the BASAL AND BOLUS SYSTEM
for use in the subcutaneous delivery of the COMPOUND for the
FIELD in the TERRITORY in accordance with the terms of this
Agreement. In the event of termination of this Agreement,
MINIMED's option as set out herein shall automatically
terminate.
2.2.3. In the event that the EVALUATION STUDY does not achieve the
target results which have been agreed by ELAN and MINIMED and
set out
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therein, then, unless otherwise agreed in writing between the
parties, the BASAL AND BOLUS SYSTEM shall automatically
replace the CONTINUOUS SYSTEM as the SYSTEM for the purpose of
this Agreement and ELAN and MINIMED shall proceed with the
development of the BASAL AND BOLUS SYSTEM and the PRODUCT for
the FIELD in accordance with the terms of this Agreement.
Furthermore, all of the rights granted to MINIMED for the
CONTINUOUS SYSTEM pursuant to Clause 2.1 shall immediately
terminate and revert to ELAN, except for those rights
reasonably necessary for the BASAL AND BOLUS SYSTEM.
2.2.4. In the event the CONTINUOUS SYSTEM is replaced by the BASAL
AND BOLUS SYSTEM herein in accordance with Section 2.3.3, then
within 30 days of such event, ELAN shall provide MINIMED with
a development plan and budget for the development of the BASAL
and BOLUS SYSTEM. Notwithstanding any other provision to the
contrary herein, in the event that MINIMED elects not to fund
the development of the BASAL AND BOLUS SYSTEM, MINIMED shall
be entitled, for a period of 60 days from receipt of such
development plan and budget, in its discretion, to terminate
this Agreement by written notice thereof to ELAN. In such
event, MINIMED shall forfeit the Licence granted hereunder and
the amount paid to ELAN pursuant to Section 11.1.1 and this
Agreement shall terminate in accordance with the provisions of
Clause 13.
2.3 SUB-LICENSING BY MINIMED:
2.3.1 Subject to the provisions of Clause 2.3.8, MINIMED shall be
entitled, subject to the prior written consent of ELAN which
shall not be unreasonably withheld or delayed, to grant
sub-licences to package, import, use, offer for sale and sell
the PRODUCT for the FIELD in one or more countries of the
TERRITORY, provided that MINIMED may grant one sub-licence
only per country and MINIMED shall not grant a sub-licence to
a TECHNOLOGICAL COMPETITOR of ELAN. Notwithstanding the
foregoing, MINIMED shall be entitled to appoint one or more
distributors in (i) the markets designated in Clause 2.3.8,
consistent with MINIMED's other diabetes business activities
in such markets and (ii) in such other countries of the
TERRITORY in accordance with the terms of this Agreement.
2.3.2 Any sub-licence granted hereunder shall be on the same terms
mutatis mutandis as the terms of this Agreement insofar as
they are applicable, but excluding the right to grant a
sub-licence or a production licence.
2.3.3 For the avoidance of doubt, MINIMED shall use its reasonable
endeavours to ensure that ELAN shall have the same rights of
audit and inspection vis-a-vis a sub-licensee, as ELAN has
pursuant to this Agreement concerning MINIMED.
2.3.4 MINIMED shall be liable to ELAN for all acts and omissions of
any sub-licensee
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as though such acts and omissions were by MINIMED and MINIMED
shall provide the indemnity to ELAN outlined in Clause 15.8.
2.3.5 Where a sub-licence has been granted under Clause 2.3.1, such
sub-licence shall automatically terminate if this Agreement
terminates for the country or countries covered by the
sub-licence.
2.3.6 MINIMED shall undertake to protect the confidentiality of
ELAN's formulation, engineering and manufacturing processes
for the SYSTEM and/or PRODUCT in its dealings with permitted
sub-licensees
2.3.7 For the avoidance of doubt:-
(1) the parties agree that any sub-licence granted
pursuant to this Clause 2.3 shall not be capable of
surviving the termination of this Agreement; and
(2) IN MARKET sales of the PRODUCT by the sub-licensee
(but not a distributor) shall be included in
calculating NSP for the purposes of this Agreement.
2.3.8. MINIMED undertakes that MINIMED shall sell the PRODUCT itself
through MINIMED's direct sales force in the USA, France,
Germany, Sweden and Benelux countries. In no event shall
MINIMED be entitled to grant sub-licences to package, import,
use, offer for sale and sell the PRODUCT for the FIELD in such
countries of the TERRITORY. MINIMED may appoint one or more
distributors in such countries of the TERRITORY in a manner
consistent with MINIMED's other diabetes business practices
from time to time in effect.
CLAUSE 3 - INTELLECTUAL PROPERTY
3.1. OWNERSHIP OF ELAN PATENT RIGHTS/KNOW-HOW:
3.1.1. ELAN shall remain the sole owner of the ELAN BACKGROUND
TECHNOLOGY.
3.1.2 ELAN shall remain the sole owner of the ELAN IMPROVEMENTS. Any
ELAN IMPROVEMENTS which are made jointly by at least one
employee of ELAN and at least one employee of MINIMED shall be
assigned to ELAN by MINIMED at ELAN's request.
3.1.3. ELAN hereby grants to MINIMED an irrevocable non-exclusive
perpetual royalty-free license to such ELAN IMPROVEMENTS as
are made jointly by at least one employee of ELAN and at least
one employee of MINIMED for use outside of the FIELD; provided
however, that any such use shall
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be subject to the provisions of Clause 4.1 for the TERM.
3.1.4 ELAN shall be entitled to use the ELAN BACKGROUND TECHNOLOGY
and ELAN IMPROVEMENTS, and all technical and clinical data,
generated by ELAN pursuant to this Agreement in connection
with ELAN's commercial arrangements otherwise than in relation
to the PRODUCT for the FIELD, and in connection with the
PRODUCT for the FIELD in any countries which cease to be part
of the TERRITORY; and in the TERRITORY following termination
of this Agreement.
3.2 OWNERSHIP OF MINIMED PATENT RIGHTS/KNOW-HOW:
3.2.1. MINIMED shall remain the sole owner of all MINIMED BACKGROUND
COMPOUND TECHNOLOGY, MINIMED BACKGROUND INFUSION SYSTEM
TECHNOLOGY, MINIMED SYSTEM IMPROVEMENTS and MINIMED COMPOUND
IMPROVEMENTS.
3.2.2. MINIMED hereby grants to ELAN an irrevocable non-exclusive
perpetual royalty-free license to all MINIMED SYSTEM
IMPROVEMENTS for use in the TERRITORY; provided however, that
any such use shall be subject to the provisions of Clause 4.1
for the TERM.
3.2.3. In the event that MINIMED wishes to incorporate any MINIMED
BACKGROUND MEDICAL DEVICE TECHNOLOGY in the SYSTEM, MINIMED
shall provide full details of any such MINIMED BACKGROUND
MEDICAL DEVICE TECHNOLOGY to ELAN in writing for review. ELAN
shall have the option, at its sole discretion, to determine
whether to include such MINIMED BACKGROUND MEDICAL DEVICE
TECHNOLOGY in the SYSTEM, which decision shall be considered
with the PROJECT TEAM. In the event that ELAN is agreeable to
including such MINIMED BACKGROUND MEDICAL DEVICE TECHNOLOGY in
the SYSTEM, ELAN and MINIMED shall enter into discussions in
good faith as to the terms upon which such MINIMED BACKGROUND
MEDICAL DEVICE TECHNOLOGY shall be licensed to ELAN.
3.3 FILING AND MAINTENANCE OF PATENTS:
3.3.1 ELAN will be entitled, at its own expense, to file and
prosecute ELAN PATENTS and patentable ELAN IMPROVEMENTS made
solely by ELAN; to determine the patent filing strategy in
relation to same at its sole discretion; to assert and defend
the foregoing patent applications against third party
oppositions; and upon grant of any letters patent, to maintain
such letters patent in force subject to the following
conditions:
(1) ELAN shall promptly notify MINIMED in writing in
relation to the existence of ELAN improvements, or
any other intellectual property rights which may be
relevant to this Agreement and upon request by
MINIMED,
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ELAN shall provide MINIMED with copies of any
documents relating to the ELAN improvements or other
intellectual property rights in question.
