[EXHIBIT 99.1]
COLLABORATION AGREEMENT
This Agreement, effective as of June 28, 1996, is made by and
between WARNER-LAMBERT COMPANY, a Delaware corporation (hereinafter
"WARNER-LAMBERT"), with primary offices located at 201 Tabor Road, Morris
Plains, New Jersey 07950, by and through its Parke-Davis Division, and
PFIZER INC., a Delaware corporation (hereinafter "PFIZER"), with primary
offices located at 235 East 42nd Street, New York, NY 10017-5755.
WHEREAS, WARNER-LAMBERT and its Affiliates (as hereinafter
defined) own all right, title and interest in and to the Patents (as
hereinafter defined); and
WHEREAS, WARNER-LAMBERT intends to file with the United States
Food and Drug Administration (hereinafter "FDA") a New Drug Application
(hereinafter "NDA") which will permit WARNER-LAMBERT to market, distribute
and sell a Product (as hereinafter defined) in the United States; and
WHEREAS, WARNER-LAMBERT believes that a collaboration arrangement
with PFIZER regarding the Products under the terms set forth in this
Agreement would be desirable and fully compatible with WARNER-LAMBERT's
marketing and business objectives; and
WHEREAS, PFIZER has significant experience in the development,
marketing and promotion of pharmaceutical products and believes it can make
significant contributions to the successful development and
commercialization of the Products; and
WHEREAS, WARNER-LAMBERT and PFIZER each desire to collaborate
with the other in the development and marketing of the Products in the
United States pursuant to the terms set forth in this Agreement.
NOW, THEREFORE, for and in consideration of the foregoing and the
representations, covenants and agreements contained herein, WARNER-LAMBERT
and PFIZER, intending to be legally bound, hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following capitalized terms
shall have the following meanings:
"Adverse Drug Experience Report" shall mean any oral, written or
electronically transmitted report of any "adverse drug experience" as
defined or contemplated by 21 C.F.R. 314.80 or 312.32, associated with the
use of Atorvastatin or any Product.
"Affiliate" shall mean any Person that directly or indirectly
controls or is controlled by or is under common control with WARNER-LAMBERT
or PFIZER, as the case may be, but only for so long as said control shall
continue. As used herein the term "control" means possession of the power
to direct or cause the direction of the management and policies of a Person
whether by contract or otherwise.
"Agreement Quarters" shall mean for each Agreement Year, each of
the three month periods ending March 31, June 30, September 30 and December
31; provided, however, that the first Agreement Quarter for Agreement Year
One shall extend from the Launch Date to the end of the first complete
calendar quarter thereafter and the last Agreement Quarter for Agreement
Year Ten shall end on the last day of Agreement Year Ten.
"Agreement Year One" shall mean the period commencing on the
Launch Date and ending on the last day of the fourth complete calendar
quarter following the Launch Date; "Agreement Year Two" shall mean the
twelve-month period commencing on the first day following the expiration of
Agreement Year One; references to Agreement Year Three through Agreement
Year Nine shall mean the successive twelve-month periods thereafter; and
"Agreement Year Ten" shall mean the period commencing on the first day
following the expiration of Agreement Year Nine and expiring on the day
which is twelve months from the end of Agreement Year Nine less the number
of days equal to one-half of the Stub Period (as defined in Section 3.06).
"Agreement Years" shall mean the period commencing on the Launch
Date and ending on the last day of Agreement Year Ten.
"Atorvastatin" shall mean the chemical compound [R-(R*,R*)]-2-(4-
fluorophenyl)-b, d-dihydroxy-5-(l-methylethyl)-3-phenyl-4-[(phenylamino)
carbonyl] 1 H-pyrrole-1-heptanoic acid, calcium salt (2:1) and hydrates
thereof.
"Baseline Sales" shall mean the amount per Agreement Year as set
forth on Exhibit A, as adjusted pursuant to Section 3.06.
"Change in Control" shall mean an event where:
(A) any Person(s) acquire beneficial ownership of capital stock
of WARNER-LAMBERT entitling the holder(s) thereof to at least
fifty-one percent (51%) of the voting power of the then outstanding
capital stock of WARNER-LAMBERT with respect to the election of
directors of WARNER-LAMBERT, or
(B) WARNER-LAMBERT enters into a merger, consolidation or
similar transaction with another Person (the "Acquiring Corporation")
in which (i) WARNER-LAMBERT is not the surviving corporation in such
transaction, (ii) the members of the Board of Directors of
WARNER-LAMBERT prior to such transaction constitute less than one half
of the members of the Board of Directors of the Acquiring Corporation
following such transaction, and (iii) at least fifty-one percent (51%)
of the voting power of the outstanding capital stock of the Acquiring
Corporation with respect to the election of directors following such
transaction is held by Persons who were shareholders of the Acquiring
Corporation prior to such transaction, or
(C) WARNER-LAMBERT sells to any Person(s) in one or more related
transactions, properties or assets representing at least fifty-one
percent (51%) of (i) WARNER-LAMBERT's consolidated total assets as
reflected on its most recent Annual Report on Form 10-K or Quarterly
Report on Form 10-Q, provided that all or substantially all of the
properties and assets used in connection with WARNER-LAMBERT's
pharmaceutical business are included in such transaction(s) and (ii)
WARNER-LAMBERT's consolidated operating income for the most recent
fiscal year as reflected on its most recent Annual Report on Form
10-K.
"Clinical Development Plan" shall mean an annual clinical
development plan and budget for the Product Lifecycle Plan Studies, as
provided in Exhibit D and as determined or varied in accordance with the
provisions of Section 4.01.
"Competing Products" shall mean any prescription pharmaceutical
product other than the Products (i) where a significant pharmacological
action of such product is direct inhibition of HMG-CoA reductase (as
demonstrated by at least 50% inhibition of the enzyme activity of HMG-CoA
reductase, at a product concentration of 1 micromolar in an in vitro,
cell-free HMG-CoA reductase activity assay system) and (ii) with
indications for lipid lowering and treatment or prevention of
atherosclerosis.
"Confidential Information" shall mean (i) for WARNER-LAMBERT, all
PFIZER Confidential Information and (ii) for PFIZER, all WARNER-LAMBERT
Confidential Information.
"Detail" shall mean a face-to-face contact (including a live
video presentation) of either a WARNER-LAMBERT or PFIZER sales
representative (or their respective designees in accordance with Section
2.02(f)), as the case may be, with (i) a medical professional with
prescribing authority or (ii) an office nurse with influence over the
pharmaceutical treatment of a patient that involves either a Primary or
Secondary Product Presentation, in each case as measured by each party's
internal recording of such activity; provided that in the case of (ii)
above, such contacts are prearranged with the applicable office nurses and
such contacts do not exceed five percent (5%) of the Details performed by
the applicable party during any Agreement Year; provided, further, that
during the first six (6) months after the Launch Date, only a Primary
Product Presentation shall constitute a Detail. With respect to certain
group or institutional Product presentations, Exhibit B sets forth how such
presentations will be counted for determination of the number of Details.
"FD&C Act" shall mean the Federal Food, Drug and Cosmetic Act, as
amended, and all applicable regulations thereunder.
"Governmental or Regulatory Authority" shall mean any court,
tribunal, arbitrator, agency, commission, official or other instrumentality
of any federal, state, county, city or other political subdivision,
domestic or foreign.
"Launch Date" shall mean the date on which the first Product is
first shipped in commercial quantities from WARNER-LAMBERT's distribution
centers for commercial sale to unaffiliated third parties in the Territory,
as promptly notified to PFIZER by WARNER-LAMBERT.
"Laws" shall mean all laws, statutes, rules, regulations,
ordinances and other pronouncements having the effect of law of any
government or Governmental or Regulatory Authority.
"Losses" shall mean any and all damages, fines, fees, penalties,
judgments, deficiencies, losses and expenses (including without limitation
interest, court costs, reasonable fees of attorneys, accountants and other
experts or other expenses of litigation or other proceedings or of any
claim, default or assessment).
"Marketing Plan" shall mean an annual plan and budget for the
promotion and marketing of the Products consistent with the provisions of
Articles II, IV and V and as may be determined or varied in accordance with
the provisions of Section 4.01.
"Net Sales" shall mean the aggregate sales of WARNER-LAMBERT and
its Affiliates of Products to unaffiliated third parties in the Territory
(but not including sales between WARNER-LAMBERT and its Affiliates) less
(i) bad debts related to the Products, and (ii) sales returns and
allowances, including, without limitation, trade, quantity and cash
discounts and any other adjustments, including, but not limited to, those
granted on account of price adjustments, billing errors, rejected goods,
damaged goods, recalls, returns, rebates, chargeback rebates, fees,
reimbursements or similar payments granted or given to wholesalers or other
distributors, buying groups, health care insurance carriers or other
institutions, freight and insurance charges billed to the customers,
customs or excise duties, sales tax and other taxes (except income taxes)
or duties relating to sales, and any payment in respect of sales to any
Governmental or Regulatory Authority in respect of any Federal or state
Medicaid, Medicare or similar program, all as determined in accordance with
generally accepted accounting principles on a basis consistent with
WARNER-LAMBERT's audited financial statements.
"Patents" shall mean those patents identified in, and the patents
issuing from the applications listed in, Exhibit C.
"Person" shall mean any natural person, corporation, general
partnership, limited partnership, joint venture, proprietorship or other
business organization.
"PFIZER Confidential Information" shall mean information which
has prior to the date hereof been or which at any time hereafter is
disclosed in writing and marked "Confidential" (or if disclosed orally, is
reduced to writing within thirty (30) days of disclosure) directly or
indirectly by PFIZER or by any of its Affiliates or agents or agents of its
Affiliates to WARNER-LAMBERT or any of its Affiliates or agents or agents
of its Affiliates in connection with this Agreement and which relates to
the business of PFIZER.
"Primary Product Presentation" shall mean a promotional message
involving a Product where such Product is given an important emphasis (but
not an emphasis that is significantly less important than the emphasis
given to other products) during a sales call.
"Product Expenses" shall mean (a) all out-of-pocket costs and
expenses incurred (i.e. paid to third parties or accrued therefor) by
WARNER-LAMBERT or PFIZER (other than costs and expenses incurred for the
services of a contract sales force) on or after April 15, 1996 in
connection with (i) marketing, advertising, sampling and promoting
(including, without limitation, educational expenses, speakers' programs
and symposia) Atorvastatin and the Products, (ii) training and
communications materials, (iii) Product Lifecycle Plan Studies, including,
without limitation, those Product Lifecycle Plan Studies commencing prior
to April 15, 1996 (but only with respect to expenses incurred for such
studies after April 15, 1996) and any fees paid to clinical research
organizations in connection with any Product Lifecycle Plan Study, and (iv)
supplementary submissions to Governmental or Regulatory Authorities,
including, without limitation, consultant fees and advisory committee
meetings relating to such submissions, except as otherwise provided in
Section 14.03(e); provided, however, such out-of-pocket costs and expenses
from April 15, 1996 through June 30, 1996 shall not be in excess of
$6,000,000, and (b) all costs and direct expenses of WARNER-LAMBERT and
PFIZER relating to the supply of Samples (as determined in accordance with
Section 5.02(b)) and the distribution of Samples.
"Product Lifecycle Plan Studies" shall mean clinical,
preclinical, epidemiological modeling, and pharmacoeconomic studies that
are designed to support marketing, publications, future labeling changes or
new indications of Atorvastatin or the Products (in the case of combination
Products, relating to (a) lipid lowering and the treatment or prevention of
atherosclerosis or (b) the treatment or prevention of vascular disease)
and, in each case, which are not included with the primary filing of the
NDA to support initial registration of the first Product, as outlined in
Exhibit D.
"Products" shall mean all finished pharmaceutical formulations
that (i) contain Atorvastatin as the sole active ingredient, or (ii)
contain Atorvastatin together with one or more other active ingredients
where such combination products have indications for (a) lipid lowering and
the treatment or prevention of atherosclerosis or (b) the treatment or
prevention of vascular disease, in each case, to be marketed by
WARNER-LAMBERT in the Territory during the Agreement Years.
"Quarterly Baseline Sales" shall mean for each Agreement Quarter,
one-fourth of the Baseline Sales for the applicable Agreement Year.
"Secondary Product Presentation" shall mean a promotional message
during a sales call that involves a Product and that is neither a Primary
Product Presentation nor a reminder sales call.
"Serious Adverse Drug Experience Report" shall mean any Adverse
Drug Experience Report that involves an adverse drug experience that is
fatal or life-threatening, is permanently disabling, requires in-patient
hospitalization, or is a congenital anomaly, cancer or overdose, or any
other event which would constitute a "serious" adverse drug experience
pursuant to the terms of 21 C.F.R. 314.80 or 312.32.
"Territory" shall mean the United States of America (including
its military bases and commissaries wherever located and excluding its
territories and possessions).
"Term of this Agreement" shall mean the period from the date
hereof until the expiration of this Agreement in accordance with Section
14.01 or earlier termination of this Agreement in accordance with Section
14.03.
"WARNER-LAMBERT Confidential Information" shall mean information
which has prior to the date hereof been or which at any time hereafter is
disclosed in writing and marked "Confidential" (or if disclosed orally, is
reduced to writing within thirty (30) days of disclosure) directly or
indirectly by WARNER-LAMBERT or by any of its Affiliates or agents or
agents of its Affiliates to PFIZER or any of its Affiliates or agents or
agents of its Affiliates in connection with this Agreement and which
relates to the business of WARNER-LAMBERT, including, without limitation,
any information concerning Atorvastatin or any of its intermediates or the
Products.
SECTION 1.02. Interpretation. Unless the context of this
Agreement otherwise requires, (i) words of any gender include each other
gender; (ii) words using the singular or plural number also include the
plural or singular number, respectively; (iii) the terms "hereof,"
"herein," "hereby," and derivative or similar words refer to this entire
Agreement; and (iv) the terms "Article" and "Section" refer to the
specified Article and Section of this Agreement. Whenever this Agreement
refers to a number of days, unless otherwise specified, such number shall
refer to calendar days.
