Exhibit 10.5(g)
[GRAPHIC OMITTED]
Cephalon, Inc.
145 Brandywine Parkway
West Chester, PA 19830-4245
August 23, 1995 (610) 344-0200
Fax (610) 344-0065
Laboratoire L. Lafon
19 Avenue du Professeur-Cadiot
94701 Maisons-Alfort
France
Re: Amendment No. 4 to License Agreement and Supply Agreement
---------------------------------------------------------
Gentlemen:
This letter agreement shall serve as an amendment to (i) the License
Agreement dated January 20, 1993, as amended prior to the date hereof (the
"License Agreement") between Cephalon, Inc. ("Cephalon") and Laboratoire L.
Lafon ("Lafon") and (ii) the Supply Agreement dated January 20, 1993, as amended
prior to the date hereof (the "Supply Agreement") between Cephalon and Lafon.
1. All capitalized terms not otherwise defined herein shall be used as
defined in the License Agreement.
2. The term "Territory," for all purposes under the License Agreement and
the Supply Agreement is hereby expanded to include Japan.
3. Appendix A to the License Agreement is hereby amended to add the
following patents and patent applications related to Licensed Products
and/or the Compound, as filed in Japan as of the date hereof (each of
which shall be included in the definition of "Patents"):
Application Date Application Number Date of Issuance Patent Number
- ---------------- ------------------ ---------------- -------------
29/03/78 35.406 28/09/87 1.400.453
14/06/91 3.143.267 [neuroprotector; Parkinson's]
14/12/92 4.332.897 [anti-ischemic agent]
4. In consideration of the expansion of the Territory, Cephalon shall pay
to Lafon, the following non-refundable license fees totalling Two
Million, Five Hundred Thousand US Dollars (USD 2,500,000)
a. Five hundred thousand US dollars (USD 500,000), payable upon
Lafon's signature of this letter agreement;
Laboratoire L. Lafon
Amendment No. 4
August 23, 1995
Page 2
b. Five hundred thousand US dollars (USD 500,000), payable on the
first anniversary of the date of this letter agreement;
c. One million US dollars (USD 1,000,000), payable upon the initial
marketing approval of an NDA equivalent in Japan for a Licensed
Product, including any related pricing approvals needed to market
the Licensed Product; and
d. Five hundred thousand US dollars (USD 500,000), payable upon the
first commercial sale of a Licensed Product in Japan.
5. Lafon agrees and acknowledges that Cephalon is authorized to enter
into an agreement with a company in Japan as Cephalon's sublicensee to
develop and commercialize Licensed Product in Japan, subject to the
prior approval of Lafon, which shall not be unreasonably withheld, and
subject to the other sublicensing provisions of Article II of the
License Agreement. Cephalon agrees and acknowledges that Cephalon's
rights to develop and commercialize Licensed Product in Japan under
this Amendment No. 4 are subject to termination by Lafon, upon 30 days
notice in writing, if Cephalon has failed to make such an arrangement
in Japan by the second anniversary of the execution of this Amendment
No. 4. In the event of such termination, Japan shall automatically be
deleted from the definition of "Territory," and the Patents and Patent
Applications referred to in paragraph 3 shall be deleted from Annex A.
In its discussions with a potential Japanese sublicensee, Cephalon
shall use its best efforts to have the candidate identify possible
product opportunities for Lafon in France. Cephalon will advise Lafon
of any such opportunities and Lafon and Cephalon will determine an
appropriate way to handle the negotiations for the product opportunity
separate from the sublicensing discussions and in a manner that does
not impair the modafinil sublicensing discussions. However, Lafon
acknowledges that there can be no assurance that a Japanese company
will have a product opportunity suitable for Lafon in France, and that
the availability of such an opportunity is not a condition to
Cephalon's right to sublicense its rights in Japan.
6. In case a sublicensing agreement is signed by Cephalon with a company
in Japan, the rate of royalty applicable to Japan according to Article
V(2) of the License Agreement and the price applicable under Article
3(b) of the Supply Agreement to the supply of Compound by Lafon for
use in Japan shall be established by Lafon and Cephalon in a separate
written amendment, in accordance with the relevant
Laboratoire L. Lafon
Amendment No. 4
August 23, 1995
Page 3
laws and regulations of the countries concerned, with the purpose of
minimizing withholding taxes and other tax liabilities of the parties.
However, the total compensation payable by Cephalon to Lafon as a
royalty under the License Agreement on Net Sales in Japan and for the
purchase of Compound from Lafon for use in Japan shall be established
based on the amount of compensation received by Cephalon from the
sublicensee, according to the following table:
% of Net Sales in % of Net Sales in
Japan paid by Japan by
Sublicensee to Sublicensee to
Cephalon Lafon
-------- -----
25 12.0
26 12.2
27 12.4
28 12.6
29 12.8
30 12.0
31 13.5
32 14.0
33 14.6
34 15.0
35 15.5
If Cephalon is unable to obtain compensation from a sublicensee of at
least 25% of Net Sales of Licensed Product in Japan, Cephalon and
Lafon shall negotiate in good faith to determine a fair allocation
between Cephalon and Lafon of the compensation from the Japanese
company. However, Lafon shall not be obligated to accept less than
12.0% of Net Sales in Japan, nor shall Cephalon be obligated to accept
compensation from the sublicensee of less than 25% of Net Sales.