(2) ELAN shall promptly notify MINIMED in writing of any
patent applications filed by ELAN under this Clause
3.3.1 and upon request by MINIMED shall provide
copies to MINIMED to such patent applications and any
patents issuing thereon, to the extent reasonably
required in order for MINIMED to fulfil its
obligations under this Agreement;
3.3.2. Elan shall inform MiniMed in a timely fashion of its intent to
seek patent protection on an Elan Improvement developed
jointly between Elan and MiniMed. At MiniMed's request, Elan
shall cooperate with MiniMed's patent counsel to seek
concurrent patent protection for such an Elan Improvement as
it relates to the Product and System. The parties will
cooperate to seek such concurrent protection so that neither
party shall be the owner of any patent, application or
publication that may be used as prior art against the other,
or otherwise be a bar to the other in obtaining patent
protection for such improvement as it relates to the Elan
Improvements.
3.3.3. If ELAN does not intend to make an application for patents or
continue prosecution of a pending application in respect of,
or continue to maintain the ELAN PATENTS or ELAN IMPROVEMENTS
in any or some countries of the TERRITORY in relation to the
FIELD, MINIMED will be entitled to file, prosecute and
maintain patent applications and patents in respect thereof,
at its own expense, in accordance with the following terms:-
(1) MINIMED shall consult with ELAN on a regular basis in
relation to the status of its activities under this
Clause 3.3.3;
(2) ELAN shall execute all documents, forms and
declarations, provide all necessary information and
data, and do all such things as shall be necessary to
enable MINIMED to exercise the foregoing right;
(3) MINIMED shall promptly notify ELAN in writing of any
patent applications filed by MINIMED hereunder and
shall provide all reasonable access to ELAN to such
patent applications and any patents issuing thereon.
3.3.4 MINIMED will be entitled, at its own expense, to file and
prosecute the MINIMED COMPOUND PATENTS and patentable MINIMED
COMPOUND IMPROVEMENTS; to determine the patent filing strategy
in relation to same at its sole discretion; to assert and
defend the foregoing patent applications against third party
oppositions; and upon grant of any letters patent, to maintain
such letters patent in force subject to the following
conditions:-
Page 16 of 44
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(1) MINIMED shall promptly notify ELAN in writing in
relation to the existence of MINIMED COMPOUND
improvements, or any other intellectual property
rights which may be relevant to this Agreement and
upon request by ELAN, MINIMED shall provide ELAN with
copies of any documents relating to the MINIMED
COMPOUND improvements or other intellectual property
rights in question.
(2) MINIMED shall promptly notify ELAN in writing of any
patent applications filed by MINIMED under this
Clause 3.3.4 and upon request by ELAN shall provide
copies to ELAN to such patent applications and any
patents issuing thereon, to the extent reasonably
required in order for ELAN to fulfil its obligations
under this Agreement.
3.3.5 MINIMED shall inform ELAN in a timely fashion of its intent to
seek patent protection on a MINIMED SYSTEM Improvement
developed solely by MiniMed. At ELAN's request, MINIMED shall
cooperate with ELAN's patent counsel to seek concurrent patent
protection for a MINIMED SYSTEM IMPROVEMENT as it relates to
the Product and System and such an improvement as it relates
to ELAN's developments outside the scope of this Agreement.
The parties will cooperate to seek such concurrent protection
so that neither party shall be the owner of any patent,
application or publication that may be used as prior art
against the other, or otherwise be a bar to the other in
obtaining patent protection for such improvement as it relates
to the MINIMED SYSTEM Improvements.
3.3.6 If MINIMED does not intend to make an application for patents
or continue prosecution of a pending application in respect
of, or continue to maintain the MINIMED COMPOUND PATENTS or
MINIMED SYSTEM IMPROVEMENTS in any or some countries of the
TERRITORY, ELAN will be entitled to file, prosecute and
maintain patent applications and patents in respect thereof,
at its own expense, in accordance with the following terms:-
(1) ELAN shall consult with MINIMED on a regular basis in
relation to the status of its activities under this
Clause 3.3.6;
(2) MINIMED shall execute all documents, forms and
declarations, provide all necessary information and
data, and do all such things as shall be necessary to
enable ELAN to exercise the foregoing right;
(3) ELAN shall promptly notify MINIMED in writing of any
patent applications filed by ELAN hereunder and shall
provide all reasonable access to MINIMED to such
patent applications and any patents issuing thereon.
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3.4 ENFORCEMENT
3.4.1 MINIMED and ELAN shall promptly inform the other in writing of
any alleged infringement of which it shall become aware by a
third party of any patents within the ELAN PATENTS or ELAN
IMPROVEMENTS and provide such other with any available
evidence of infringement.
3.4.2 ELAN, at its option, shall be entitled to institute any
administrative, judicial or other proceeding to prevent or
stop any infringement or unauthorised use ("ENFORCEMENT
PROCEEDINGS") of the ELAN BACKGROUND TECHNOLOGY or ELAN
IMPROVEMENTS.
3.4.3. MINIMED agrees to provide all reasonable co-operation and
assistance to ELAN in relation to any such ENFORCEMENT
PROCEEDINGS and agrees to be named as a party in any
ENFORCEMENT PROCEEDINGS, as necessary, instituted by ELAN
hereunder. ELAN shall reimburse MINIMED its reasonable costs
and expense for co-operating with ELAN hereunder.
3.4.4 MINIMED, at its option, shall be entitled to institute
ENFORCEMENT PROCEEDINGS in respect of any infringement or
unauthorised use of the MINIMED BACKGROUND COMPOUND
TECHNOLOGY, MINIMED COMPOUND IMPROVEMENTS, MINIMED SYSTEM
IMPROVEMENTS, or MINIMED INFUSION SYSTEM BACKGROUND TECHNOLOGY
at its own expense and for its own benefit. ELAN agrees to
provide all reasonable co-operation and assistance to MINIMED
in relation to any such ENFORCEMENT PROCEEDINGS and agrees to
be named as a party in any ENFORCEMENT PROCEEDINGS, as
necessary, instituted by MINIMED hereunder.
3.4.5 In the event that the intellectual property owner does not
want to institute ENFORCEMENT PROCEEDINGS, then the other
Party may enforce such rights at its own expense. The
intellectual property owner shall cooperate with the enforcing
Party and provide all reasonable assistance in relation to any
such ENFORCEMENT PROCEEDINGS. The enforcing Party must seek
written approval from the intellectual property owner, which
may not be unreasonably withheld, prior to taking action and
must keep the intellectual property owner informed of the
action and may not enter into any settlement agreement without
the intellectual property owner's consent, which may not be
unreasonably withheld. Any reasonable fees and costs borne by
the intellectual property owner shall be reimbursed by the
enforcing Party. In the event that MINIMED decides to enforce
the ELAN BACKGROUND TECHNOLOGY or ELAN IMPROVEMENTS in
accordance with this paragraph, any recovery remaining after
the deduction of reasonable expenses (including attorney's
fees and
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expenses) incurred in relation to such ENFORCEMENT PROCEEDINGS
shall constitute NSP for the purpose of this Agreement.
3.5 DEFENCE
3.5.1 In the event that a claim or proceeding is brought against
MINIMED by a third party alleging that the method of
manufacture, manufacture, sale, use or offer for sale of the
SYSTEM and/or the PRODUCTas claimed in the ELAN PATENTS,
infringes the patent rights of such a third party in the
TERRITORY, MINIMED shall promptly advise ELAN of such threat
or suit.
3.5.2. Confidential portion omitted and filed separately with the
Commission.
3.5.3. Confidential portion omitted and filed separately with the
Commission.
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20
3.5.4 Confidential portion omitted and filed separately with the
Commission.
3.5.5 Neither Party shall have any liability to the other party
whatsoever or howsoever arising for any losses incurred as a
result of MINIMED having to cease selling the PRODUCT or
having to defer the launch of selling the PRODUCT.
3.5.6. In the event that a claim or proceeding is brought against
ELAN by a third party alleging that the manufacture, offer for
sale, sale, distribution or use of the PRODUCT and/or the
COMPOUND in the TERRITORY infringes any adversely held patent
or involves the unauthorised use of any other intellectual
property, ELAN shall promptly advise MINIMED of such threat or
suit. Subject to ELAN's obligations pursuant to the provisions
of Clause 3.5.2, Clause 3.5.3, Clause 3.5.4. and Clause 15.4,
MINIMED shall indemnify ELAN against such a claim; provided
that ELAN shall not acknowledge to the third party or to any
other person the validity of the patent rights of such a third
party and shall not compromise or settle any claim or
proceedings relating thereto without the written consent of
MINIMED, which shall not be unreasonably withheld or delayed.