ARTICLE II
CERTAIN RIGHTS AND OBLIGATIONS
SECTION 2.01. Co-Promotion Rights. Subject to the terms of this
Agreement, WARNER- LAMBERT grants to PFIZER the exclusive right, together
with WARNER-LAMBERT, to promote and detail Products in the Territory
pursuant to the terms of this Agreement. Subject to the provisions of
Section 2.02(f), so long as PFIZER's rights of co-promotion under this
Section 2.01 shall remain in effect, WARNER-LAMBERT shall not grant any
rights to, or permit or authorize any third party (other than a
WARNER-LAMBERT Affiliate) to sell Products in the Territory (other than
wholesalers and other third parties in the chain of distribution), or to
promote or detail Products in the Territory in a manner similar to the
detailing and promotion of Products by PFIZER pursuant to this Agreement.
SECTION 2.02. Detailing and Promotional Efforts.
(a) Both PFIZER and WARNER-LAMBERT shall deploy such of
their respective sales forces in an effort to promote effectively and
detail the Products in the Territory in accordance with the terms of this
Agreement and the relevant Marketing Plan. In conducting such promotion and
detailing both PFIZER and WARNER-LAMBERT shall use reasonable commercial
efforts consistent with accepted pharmaceutical industry business
practices. No party shall be required to undertake any activity under this
Agreement which it believes, in good faith, may violate any Laws.
(b) Each party shall diligently work to fulfill all
responsibilities assigned to it under this Agreement and each Marketing
Plan and shall comply with all applicable Laws in the Territory. It is the
intention of the parties that during the first seven (7) Agreement Years
each of WARNER- LAMBERT and PFIZER will devote substantially equal efforts
and internal resources to the marketing, promotion and detailing of the
Products and the other activities contemplated under this Agreement, and
during Agreement Years Eight through Agreement Year Ten such efforts and
resources shall be 35% for PFIZER and 65% for WARNER-LAMBERT. The Marketing
Plans developed under Section 4.01 shall reflect the foregoing. If the
parties agree that additional detailing or other internal resources are
necessary beyond those contemplated in this Agreement, or if one party is
requested to devote its resources in excess of its appropriate share, the
parties shall first determine fair compensation to such party for its
additional efforts. Furthermore, no party hereto shall be required, without
its consent, to devote any employees or other internal resources of a type,
scope or nature which are materially different from those provided by the
other party.
(c) During each of the first seven (7) Agreement Years,
each of PFIZER and WARNER-LAMBERT shall be responsible for performing a
number of Details equal to fifty percent (50%) of the Details designated
for such Agreement Year in the Marketing Plan then in effect. With respect
to each of Agreement Years Eight through Ten, PFIZER shall be responsible
for performing a number of Details equal to thirty-five percent (35%) of
the Details called for in the Marketing Plan then in effect for such
Agreement Year, and WARNER-LAMBERT shall be responsible for performing
sixty-five percent (65%) of the Details called for in such Marketing Plan.
(d) Subject to the terms of Section 2.02(e), (i) the
Marketing Plans for Agreement Years One through Five shall obligate both
parties together to perform a total of one million (1,000,000) Details for
each such Agreement Year, and (ii) the Marketing Plans for Agreement Years
Six through Ten shall obligate both parties together to perform a total of
nine hundred thousand (900,000) Details for each such Agreement Year,
provided, if PFIZER's co-promotion rights have been terminated pursuant to
Sections 14.02(a) or 14.02(b), then the number of required Details to be
included in the Marketing Plans for each of the remaining Agreement Years
shall be the lesser of (i) the number of Details in the Marketing Plan for
the last Agreement Year in which PFIZER was co-promoting the Product
hereunder and (ii) 1,000,000 (for Agreement Years One through Five) or
900,000 (for Agreement Years Six through Ten).
(e) The number of Details set forth in Section 2.02(d) may
be adjusted by the Operating Committee, the Executive Committee or
WARNER-LAMBERT pursuant to the terms of Section 4.01; provided that
WARNER-LAMBERT shall not unilaterally increase or decrease such number of
Details during any Agreement Year by more than twenty-five percent (25%)
without the prior consent of PFIZER.
(f) Upon notice to the other party, WARNER-LAMBERT and
PFIZER shall each have the right to use the services of a contract sales
force (i.e. a third party whose primary business is devoted to detailing
third party products) to assist such party in satisfying its obligations
hereunder; provided, however, after such time as WARNER-LAMBERT terminates
PFIZER's copromotion rights under Sections 14.02(a) or 14.02(b), in no
event shall WARNER-LAMBERT be permitted to use a contract sales force
(without PFIZER's prior consent) to perform a number of Details greater
than such number of Details performed by a contract sales force for
WARNER-LAMBERT prior to termination of PFIZER's copromotion rights.
Furthermore, in no event shall WARNER-LAMBERT increase its use of such a
contract sales force (without PFIZER's prior consent) to perform a greater
number of Details in anticipation of its decision to terminate PFIZER's
co-promotion rights pursuant to Sections 14.02(a) or 14.02(b).
SECTION 2.03. Detailing Reports.
(a) During the first Agreement Quarter of Agreement Year
One, each party shall provide to the other both a preliminary and final
report of the number of Details carried out by its representatives during
each week in such Agreement Quarter. Preliminary reports shall be delivered
to the other party no later than two weeks after the end of the applicable
week in such Agreement Quarter and final reports shall be delivered no
later than six weeks after the end of the applicable week.
(b) Commencing with the second Agreement Quarter and
continuing until the expiration of Agreement Year Two, each party shall
provide to the other party both a preliminary and final report of the
number of Details carried out by its representatives during each month.
Preliminary reports shall be delivered to the other party no later than two
weeks after the end of the applicable calendar month and final reports
shall be delivered no later than six weeks after the end of the applicable
calendar month.
(c) Commencing with the first Agreement Quarter in
Agreement Year Three and continuing during the remaining Agreement Years,
each party shall provide to the other party a report of the number of
Details carried out by its representatives during each Agreement Quarter.
Preliminary reports shall be delivered to the other party within two weeks
of the end of the applicable Agreement Quarter and final reports shall be
delivered six weeks after the end of the applicable Agreement Quarter.
SECTION 2.04. Development of Products; Regulatory Approvals.
(a) WARNER-LAMBERT shall exercise reasonable efforts to
obtain, as soon as reasonably practicable, the approval by FDA of an NDA
for a Product with a package insert that is materially equivalent to the
provisions of Exhibit E-2.
(b) WARNER-LAMBERT shall be entitled at any time to cease
permanently the sale of any Product in the Territory if continued sale of
such Product would be in violation of Laws or if WARNER-LAMBERT in good
faith believes that it has an ethically valid reason therefor based on
medical or scientific problems concerning such Product.
(c) WARNER-LAMBERT shall be under no liability whatsoever
to compensate PFIZER or make any other payment to PFIZER if (i) the FDA,
for any reason, does not approve any NDA or supplement, (ii) the approved
package insert for the first Product is not materially equivalent to the
provisions of Exhibit E-2, or (iii) if WARNER-LAMBERT determines to take
any of the steps that it is permitted to take pursuant to this Section
2.04, provided, in the case of (i), (ii) and (iii) above, such failure to
approve by FDA or such cessation of sale shall not be the result of any
breach of this Agreement by WARNER-LAMBERT.
(d) Subject to the performance of, or compliance with,
their respective obligations as set forth in this Agreement, neither party
shall have any liability to the other party, whether in respect of any
amounts which might have been earned but are not earned by the other party
pursuant to this Agreement, or for any costs or expenses of any nature
incurred by the other party in anticipation of any amounts which might have
been earned by such other party pursuant to this Agreement but are not
earned, if for any reason, other than a breach of this Agreement, Net Sales
of the Products in the Territory during any of the Agreement Years do not
reach the Baseline Sales for such Agreement Year or any other level.
SECTION 2.05. Trademarks, etc.
(a) The Products shall be promoted and sold under
trademark(s) selected by WARNER-LAMBERT in its sole discretion and owned by
WARNER-LAMBERT or by any of its Affiliates (the "Trademark"). PFIZER shall
have no rights under this Agreement in or to the Trademark or the goodwill
pertaining thereto except as specifically provided herein. PFIZER shall
utilize the Trademark only for the purposes contemplated herein. PFIZER
agrees that upon termination or expiration of this Agreement (or upon
PFIZER no longer retaining co-promotion rights under Section 2.01 if such
date occurs first), it will discontinue forthwith all use of the Trademark.
(b) Except as specifically set forth in this Agreement,
PFIZER shall not enjoy or exercise any proprietary or property right or
other interest in the Trademark, the Patents or in any copyright owned by
WARNER-LAMBERT or any of its Affiliates and relating to any Product.
(c) PFIZER is the owner of the PFIZER logo set forth on
Exhibit F (the "PFIZER Logo"). PFIZER grants WARNER-LAMBERT the right to
use the PFIZER Logo on labeling, package inserts and packaging materials
for Products, all Promotional Materials (as hereinafter defined), Samples
(as hereinafter defined) and any other materials used in connection with
the performance of this Agreement during the Term of this Agreement (or the
period of time in which PFIZER retains co-promotion rights under Section
2.01 if shorter) and for the period of six (6) months thereafter for all
Products, Promotional Materials, Samples, labeling and inserts containing
the PFIZER Logo; provided, however, such use shall be consistent with the
uses approved by PFIZER's representatives on the Operating Committee (or
the U.S. Marketing Subcommittee thereof). WARNER-LAMBERT shall have no
rights under this Agreement in or to the PFIZER Logo or the goodwill
pertaining thereto except as specifically provided for herein. Except as
provided for in this Section 2.05(c), WARNER-LAMBERT agrees that upon
termination or expiration of this Agreement (or upon PFIZER no longer
retaining co-promotion rights under Section 2.01 if such date occurs
first), it will discontinue forthwith all use of the PFIZER Logo.
SECTION 2.06. Product Lifecycle Plan Studies. All data,
inventions and discoveries generated during the course of any Product
Lifecycle Plan Study, whether such study is sponsored and/or conducted by
PFIZER or WARNER-LAMBERT, shall be the joint property of WARNER-LAMBERT and
PFIZER, and each party shall have the right to use such data, inventions
and discoveries free of charge during and after the Term of this Agreement.
The parties agree to execute any documents or undertake any further actions
as may be reasonably necessary to effectuate the foregoing. Nothing in this
Section 2.06 shall be deemed to amend or modify the covenants and
agreements set forth in Sections 2.05(b), 2.08, 6.02 and 10.01.
SECTION 2.07. Joint Development Program. The parties will
undertake a joint development program (the "Program") to develop additional
indications and clinical information regarding the Products. The Program
will consist of the Product Lifecycle Plan Studies. The Program will be
managed by the Research Subcommittee pursuant to the provisions of Section
4.01. WARNER-LAMBERT and PFIZER shall be responsible for the expenses of
the Program pursuant to the applicable provisions of Sections 3.01 and
3.02(a). The parties shall have such rights regarding data, inventions and
discoveries generated from the Program as set forth in Section 2.06.
SECTION 2.08. Non-Compete. During the Term of this Agreement and
for two (2) years thereafter, neither PFIZER nor WARNER-LAMBERT (nor their
respective Affiliates or licensees) shall, directly or indirectly, market,
sell, detail, promote or distribute any Competing Products in any part of
the Territory.
ARTICLE III
PAYMENTS
SECTION 3.01. PFIZER Payments.
(a) In consideration for the rights granted to PFIZER under
this Agreement (including, without limitation, the exclusive right to
co-promote the Products under Section 2.01 and the rights set forth in this
Agreement to use the governmental approvals, data, inventions, discoveries,
patents, trademark, manufacturing rights, know-how and other intangible
rights granted hereunder), PFIZER shall pay to WARNER-LAMBERT One Hundred
Forty-five Million Dollars ($145,000,000) as follows: (i) Twenty Million
Dollars ($20,000,000) upon signing of this Agreement, (ii) Twenty Million
Dollars ($20,000,000) within three business days of PFIZER's receipt of
notice from WARNER-LAMBERT of the acceptance for filing by FDA of an NDA
for a Product which NDA provides for intended uses materially equivalent to
those provided for in Exhibit E-1, and (iii) One Hundred Five Million
Dollars ($105,000,000) within three business days of PFIZER's receipt of
notice from WARNER- LAMBERT of FDA approval of an NDA for the Product which
includes an approved package insert materially equivalent to that provided
in Exhibit E-2. Such payments shall be made in accordance with the terms of
Section 3.04.
(b) For as long as PFIZER shall enjoy co-promotion rights
under Section 2.01, subject to the terms of Section 14.04(b), PFIZER shall
be responsible for (i) fifty percent (50%) of all Product Expenses until
the expiration of Agreement Year Seven and (ii) thirty-five percent (35%)
of all Product Expenses in Agreement Years Eight through the expiration of
Agreement Year Ten. PFIZER shall pay its share of Product Expenses in
accordance with the terms set forth in Sections 3.03 and 3.04.
SECTION 3.02. WARNER-LAMBERT Payments. Subject to the other
provisions of this Agreement, WARNER-LAMBERT agrees that:
(a) WARNER-LAMBERT shall be responsible for (i) fifty
percent (50%) of all Product Expenses until the expiration of Agreement
Year Seven and (ii) sixty five percent (65%) of all Product Expenses in
Agreement Years Eight through the expiration of Agreement Year Ten.
WARNER-LAMBERT shall pay its share of Product Expenses in accordance with
the terms set forth in Sections 3.03 and 3.04.