The second paragraph of Article III, Section 3.b and Article III,
Section 3.c of the License Agreement shall not apply to this Amendment
No. 4. Instead, Cephalon will consult with and will keep Lafon advised
about the appropriate schedule for regulatory filings in Japan with
respect to a Licensed Product, to ensure prompt commercialization of
Licensed Products in a commercially reasonable manner, taking into
account the possible therapeutic indications and related regulatory
requirements in Japan applicable to preclinical and clinical trials.
Laboratoire L. Lafon
Amendment No. 4
August 23, 1995
Page 4
7. (a) Concerning U.S. Patent Application Serial No. 08/319,124 (the
"Cephalon Application"), Cephalon is hereby authorized to file
counterparts of such Application in all countries within its
Territory; in addition, Cephalon may file such Application in
other countries outside the Territory, at its own cost and
expense.
(b) Cephalon hereby grants to Lafon a non-exclusive, fully-paid
license, with the right to sublicense, to any and all
applications and patents resulting therefrom which are
counterparts of the Cephalon Application, and which are filed in
countries outside Cephalon's Territory to make, have made, use
and sell Compounds and Licensed Products in all countries outside
of Cephalon's Territory. Lafon's license hereunder shall survive
the expiration of the License Agreement by its terms and any
proper termination of the License Agreement by either party.
(c) Article VII, paragraph 6, is hereby amended to read in its
entirety as follows:
"CEPHALON and LAFON will advise each other periodically of any
Improvements made by either party patentable or not, and CEPHALON
and LAFON agree to grant the other party authorization to use
such Improvements at no cost on a nonexclusive basis. The
licensees or sublicensees of a party shall be authorized to use
an Improvement of the other party in their respective territory
or territories (but not in the territory of the party who made
the Improvement) if the licensee or sublicensee has agreed to
reciprocity with respect to its own Improvements. Notwithstanding
the foregoing, the term "Improvements" shall not include
preclinical and clinical study data related to the Compound,
which shall be governed by the separate provisions of this
Agreement related to such data.
8. A difference has appeared between the parties concerning the
construction of the License Agreement regarding communication of the
reports on Cephalon's studies, Cephalon considering that it has no
obligation to communicate to Lafon such reports and Lafon considering
that communication of such reports is required by Cephalon under the
License Agreement. Both parties standing on their positions, the
following compromise is hereby agreed and accepted by both parties:
(a) Each party shall supply the other party, from time to time and at
least semiannually, with interim progress reports concerning
any program or study
Laboratoire L. Lafon
Amendment No. 4
August 23, 1995
Page 5
which is performed by such party (or its licensees or
sublicensees) relating to the Licensed Product, including but not
limited to, chemical, biological, physical, pharmacological and
toxicological studies, animal and clinical studies, data and
know-how concerning the manufacture of Licensed Products. The
corresponding detailed final reports and, if requested by a
party, the corresponding raw data will be supplied to the
requesting party, promptly upon completion. Each party shall
submit to the other, before initiating a study after the date of
this Amendment No. 4, a copy of the protocol of each clinical
study to be performed. Lafon shall have the right to review and
approve a protocol of Cephalon to determine that in its
reasonable opinion it is not detrimental to the commercialization
of the Compound, but Lafon shall not unreasonably withhold its
approval of such protocol. Each party is hereby authorized to
freely use such information and reports supplied by the other
party, either directly or through its licensees or sublicensees,
in its respective jurisdictions, subject to the confidentiality
provisions of the License Agreement and except as provided in
clause (d) below.
(b) Without prejudice to the generality of the foregoing, Cephalon
will deliver to Lafon final reports of the studies designated
C103 and C107 by September 30, 1995 (or such later time
designated by Lafon as shall be sufficient for Lafon to include
such reports in a response to the CPMP), excluding any delays
caused by events outside of Cephalon's control. Cephalon also
shall provide the final reports of the studies designated C201
and C109 is soon as commercially practicable after September 30,
1995 (currently the delivery date for both studies is estimated
to be in mid-October 1995) as well as the final reports for the
studies designated C301 and C302 (currently the delivery date for
C301 is estimated to be in the 1st quarter of 1996). Cephalon
also will furnish Lafon with copies of all protocols related to
clinical studies conducted by Cephalon prior to the date hereof.
(c) The same provisions as are included in paragraph (a) above shall
apply to all programs and studies that are performed by any
sublicensee of Cephalon or Lafon, including any sublicensee of
Cephalon in Japan.
(d) Concerning all clinical programs and studies concerning
indications of any Licensed Product (other than the treatment of
narcolepsy and idiopathic hypersomnia) initiated after the date
of this Amendment No. 4. Cephalon will notify Lafon as promptly
as practicable of any such clinical study or