At its option, MINIMED may elect to take over the conduct of
such proceedings from ELAN with counsel of MINIMED's choice.
In such event MINIMED shall keep ELAN advised of all material
developments in the said proceedings and shall not settle or
compromise such proceedings without the consent of ELAN which
shall not be unreasonably withheld or delayed.
3.5.7. In the event that a claim or proceeding is brought against
ELAN by a third party alleging that the manufacture, offer for
sale, sale, distribution or use of the SYSTEM infringes any
adversely held patent or involves the unauthorised use of any
other intellectual property, the provisions of either Clause
3.5 of this Agreement or Clause 3.5 of the MANUFACTURING
AGREEMENT shall apply; provided however, that in no event
shall MINIMED be entitled to rely upon the provisions of both
agreements.
3.6 TRADEMARKS
ELAN AND MINIMED hereby acknowledge and agree that one or more
trademarks
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21
owned or licensed by or on behalf of either party, whether on the date
hereof or hereafter, may be used in connection with the sale or
promotion of the PRODUCT. This Agreement notwithstanding, any such mark
shall continue to be owned or licensed by ELAN or MINIMED, as
appropriate. In the event that an ELAN trademark is to be used in
connection with for the PRODUCT, then, at such time, the parties shall
enter into an appropriate royalty-free trademark licence agreement as
is necessary.
CLAUSE 4 - COMPETING PRODUCTS
4.1 Subject to the provisions of Clause 4.2 and except as otherwise
provided in this Agreement and the MANUFACTURING AGREEMENT, ELAN and
MINIMED shall not promote, license, manufacture, market, or sell an
external disposable subcutaneous infusion device, which is * other than
the PRODUCT ("COMPETING PRODUCT") in the TERRITORY during the INITIAL
PERIOD.
4.2 Confidential portion omitted and filed separately with the Commission.
4.3 Confidential portion omitted and filed separately with the Commission.
CLAUSE 5 - DEVELOPMENT OF THE SYSTEM AND PRODUCT
5.1 ELAN has developed the SYSTEM in accordance with the CURRENT SYSTEM
SPECIFICATIONS as a method of drug delivery. ELAN acknowledges that it
is of the opinion, that to the best of its knowledge and belief as of
the date of this Agreement, the SYSTEM is capable of performing in
material conformance with the CURRENT SYSTEM SPECIFICATIONS.
Notwithstanding the foregoing, ELAN and MINIMED acknowledge and agree
that the SYSTEM is still in
- --------------
* Confidential portion omitted and filed separately with the Commission
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22
development and that such development involves inherent risks in terms
of outcome and timing. Any obligation on ELAN arising hereunder shall
be expressly limited to a covenant to exercise all commercially
reasonable efforts to develop the SYSTEM in accordance with the terms
of this Agreement.
5.2. The Parties wish ELAN to further develop the SYSTEM to deliver the
COMPOUND, and ELAN shall diligently pursue the same in a commercially
reasonable manner. ELAN shall further develop the SYSTEM in accordance
with the PROJECT pursuant to the terms of this Agreement. However, it
is acknowledged that device development incorporates inherent risk in
terms of outcomes and ELAN does not guarantee the further development
of the SYSTEM or the ability of the SYSTEM to achieve the PROJECT
SYSTEM SPECIFICATIONS beyond the CURRENT SYSTEM SPECIFICATIONS and/or
to obtain the DMF or DEVICE REGULATORY APPROVAL in one or more of the
countries of the TERRITORY.
5.3 Except as otherwise provided for herein or in the MANUFACTURING
AGREEMENT, MINIMED shall be responsible for all activities and costs
associated with the further development of the PRODUCT in accordance
with the PROJECT pursuant to the terms of this Agreement and in
particular but not limited to :
5.3.1. sourcing, supplying and, if necessary, formulating, all
COMPOUND which is required to develop the SYSTEM and the
PRODUCT; and
5.3.2. designing and manufacturing the drug cartridge which will
contain the COMPOUND and will be used in connection with the
SYSTEM.
5.4 ELAN and MINIMED shall undertake their respective obligations under the
PROJECT on a collaborative basis. Accordingly, the parties shall
co-operate in good faith particularly with respect to unknown problems
or contingencies and shall perform their respective obligations in good
faith and in a commercially reasonable, diligent and workmanlike
manner.
5.5 As soon as possible following the execution of this Agreement, MINIMED
shall provide to ELAN, unless it has already done so prior to the
execution of this Agreement, the specifications for the COMPOUND to be
delivered with the SYSTEM, the desired PRODUCT characteristics, interim
PRODUCT SPECIFICATIONS and information as to the MINIMED objectives for
the PRODUCT.
5.6 In particular, MINIMED shall be responsible for determining the scope
and nature, and for carrying out at its own cost all clinical studies
program in human patients, including for the avoidance of doubt any
pharmacokinetic/pharmacodynamic studies. Such studies shall be
performed by MINIMED for the MAJOR MARKETS, and for other the countries
of the TERRITORY outside of the MAJOR MARKETS, in accordance with
Clause 7;
5.6.1 the primary objectives of the program so conducted shall be to
complete the
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23
DEVICE REGULATORY APPLICATION and DEVICE REGULATORY APPROVAL
in the MAJOR MARKETS and it is the parties' expectation that
the body of data so generated in the PROJECT will also support
such applications for DEVICE REGULATORY APPROVAL which MINIMED
or its AFFILIATES or permitted sub-licensees shall make in the
other countries of the TERRITORY in accordance with the terms
of this Agreement.
5.6.2 Subject to the provisions of Clause 7, MINIMED agrees to carry
out and complete the clinical program in the USA and in such
other countries of the TERRITORY as necessary to obtain DEVICE
REGULATORY APPROVAL in such countries to a standard and
timeframe which it would otherwise find appropriate for one of
its major branded products;
5.6.3 MINIMED shall keep ELAN informed as to the progress and
completion of the studies and, shall provide to ELAN summary
study reports thereon;
5.6.4 MINIMED undertakes that it shall carry out all such clinical
studies to prevailing cGCP and cGLP and most specifically in
accordance with the applicable RHA standards and guidelines;
5.6.5 MINIMED shall be responsible at its cost for the preparation
and filing of appropriate INDs (and/or IDE's or 510k's, to the
extent deemed appropriate by the PROJECT TEAM and subject to
the provisions of Clause 7.4) to the extent required to allow
it to undertake such clinical studies. ELAN shall co-operate
with MINIMED as reasonably necessary in the preparation and
filing of such INDs. The parties agree that ELAN's charges to
MINIMED for any such work shall be as set out in Clause 11.2
of the Agreement.
5.7 For the avoidance of doubt, it is acknowledged that ELAN's primary
objective under the PROJECT is to develop the SYSTEM in accordance with
the PROJECT.
5.8 MINIMED shall conduct any pharmacokinetic, clinical, pharmacoeconomic,
and any other market analysis, study or test on the PRODUCT which
MINIMED deems appropriate. In the event that MINIMED does conduct such
analysis, study or test, MINIMED shall own the said data and
information which shall thereafter form part of MINIMED KNOW-HOW.
MINIMED shall provide ELAN with a summary report of any such material
analysis, study or test performed by MINIMED as soon as is reasonably
possible following its completion. Subject to any contractual
restrictions on MINIMED and to the prior written consent of MINIMED
which shall not be unreasonably withheld or delayed, and subject
further, as appropriate, to secrecy obligations being imposed on any
recipient of such MINIMED KNOW-HOW, ELAN shall be entitled to use any
such MINIMED KNOW-HOW in connection with ELAN's commercial arrangements
for the SYSTEM otherwise than in relation to the PRODUCT for the FIELD,
and in
Page 23 of 44
24
connection with the PRODUCT for the FIELD in any countries which cease
to be part of the TERRITORY; and in the TERRITORY following termination
of this Agreement. Subject to any contractual restrictions on ELAN,
ELAN shall disclose a summary report of any technical or clinical data
which may be generated by ELAN or ELAN's licensees on the SYSTEM to
MINIMED. Subject to the prior written consent of ELAN which shall not
be unreasonably withheld or delayed, MINIMED shall be entitled to use
any such data connection with the PRODUCT in the TERRITORY.