(b) For Agreement Years One through Agreement Year Seven,
WARNER-LAMBERT shall pay to PFIZER an amount equal to: (i) 13.35% of Net
Sales up to fifty percent (50%) of the Baseline Sales for the applicable
Agreement Year, (ii) 31.15% of Net Sales in excess of fifty percent (50%)
of the Baseline Sales for each such Agreement Year up to one hundred
percent (100%) of the applicable Baseline Sales, and (iii) 44.50% of Net
Sales in excess of the Baseline Sales for each such Agreement Year; and
(c) For Agreement Year Eight, WARNER-LAMBERT shall pay to
PFIZER an amount equal to: (i) 13.35% of Net Sales up to fifty percent
(50%) of the Baseline Sales for Agreement Year Eight, (ii) 22.25% of Net
Sales in excess of fifty percent (50%) of the Baseline Sales for Agreement
Year Eight up to one hundred percent (100%) of the Baseline Sales for
Agreement Year Eight, and (iii) 31.15% of Net Sales in excess of the
Baseline Sales for Agreement Year Eight; and
(d) For Agreement Year Nine, WARNER-LAMBERT shall pay to
PFIZER an amount equal to: (i) 13.35% of Net Sales up to one hundred
percent (100%) of the Baseline Sales for Agreement Year Nine, and (ii)
31.15% of Net Sales in excess of the Baseline Sales for Agreement Year
Nine; and
(e) For Agreement Year Ten, WARNER-LAMBERT shall pay to
PFIZER an amount equal to: (i) 8.90% of Net Sales up to one hundred percent
(100%) of the Baseline Sales for Agreement Year Ten, and (ii) 31.15% of Net
Sales in excess of the Baseline Sales for Agreement Year Ten.
(f) Solely by way of illustration, Exhibit G sets forth the
application of the above subsections (b) through (e).
(g) In the event that PFIZER obtains any co-promotion
rights to any combination Atorvastatin product included as a Product
pursuant to this Agreement, the parties shall meet to discuss in good faith
any appropriate amendments to the terms of subsections (b) through (e) to
reflect any increased manufacturing or other direct costs or third party
royalties associated with such new Product.
SECTION 3.03. Payments; Payment Reports.
(a) WARNER-LAMBERT shall make payments to PFIZER arising
under Section 3.02 (subsections (b) through (e)) on a quarterly basis as
follows: For the first three Agreement Quarters in any Agreement Year,
payment shall be calculated in accordance with the applicable formula set
forth in Section 3.02 (subsections (b) through (e)) by comparing Net Sales
in each such Agreement Quarter against the Quarterly Baseline Sales for
such Agreement Quarter. At the expiration of the fourth Agreement Quarter
in each Agreement Year, WARNER-LAMBERT shall (i) determine the Net Sales
for such fourth Agreement Quarter and the entire Agreement Year, (ii)
calculate the actual amount due PFIZER for such Agreement Year pursuant to
the terms of Section 3.02 (subsections (b) through (e)), and (iii) pay
PFIZER the difference between (x) what was paid to PFIZER pursuant to
Section 3.02 (subsections (b) through (e)) for the first three Agreement
Quarters in such Agreement Year and (y) the amount actually due to PFIZER
under Section 3.02 (subsections (b) through (e)) for such Agreement Year;
provided that if the amount paid to PFIZER pursuant to Section 3.02
(subsections (b) through (e)) for the first three Agreement Quarters in any
Agreement Year exceeds what was actually due to PFIZER for the entire
Agreement Year pursuant to the applicable subsection, PFIZER shall promptly
repay such excess amount to WARNER-LAMBERT.
(b) PFIZER shall, within thirty (30) days of the end of
each Agreement Quarter (or, prior to the Launch Date, each calendar
quarter), notify WARNER-LAMBERT of the total amount of Product Expenses
incurred by PFIZER and its Affiliates during such Agreement Quarter or
calendar quarter, as the case may be. Furthermore, within thirty (30) days
of the Launch Date, PFIZER shall notify WARNER-LAMBERT of the total amount
of Product Expenses incurred by PFIZER and its Affiliates in the period of
time between the end of the last complete calendar quarter prior to the
Launch Date and the Launch Date.
(c) Provided PFIZER has complied with Section 3.03(b),
WARNER-LAMBERT shall, within forty-five (45) days of the receipt of
PFIZER's notice under Section 3.03(b), notify PFIZER of the calculation of
the total amount of Product Expenses for such Agreement Quarter, the
amounts paid or accrued by each of WARNER-LAMBERT or PFIZER, and the
amounts, if any, payable by either party to the other in accordance with
Sections 3.01(b) and 3.02(a).
(d) Provided PFIZER has complied with Section 3.03(b),
WARNER-LAMBERT shall, within forty-five (45) days of the receipt of
PFIZER's notice under Section 3.03(b), notify PFIZER of the calculation of
the amount payable to PFIZER or WARNER-LAMBERT, as the case may be,
pursuant to Section 3.03(a).
(e) Any amount payable by either party pursuant to the
notification under Sections 3.03(c) and 3.03(d) shall be offset against any
amounts due such party and the net amount shall be paid by WARNER-LAMBERT
or PFIZER, as the case may be, within ten (10) business days after
notification by WARNER-LAMBERT pursuant to Sections 3.03(c) and 3.03(d).
(f) For the period of time from April 15, 1996 to the
expiration of the last complete calendar quarter prior to the Launch Date,
WARNER-LAMBERT shall, within sixty (60) days after the end of each calendar
quarter, notify PFIZER of the calculation of WARNER-LAMBERT's and PFIZER's
share of Product Expenses in respect of such calendar quarter in accordance
with Sections 3.01(b) and 3.02(a), and PFIZER or WARNER-LAMBERT, as the
case may be, shall pay such amount to the other within ten (10) business
days after such notification. In addition, within sixty (60) days of the
Launch Date, WARNER-LAMBERT shall notify PFIZER of the calculation of
WARNER-LAMBERT's and PFIZER's share of Product Expenses in respect of the
period of time from the end of the last complete calendar quarter prior to
the Launch Date to the Launch Date, and PFIZER or WARNER-LAMBERT, as the
case may be, shall pay such amount to the other within ten (10) business
days after such notification.
SECTION 3.04. Manner of Payments. All sums due to either party
shall be payable in United States dollars by bank wire transfer in
immediately available funds to such bank account in the Territory as each
of PFIZER and WARNER-LAMBERT shall designate. PFIZER shall notify
WARNER-LAMBERT's Assistant Treasurer, Domestic by facsimile transmission
(at 201-540-3930 or such other number as may be communicated to PFIZER by
WARNER-LAMBERT) as to the date and amount of any such wire transfer to
WARNER-LAMBERT one business day prior to such transfer. WARNER-LAMBERT
shall notify PFIZER's Treasurer by facsimile transmission (at 212-573-1133
or such other number as may be communicated to WARNER-LAMBERT by PFIZER) as
to the date and amount of any such wire transfer to PFIZER one business day
prior to such transfer.
SECTION 3.05. Interest on Late Payments. If either
WARNER-LAMBERT or PFIZER shall fail to make a timely payment pursuant to
this Article III, interest shall accrue on the past due amount at a rate
equal to the rate of interest for 30 day high-grade commercial paper issued
by major corporations effective for the first date on which the payment was
delinquent, calculated on an actual/360 basis, as quoted in The Wall Street
Journal.
SECTION 3.06. Adjustments to Baseline Sales. Upon the
determination of the Launch Date, the parties shall meet to discuss in good
faith appropriate adjustments to the Quarterly Baseline Sales and Baseline
Sales for the Agreement Years to account for any extended stub period
included in the First Agreement Quarter of Agreement Year One as follows:
Upon determining the additional period added to Agreement Year One (the
"Stub Period"), a pro rata portion (based on the Stub Period) of Baseline
Sales for Agreement Year Two shall be subtracted from Baseline Sales for
Agreement Year Two and added to the Baseline Sales for Agreement Year One.
For Agreement Year Two and each succeeding Agreement Year, pro rata
portions (based on the Stub Period) of the Baseline Sales for the
succeeding Agreement Year shall be subtracted from such Agreement Year and
added to the Baseline Sales for the prior Agreement Year through Agreement
Year Nine. Baseline Sales for Agreement Year Ten shall be reduced by
one-half of the pro rata amount of such Baseline Sales that was added to
the Baseline Sales for Agreement Year Nine pursuant to the preceding
sentence. Quarterly Baseline Sales for each Agreement Quarter in the
Agreement Years shall be increased (or decreased for purposes of Agreement
Year Ten) by a pro rata amount of the increase (or decrease) in Baseline
Sales for the applicable Agreement Year.
ARTICLE IV
COOPERATION; MARKETING PLANS;
CLINICAL DEVELOPMENT PLANS
SECTION 4.01. Cooperation.
(a) Subject to the other provisions of this Agreement, the
parties agree that the principal objectives of the parties hereunder in
jointly promoting and detailing Products in the Territory are to use
reasonable efforts to maximize Net Sales and the financial return to the
parties hereunder and to develop and sponsor Product Lifecycle Plan Studies
during the period of time WARNER-LAMBERT and PFIZER shall be co-promoting
the Products under this Agreement. The parties agree that they shall
establish a formal framework within which they will discuss strategies for
the development, marketing and detailing of the Products in the Territory.
Exhibit K hereto sets forth a chart depicting the organization and
structure the parties have adopted to implement the cooperation between the
parties.
(b) The formal framework referred to in Section 4.01(a)
shall initially be comprised of the following:
(i) An Operating Committee, which shall operate by
consensus between the parties, shall meet at least
quarterly and shall have as its overall purpose the
development and implementation of commercial planning
activities and research and development programs, each
consistent with the other. The Operating Committee
shall have subcommittees as set forth below and in
Exhibit K. The Operating Committee shall consist of an
equal number of senior sales and marketing managers and
senior research and development managers of each party,
chaired by a senior sales and marketing manager of
WARNER-LAMBERT, shall review the activities of the U.S.
Marketing Subcommittee, the Research Subcommittee and
any other subcommittees formed from time to time, and
seek to resolve any matter upon which any such
subcommittee is unable to agree.
(ii) A U.S. Marketing Subcommittee comprising an equal
number of senior sales and marketing managers of each
party and two senior research and development managers
of each party, chaired by a senior sales and marketing
manager of WARNER-LAMBERT, which shall operate by
consensus between the parties, and shall meet at least
quarterly to: (a) develop and discuss strategies for
the detailing and marketing of the Product in the
Territory, including allocation of responsibility for
marketing activities, (b) develop and agree upon
contracting strategies and procedures as provided in
Exhibit L, (c) prepare and review Marketing Plans
(including the budget for advertising, promotional and
detailing activities and sampling strategies)
consistent with the provisions of Exhibits H and I and
Articles II, IV and V, (d) review progress against the
current Marketing Plan, (e) review progress of
marketing expenditures in an Agreement Year against the
budget for such activities in the applicable Agreement
Year, (f) review progress of Product sales against the
forecast included in the current Marketing Plan, (g)
review potential amendments to the current Marketing
Plan (including the budget for advertising, promotional
and sampling strategies and the forecast of Product
sales), (h) establish working groups responsible for
the preparation and tactical implementation of the
Marketing Plan, (i) integrate PFIZER colleagues into
existing WARNER-LAMBERT Product teams, (j) make
presentations to the Executive Committee and (k)
undertake all other responsibilities deemed necessary
in connection with the management of the marketing and
sale of the Product in the Territory.
(iii) A Research Subcommittee comprising an equal number of
senior research and development managers of each party
and two senior sales and marketing managers of each
party, chaired by a senior research and development
manager of WARNER-LAMBERT, which shall operate by
consensus between the parties, and shall meet at least
quarterly to: (a) review progress of ongoing Product
Lifecycle Plan Studies, (b) review and approve annual
worldwide Clinical Development Plans (including
budgets) consistent with provisions of Exhibit D,
(c) review clinical expenditures in an Agreement Year
against the budget for such activities in the
applicable Clinical Development Plan, and (d) make
presentations to the Executive Committee.
(iv) An Executive Committee, which shall operate by
consensus between the parties, comprising an equal
number of senior executives of each party, chaired by a
senior executive of WARNER-LAMBERT, which shall review
the activities of the Operating Committee, including
the U.S. Marketing Subcommittee and the Research
Subcommittee thereof, and seek to resolve any matter
upon which any such committee or subcommittee is unable
to agree.
(c) The parties may, upon mutual agreement, supplement or
vary the formal framework specified in Section 4.01(b) from time to time.
(d) If for any reason the Executive Committee cannot reach
agreement on any appropriate matter, the matter shall be referred to the
Chief Executive Officers of each party for good faith resolution. It is,
however, expressly agreed that the WARNER-LAMBERT Chief Executive Officer,
after consultation with the PFIZER Chief Executive Officer, shall have the
final decision making authority with respect to the matters appropriately
referred to him and such decision shall be binding on the parties, subject
to the provisions of this Agreement. Pursuant to the foregoing, it is
acknowledged that the Chief Executive Officers of WARNER-LAMBERT and PFIZER
may reasonably disagree on matters relating to strategies to market, detail
and/or promote the Products in the Territory. The decisions of the
WARNER-LAMBERT Chief Executive Officer on such matters shall be binding on
the parties, provided such decisions are made in good faith and have a
reasonable basis therefor. In particular, it is agreed that such decisions
cannot be challenged on the basis of being inconsistent with the first two
sentences of Section 2.02(a) or the first sentence of Section 4.01(a);
provided such decisions shall not be in conflict with other specific
provisions of this Agreement.
(e) Attached hereto as Exhibit H is the Marketing Plan for
all pre-launch educational activities and the Marketing Plan for Agreement
Year One. The U.S. Marketing Subcommittee shall seek to produce Marketing
Plans for each ensuing Agreement Year on or before October 31 of the prior
Agreement Year or such other date as may be determined in accordance with
this Section 4.01.