CLAUSE 6 - PROJECT TEAM AND PROJECT MANAGEMENT
6.1 It is recognised by the parties that a significant resource shall be
required from each party to accomplish successful DEVICE REGULATORY
APPROVAL in the MAJOR MARKETS and launch of the PRODUCT, particularly
in the co-ordination of logistics, finalisation of various
specifications, preparation and agreement of clinical study designs and
protocols, methodologies transfer, supply and packaging configurations,
shipping and handling procedures and for this purpose, the parties will
establish a PROJECT TEAM.
6.2 The PROJECT TEAM shall consist of a chief representative from each
party together with such additional business and development personnel
from each party who are appropriately skilled and knowledgeable in
relation to the PROJECT and who are deemed necessary to accomplish the
work of the PROJECT.
6.3 Unless otherwise agreed by the parties, the PROJECT TEAM shall meet at
least once each calendar quarter, such meetings to continue until the
time of launch or such later time as may be agreed. The PROJECT TEAM
may be meet in person or by means of such telephone, video or other
communication facilities as permit all members of the PROJECT TEAM to
communicate with each other simultaneously and instantaneously. If the
PROJECT TEAM decides to meet in person, such meetings shall be held
alternatively at the offices of ELAN and MINIMED or as otherwise agreed
by the parties. Meetings shall be co-chaired by the chief
representatives of the parties. At and between meetings of the PROJECT
TEAM, each party shall keep the other fully and regularly informed as
to its progress with its respective obligations.
6.4 In the event of a dispute amongst the PROJECT TEAM which cannot be
resolved by consensus, such dispute shall be referred to the President
and Chief Operating Officer, of MINIMED and the President of Elan
Pharmaceutical Technologies who shall discuss the matter and attempt to
reach an amicable solution. In the event that the foregoing officers
cannot resolve the dispute amicably, the said officers shall refer the
dispute to the Chairmen of MINIMED and ELAN who shall discuss the
matter and attempt to reach an amicable solution. The provisions of
this Clause 6.4. shall be without prejudice to the parties' other
rights and remedies.
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6.5. The PROJECT TEAM shall not have the authority to amend or vary any of
the terms of this Agreement.
CLAUSE 7 - REGISTRATION OF THE PRODUCT
7.1 The PROJECT TEAM shall establish the regulatory procedure to be
followed by ELAN and MINIMED in order to secure all necessary
regulatory approvals to market the PRODUCT in the MAJOR MARKETS as
swiftly as practicable. ELAN shall be responsible for filing and
maintaining a DMF for the SYSTEM with the RHA in the MAJOR MARKETS.
ELAN shall use reasonable endeavours in filing and maintaining each DMF
with the RHA in the MAJOR MARKETS as swiftly as practicable.
7.2 At its expense, MINIMED shall be responsible for the filing and
maintaining all required NDAs and DEVICE REGULATORY APPLICATIONS in
respect of the COMPOUND and PRODUCT respectively, with the RHAs in the
TERRITORY. MINIMED shall use reasonable endeavours in prosecuting each
required NDA and DEVICE REGULATORY APPLICATION to approval by the RHA
as swiftly as practicable.
7.3 MINIMED shall notify ELAN of the date of submission of any NDA or
DEVICE REGULATORY APPLICATION in any country of the TERRITORY and shall
also notify ELAN of any NDA APPROVAL or DEVICE REGULATORY APPROVAL as
soon as is reasonably possible following said approval.
7.4 MINIMED will be the holder of the NDA APPROVAL and DEVICE REGULATORY
APPROVAL for the COMPOUND and PRODUCT respectively, in the TERRITORY,
provided however, that in the event that a DEVICE REGULATORY APPROVAL
is granted for the SYSTEM alone, such DEVICE REGULATORY APPROVAL shall
be the property of ELAN. In such event, ELAN shall provide MINIMED with
reference rights to such DEVICE REGULATORY APPROVAL mutatis mutandis
with the provisions of Clause 7.5 below.
7.5 MINIMED will permit ELAN, or ELAN's licensees, without charge, to have
access to, to photocopy and to cross reference all DEVICE REGULATORY
APPROVALS or DEVICE REGULATORY APPLICATIONS for the PRODUCT for the
purpose of obtaining DEVICE REGULATORY APPROVALS for the SYSTEM in
connection with ELAN's commercial arrangements otherwise than in
relation to the PRODUCT for the FIELD, and in connection with the
PRODUCT for the FIELD in any countries which cease to be part of the
TERRITORY; and in the TERRITORY following termination of this
Agreement.
7.6 MINIMED shall submit to ELAN a quarterly report, for every calendar
quarter prior to the marketing of the PRODUCT within 14 days of the end
of the relevant quarter fully outlining the regulatory status of the
PRODUCT in the TERRITORY, including an overview of any material
communications with the RHAs in the TERRITORY.
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26
7.7 MINIMED shall be responsible for obtaining and maintaining all
regulatory approvals necessary for MINIMED to package the PRODUCT into
final marketing packaging and for obtaining all applicable state and
local regulatory approvals for the distribution of the PRODUCT in the
TERRITORY. ELAN shall co-operate with MINIMED in obtaining such
approvals.
7.8 MINIMED shall provide ELAN with access to all DEVICE REGULATORY
APPROVALS to enable ELAN to exercise its rights and fulfil its
obligations hereunder.
7.9 MINIMED shall indemnify and hold harmless ELAN from and against all
claims, damages, losses, liabilities and expenses to which ELAN may
become liable relating to or arising out of MINIMED's bad faith,
negligence or intentional misconduct in connection with the filing or
maintenance of the DEVICE REGULATORY APPLICATIONS and REGULATORY
APPROVALS in the TERRITORY. ELAN shall indemnify and hold harmless
MINIMED from and against all claims, damages, losses, liabilities and
expenses to which MINIMED may become liable relating to or arising out
of ELAN's bad faith, negligence or intentional misconduct in connection
with the filing or maintenance of the DMF in the TERRITORY.
7.10 Subject to the express representations and warranties set out in this
Agreement, it is hereby acknowledged that there are inherent
uncertainties involved in the registration of pharmaceutical products
and medical devices with the RHA in relation to achieving the PROJECT
SYSTEM SPECIFICATIONS and/or PRODUCT SPECIFICATIONS, filing and
maintaining the DMF, and obtaining the NDA APPROVAL and/or DEVICE
REGULATORY APPROVAL and such uncertainties form part of the business
risk involved in undertaking the form of commercial collaboration
outlined in this Agreement. Accordingly, ELAN and MINIMED shall have no
liability to the other as a result of any failure of the PRODUCT to
successfully achieve the PROJECT SYSTEM SPECIFICATIONS or PRODUCT
SPECIFICATIONS, or the DMF, NDA APPROVAL or DEVICE REGULATORY APPROVAL
of the RHA.
CLAUSE 8 - MARKETING AND PROMOTION OF THE PRODUCT
8.1. Upon a date to be agreed by the PROJECT TEAM, ELAN and MINIMED shall
establish a MARKETING COMMITTEE consisting of at least one
representative from each party who shall act as liaison between the
parties to ensure that ELAN is up to date on the prevailing market
conditions and MINIMED's efforts at marketing and selling the PRODUCT.
Within 90 days of the submission of the first DEVICE REGULATORY
APPLICATION for the PRODUCT in the MAJOR MARKETS, MINIMED will outline
to ELAN the structure of the promotional activities to be carried out
by MINIMED for the period up to the first commercial sale of the
PRODUCT and for a period of 1 year thereafter. MINIMED shall both prior
to and subsequent to the launch of a PRODUCT communicate with ELAN
regarding its objectives for and performance of such
Page 26 of 44
27
PRODUCT in the MAJOR MARKETS and in all of the other countries of the
TERRITORY. At such meetings, MINIMED shall report on the ongoing sales
performance of the PRODUCT in the TERRITORY, including marketing
approaches, educational campaigns, promotional and advertising
materials and campaigns, sales plans, pricing and results, performance
against competitors, its objectives for the PRODUCT and its plans for
the next year of the Agreement. In addition the MARKETING COMMITTEE
shall review the quarterly royalty statements and in particular the
calculation of GROSS PROFIT and the deductible items listed in the
definition of NSP.