(f) Attached hereto as Exhibit I are general parameters for
the annual Marketing Plans for Agreement Years Two through Ten. Each
Marketing Plan shall be consistent with the provisions of such Exhibit I;
provided such Marketing Plans may be adjusted by the Operating Committee
(or the U.S. Marketing Subcommittee thereof), the Executive Committee or
WARNER-LAMBERT pursuant to the terms of Section 4.01. WARNER-LAMBERT shall
not unilaterally increase or decrease any total annual budget amount or the
total annual Sample number included in Exhibit I for a Marketing Plan
without the prior consent of PFIZER (i) by more than twenty-five percent
(25%) for Agreement Years Two through Six, and (ii) by more than fifteen
percent (15%) for Agreement Years Seven through Ten. Subject to the
foregoing and the other provisions of this Agreement, each Marketing Plan
shall stipulate the way in which the Products are to be promoted and
detailed in the Territory during the period to which the Marketing Plan
relates and shall include, inter alia: (i) the number and type of Details
to be performed and strategies relating to such detailing activity, (ii)
contracting strategies and procedures as provided in Exhibit L, (iii) other
advertising and promotional activity to be undertaken, (iv) any training
and/or sampling programs to be conducted, (v) budgets, (vi) disease
management programs to be conducted, (vii) medical education programs to be
conducted, (viii) public relations activities and (ix) such other
activities as may be agreed on by the U.S. Marketing Subcommittee, the
Operating Committee, the Executive Committee or determined or varied
pursuant to the provisions of Section 4.01(d). The Marketing Plans shall
not address sales force incentives or compensation, and each party shall
have sole authority and responsibility for designing and executing any such
program for its sales force. Neither party shall make any material change
in any Marketing Plan or Clinical Development Plan without the prior
approval of the Operating Committee.
(g) All of the committees and subcommittees contemplated in
Exhibit K shall be established within thirty (30) days from the date of
this Agreement. Each party shall bear its own costs associated with its
participation on the various committees and subcommittees.
SECTION 4.02. Information Exchange. Each party shall forthwith
upon the execution of this Agreement and thereafter at all times during the
Agreement Years promptly disclose to the other party all significant
information of which it becomes aware, which it can legally disclose and
which it reasonably believes will be important in planning and effecting
the detailing, promotion, marketing and sale of the Products in the
Territory.
ARTICLE V
PROMOTIONAL MATERIALS AND SAMPLES
SECTION 5.01. Promotional and Educational Materials.
(a) Subject to the terms of clause (b) below and Section
8.03, during the Term of this Agreement (or the period of time in which
PFIZER retains co-promotion rights under Section 2.01 if shorter) the
Operating Committee shall create and develop advertising, promotional,
educational and communication materials for marketing, advertising and
promotion of the Products for distribution to independent third parties
(including medical professionals) and to WARNER-LAMBERT's and PFIZER's
respective sales forces in accordance with the terms of the Marketing Plans
(the "Promotional Materials") and which shall be subject to
WARNER-LAMBERT's prior approval pursuant to Section 8.03. Subject to the
terms of Section 2.05(c) and this Section 5.01, WARNER-LAMBERT shall own
all right, title and interest in and to any such Promotional Materials
which are specifically directed to the Products including applicable
copyrights and trademarks and PFIZER shall execute all documents and take
all actions as are reasonably requested by WARNER-LAMBERT to vest title to
such Promotional Materials, copyrights and trademarks in WARNERLAMBERT.
Promotional Materials shall be paid for by the parties as set forth in
Sections 3.01(b) and 3.02(a).
(b) PFIZER and WARNER-LAMBERT shall retain all rights,
including, without limitation, copyrights and trademarks, to all of their
respective existing programs and materials in all formats (print, video,
audio, digital, computer, etc.) regarding sales training, patient education
and disease management programs presently owned by each, as well as any
modifications of such programs each may develop in the future which are not
specific to the Products. PFIZER and WARNER-LAMBERT shall, from time to
time, each notify the other as to the identity of such proprietary
programs. In the event that WARNER-LAMBERT desires after the expiration or
termination of this Agreement, to use any PFIZER program which has been
specifically adapted for, or directed to, any of the Products, the parties
shall negotiate in good faith to conclude, if possible, an appropriate
agreement (including the amount of compensation to be paid to PFIZER) for
such use. In addition, all such new programs hereafter jointly developed by
PFIZER and WARNER-LAMBERT pursuant to this Agreement shall be jointly owned
by PFIZER and WARNER-LAMBERT, and each party shall have the right to use
such jointly developed programs free of charge after the Term of this
Agreement.
(c) PFIZER shall not produce (other than as concepts for
consideration by WARNER-LAMBERT), distribute or otherwise use any
promotional or communications material relating to the Products which has
not been approved in accordance with the management framework established
in Section 4.01 and by WARNER-LAMBERT pursuant to Section 8.03.
(d) Each party shall during each Agreement Year provide the
other party with such quantities of Promotional Materials consistent with
the applicable Marketing Plan and the provisions of this Agreement to meet
such party's reasonable requirements for use in accordance with the then
current Marketing Plan.
SECTION 5.02. Samples.
(a) WARNER-LAMBERT shall during each Agreement Year provide
PFIZER with such quantities of samples of the Products ("Samples")
consistent with the applicable Marketing Plan and the provisions of this
Agreement to meet PFIZER's reasonable requirements for use in accordance
with the then current Marketing Plan. For each Agreement Year Samples shall
be allocated fairly between the parties based on the number of Details each
is required to undertake. PFIZER and WARNER-LAMBERT shall use Samples
strictly in accordance with the then current Marketing Plan and shall
distribute Samples in full compliance with all applicable Laws, including
the requirements of the Prescription Drug Marketing Act of 1987, as amended
(the "PDM Act"). PFIZER will maintain those records required by the PDM Act
and all other Laws and shall allow representatives of WARNER-LAMBERT to
inspect such records on request. WARNER-LAMBERT shall be solely responsible
for the filing of any necessary reports to FDA in connection with the PDM
Act.
(b) The cost per Sample distributed in each Agreement
Quarter shall be calculated as twelve percent (12%) of the quotient of (i)
Net Sales in such Agreement Quarter over (ii) the total number of pills of
Product sold to unaffiliated third parties in the Territory in such
Agreement Quarter.
(c) Within thirty (30) days after the end of the Term of
this Agreement (or, if earlier, the termination of PFIZER's co-promotion
rights), PFIZER shall return, or otherwise dispose of in accordance with
instructions from WARNER-LAMBERT, all remaining Samples provided by
WARNER-LAMBERT and will provide WARNER-LAMBERT with a certified statement
that all remaining Samples have been returned or otherwise properly
disposed of and that PFIZER is no longer in possession or control of any
such Samples in any form or fashion.
SECTION 5.03. Labeling. The parties agree that, subject to the
requirements of the FD&C Act and approval of FDA, WARNER-LAMBERT and PFIZER
shall be given equal exposure and prominence on all Product package
inserts, packaging, Samples and all Promotional Materials used or
distributed in connection with the Products under this Agreement; provided
such equal exposure shall not be required where PFIZER has prohibited the
use of the PFIZER Logo in accordance with the terms of Section 2.05(c).
Regarding the Physicians Desk Reference, reference to PFIZER shall be as
set forth in Exhibit J.
ARTICLE VI
INFORMATION CONCERNING THE PRODUCT
SECTION 6.01. Public Statements. PFIZER and WARNER-LAMBERT
shall ensure that no claims or representations in respect of the Products
or Atorvastatin or the characteristics thereof are made by or on behalf of
it (by members of its sales force or otherwise) that have not been approved
by WARNER-LAMBERT or which do not represent an accurate summary or
explanation of the labeling of the Product or a portion thereof.
SECTION 6.02. Ownership. PFIZER shall not represent to any
third party that it has any proprietary or property right or interest in
the Products, Atorvastatin or in the Patents or the Trademark, except for
such rights granted to PFIZER under Section 2.01. Furthermore, PFIZER
acknowledges that it does not have any right, title or interest in the
Patents.
SECTION 6.03. Medical Inquiries. PFIZER shall comply with the
directions and policies which WARNER-LAMBERT may reasonably formulate
concerning responses to be made to medical questions or inquiries from
members of the medical and paramedical professions and consumers regarding
the Products and shall, if so requested by WARNER-LAMBERT, provide
WARNER-LAMBERT with details of inquiries received and responses given.
SECTION 6.04. WARNER-LAMBERT Information.
(a) WARNER-LAMBERT shall provide PFIZER with information,
known to WARNER-LAMBERT, which is relevant or appropriate to enable PFIZER
to respond promptly to medical questions or inquiries from members of the
medical and paramedical professions and consumers relating to the Products.
(b) PFIZER shall refer all questions and inquiries to which
PFIZER is unable to respond, using the materials provided by WARNER-LAMBERT
pursuant to Section 6.04(a), to WARNER-LAMBERT.
ARTICLE VII
TRAINING
SECTION 7.01. Training Plans. PFIZER and WARNER-LAMBERT shall,
each at its own expense, comply with any reasonable training plan contained
in any Marketing Plan which is otherwise consistent with provisions of this
Agreement.
SECTION 7.02. Assistance. During the Term of this Agreement (or
the period of time in which PFIZER retains co-promotion rights under
Section 2.01 if shorter), each party shall make available to the other, to
the extent reasonable:
(a) Reasonable services of such party's sales training
personnel to assist the other party's sales training personnel in training
its detailing force; and
(b) Reasonable quantities of training and communications
materials created and developed for marketing and promoting the Products.
ARTICLE VIII
REGULATORY MATTERS
SECTION 8.01. Communication with Regulatory Authorities. PFIZER
shall not without the consent of WARNER-LAMBERT or unless so required by
Law (and then only pursuant to the terms of this Section 8.01), correspond
or communicate with the FDA or with any other Governmental or Regulatory
Authority, whether within the Territory or otherwise, concerning the
Products or Atorvastatin or otherwise take any action concerning any
authorization or permission under which the Products are sold or any
application for the same. Furthermore, PFIZER shall, immediately upon
receipt of any communication from the FDA or from any other Governmental or
Regulatory Authority relating to Atorvastatin or any Product, forward a
copy or description of the same to WARNER-LAMBERT and respond to all
inquiries by WARNER-LAMBERT relating thereto. If PFIZER is advised by its
counsel that it must communicate with the FDA or with any other
Governmental or Regulatory Authority, then PFIZER shall so advise
WARNER-LAMBERT immediately and, unless the Law prohibits, provide
WARNER-LAMBERT in advance with a copy of any proposed written communication
with the FDA or any other Governmental or Regulatory Authority and comply
with any and all reasonable direction of WARNER-LAMBERT concerning any
meeting or written or oral communication with the FDA or any other
Governmental or Regulatory Authority.
SECTION 8.02. FDA Filings. Subject to the terms of Section 2.04,
upon receipt of the initial NDA approval for a Product, WARNER-LAMBERT
shall have exclusive authority and responsibility to maintain and seek
revisions of the conditions of FDA marketing approval for the Products and
shall keep PFIZER informed of any such actions, provided any such revisions
are not inconsistent with the decisions of the parties as determined in
accordance with Section 4.01. Within twenty (20) days after submission to
FDA, WARNER-LAMBERT shall provide PFIZER with copies of all final
submissions to the NDA that are intended to change or modify the label or
labeling for, or the indications of, Atorvastatin or any of the Products.
Subject to the terms of Section 8.01, PFIZER will not file any document
with FDA or any other Governmental or Regulatory Authority relating to any
Product or Atorvastatin without the prior consent of WARNER-LAMBERT.
SECTION 8.03. Labeling and Promotional Materials.
WARNER-LAMBERT shall have sole authority and responsibility to seek and/or
obtain any necessary FDA approvals of any label, labeling, package inserts
and packaging, and Promotional Materials used in connection with the
Products, and for determining whether the same requires FDA approval. No
Product label, labeling or Promotional Materials may be used or distributed
by PFIZER unless such label, labeling or Promotional Materials have been
approved in advance by the Operating Committee (or the U.S. Marketing
Subcommittee thereof) and, for purposes of determining compliance with
applicable Laws, WARNER-LAMBERT, pursuant to WARNER-LAMBERT's internal
procedures.
SECTION 8.04. Complaints. Subject to the terms of Section 8.06,
PFIZER shall refer any complaints (including medical complaints) which it
receives concerning any Product or Atorvastatin to WARNER-LAMBERT within
ninety-six hours of PFIZER's receipt of the same; provided that all
complaints concerning suspected or actual Product tampering, contamination
or mix-up (e.g. wrong ingredients) shall be delivered within twenty-four
hours of any member of the PFIZER Group's (as hereinafter defined) receipt
of the same. PFIZER shall not take any other action in respect of any such
complaint without the consent of WARNER-LAMBERT unless otherwise required
by Law.
SECTION 8.05. Regulatory Information. Subject to the terms of
Section 8.01, each party agrees to provide the other with all reasonable
assistance and take all actions reasonably requested by the other party
that are necessary or desirable to enable the other party to comply with
any Law applicable to Atorvastatin or any Product, including, but not
limited to, WARNER-LAMBERT meeting its reporting and other obligations to
(i) maintain and update any NDA's for the Products, (ii) report Adverse
Drug Experience Reports and Serious Adverse Drug Experience Reports to the
FDA and/or other Governmental or Regulatory Authorities and (iii) submit or
file Promotional Materials with the FDA. Such assistance and actions shall
include, among other things, keeping the other party informed, commencing
within forty-eight hours of notification of any action by, or notification
or other information which it receives (directly or indirectly) from, the
FDA or any other Governmental or Regulatory Authority, which (a) raises any
material concerns regarding the safety or efficacy of any Product, (b)
which indicates or suggests a potential material liability for either party
to third parties arising in connection with any Product, or (c) which is
reasonably likely to lead to a recall or market withdrawal of any Product,
provided that neither party shall be obliged to disclose information in
breach of any contractual restriction which it could not reasonably have
avoided. For purposes of this Section 8.05, each of the events set forth in
(a), (b) and (c) of this Section 8.05 shall be defined as a "Material
Event". Information that shall be disclosed pursuant to this Section 8.05
shall include, but not be limited to:
(1) Governmental or Regulatory inspections of manufacturing,
distribution or other related facilities; inquiries by Governmental or
Regulatory Authorities concerning clinical investigation activities
(including inquiries of investigators, clinical monitoring organizations
and other related parties); any communication from Governmental or
Regulatory Authorities involving the manufacture, sale, promotion or
distribution of Products or any other Governmental or Regulatory Authority
reviews or inquiries relating to Atorvastatin or any of the Products which,
in each case, constitute a Material Event; and
(2) receipt of a Warning Letter relating to Atorvastatin or any
of the Products; and
(3) an initiation of any Governmental or Regulatory Authority
investigation, detention, seizure or injunction concerning any Product.
SECTION 8.06. Adverse Drug Experience Reports. (a) Subject to
the FD&C Act, PFIZER shall:
(i) notify WARNER-LAMBERT of all Serious Adverse Drug
Experience Reports (including Serious Adverse Drug
Experience Reports occurring in any Product Lifecycle
Plan Study conducted, sponsored or monitored by PFIZER
or WARNER-LAMBERT) within ninety-six hours of the time
such Serious Adverse Drug Experience Report becomes
known to PFIZER or any of its Affiliates or any
employee or agent of PFIZER or any of its Affiliates
(the "PFIZER Group"); and
(ii) notify WARNER-LAMBERT of all Adverse Drug Experience
Reports (except for Adverse Drug Experience Reports
occurring in a Product Lifecycle Plan Study conducted,
sponsored or monitored by PFIZER or WARNER-LAMBERT)
within ten days of the time such Adverse Drug
Experience Report becomes known to any member of the
PFIZER Group; and
(iii) notwithstanding any other provision of this Section
8.06, use its best efforts to notify WARNER-LAMBERT of
all unexpected fatal or life-threatening experiences
occurring in connection with an IND study conducted,
sponsored or monitored by PFIZER, as defined in
21 C.F.R 312.32, within twenty-four hours (but, in no
event, later than thirty-six hours) of the time any
such experience becomes known to any member of the
PFIZER Group; and
(iv) notwithstanding any other provision in this Section
8.06, notify WARNER-LAMBERT of all other serious and
unexpected adverse experiences occurring in connection
with an IND study conducted, sponsored or monitored by
PFIZER, as defined in 21 C.F.R 312.32, within
seventy-two hours of the time any such experience
becomes known to any member of the PFIZER Group.
(b) PFIZER shall notify WARNER-LAMBERT of all Adverse Drug
Experience Reports occurring in any Product Lifecycle Plan Study conducted,
sponsored or monitored by PFIZER when such Product Lifecycle Plan Study is
completed in a study report issued to WARNER-LAMBERT in connection
therewith. Each such final study report shall be provided to WARNER-LAMBERT
within fifteen days of its completion. Except for Adverse Drug Experience
Reports occurring in any Product Lifecycle Plan Study conducted, sponsored
or monitored by PFIZER, notification under this Section 8.06 shall be by
facsimile and overnight courier and in accordance with instructions to be
mutually agreed upon by PFIZER and WARNER-LAMBERT. All follow-up
investigations concerning Adverse Drug Experience Reports and Serious
Adverse Drug Experience Reports occurring during Product Lifecycle Plan
Studies shall be conducted by the party initiating, sponsoring or
monitoring such study; provided that the results of such follow-up
investigations conducted by PFIZER shall be delivered to WARNER-LAMBERT
within ninety-six hours of the time such follow-up information is obtained
by any member of the PFIZER Group. All other follow-up investigations
concerning Adverse Drug Experience Reports and Serious Adverse Drug
Experience Reports shall be conducted by WARNER-LAMBERT. PFIZER shall
provide all reasonable cooperation with any investigation of any such
spontaneous Adverse Drug Experience Report or Serious Adverse Drug
Experience Report conducted by WARNER-LAMBERT.
(c) Subject to Section 8.01, (i) PFIZER shall not disclose
any information concerning Adverse Drug Experience Reports or Serious
Adverse Drug Experience Reports to any Person or Governmental or Regulatory
Authority without the prior consent of WARNER-LAMBERT, and (ii)
WARNER-LAMBERT shall have the sole discretion to determine whether any
complaint, Adverse Drug Experience Report or Serious Adverse Drug
Experience Report must be reported to the FDA or any other Governmental or
Regulatory Authority.
(d) Within fourteen (14) days of submission, WARNER-LAMBERT
shall provide PFIZER with copies of all 15 day "Alert Reports" relating to
the Products and submitted to FDA in accordance with 21 C.F.R. 314.80(c)(1)
and all periodic adverse drug experience reports relating to the Products
and submitted in accordance with 21 C.F.R. 314.80(c)(2).
SECTION 8.07. Recalls Or Other Corrective Action.
WARNER-LAMBERT shall have sole responsibility for and shall make all
decisions with respect to any recall, market withdrawals or any other
corrective action related to the Products. WARNER-LAMBERT shall promptly
notify PFIZER of any such actions taken by WARNER-LAMBERT which are
reasonably likely to result in a material adverse effect on the
marketability of any Product in the Territory. At WARNER-LAMBERT's request,
PFIZER shall provide reasonable assistance to WARNER-LAMBERT in conducting
such recall, market withdrawal or other corrective action and any
documented, direct, out-of-pocket costs incurred by PFIZER with respect to
participating in such recall, market withdrawal or other corrective action
shall be reimbursed by WARNER-LAMBERT. WARNER-LAMBERT shall be under no
liability whatsoever to compensate PFIZER or make any other payment to
PFIZER for any decision to recall, initiate a market withdrawal or take any
other corrective action with respect to the Products contemplated in this
Section 8.07, unless such action results from WARNER-LAMBERT's failure to
comply with the terms of this Agreement.
SECTION 8.08. Survival of Obligations. The obligations of the
parties set forth in Sections 8.01, 8.04, 8.05 and 8.06 shall survive the
termination of this Agreement (or the period of time in which PFIZER
retains co-promotion rights under Section 2.01 if shorter) for the shelf
life of the Products containing the PFIZER Logo in accordance with Section
2.05(c).
ARTICLE IX
ORDERS AND SUPPLY OF PRODUCTS
SECTION 9.01. Orders and Terms of Sale. WARNER-LAMBERT shall
have the sole right to (i) receive, accept and fill orders for Products,
(ii) control invoicing, order processing and collection of accounts
receivable for Product sales, (iii) record Product sales in its books of
account, and (iv) establish and modify the commercial terms and conditions
with respect to the sale and distribution of Products, including matters
such as the price at which the Products will be sold and whether any
discounts, rebates or other deductions should be made, paid or allowed. It
is understood that certain of the matters set forth in clause (iv) above
shall be incorporated in the Marketing Plans developed pursuant to Section
4.01.
SECTION 9.02. Misdirected Orders. If, for any reason, PFIZER
receives orders for Products, PFIZER shall forward such orders to
WARNER-LAMBERT (or if directed by WARNER-LAMBERT to WARNER-LAMBERT's
wholesalers) as soon as practicable.
SECTION 9.03. Product Returns. If any quantities of the
Products are returned to PFIZER, PFIZER shall immediately notify
WARNER-LAMBERT and ship them to the facility designated by WARNER-LAMBERT,
with any reasonable or authorized shipping or other documented direct cost
to be paid by WARNER-LAMBERT. PFIZER, at its option, may advise the
customer who made the return that the Products have been returned to
WARNER-LAMBERT, but shall take no other steps in respect of any return
without the consent of WARNER-LAMBERT. All returns of Samples used by the
PFIZER field force shall first be returned to PFIZER which shall ship them
to WARNER-LAMBERT, at WARNER-LAMBERT's expense.
SECTION 9.04. Supply. WARNER-LAMBERT shall use reasonable
efforts to supply Products (both for trade purposes and Samples) during the
Term of this Agreement in a consistent fashion and in sufficient quantities
to meet the forecasted amounts of Products in accordance with the then
current Marketing Plan. With respect to the foregoing, WARNER-LAMBERT shall
maintain inventory of Products (a) for the first two Agreement Quarters of
Agreement Year One, equal to six (6) months (based on the then current
Marketing Plan) and (b) for the final two Agreement Quarters of Agreement
Year One and the remaining Agreement Years, equal to three (3) months
(based on the then current Marketing Plan). WARNER-LAMBERT shall establish
appropriate back-up manufacturing facilities and shall be responsible for
obtaining all FDA or other Governmental or Regulatory Authority approvals
for such facilities on a timely basis as required to prevent any
interruption, discontinuity or other impediment to continued supply of the
Products.
SECTION 9.05. PFIZER Back-Up Manufacturing Facilities. If,
after approval of an NDA for a Product, additional back-up manufacturing
facilities are required, PFIZER shall have the option, at its sole cost and
expense, to request WARNER-LAMBERT to file a supplement to have one or more
of PFIZER's or any of its Affiliate's manufacturing facilities (the "PFIZER
Facilities") qualified and approved as back-up manufacturing facilities. If
PFIZER desires to have any of its facilities so qualified, PFIZER shall
notify WARNER-LAMBERT of the identity of such PFIZER Facilities and the
back-up manufacturing services to be provided promptly after PFIZER has
made this determination. WARNER-LAMBERT shall have the right to visit and
audit such PFIZER Facilities and review all other appropriate technical
information to determine whether such PFIZER Facilities are acceptable,
such consent not to be unreasonably withheld. If approved by
WARNER-LAMBERT, WARNER-LAMBERT shall have the right to provide reasonable
technical assistance in the qualification and approval of such PFIZER
Facilities at the cost and expense of PFIZER. WARNER-LAMBERT shall be
solely responsible for filing all submissions or other correspondence with
the FDA and/or other Governmental or Regulatory Authorities in connection
with any decision to seek approval of a PFIZER Facility as an additional
back-up manufacturing facility. WARNER-LAMBERT shall also be responsible
for determining technical and other conditions set forth in any supplement
filed with reference to this Section. WARNER-LAMBERT shall have the sole
right to determine whether or not to use the PFIZER Facilities in the event
of an interruption or depletion in supply of Product and, under such
circumstances, a separate manufacturing agreement will be entered into
between the parties.
SECTION 9.06. Failure of Supply. In the event for any reason,
including Force Majeure (as hereinafter defined) (but excluding the failure
of PFIZER to perform its obligations as a back-up manufacturer pursuant to
the terms of Section 9.05, if applicable), WARNER-LAMBERT shall be unable
to supply on a timely basis (in accordance with WARNER-LAMBERT's normal and
customary practice) at least ninety-three percent (93%) of the orders for
Product in the Territory and provided that such orders are not materially
greater than the forecasted Product requirements included in the then
current Marketing Plan, then the following adjustments shall be made to the
terms otherwise provided herein:
(a) If such failure to supply continues for two consecutive
months or less, the Agreement Year in which such failure to supply occurred
shall be extended by a length of time equal to two times the number of days
during which WARNER-LAMBERT failed to supply Product as provided for above.
(b) If such failure to supply continues longer than two
consecutive months, the Agreement Year in which such failure to supply
occurred shall be extended by a length of time equal to four times the
number of days during which WARNER-LAMBERT failed to supply Product as
provided for above.
(c) Provided WARNER-LAMBERT's failure to meet its supply
obligations shall not be the result of WARNER-LAMBERT's material breach of
its obligations under this Agreement, then Sections 9.06(a) and (b) set
forth PFIZER's sole remedy in the event WARNER-LAMBERT fails to meet the
supply obligations set forth in this Article IX.
ARTICLE X
CONFIDENTIAL INFORMATION
SECTION 10.01. Confidential Information. Each of PFIZER and
WARNER-LAMBERT shall keep all Confidential Information from the other with
the same degree of care it maintains the confidentiality of its own
confidential information. Each party shall not use such Confidential
Information for any purpose other than in performance of this Agreement or
disclose the same to any other Person other than to such of its employees,
agents, advisers, representatives, consultants and counsel who have a need
to know such Confidential Information to implement the terms of this
Agreement; provided, however, any such consultants shall be subject to
confidentiality obligations consistent with those provided herein. The
party receiving the Confidential Information (the "Receiving Party") shall
advise any employee, agent, adviser, representative, consultant or counsel
who receives such Confidential Information of the confidential nature
thereof and of the obligations contained in this Agreement relating
thereto, and the Receiving Party shall ensure that all such employees,
agents, advisers, representatives, consultants and counsel comply with such
obligations as if they had been a party hereto. Upon termination of this
Agreement, or earlier if so requested by the party disclosing the
Confidential Information (the "Disclosing Party"), the Receiving Party
shall use reasonable efforts to return or destroy all documents, tapes or
other media containing Confidential Information in its possession, except
that the Receiving Party may keep one copy of Confidential Information in
the Legal Department files of the Receiving Party, solely for archival
purposes. Such archival copy shall be deemed to be the property of the
Disclosing Party, and shall not be copied or distributed in any manner
without the express prior permission of the Disclosing Party; provided,
however, that the Receiving Party shall have the right to disclose any
Confidential Information provided hereunder if, in the reasonable opinion
of the Receiving Party's legal counsel, such disclosure is necessary to
comply with the terms of this Agreement, or the requirements of any Law.
The Receiving Party shall notify the Disclosing Party of the Receiving
Party's intent to make such disclosure of Confidential Information pursuant
to the proviso of the preceding sentence sufficiently prior to making such
disclosure so as to allow the Disclosing Party adequate time to take
whatever action the Disclosing Party may deem to be appropriate to protect
the confidentiality of the information.
SECTION 10.02. Exceptions. Each of PFIZER and WARNER-LAMBERT
shall be relieved of any and all of the obligations of Section 10.01 with
respect to a specific item of Confidential Information if:
(a) such Confidential Information is in the public domain
at the time of disclosure hereunder or subsequently comes within the public
domain through no fault or action of the Receiving Party or any of its
Affiliates; or
(b) such Confidential Information is in the possession or
control of the Receiving Party or any of its Affiliates at the time of
disclosure by or on behalf of the Disclosing Party or is independently
discovered, after the date of disclosure, by the Receiving Party or any of
its Affiliates without the aid, application or use of the Confidential
Information, in each such case as evidenced by written records; or
(c) such Confidential Information is obtained by the
Receiving Party from any third party not in violation of any
confidentiality obligation to the Disclosing Party.