8.2. Unless otherwise agreed by the Parties, the MARKETING COMMITTEE shall
meet at least once each calendar quarter, such meetings to continue
until such time as may be agreed by the PROJECT TEAM. Thereafter, the
Parties shall meet on an annual basis. The MARKETING COMMITTEE shall
meet alternately at the offices of ELAN and MINIMED or as otherwise
agreed by the parties, or shall conduct such meetings by telephonic or
video conference. Each party shall bear the cost of its own travel
expenses.
8.3 MINIMED shall control and be responsible for the content and format of
the promotional campaign to be submitted to the RHA, but shall inform
ELAN thereof and provide to ELAN a copy of such submissions, which
shall be subject to the confidentiality obligations herein. To the
extent required by the laws, rules and regulations of the RHA in the
applicable country of the TERRITORY, MINIMED shall use reasonable
efforts to obtain approval by the RHA of the promotional campaign for
the PRODUCT.
8.4. Within 6 months of the EFFECTIVE DATE, the MARKETING COMMITTEE shall
agree in good faith upon a schedule for the commercialisation of the
PRODUCT in such countries of the TERRITORY outside of the MAJOR MARKETS
as the MARKETING COMMITTEE shall determine. Such schedule shall include
but not be limited to the target dates for filing the DEVICE REGULATORY
APPLICATION and for securing DEVICE REGULATORY APPROVAL for the PRODUCT
in such countries of the TERRITORY, as well as the general structure of
the promotional activities to be carried out by MINIMED.
8.5 MINIMED shall diligently pursue the commercialisation of the PRODUCT
and shall use commercially reasonable efforts, including reasonable IN
MARKET prices, to market and promote the PRODUCT in the MAJOR MARKETS,
and throughout the rest of the TERRITORY in accordance with the
schedule agreed upon by the MARKETING COMMITTEE pursuant to Article
8.4, and in doing so, shall use the same level of effort as with other
similar products of similar sales potential which it markets. MINIMED
covenants that it shall not use the PRODUCT as a "loss leader" in its
marketing programs and shall at all times use its reasonable efforts in
marketing the PRODUCT.
8.6 MINIMED shall submit to ELAN for ELAN's information, copies of all
trade packaging, cartons and labels and other printed materials which
MINIMED proposes at any time to
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use in relation to the sale of the PRODUCT provided always that the
provisions of this Clause 8.6 shall be without prejudice to the
obligations and responsibilities of MINIMED under Clauses 8.1 and 15.7
and MINIMED shall indemnify and hold harmless ELAN from and against all
claims, damages, losses, liabilities and expenses to which ELAN may
become liable relating to the activities described in this Clause 8.6.
Unless ELAN reasonably objects to the use of any such materials within
14 days of receipt for information purposes, MINIMED shall be entitled
to proceed to use such trade packaging, cartons and labels and other
printed materials in connection with the sale of the PRODUCT provided
however, that in no event shall such materials contain any statement
which may have a damaging or harmful effect on the commercialisation of
the SYSTEM and/or the goodwill of ELAN in the TERRITORY.
8.7 To the extent permitted by law, the materials referred to in Clause 8.6
shall include due acknowledgement that the PRODUCT is licensed from
ELAN.
8.8 To the extent permitted by law, MINIMED shall mark or have marked all
patent number(s) in respect of the ELAN PATENTS on all PRODUCT or
PRODUCT packaging, or otherwise reasonably communicate to the trade the
existence of any ELAN PATENTS for the countries within the TERRITORY in
such a manner as to ensure compliance with, and enforceability under,
applicable laws.
8.9 MINIMED shall effect the first full scale commercial launch of the
PRODUCT in the USA as soon as reasonably practicable but in any event
within * days of the DEVICE REGULATORY APPROVAL in the USA. Except for
any failure to manufacture and/or supply the SYSTEM arising from any
breach of the MANUFACTURING AGREEMENT by MINIMED, the obligation in the
preceding sentence to effect a full scale commercial launch of the
PRODUCT shall coincide with the availability of adequate quantities in
accordance with the production requirements as set out in the
MANUFACTURING AGREEMENT. With respect to each of the other countries of
the TERRITORY, MINIMED will effect a national commercial launch of the
PRODUCT as soon as reasonably practicable but in any event within *
days after the relevant DEVICE REGULATORY APPROVAL.
CLAUSE 9 - SUPPLY OF THE SYSTEM
9.1 ELAN has appointed MINIMED as the manufacturer of the SYSTEM for and on
behalf of ELAN pursuant to the MANUFACTURING AGREEMENT and MINIMED
shall manufacture and supply the SYSTEM for distribution pursuant to
the terms set out therein. MINIMED shall be the sole and exclusive
supplier of the SYSTEM to MINIMED in the TERRITORY for the purpose of
this Agreement.
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* Confidential portion omitted and filed separately with the Commission
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CLAUSE 10 - MANUFACTURE OF THE PRODUCT
10.1 MINIMED shall be responsible at its sole expense, for furnishing all
operations, labour, supervision, equipment, tools, machinery, COMPOUND
and facilities necessary to manufacture the PRODUCT in accordance with
the SYSTEM SPECIFICATIONS, PRODUCT SPECIFICATIONS and REGULATORY
APPROVALS including but not limited to:
10.1.1. sourcing and supplying all COMPOUND which is required for the
PRODUCT;
10.1.2. manufacturing the drug cartridge for the SYSTEM and filling
such drug cartridge with the COMPOUND;
10.1.3. qualifying, ordering, receiving, approving and storing, in
suitable facilities free from contamination, all packaging
materials which are necessary to package the PRODUCT;
10.1.4. packaging the SYSTEM with the drug cartridge containing the
COMPOUND;
10.1.5. analysing the PRODUCT for quality control and releasing the
PRODUCT for commercial sale.
10.2 MINIMED shall be responsible for, and shall ensure that, all of the
suppliers of equipment, tools, machinery and materials shall hold all
necessary licenses and registrations appropriate and necessary for the
inclusion of such materials in the PRODUCT. MINIMED shall indemnify
ELAN against any claim arising from any defective materials or COMPOUND
which may be included in the PRODUCT.
CLAUSE 11 - FINANCIAL PROVISIONS
11.1 LICENCE ROYALTIES:
11.1.1 In consideration of the licence of the ELAN PATENTS granted to
MINIMED under this Agreement, MINIMED shall pay to ELAN the
non-refundable amounts set forth in Schedule 7 hereto.
11.1.2 In the event that MINIMED exercises the option for the BASAL
AND BOLUS SYSTEM pursuant to Clause 2.2.2, then in addition to
the amounts payable to ELAN pursuant to Clause 11.1.1, MINIMED
shall pay to ELAN a further $ * upon the exercise of such
option in consideration of
- --------------------
* Confidential portion omitted and filed separately with the Commission
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the licence of the ELAN PATENTS granted to MINIMED under this
Agreement for the BASAL AND BOLUS SYSTEM.
11.2 DEVELOPMENT ROYALTIES:
11.2.1. Except as otherwise provided in this Agreement or in the
MANUFACTURING AGREEMENT, all development or other technical
assistance which ELAN shall perform pursuant to the PROJECT or
the terms of this Agreement, or which is requested by MINIMED
and agreed to by ELAN, shall be charged to MINIMED at FULLY
ALLOCATED COST plus * %. Any such work shall be mutually
agreed upon by ELAN and MINIMED in writing and in advance of
the commencement of such work, which agreement shall include
an agreed upon budget.
11.2.2 Development royalties for all work agreed upon by ELAN and
MINIMED pursuant to Clause 11.2.1. and carried out by ELAN
hereunder shall be invoiced by ELAN to MINIMED at the end of
each calendar quarter. Payment shall be effected in US Dollars
within 30 days of the date of receipt of the relevant invoice.
11.3 ROYALTY ON SALES:
11.3.1 In consideration of the licence of the ELAN PATENTS to MINIMED
hereunder, the royalty payable by MINIMED to ELAN on GROSS
PROFIT of the PRODUCT following the first launch of the
PRODUCT in accordance with the table set forth in Schedule 7
to this Agreement.
11.3.2 Within forty-five (45) days of the end of each calendar
quarter of this Agreement, MINIMED shall notify ELAN of the
NSP of PRODUCT for that previous calendar quarter. Payments
shown by each calendar quarter report to have accrued but
which have not yet been paid shall be included in calculating
the NSP for that quarter.