SECTION 10.03. Survival. The obligations and prohibitions
contained in this Article X shall survive the expiration or termination of
this Agreement for a period of five (5) years.
ARTICLE XI
REPRESENTATIONS, WARRANTIES, COVENANTS AND
INDEMNIFICATION
SECTION 11.01. WARNER-LAMBERT Representations, Warranties and
Covenants. WARNER-LAMBERT hereby represents, warrants, covenants and
agrees as follows:
(a) WARNER-LAMBERT has the corporate power and authority to
execute and deliver this Agreement and to perform its obligations
hereunder, and the execution, delivery and performance of this Agreement by
WARNER-LAMBERT has been duly and validly authorized and approved by proper
corporate action on the part of WARNER-LAMBERT, and WARNER-LAMBERT has
taken all other action required by law, its certificate of incorporation,
by-laws or any agreement to which it is a party or to which it may be
subject, required to authorize such execution, delivery and performance.
Assuming due authorization, execution and delivery on the part of PFIZER,
this Agreement constitutes a legal, valid and binding obligation of
WARNER-LAMBERT, enforceable against WARNER-LAMBERT in accordance with its
terms, except as the enforceability thereof may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws of general
application relating to creditors' rights.
(b) As of the date hereof, the execution and delivery of
this Agreement by WARNER-LAMBERT and the performance by WARNER-LAMBERT
contemplated hereunder will not violate any Laws or any order of any court
or other Governmental or Regulatory Authority.
(c) As of the date hereof, neither the execution and
delivery of this Agreement nor the performance hereof by WARNER-LAMBERT
requires WARNER-LAMBERT to obtain any permits, authorizations or consents
from any Governmental or Regulatory Authority (except for FDA approval of
the Products) or from any other Person, and such execution, delivery and
performance will not result in the breach of or give rise to any
termination of any agreement or contract to which WARNER-LAMBERT may be a
party and which relates to the Products.
(d) As of the date hereof, Exhibit C contains a correct and
complete list of all patents and patent applications issued or pending in
the Territory relating to Atorvastatin which are owned by WARNER-LAMBERT or
its Affiliates. All of the Patents issued as of the date hereof (i) are
held of record by WARNER-LAMBERT, (ii) are free and clear of all liens,
encumbrances and other claims, and (iii) are not subject anywhere in the
Territory to any pending cancellation, opposition or reexamination
proceeding or any other proceeding challenging their extent or validity. To
the best of WARNER-LAMBERT's knowledge, all of the Patents issued as of the
date hereof are valid and in full force. WARNER-LAMBERT is the owner of
record of all applications listed on Exhibit C. To the best of
WARNER-LAMBERT's knowledge, the claims included in such applications relate
to patentable subject matter, and WARNER-LAMBERT is not aware of any reason
that such claims would not be allowed to issue.
(e) As of the date hereof, to the best of WARNER-LAMBERT's
knowledge, the manufacture, use or sale of the Products does not infringe
any patents of third parties, and, to the best knowledge of WARNER-LAMBERT,
no third party is infringing in the Territory any of the issued Patents or
any of the claims of the patent applications listed in Exhibit C.
(f) As of the date hereof, there are no actions, suits,
proceedings or claims, pending against WARNER-LAMBERT or any of its
Affiliates, or, to the knowledge of WARNER-LAMBERT, threatened against
WARNER-LAMBERT or any of its Affiliates, at law or in equity, or before or
by any court or Governmental or Regulatory Authority relating to the
Products or any of the matters contemplated under this Agreement. To the
knowledge of WARNER-LAMBERT, there are no investigations, pending or
threatened against WARNER-LAMBERT or any of its Affiliates, at law or in
equity, or before or by any Governmental or Regulatory Authority relating
to the Products or any of the matters contemplated under this Agreement.
(g) WARNER-LAMBERT will exercise reasonable diligence to
ensure that the Product NDA to be filed with the FDA and all amendments
thereto will be prepared in accordance with all applicable requirements of
the FD&C Act.
(h) WARNER-LAMBERT has heretofore disclosed to PFIZER all
material information known to WARNER-LAMBERT with respect to the safety and
effectiveness of the Products or human risk factors relating thereto.
(i) WARNER-LAMBERT covenants that during the Term of this
Agreement it shall carry out the detailing, promotion, marketing and sale
of the Products and its other obligations or activities hereunder in
accordance with (i) the terms of this Agreement, (ii) accepted
pharmaceutical industry practices and (iii) all applicable Laws.
(j) WARNER-LAMBERT covenants that Products to be
distributed by WARNER-LAMBERT during the Term of this Agreement will, at
the time of shipment by or on behalf of WARNER-LAMBERT, not be misbranded
or adulterated under the terms of the FD&C Act.
(k) WARNER-LAMBERT acknowledges that PFIZER is relying, and
is entitled to rely, on the foregoing representations, warranties and
covenants.
SECTION 11.02. PFIZER Representations, Warranties and Covenants.
PFIZER hereby represents, warrants, covenants and agrees as follows:
(a) PFIZER has the corporate power and authority to execute
and deliver this Agreement and to perform its obligations hereunder, and
the execution, delivery and performance of this Agreement by PFIZER has
been duly and validly authorized and approved by proper corporate action on
the part of PFIZER, and PFIZER has taken all other action required by law,
its certificate of incorporation, by-laws or any agreement to which it is a
party or to which it may be subject, required to authorize such execution,
delivery and performance. Assuming due authorization, execution and
delivery on the part of WARNER-LAMBERT, this Agreement constitutes a legal,
valid and binding obligation of PFIZER, enforceable against PFIZER in
accordance with its terms, except as the enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization or other
similar laws of general application relating to creditors' rights.
(b) As of the date hereof, the execution and delivery of
this Agreement by PFIZER and the performance by PFIZER contemplated
hereunder will not violate any Laws or any order of any court or other
Governmental or Regulatory Authority.
(c) As of the date hereof, neither the execution and
delivery of this Agreement nor the performance hereof by PFIZER requires
PFIZER to obtain any permits, authorizations or consents from any
Governmental or Regulatory Authority or from any other Person, and such
execution, delivery and performance will not result in the breach of or
give rise to any termination of any agreement or contract to which PFIZER
may be a party.
(d) As of the date hereof, there are no actions, suits,
proceedings or claims, pending against PFIZER or any of its Affiliates, or,
to the knowledge of PFIZER, threatened against PFIZER or any of its
Affiliates, at law or in equity, or before or by any court or Governmental
or Regulatory Authority relating to any of the matters contemplated under
this Agreement. To the knowledge of PFIZER, there are no investigations,
pending or threatened against PFIZER or any of its Affiliates, at law or in
equity, or before or by any Governmental or Regulatory Authority relating
to the matters contemplated under this Agreement or which would otherwise
materially adversely affect PFIZER's ability to perform its obligations
hereunder.
(e) PFIZER covenants that during the Term of this Agreement
it shall carry out the detailing, promotion and marketing of the Products
and its other obligations or activities hereunder in accordance with (i)
the terms of this Agreement, (ii) accepted pharmaceutical industry
practices and (iii) all applicable Laws.
(f) PFIZER acknowledges that WARNER-LAMBERT is relying, and
is entitled to rely, on the foregoing representations, warranties and
covenants.
SECTION 11.03. Indemnification of PFIZER.
(a) WARNER-LAMBERT shall indemnify, defend and hold PFIZER
PARTIES (as hereinafter defined) harmless from and against any and all
Losses incurred, suffered or sustained by PFIZER PARTIES or to which PFIZER
PARTIES become subject, arising out of or resulting from: (i) any third
party claims, actions, suits, proceedings, liabilities or obligations
arising from (a) any misrepresentation or breach of any representation,
warranty or agreement made by WARNER-LAMBERT in this Agreement, (b) any act
or omission of negligence, recklessness or willful misconduct of
WARNER-LAMBERT (including, without limitation, any violation of the FD&C
Act) or (c) the testing, manufacture, distribution, use or sale of the
Products (including, without limitation, any claim for death or bodily
injury or patent or trademark infringement); and (ii) any claim for
indemnification by PFIZER which is wrongfully disputed by WARNER-LAMBERT.
For purposes of this Section 11.03 PFIZER PARTIES means PFIZER and its
Affiliates and their respective agents, directors, officers and employees.
(b) The indemnity in Section 11.03(a) shall not apply to
the extent that any Loss is primarily the result of any breach of this
Agreement by PFIZER or of any act or omission of negligence, recklessness
or willful misconduct of PFIZER PARTIES.
SECTION 11.04. Indemnification of WARNER-LAMBERT.
(a) PFIZER shall indemnify, defend and hold WARNER-LAMBERT
PARTIES (as hereinafter defined) harmless from and against any and all
Losses incurred, suffered or sustained by WARNER-LAMBERT PARTIES or to
which WARNER-LAMBERT PARTIES become subject, arising out of or resulting
from: (i) any third party claims, actions, suits, proceedings, liabilities
or obligations arising from (a) any misrepresentation or breach of any
representation, warranty or agreement made by PFIZER in this Agreement or
(b) any act or omission of negligence, recklessness or willful misconduct
of PFIZER (including, without limitation, any violation of the FD&C Act);
and (ii) any claim for indemnification by WARNER-LAMBERT which is
wrongfully disputed by PFIZER. For purposes of this Section 11.04
WARNER-LAMBERT PARTIES means WARNER-LAMBERT and its Affiliates and their
respective agents, directors, officers and employees.
(b) The indemnity in Section 11.04(a) shall not apply to
the extent that any Loss is primarily the result of any breach of this
Agreement by WARNER-LAMBERT or of any act or omission of negligence,
recklessness or willful misconduct of WARNER-LAMBERT PARTIES.
SECTION 11.05. Procedures. In the event any third party asserts
any claim in respect to any matter to which the indemnification in Sections
11.03 or 11.04 relates, the party against whom the claim is asserted (the
"Indemnified Party") shall not make any admission concerning such claim,
but shall promptly notify the other party (the "Indemnifying Party"), of
the claim, and the Indemnifying Party shall be entitled, but not obliged,
to manage and control, at its sole expense, the defense of the claim and
its settlement. The benefit of any indemnity by the Indemnifying Party
under this Agreement in respect of any claim shall not apply to the
Indemnified Party if any admission made by such party or any failure by
such party to notify the Indemnifying Party of the claim materially
prejudices the defense of such claim. If the Indemnifying Party elects to
defend such claim, it shall give prompt notice to the Indemnified Party. If
the Indemnifying Party does not give such notice and does not proceed
diligently to defend the Indemnified Party within twenty (20) days after
receipt of notice of the claim, the Indemnifying Party shall be bound by
any defense or settlement made by the Indemnified Party and shall reimburse
the Indemnified Party for its Losses and expenses related to the defense or
settlement of the third party claim. If the Indemnifying Party elects to
defend the claim and gives notice to the Indemnified Party and proceeds
diligently to defend the Indemnified Party, then the Indemnified Party
shall not settle any claim for which it is seeking indemnification without
the prior consent of the Indemnifying Party. The Indemnified Party shall,
if requested by the Indemnifying Party, cooperate in all reasonable
respects in the defense of such a third party claim which is being managed
and controlled by the Indemnifying Party. The Indemnified Party may, at its
option and expense, be represented by counsel of its own choice in any
action or proceeding arising out of such claim; provided, however, the
Indemnifying Party shall not be liable for any litigation costs or expenses
incurred, without its consent, by the Indemnified Party where such action
or proceeding is under the control and management of the Indemnifying
Party.
SECTION 11.06. Insurance Proceeds. Any indemnification
hereunder shall be made net of any insurance proceeds recovered by the
Indemnified Party; provided, however, that if, following the payment to the
Indemnified Party of any amount under this Article XI, such Indemnified
Party recovers any insurance proceeds in respect of the claim for which
such indemnification payment was made, the Indemnified Party shall promptly
pay an amount equal to the amount of such proceeds (but not exceeding the
amount of such indemnification payment) to the Indemnifying Party.
SECTION 11.07. Survival. The provisions of this Article XI
shall survive the expiration or termination of this Agreement.
ARTICLE XII
PATENT AND TRADEMARK INFRINGEMENT
SECTION 12.01. Prosecution and Maintenance of Patents.
WARNER-LAMBERT shall make adequate filings for, and prosecute and maintain,
all Patents and related applications in the Territory unless WARNER-LAMBERT
reasonably believes that any such Patent or related application is not
material to the matters contemplated in this Agreement. WARNER-LAMBERT
shall consult with PFIZER prior to abandoning any Patents or related
applications that are material to the matters contemplated in this
Agreement. At PFIZER's reasonable request WARNER-LAMBERT shall advise
PFIZER of the status of pending applications, shall provide PFIZER with
copies of documentation concerning such applications and shall consult with
PFIZER before taking any action materially affecting the scope of patent
coverage relating to Products. WARNER-LAMBERT shall file all applications
and take any other actions necessary to obtain patent extensions and
supplementary protection certificates for Patents where available in the
Territory unless WARNER-LAMBERT reasonably believes that any such Patent or
application is not material to the matters contemplated in this Agreement.
SECTION 12.02. Patent Infringement.
(a) In the event any infringement action shall be brought
within the Territory against PFIZER or any of its Affiliates because of the
manufacture, use or sale of Products, PFIZER shall promptly notify
WARNER-LAMBERT. WARNER-LAMBERT shall, at its sole expense, assume the
defense of such action, and PFIZER shall be fully indemnified on account of
such action subject to the terms of Article XI.
(b) If any third party shall, in the reasonable opinion of
either party, infringe any of the Patents, such party shall promptly notify
the other party.