11.3.3 Payment of royalties shall be made once in each calendar
quarter within 45 days after the expiry of the relevant
calendar quarter.
11.3.4 All payments due hereunder shall be made in U.S. Dollars.
11.3.5 In the event that MINIMED or any AFFILIATE of MINIMED shall
sell the PRODUCT together with other products of MINIMED to
third parties (by the method commonly known in the
pharmaceutical industry as "bundling") and the price
attributable to the PRODUCT is less than the average price of
"arms length" sales to similar customers for the reporting
period in which sales occur (such sales to be excluded from
the calculation of the average price of "arms length" sales),
NSP for any such sales shall be the average price of "arms
length" sales by
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MINIMED or an AFFILIATE of MINIMED or a permitted sub-licensee
to similar customers in the country where such bundling occurs
during the reporting period in which such sales occur.
11.4 METHOD OF CALCULATION OF ROYALTIES AND OTHER PAYMENTS:
The parties acknowledge and agree that the methods for calculating the
royalties and other payments fees hereunder are for the purposes of the
convenience of the parties, are freely chosen and not coerced.
CLAUSE 12 - PAYMENTS, REPORTS AND AUDITS
12.1 MINIMED shall keep true and accurate records of gross sales of the
PRODUCT, the number of units of PRODUCT sold, the items deducted from
the gross amount in calculating the NSP, the NSP, the GROSS PROFIT and
the royalties payable to ELAN under Clause 11. MINIMED shall deliver to
ELAN a written statement ("the STATEMENT") thereof within 45 days
following the end of each calendar quarter, (or any part thereof in the
first or last calendar quarter of this Agreement) for such calendar
quarter. The STATEMENT shall outline on a country-by-country basis, the
calculation of the NSP from gross revenues during that calendar
quarter, the applicable percentage rate, and a computation of the sums
due to ELAN. The parties' financial officers shall agree upon the
precise format of the STATEMENT.
12.2 Unless otherwise notified in writing by ELAN, payments due on GROSS
PROFIT of the PRODUCT based on sales amounts in a currency other than
US Dollars shall first be calculated in the foreign currency and then
converted to US Dollars on the basis of the exchange rate in effect for
the purchase of US Dollars with such foreign currency quoted in the
Wall Street Journal (or comparable publication if not quoted in the
Wall Street Journal) with respect to the sale of currency of the
country of origin of such payment for the day prior to the date on
which the payment by MINIMED is being made.
12.3 Any income or other taxes which MINIMED is required by law to pay or
withhold on behalf of ELAN with respect to royalties and any other
monies payable to ELAN under this Agreement shall be deducted from the
amount of such GROSS PROFIT payments, royalties and other monies due.
MINIMED shall furnish ELAN with proof of such payments. Any such tax
required to be paid or withheld shall be an expense of and borne solely
by ELAN. MINIMED shall promptly provide ELAN with a certificate or
other documentary evidence to enable ELAN to support a claim for a
refund or a foreign tax credit with respect to any such tax so withheld
or deducted by MINIMED. The parties will reasonably cooperate in
completing and filing documents required under the provisions of any
applicable tax treaty or under any other applicable law, in order to
enable MINIMED to make such payments to ELAN without any deduction or
withholding.
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12.4 All payments due hereunder shall be made to the designated bank account
of ELAN in accordance with such timely written instructions as ELAN
shall from time to time provide.
12.5 MINIMED shall pay interest to ELAN at the Prime Rate publicly announced
by Morgan Guaranty Trust Company of New York at its principal office on
the date (or next to occur business day, if such date is not a business
day) on which payment should have been made pursuant to the applicable
provisions of this Agreement plus 5% on all late payments under this
Agreement applicable from the date on which payment should have been
made pursuant to the applicable provisions of this Agreement until the
date of payment.
12.6 For the 180 day period following the close of each calendar year of the
Agreement, ELAN and MINIMED will, in the event that the other party
reasonably requests such access, provide each other's independent
certified accountants (reasonably acceptable to the other party) with
access, during regular business hours and subject to the
confidentiality provisions as contained in this Agreement, to such
party's books and records relating to the PRODUCT, solely for the
purpose of verifying the accuracy and reasonable composition of the
calculations hereunder for the calendar year then ended.
12.7 In the event of a discovery of a discrepancy which exceeds 5% of the
amount due or charged by a party for any period, the cost of such
accountants shall be borne by the audited party; otherwise, such cost
shall be borne by the auditing party.
CLAUSE 13 - DURATION AND TERMINATION
13.1 This Agreement shall be deemed to have come into force on the EFFECTIVE
DATE and, subject to the rights of termination outlined in this Clause
13 will expire on a country by country basis on the 12th anniversary of
the date of the launch of the PRODUCT in the country concerned ("the
INITIAL PERIOD").
13.2 At the end of the INITIAL PERIOD, the Agreement shall continue
automatically for rolling 2 year periods thereafter, unless the
Agreement has been terminated by either of the parties by serving 2
years' written notice on the other immediately prior to the end of the
INITIAL PERIOD or any additional 2 year period provided for herein.
13.3 In addition to the rights of termination provided for elsewhere in this
Agreement, either party will be entitled forthwith to terminate this
Agreement by written notice to the other party if:
13.3.1 that other party commits any breach of any of the provisions
of this Agreement, and in the case of a breach capable of
remedy, fails to remedy the same within 90 days after receipt
of a written notice giving full particulars of the breach and
requiring it to be remedied;
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13.3.2 that other party goes into liquidation (except for the
purposes of amalgamation or reconstruction and in such manner
that the company resulting therefrom effectively agrees to be
bound by or assume the obligations imposed on that other party
under this Agreement);
13.3.3 an encumbrancer takes possession or a receiver is appointed
over any of the property or assets of that other party;
13.3.4 any proceedings are filed or commenced by that other party
under bankruptcy, insolvency or debtor relief laws or anything
analogous to any of the foregoing under the laws of any
jurisdiction occurs in relation to that other party.
13.3.5 a TECHNOLOGICAL COMPETITOR of the other party hereto, or a
company with a directly competing product, acquires * % or
more of the other party's voting stock or where * % or more of
the voting stock of a TECHNOLOGICAL COMPETITOR to a party
hereto is acquired by the other party hereto.
13.4 For the purposes of Clause 13.3.1, a breach will be considered capable
of remedy if the party in breach can comply with the provision in
question in all respects other than as to the time of performance
(provided that time of performance is not of the essence).
13.5 In further addition to the rights and termination provided for
elsewhere in this Agreement, ELAN shall be entitled to forthwith
terminate the licence granted to MINIMED under this Agreement for any
country or countries of the TERRITORY, in accordance with the terms set
out below, in the event that MINIMED:-
13.5.1 fails to file a DEVICE REGULATORY APPLICATION for the PRODUCT
in any country of the MAJOR MARKETS within 18 months from the
completion of the PROJECT; or
13.5.2 fails to file a DEVICE REGULATORY APPLICATION for the PRODUCT
in any country of TERRITORY outside of the MAJOR MARKETS
within 18 months of the target date set for such country by
the MARKETING COMMITTEE pursuant to Clause 8.4; or
13.5.3 fails to effect any one of the commercial launches required by
Clause 8 in accordance with the provisions thereof; or
13.5.4 notifies ELAN that it does not wish to commercialise the
PRODUCT in any country of the TERRITORY.
- --------------------
* Confidential portion omitted and filed separately with the Commission
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CLAUSE 14 - CONSEQUENCES OF TERMINATION
14.1 Upon exercise of those rights of termination specified in Clauses 13 or
elsewhere in this Agreement, this Agreement shall, subject to the
provisions of the Agreement which survive the termination of the
Agreement and Clause 14.2, automatically terminate forthwith and be of
no further legal force or effect.
14.2 Upon termination of the Agreement by either party, or upon termination
by ELAN of a licence for a particular country under Clause 13.5, the
following shall be the consequences relating to the TERRITORY or the
particular country, as applicable:-
14.2.1 any sums that were due from MINIMED to ELAN under the
provisions of Clause 11 or otherwise howsoever prior to the
exercise of the right to terminate this Agreement as set forth
herein shall be paid in full within 30 days of termination of
this Agreement and receipt of the invoice in respect thereto,
and ELAN shall not be liable to repay to MINIMED any amount of
money paid or payable by MINIMED to ELAN up to the date of the
termination of this Agreement;
14.2.2 all confidentiality provisions set out herein shall remain in
full force and effect for a period of 7 years from the date of
termination of this Agreement;
14.2.3 all responsibilities and warranties shall insofar as they are
appropriate remain in full force and effect;
14.2.4 the rights of inspection and audit shall continue in force for
the period referred to in the relevant provisions of this
Agreement;
14.2.5 ELAN shall be entitled to research, develop, manufacture and
commercialise the SYSTEM in the FIELD for its own benefit in
the TERRITORY or in the relevant country or countries of the
TERRITORY and either party shall be entitled to manufacture,
market, sell, or assist in the distribution or sale of a
COMPETING PRODUCT;
14.2.6 ELAN shall be entitled to file for DEVICE REGULATORY APPROVAL
for the SYSTEM with any insulin and/or insulin analogue
otherwise available to ELAN, in any country which ceases to be
a part of the TERRITORY, or in any country of the TERRITORY in
the event of termination of this Agreement, or in the
TERRITORY or the relevant country or countries of the
TERRITORY;
14.2.7 subject to the provisions of Clause 3.1.3, the licence granted
by ELAN to
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MINIMED of the ELAN BACKGROUND TECHNOLOGY and ELAN
IMPROVEMENTS shall automatically terminate;
14.2.8 MINIMED shall transfer to ELAN or ELAN's designee without
charge (but at ELAN's expense, if any), and/or permit ELAN or
ELAN's designee without charge to conduct sufficient
cross-referencing to, and have sufficient access to any and
all pending DEVICE REGULATORY APPLICATIONS or granted DEVICE
REGULATORY APPROVALS for the PRODUCT for the relevant country
or countries of the TERRITORY.
CLAUSE 15 - WARRANTY AND INDEMNITY
15.1 ELAN represents and warrants that it has the sole, exclusive and
unencumbered right to grant the licences and rights herein granted to
MINIMED, and that it has not granted any option, licence, right or
interest in or to the ELAN PATENTS or ELAN KNOW-HOW to any third party
which would conflict with the rights granted by this Agreement. ELAN
agrees to hold MINIMED harmless from any and all costs, expenses and
damages (including reasonable attorneys' fees) incurred or sustained by
MINIMED as the result of any third party's challenges to ELAN's right
to grant the rights and licences herein granted to MINIMED.
15.2 ELAN represents and warrants that the execution of this Agreement and
the full performance and enjoyment of the rights of MINIMED under this
Agreement will not breach or in any way be inconsistent with the terms
and conditions of any licence, contract, understanding or agreement,
whether express, implied, written or oral between ELAN and any third
party.
15.3 Except as expressly stated in this Clause 15, all other warranties,
conditions and representations, express or implied, statutory or
otherwise, including a warranty as to the quality or fitness for any
particular purpose of the SYSTEM are hereby excluded and except as
expressly stated in this Agreement, ELAN shall not be liable in
contract, tort or otherwise for any loss, damage, expense or injury,
arising out of or in connection with the PRODUCT or any defect in the
SYSTEM or from any other cause.
15.4 ELAN represents and warrants to MINIMED as of the date of the EFFECTIVE
DATE:-
15.4.1 there are no patent or other proceedings served on ELAN in
connection with the SYSTEM; and
15.4.2 to the best of ELAN's knowledge, there are no threatened
patent or other proceedings against ELAN in connection with
the SYSTEM;
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15.4.3 to the best of ELAN's knowledge, there are no substantive
grounds for patent proceedings against ELAN in connection with
the SYSTEM.
15.5 ELAN represents and warrants that, in performing the development
activities for the further development of the SYSTEM, ELAN will
exercise all due skill, care and diligence in conducting such
activities as are commercially reasonable.
15.6 MINIMED represents and warrants that, once successfully assembled, the
PRODUCT sold by MINIMED under this Agreement will conform and perform
in all material respects to:-
15.6.1 the PRODUCT SPECIFICATIONS, the NDA APPROVAL and DEVICE
REGULATORY APPROVAL; and
15.6.2 all applicable regulations and requirements of the relevant
RHA including the then cGMP regulations which apply to the
manufacture and supply of the COMPOUND and the PRODUCT.
15.7 MINIMED further represents and warrants to ELAN that in assembling,
packaging, transporting, storing, handling, distributing, marketing and
selling the PRODUCT hereunder:-
15.7.1 it will exercise all due skill, care and diligence in
conducting such activities as are commercially reasonable; and
15.7.2 it will comply with the provisions of this Agreement, all RHA
and other approvals, all applicable state and local regulatory
approvals and all applicable laws, ordinances and regulations.
15.8 Each of the parties shall indemnify, defend and hold harmless the other
party from all actions, losses, claims, demands, damages, costs and
liabilities (including reasonable attorneys' fees) to which the other
party is or may become liable insofar as they arise out of any breach
by the first party of any of its obligations or warranties under this
Agreement.
15.9 With reference to Clause 2.3.4, MINIMED shall indemnify and hold
harmless ELAN to the extent that any claims, damages, liabilities,
claims, costs or expenses arise out of any such acts or omissions of
any sub-licensee.
15.10 As a condition of obtaining an indemnity in the circumstances set out
in Clauses 15.4, 15.5, 15.6, 15.7, 15.8 and 15.9, the party seeking an
indemnity shall:
15.10.1 fully and promptly notify the other party of any claim or
proceedings, or threatened claim or proceedings;
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15.10.2 permit the indemnifying party to take full control of such
claim or proceedings;
15.10.3 assist in the investigation and defence of such claim or
proceedings;
15.10.4 not compromise or otherwise settle any such claim or
proceedings without the prior written consent of the other
party, which consent shall not be unreasonably withheld; and
15.10.5 take all reasonable steps to mitigate any loss or liability in
respect of any such claim or proceedings.
15.11 Notwithstanding anything to the contrary in this Agreement, ELAN and
MINIMED shall not be liable to the other by reason of any
representation or warranty, condition or other term or any duty of
common law, or under the express terms of this Agreement, for any
consequential or incidental loss or damage (whether for loss of profits
or otherwise) and whether occasioned by the negligence of the
respective parties, their employees or agents or otherwise.
15.12 ELAN and MINIMED shall maintain comprehensive general liability
insurance, including product liability insurance on the SYSTEM and
PRODUCT respectively, in such prudent amount as shall be determined by
the PROJECT TEAM. Each Party shall provide the other Party with a
certificate from the insurance company verifying the above and
undertakes to notify such Party directly at least 30 days prior to the
expiration or termination of such coverage.
CLAUSE 16 - CUSTOMER COMPLAINTS AND PRODUCT RECALL
16.1 MINIMED shall notify ELAN promptly:-
16.1.1 of any complaints from third parties reported to MINIMED
involving any serious and unexpected adverse reactions
resulting from the use of the PRODUCT; and
16.1.2 of any potential recall of the PRODUCT by any governmental
authority.
16.2. ELAN shall notify MINIMED promptly:-.
16.2.1 of any complaints from third parties reported to ELAN
involving any serious and unexpected adverse device events or
incident reports resulting from the use of the SYSTEM; and
16.1.2 of any potential recall of the SYSTEM by any governmental
authority.
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16.3 MINIMED and ELAN shall establish a procedure for formal adverse event
handling, customer complaints and reporting. It is envisaged that
MINIMED shall be responsible for furnishing post-marketing reports to
the applicable RHA's and other relevant regulatory agencies. MINIMED
and ELAN shall keep each other informed and shall copy the other party
with all communications with the RHA's and other relevant regulatory
agencies with respect to the PRODUCT and such events.
16.4 In the event of any recall of the PRODUCT, as suggested or requested by
any governmental authority:
16.4.1 MINIMED shall perform the recall of the PRODUCT in the
TERRITORY and save as provided in Clause 16.4.2, in all events
the recall costs shall be borne by MINIMED.
16.4.2 If the recall arises from ELAN's acts or omissions in
manufacturing the SYSTEM or any failure to conform to the
PROJECT SYSTEM SPECIFICATIONS, the recall costs shall be borne
by ELAN provided that MINIMED should not have discovered the
said act or omission prior to the sale of the PRODUCT by
exercising the quality procedures to be agreed upon by the
parties for the release of the PRODUCT.