(c) If any third party shall infringe any of the Patents in
connection with either the manufacture, use or sale of a product in the
Territory that has a Material Adverse Effect (as hereinafter defined) on
the Products, WARNER-LAMBERT shall bring suit and take such other action as
it may determine is reasonably necessary to enjoin, prohibit, or retard
such infringement. PFIZER shall, at WARNER-LAMBERT's request, cooperate in
such suits or actions. Any monetary recovery in connection with such
infringement action shall first be applied to reimburse WARNER-LAMBERT and
to the extent requested by WARNER-LAMBERT, PFIZER, for their out-of-pocket
expenses (including reasonable attorneys' fees) in prosecuting such
infringement, and WARNER-LAMBERT shall be entitled to the balance of such
recovery. If such recovery is less than such out-of-pocket expenses,
reimbursement shall be on a pro-rata basis. In the event of such a Material
Adverse Effect, the Agreement Year in which such infringement occurred
shall be extended by the number of days during which such infringement
resulted in a Material Adverse Effect on Net Sales in the Territory. For
purposes of this Section 12.02(c), "Material Adverse Effect" shall be
deemed to occur if sales in the Territory of infringing products by such
infringing party equal at least ten percent (10%) of Net Sales in such
Agreement Year. If WARNER-LAMBERT fails to obtain a discontinuance of said
infringement and/or elects not to bring suit against such third party
infringer, WARNER-LAMBERT will give notice to PFIZER of its election not to
bring suit within ten (10) days of such election. PFIZER may, at its
option, (i) obtain a discontinuance of the alleged infringement or (ii)
bring suit against such third party within six (6) months of the date of
receipt by PFIZER of the aforesaid notice. Any suit by PFIZER will be
either in the name of PFIZER or in the name of WARNER-LAMBERT, or jointly
by WARNER-LAMBERT and PFIZER, as may be required by Law. For this purpose,
WARNER-LAMBERT will execute such legal papers necessary for the prosecution
of such suit as may be reasonably requested by PFIZER. If PFIZER does bring
such a suit or action, it shall bear all costs and expenses associated
therewith and will be entitled to keep any and all recoveries.
(d) If any third party shall infringe any of the Patents
and such infringement does not result in a Material Adverse Effect,
WARNER-LAMBERT shall have sole discretion whether or not to bring suit to
enjoin, prohibit, or retard such infringement. WARNER-LAMBERT shall be
solely responsible for all out-of-pocket expenses incurred in connection
with such infringement suits and shall have sole rights to any recoveries
made thereunder. PFIZER shall, at WARNER-LAMBERT's request, cooperate in
such suits or actions.
SECTION 12.03. Trademarks. (a) WARNER-LAMBERT agrees to pursue
and maintain the Trademark and all of its relevant copyrights relating to
the Products in the Territory. WARNER-LAMBERT and PFIZER shall each advise
the other promptly upon its becoming aware of any infringement by a third
party of the Trademark.
(b) WARNER-LAMBERT and its Affiliates shall have sole
discretion to decide what if any action should be taken in relation to such
infringement. PFIZER shall cooperate fully with, and as reasonably
requested by, WARNER-LAMBERT, at WARNER-LAMBERT's expense, in any
investigation or action taken by WARNER-LAMBERT or any of its Affiliates in
respect of such infringement. Any sums obtained as a result of any such
suit or proceeding, whether by judgment, award, decree or settlement, shall
be the property of WARNER-LAMBERT or its Affiliate and PFIZER shall not
under any circumstances be entitled to any share of the same.
ARTICLE XIII
RECORDS
SECTION 13.01. Detail Records. Both parties shall keep accurate
and complete records of each Detail carried out by it under this Agreement
and shall make such records available for inspection, review and audit by
an independent certified public accountant appointed by the other party and
reasonably acceptable to such party for the purpose of verifying the number
of Details made by such party. All costs and expenses incurred in
connection with performing any such audit shall be paid by the party
performing such audit. Such accountants shall not reveal to the party
seeking verification the details of its review, except for such information
as is required to be disclosed under this Agreement, and shall be subject
to confidentiality obligations consistent with the provisions of Article X.
SECTION 13.02. Financial Records. WARNER-LAMBERT shall keep
such records of Net Sales and Product Expenses as are necessary to
determine accurately under generally accepted accounting principles the
sums due to PFIZER and WARNER-LAMBERT under this Agreement. PFIZER shall
keep such records of its Product Expenses as are necessary to determine
accurately under generally accepted accounting principles the sums due to
PFIZER and WARNER-LAMBERT under this Agreement. Such records shall be
retained by each party (in such capacity, the "Recording Party") and shall
be made available for inspection, review and audit, at any time during the
applicable Agreement Year and for three (3) years thereafter, at the
request and expense of the other party, by an independent certified public
accountant appointed by such other party and reasonably acceptable to the
Recording Party for the sole purpose of verifying the Recording Party's
accounting reports and payments made or to be made pursuant to this
Agreement, provided that such audits may not be performed by either party
more than once per Agreement Year. Such accountants shall not reveal to the
party seeking verification the details of its review, except for such
information as is required to be disclosed under this Agreement, and shall
be subject to confidentiality obligations consistent with the provisions of
Article X.
SECTION 13.03. Retaining of Records. The documents from which
were calculated (i) the sums due under Article III and (ii) the number of
Details as set forth in the written reports delivered in accordance with
Section 2.02 shall be retained by WARNER-LAMBERT or PFIZER (whichever is
relevant) during the Term of this Agreement and for three (3) years
thereafter.
ARTICLE XIV
TERM AND TERMINATION
SECTION 14.01. Term. Unless otherwise mutually agreed to by the
parties, this Agreement shall expire on the last day of Agreement Year Ten.
SECTION 14.02. Termination of Co-Promotion Rights.
WARNER-LAMBERT shall have the right to terminate PFIZER's co-promotion
rights, granted under Section 2.01, as follows:
(a) If at any time from the date of this Agreement through
the end of Agreement Year Five a Change of Control of WARNER-LAMBERT shall
occur, WARNER-LAMBERT shall have the right to terminate PFIZER's
co-promotion rights under Section 2.01 as follows: (i) WARNER-LAMBERT shall
give to PFIZER notice of WARNER-LAMBERT's intent to terminate such
co-promotion rights ("Termination Notice A"), (ii) Termination Notice A
shall specify a date for such termination of co-promotion rights which date
shall be not less than twelve (12) months after the date of Termination
Notice A, (iii) in no event shall the date for termination of such
co-promotion rights be earlier than the first day of Agreement Year Four,
and (iv) in all cases the date for termination of such co-promotion rights
shall be on the first day of an Agreement Quarter; and
(b) WARNER-LAMBERT shall have the right, at its sole
discretion, to terminate PFIZER's co-promotion rights under Section 2.01 as
follows: (i) WARNER-LAMBERT shall give to PFIZER notice of WARNER-LAMBERT's
intent to terminate such co-promotion rights ("Termination Notice B"), (ii)
Termination Notice B shall specify a date for such termination of
co-promotion rights which date shall be not less than twelve (12) months
after the date of Termination Notice B, (iii) in no event shall the date
for termination of such co-promotion rights be earlier than the first day
of Agreement Year Six, and (iv) in all cases the date for termination of
such co-promotion rights shall be on the first day of an Agreement Quarter;
and
(c) If Net Sales during Agreement Year Four are less than
sixty-five percent (65%) of the Baseline Sales for Agreement Year Four,
WARNER-LAMBERT shall have the right, at its sole discretion, to terminate
PFIZER's co-promotion rights under Section 2.01 as follows: (i)
WARNER-LAMBERT shall give to PFIZER notice of WARNER-LAMBERT's intent to
terminate such co-promotion rights ("Termination Notice C") which Notice
shall be given on or before the date which is the commencement of the third
Agreement Quarter of Agreement Year Five, and (ii) Termination Notice C
shall specify the last day of Agreement Year Five as the date for such
termination.
SECTION 14.03. Termination of Agreement.
(a) At any time, upon twelve (12) months' notice to
WARNER-LAMBERT, PFIZER shall have the right, at PFIZER's sole discretion,
to terminate this Agreement (provided the date for termination shall be on
the first day of an Agreement Quarter), and upon such termination, subject
to Section 14.05, PFIZER shall have no further rights to any payments or
compensation from WARNER-LAMBERT.
(b) If either WARNER-LAMBERT or PFIZER materially breaches
or defaults in the performance of any of the provisions of this Agreement,
and such material breach or default is not cured within sixty (60) days
after the giving of notice by the other party specifying such breach or
default, the other party shall have the right to terminate this Agreement
forthwith. For the purposes of this Section 14.03(b), a material breach or
default in the performance of any of the provisions of this Agreement shall
include a material inaccuracy in any representation, warranty or covenant
contained herein.
(c) To the extent permitted by Law, if either
WARNER-LAMBERT or PFIZER shall become insolvent, or shall make or seek
to make or arrange an assignment for the benefit of creditors, or if
proceedings in voluntary or involuntary bankruptcy shall be initiated
by, on behalf of or against such party (and, in the case of any such
involuntary proceeding, not dismissed within ninety (90) days), or if a
receiver or trustee of such party's property shall be appointed and not
discharged within ninety (90) days, the other party shall have the right
to terminate this Agreement forthwith.
(d) Between July 1, 1996 and August 31, 1996, PFIZER shall
have the right to review and audit the NDA submission relating to a
Product. WARNER-LAMBERT shall respond to all reasonable inquiries generated
therefrom. Within ten (10) days of completion of such audit, but no later
than September 10, 1996, PFIZER shall have the right, upon prior notice to
WARNER-LAMBERT, to terminate this Agreement if, as a result of such review
and audit, PFIZER determines that the package insert likely to be approved
by FDA will not be materially equivalent to that provided in Exhibit E-2;
provided that such termination notice shall be effective on or before
September 10, 1996; provided further that all amounts paid by PFIZER on or
before such termination date pursuant to Section 3.01(a)(i) and all Product
Expenses paid by PFIZER on or before such termination date shall be
nonrefundable. If PFIZER has paid the amount set forth in Section
3.01(a)(ii), such amount shall be refunded by WARNER-LAMBERT to PFIZER.
(e) If FDA does not approve an NDA for the Product which
includes a package insert materially equivalent to that provided in Exhibit
E-2, the following provisions shall apply:
(i) Within thirty (30) days after such FDA approval
WARNER-LAMBERT shall notify PFIZER whether
WARNER-LAMBERT is agreeable or not to undertaking, at
WARNER-LAMBERT's sole expense, such additional studies
as may be necessary in order to obtain FDA approval for
the Product with a package insert materially equivalent
to that provided in Exhibit E-2; provided that
WARNER-LAMBERT shall have the right at any time, upon
notice to PFIZER, to cease any further activity with
respect to such additional studies.
(ii) Within thirty (30) days of the giving of notice by
WARNER-LAMBERT pursuant to Section 14.03(e)(i) that it
shall undertake such additional studies, PFIZER shall
have the option, by notice to WARNER-LAMBERT, to either
(x) terminate this Agreement, effective the date of
such notice, or (y) to elect to continue this Agreement
to await the results of the additional studies to be
undertaken by WARNER-LAMBERT and the results of any
additional FDA action or approval regarding the
Product; provided the payment of the $105,000,000 by
PFIZER under Section 3.01(a)(iii) shall only be payable
at such time as FDA shall approve an NDA for a Product
which includes an approved package insert materially
equivalent to that provided in Exhibit E-2; provided
further that all amounts paid by PFIZER pursuant to
Section 3.01(a)(i) and 3.01(a)(ii) and all Product
Expenses paid by PFIZER prior to such notification or
PFIZER's termination of the Agreement shall be
nonrefundable. If WARNER-LAMBERT elects to sell a
Product while conducting further clinical studies in
accordance with Section 14.03(e)(i), PFIZER shall have
no co-promotion rights nor obligations with respect to
such Product until such time as it makes the payment of
$105,000,000 pursuant to Section 3.01(a)(iii). It is
understood that the Launch Date shall not be deemed to
have occurred with respect to a Product unless PFIZER
has exercised its rights to such Product as evidenced
by its payment of $105,000,000 pursuant to this Section
14.03(e).
(iii) Within ninety (90) days of the giving of notice by
WARNER-LAMBERT pursuant to Section 14.03(e)(i) that
(x) it shall not undertake such additional studies, or
(y) it shall permanently cease any further activity
with respect to such additional studies, PFIZER shall
either make the payment of $105,000,000 pursuant to
Section 3.01(a)(iii) or this Agreement shall terminate
forthwith; provided, however, that WARNER-LAMBERT shall
not undertake such additional studies or resume any
further activity with respect to such studies for
a fifteen (15) year period thereafter.
SECTION 14.04. Effects of Termination of Co-Promotion Rights.
(a) Termination by WARNER-LAMBERT under Section 14.02 shall
not release either party from any obligation to pay to the other party any
sums due under Article III in connection with activities completed on or
before the effective date of such termination, but no further sums shall be
payable under Article III except as provided in Sections 14.04 or 14.05.
(b) If PFIZER's co-promotion rights are terminated by
WARNER-LAMBERT pursuant to Sections 14.02(a) or 14.02(b), WARNER-LAMBERT
shall pay to PFIZER seventy-five percent (75%) of the payment(s) PFIZER
would have received pursuant to Article III through the end of Agreement
Year Ten. In computing such amounts there shall be deducted the amounts
PFIZER would have owed WARNER-LAMBERT pursuant to Section 3.01(b) with
respect to the remaining Agreement Years had PFIZER's co-promotion rights
not been terminated; provided that PFIZER shall have no obligations under
Section 3.01(b) to actually pay or incur any Product Expenses after
PFIZER's co-promotion rights are terminated under Sections 14.02(a) or
14.02(b). It is understood that payments for each such remaining Agreement
Year shall be based on the actual Net Sales, Product Expenses and the
Baseline Sales, in each case for such Agreement Year as provided in this
Agreement. Moneys shall be payable in the manner and at such times as set
forth in Sections 3.03 and 3.04 for each Agreement Quarter during such
remaining Agreement Years. In addition, (i) WARNER-LAMBERT shall continue
to comply with all its marketing, detailing, promotional and clinical
obligations under this Agreement as if PFIZER had retained its co-promotion
rights, and (ii) WARNER-LAMBERT (or such other co-promotion partner as
WARNER-LAMBERT shall appoint) shall assume the marketing, detailing,
promotional and clinical obligations that PFIZER would have been
responsible for pursuant to this Agreement had the Agreement not been
terminated, and PFIZER shall have no responsibility therefor.