In the event that ELAN should bear the costs of any recall
hereunder, ELAN shall be entitled but not obliged to take over
and perform the recall of the PRODUCT described in Clause
16.4.1 and MINIMED shall provide ELAN with all such reasonable
assistance as may be required by ELAN, with ELAN reimbursing
MINIMED for reasonable costs incurred.
16.4.3 Neither party shall be liable to the other party or to any
third party for consequential or incidental damages which may
arise as a result of the recall of the PRODUCT.
16.4.4. For the avoidance of doubt, in no event shall MINIMED be
responsible under this Agreement for performing any recall of
the PRODUCT in any country of the TERRITORY for which
MINIMED's license to the ELAN BACKGROUND TECHNOLOGY and ELAN
IMPROVEMENTS has been terminated in accordance with the terms
of this Agreement.
CLAUSE 17 - MISCELLANEOUS PROVISIONS
17.1 SECRECY:
17.1.1 Any information, whether written or oral (oral information
shall be reduced to writing within one month by the party
giving the oral information and the written form shall be
furnished to the other party)
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pertaining to the PRODUCT that has been or will be
communicated or delivered by ELAN to MINIMED, or by MINIMED to
ELAN, including, without limitation, trade secrets, business
methods, and cost, supplier, manufacturing and customer
information, shall be treated by MINIMED and ELAN,
respectively, as confidential information, and shall not be
disclosed or revealed to any third party whatsoever or used in
any manner except as expressly provided for herein; provided,
however, that such confidential information shall not be
subject to the restrictions and prohibitions set forth herein
to the extent that such confidential information:-
(1) is available to the public in public literature or
otherwise, or after disclosure by one party to the
other becomes public knowledge through no default of
the party receiving such confidential information; or
(2) was known to the party receiving such confidential
information prior to the receipt of such confidential
information by such party, whether received before or
after the date of this Agreement; or
(3) is obtained by the party receiving such confidential
information from a third party not subject to a
requirement of confidentiality with respect to such
confidential information; or
(4) is required to be disclosed pursuant to: (A) any
order of a court having competent jurisdiction and
power to order such information to be released or
made public; or (B) any lawful action of a
governmental or regulatory agency or stock exchange
provided that each party shall notify the other in
writing of any disclosure of information required
hereunder prior to such disclosure.
17.1.2 Each party shall take in relation to the confidential
information of the other party all such precautions as it
normally takes with its own confidential information to
prevent any improper disclosure of such confidential
information to any third party; provided, however, that such
confidential information may be disclosed within the limits
required to obtain any authorisation from the applicable RHA
or any governmental or regulatory agency or, with the prior
written consent of the other party, which shall not be
unreasonably withheld, or as may otherwise be required in
connection with the purposes of this Agreement.
17.1.3 Each of the parties agrees that it will not use, directly or
indirectly, any know-how of the other party (ELAN KNOW-HOW or
MINIMED KNOW-
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HOW, as the case may be), or other confidential information
disclosed to it by the other party or obtained by it from the
other party pursuant to this Agreement, other than as
expressly provided herein.
17.1.4 Neither party will publicise the existence of this Agreement
in any way without the prior written consent of the other
party subject to the disclosure requirements of applicable
laws and regulations. In the event that either party wishes to
make an announcement concerning the Agreement, that party will
seek the consent of the other party. The terms of any such
announcement shall be agreed in good faith. ELAN and MINIMED
shall also co-operate in good faith with respect to any stock
exchange filings, public announcements, or filings with the
United States Securities and Exchange Commission which may be
necessary following execution of this Agreement.
17.2 ASSIGNMENTS/ SUB-CONTRACTING:
This Agreement may not be assigned by MINIMED or ELAN without the prior
written consent of the other party, save that either party may assign
this Agreement in whole or in part and delegate its duties hereunder to
its AFFILIATE or AFFILIATES without such consent provided that such
assignment or delegation has no material adverse tax implications for
the other party hereto. Each party shall be responsible for the acts
and/or omissions of its respective AFFILIATES.
17.3 PARTIES BOUND:
This Agreement shall be binding upon and enure for the benefit of
parties hereto, their successors and permitted assigns.
17.4 SEVERABILITY:
If any provision in this Agreement is agreed by the parties to be, or
is deemed to be, or becomes invalid, illegal, void or unenforceable
under any law that is applicable hereto:-
17.4.1 such provision will be deemed amended to conform to applicable
laws so as to be valid and enforceable or, if it cannot be so
amended without materially altering the intention of the
parties, it will be deleted, with effect from the date of such
agreement or such earlier date as the parties may agree; and
17.4.2 the validity, legality and enforceability of the remaining
provisions of this Agreement shall not be impaired or affected
in any way.
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17.5 FORCE MAJEURE:
Neither party to this Agreement shall be liable for delay in the
performance of any of its obligations hereunder if such delay results
from causes beyond its reasonable control, including, without
limitation, acts of God, fires, earthquakes, strikes, acts of war, or
intervention of a government authority, non-availability of raw
materials, but any such delay or failure shall be remedied by such
party as soon as practicable.
17.6 RELATIONSHIP OF THE PARTIES:
Nothing contained in this Agreement is intended or is to be construed
to constitute ELAN and MINIMED as partners or members of a joint
venture or either party as an employee of the other. Neither party
hereto shall have any express or implied right or authority to assume
or create any obligations on behalf of or in the name of the other
party or to bind the other party to any contract, agreement or
undertaking with any third party.
17.7 AMENDMENTS:
No amendment, modification or addition hereto shall be effective or
binding on either party unless set forth in writing and executed by a
duly authorised representative of both parties.
17.8 WAIVER:
No waiver of any right under this Agreement shall be deemed effective
unless contained in a written document signed by the party charged with
such waiver, and no waiver of any breach or failure to perform shall be
deemed to be a waiver of any future breach or failure to perform or of
any other right arising under this Agreement.
17.9 NO EFFECT ON OTHER AGREEMENTS:
No provision of this Agreement shall be construed so as to negate,
modify or affect in any way the provisions of any other agreement
between the parties unless specifically referred to, and solely to the
extent provided, in any such other agreement.
17.10 GOVERNING LAW AND JURISDICTION:
This Agreement shall be governed by the laws of the State of New York,
without regard to principles of conflicts of law. Each of the Parties
hereby irrevocably submits to the jurisdiction of any New York State or
United States Federal court
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sitting in the County, City and State of New York over any action or
proceeding arising out of or relating to this Agreement, and each
hereby waives the defence of any inconvenient forum for the maintenance
of such action.
17.11 NOTICE:
17.11.1 Any notice to be given under this Agreement shall be sent in
writing in English by registered airmail or telecopied to:
Elan Pharmaceutical Technologies at
Elan Pharmaceutical Technologies
A division of Elan Corporation, plc.
Lincoln House
Lincoln Place
Dublin 2
Ireland.
Attention: Vice-President & General Counsel,
Elan Pharmaceutical Technologies
Telephone: 353 1 7094000
Telefax : 353 1 7094124
Elan Pharma International Limited at
Elan Pharma International Limited
WIL House
Shannon Business Park
Shannon
Co. Clare
Ireland.
Attention: Company Secretary
Telephone: 353 61 363533
Telefax: 353 61 362010
MINIMED at
MiniMed Inc.
12744 San Fernando Road
Sylmar
California 91342
United States of America
Attention: Senior Vice President & General Counsel
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Telephone: 818 362 5958
Telefax: 818 367 1460
or to such other address(es) and telecopier numbers as may
from time to time be notified by either party to the other
hereunder.
17.11.2 Any notice sent by mail shall be deemed to have been delivered
within 10 working days after despatch and any notice sent by
telex or telecopy shall be deemed to have been delivered
within 24 hours of the time of the despatch. Notice of change
of address shall be effective upon receipt.
IN WITNESS of which the parties have executed this Agreement.
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Executed by MINIMED INC. on 11th June, 1999
By : /s/ TERRANCE H. GREGG
--------------------------
Name: Terrance H. Gregg
Title: President and Chief Operating Officer
Executed by ELAN PHARMACEUTICAL TECHNOLOGIES on 10th June, 1999
By: /s/ LARRY A. STERNSON
--------------------------
Name: Larry A. Sternson
--------------------------
Title: President
--------------------------
Executed by ELAN PHARMA INTERNATIONAL LIMITED on 10th June, 1999
By: /s/ DAVID HURLEY
--------------------------
Name: David Hurley
--------------------------
Title: Director
--------------------------
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