(c) If PFIZER's co-promotion rights are terminated by
WARNER-LAMBERT pursuant to Section 14.02(c), then, to the extent that the
aggregate payments made by PFIZER pursuant to Sections 3.01(a) and 3.01(b)
are in excess of the aggregate payments made by WARNER-LAMBERT to PFIZER
pursuant to Section 3.02, WARNER-LAMBERT shall pay to PFIZER an amount
equal to one hundred thirty-seven and one-half percent (137.5%) of such
difference. Such amount shall be paid in five (5) equal annual
installments, beginning with the first day of Agreement Year Six. In the
event PFIZER's co-promotion rights are terminated under Section 14.04(c),
neither party shall have continuing obligations regarding supplying,
marketing, promoting, detailing or clinical development of the Products.
Moreover, in no event shall either party have any further obligations under
Article III arising after PFIZER's co-promotion rights have been terminated
under Section 14.02(c).
SECTION 14.05. No Prejudice to Rights. Termination of this
Agreement shall be without prejudice to:
(a) The rights of the parties to any payments due under
Article III to the date of termination; and
(b) Any remedies which either party may then have hereunder
or at law; and
(c) Either party's right to obtain performance of any
obligations provided for in this Agreement which survive termination by
their express terms.
SECTION 14.06. Return of Confidential Information. (a) Subject
to the terms of Section 10.01 and 14.06(b), upon the termination of this
Agreement (or, if earlier, the termination of PFIZER's co-promotion
rights), (i) PFIZER shall within thirty (30) days return to WARNER-LAMBERT
all Samples, Promotional Materials, communications materials, marketing
plans and reports and other tangible WARNER-LAMBERT Confidential
Information provided to PFIZER by or on behalf of WARNER-LAMBERT pursuant
to the terms and intent of this Agreement, and (ii) WARNER-LAMBERT shall
within thirty (30) days return to PFIZER all tangible PFIZER Confidential
Information provided to WARNER-LAMBERT by or on behalf of PFIZER pursuant
to this Agreement.
(b) If PFIZER's co-promotion rights are terminated by
WARNER-LAMBERT pursuant to Section 14.02, then, WARNER-LAMBERT shall
reimburse PFIZER for the Product Expenses incurred by PFIZER pursuant to
Section 3.01(b) with respect to the Samples and Promotional Materials
returned to WARNER-LAMBERT pursuant to Section 14.06(a). This payment shall
be made by WARNER-LAMBERT within sixty (60) days of PFIZER's return of such
Samples in accordance with the terms of Section 14.06(a).
ARTICLE XV
MISCELLANEOUS
SECTION 15.01. Relationship of the Parties. Each party shall
bear its own costs incurred in the performance of its obligations hereunder
without charge or expense to the other except as expressly provided in this
Agreement. Neither party shall have any responsibility for the hiring,
termination or compensation of the other party's employees or for any
employee benefits of such employee. No employee or representative of a
party shall have any authority to bind or obligate the other party to this
Agreement for any sum or in any manner whatsoever, or to create or impose
any contractual or other liability on the other party without said party's
approval. For all purposes, and notwithstanding any other provision of this
Agreement to the contrary, PFIZER's legal relationship under this Agreement
to WARNER-LAMBERT shall be that of independent contractor. Nothing in this
Agreement shall be construed to establish a relationship of co-partners or
joint venturers between the parties.
SECTION 15.02. No Solicitation. The parties agree that during
the Term of this Agreement neither party shall solicit any employee of the
other party, with whom it has come in contact or interacted for the
purposes of the performance of this Agreement, to leave the employment of
the other party and accept employment with the first party.
SECTION 15.03. Force Majeure. The occurrence of an event which
materially interferes with the ability of a party to perform its
obligations or duties hereunder which is not within the reasonable control
of the party affected, not due to malfeasance, and which could not with the
exercise of due diligence have been avoided ("Force Majeure"), including,
but not limited to, fire, accident, labor difficulty, strike, riot, civil
commotion, act of God, delay or errors by shipping companies or change in
Law, shall not excuse such party from the performance of its obligations or
duties under this Agreement, but shall merely suspend such performance
during the continuation of Force Majeure. The party prevented from
performing its obligations or duties because of Force Majeure shall
promptly notify the other party hereto (the "Other Party") of the
occurrence and particulars of such Force Majeure and shall provide the
Other Party, from time to time, with its best estimate of the duration of
such Force Majeure and with notice of the termination thereof. The party so
affected shall use reasonable efforts to avoid or remove such causes of
nonperformance. Upon termination of Force Majeure, the performance of any
suspended obligation or duty shall promptly recommence. Neither party shall
be liable to the Other Party for any direct, indirect, consequential,
incidental, special, punitive, exemplary or other damages arising out of or
relating to the suspension or termination of any of its obligations or
duties under this Agreement by reason of the occurrence of Force Majeure.
SECTION 15.04. Confidentiality; Public Announcements.
(a) Each party shall keep the terms of this Agreement
confidential and shall not disclose the same to any third party other than
(i) by agreement of the parties hereto, or (ii) as required by Law or stock
exchange regulation or an order of a competent court; provided that prior
to disclosure pursuant to (ii) above, the disclosing party shall notify the
nondisclosing party sufficiently prior to making such disclosure so as to
allow the nondisclosing party adequate time to take whatever action it may
deem to be appropriate to protect the confidentiality of the information.
(b) Neither party shall make any press release or other
public announcement or other disclosure to third parties relating to this
Agreement without the prior consent of the other party, which consent shall
not be unreasonably withheld, except where required by applicable Law;
provided that prior to disclosure, the disclosing party shall notify the
nondisclosing party sufficiently prior to making such disclosure so as to
allow the nondisclosing party adequate time to take whatever action it may
deem to be appropriate to protect the confidentiality of the information.
SECTION 15.05. Limitation on Liability. Notwithstanding
anything to the contrary contained elsewhere in this Agreement, (but
subject to this Section 15.05), neither party shall be liable to the other
for Losses constituting incidental, indirect or consequential damages for a
cumulative aggregate amount in excess of $50,000,000; provided, however,
notwithstanding the foregoing, each party shall have the right to recover
(and the foregoing limitations contained in this Section 15.05 shall not
apply to): (i) all amounts for which the other party is obligated to pay
pursuant to Article III or Section 14.04 in the event of (x) a breach by
WARNER-LAMBERT of its obligations to make payments pursuant to Section
14.04, or (y) a breach by the other party of its respective obligations to
make payments pursuant to Article III; or (ii) all Losses relating to a
breach by the other party of its respective obligations under Section 11.03
(in the case of WARNER-LAMBERT) or Section 11.04 (in the case of PFIZER)
involving, in any case, the commencement of or assertion of any claim,
action, suit or proceeding by a third party in respect of which indemnity
may be sought under Section 11.03 or Section 11.04, as applicable. It is
agreed that in the event of a breach of this Agreement by WARNER-LAMBERT,
the difference (in no event less than zero), if any between (I) amounts
previously paid to WARNER-LAMBERT by PFIZER pursuant to Section 3.01(a) and
expenses for which PFIZER is responsible pursuant to Section 3.01(b),
together with all internal costs and expenses incurred by PFIZER in
connection with, or in support of, its performance of its obligations under
this Agreement (such as, for example, clinical, marketing, promotional and
field force costs and expenses) and (II) amounts previously paid to PFIZER
pursuant to Sections 3.02 and 14.04, will not be considered as constituting
incidental, indirect or consequential damages.
SECTION 15.06. Choice of Law. This Agreement shall be governed
by and construed in accordance with the law of the State of New York other
than those provisions governing conflicts of law. Each party hereby
irrevocably and unconditionally submits for itself and its property in any
legal action or proceeding relating to or arising out of this Agreement, or
any of the transactions contemplated hereby, to the non-exclusive general
jurisdiction of the Courts of the State of New York, the courts of the
United States of America for the Southern District of New York, and
appellate courts from any thereof, and agrees that any such action or
proceeding may be brought in such courts.
SECTION 15.07. Assignment. This Agreement may not be assigned
by either party without the prior consent of the other party; provided that
each party shall have the right to assign its rights and obligations under
this Agreement to (a) any third party successor to all or substantially all
of (i) its entire business or (ii) its pharmaceutical business or (b) its
Affiliate or Affiliates who shall be substituted directly in whole or in
part for it hereunder; provided however, that the assignor shall be
responsible for the performance of its Affiliate assignee(s) hereunder.
This Agreement shall be binding upon, and subject to the terms of the
foregoing sentence, inure to the benefit of the parties hereto, their
successors, legal representatives and assigns.
SECTION 15.08. Notices. All demands, notices, consents,
approvals, reports, requests and other communications hereunder must be in
writing and will be deemed to have been duly given only if delivered
personally or by facsimile transmission or by mail (first class, postage
prepaid) to the parties at the following addresses or facsimile numbers:
WARNER-LAMBERT:
Warner-Lambert Company
201 Tabor Road
Morris Plains, New Jersey 07950
Attention: President, Pharmaceutical Sector
Facsimile No. 201-540-4009
with a copy to: Vice President and General Counsel
Facsimile No. (201) 540-3927
PFIZER:
Pfizer Inc.
235 East 42nd Street
New York, New York 10017-5755
Attention: President, U.S. Pharmaceutical Group
Facsimile No. (212) 808-8652
with a copy to: Senior Vice President and General Counsel
Facsimile No. (212) 808-8924
or to such other address as the addressee shall have last furnished in
writing in accord with this provision to the addressor.
SECTION 15.09. Invalid Provisions. If any provision of this
Agreement is held to be illegal, invalid or unenforceable under any
applicable present or future Law, and if the rights or obligations of
either party hereto under this Agreement will not be materially and
adversely affected thereby, (i) such provision will be fully severable,
(ii) this Agreement will be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof, (iii)
the remaining provisions of this Agreement will remain in full force and
effect and will not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom and (iv) in lieu of such illegal,
invalid or unenforceable provision, there will be added automatically as a
part of this Agreement, a legal, valid and enforceable provision as similar
in terms to such illegal, invalid or unenforceable provision as may be
possible.
SECTION 15.10. Headings. The headings used in this Agreement
have been inserted for convenience of reference only and do not define or
limit the provisions hereof.
SECTION 15.11. Waiver. Any term or condition of this Agreement
may be waived at any time by the party that is entitled to the benefit
thereof, but no such waiver shall be effective unless set forth in a
written instrument duly executed by or on behalf of the party or parties
waiving such term or condition. No waiver by any party of any term or
condition of this Agreement, in any one or more instances, shall be deemed
to be or construed as a waiver of the same or any other term or condition
of this Agreement on any future occasion. All remedies, either under this
Agreement or by Law or otherwise afforded, will be cumulative and not
alternative.
SECTION 15.12. Entire Agreement. This Agreement (including
Exhibits A through L hereto), together with the Confidential Disclosure
Agreement, dated March 4, 1996, between WARNER-LAMBERT and PFIZER (the
"Confidential Disclosure Agreement"), constitutes the entire agreement
between the parties hereto with respect to the within subject matter and
supersedes all previous agreements, whether written or oral. It is agreed
that (i) Article X of this Agreement shall govern the protection of
Confidential Information disclosed prior to or pursuant to this Agreement
and (ii) the matters referred to in Paragraph 8 and Attachment A of the
Confidential Disclosure Agreement shall remain in full force and effect
pursuant to the terms thereof. This Agreement may be altered, amended or
changed only by a writing making specific reference to this Agreement and
signed by duly authorized representatives of WARNER-LAMBERT and PFIZER.
SECTION 15.13. No License. Nothing in this Agreement shall be
deemed to constitute the grant of any license or other right in either
party to or in respect of any product, patent, trademark, Confidential
Information, trade secret or other data or any other intellectual property
of the other party except as expressly set forth herein.
SECTION 15.14. Third Party Beneficiaries. None of the
provisions of this Agreement shall be for the benefit of or enforceable by
any third party, including, without limitation, any creditor of either
party hereto. No such third party shall obtain any right under any
provision of this Agreement or shall by reasons of any such provision make
any claim in respect of any debt, liability or obligation (or otherwise)
against either party hereto.
SECTION 15.15. Independent Agreements. WARNER-LAMBERT and
PFIZER have, as of the date hereof, entered into an option Agreement (the
"Option Agreement") under which PFIZER grants to WARNER-LAMBERT an option
to negotiate and possibly to acquire in the future certain co-promotion and
other rights to a PFIZER compound. The Option Agreement contemplates that
the parties will in the future negotiate and, if such negotiations are
successful, enter into additional agreements regarding such PFIZER
compound. It is recognized that the parties may fail to reach any future
agreement or agreements contemplated under the Option Agreement, or the
Option Agreement may terminate, or disputes may arise under the Option
Agreement or in connection with any transactions contemplated thereunder,
or WARNER-LAMBERT may not acquire or be granted any rights to any PFIZER
compound under the Option Agreement. WARNER-LAMBERT acknowledges under any
of the foregoing circumstances it shall have no claim whatsoever against
PFIZER under this Agreement which shall remain in full force and effect
according to its terms.
SECTION 15.16. Counterparts. This Agreement may be executed in
any two or more counterparts, each of which, when executed, shall be deemed
to be an original and all of which together shall constitute one and the
same document.
IN WITNESS WHEREOF, WARNER-LAMBERT and PFIZER, by their duly
authorized officers, have executed this Agreement as of the date first
written above.
WARNER-LAMBERT COMPANY PFIZER INC.
/s/ Lodewijk J.R. de Vink /s/ Karen L. Katen
----------------------------- --------------------------------
Lodewijk J.R. de Vink Karen L. Katen
President and Chief Operating Vice President
Officer