Exhibit 10.14
MANUFACTURING AGREEMENT
by and between
NPS ALLELIX CORP.
and
SYNCO BIO PARTNERS B.V.
THIS MANUFACTURING AGREEMENT (the "Agreement") is made and entered into June 12,
2001 ("Effective Date"), by and between:
NPS ALLELIX Corp. ("NPS"), with its principal place of business at 6850 Goreway
Drive, Mississauga, Ontario, Canada L4V I V7,
and
SynCo Bio Partners B.V. ("SYNCO"), with its registered offices at Paasheuvelweg
30, 1105 BJ Amsterdam, The Netherlands,
Background
- - NPS has developed the proprietary product ALX1-11, recombinant human
parathyroid hormone ("rhPTH"), and the process to manufacture it and is
currently (or will soon be) in Phase III Clinical Trials with rhPTH
worldwide (including the United States, Canada, Latin America, Europe and
India);
- - SYNCO operates as a biopharmaceutical service provider and has experience
with the manufacture of rhPTH and SYNCO desires to manufacture rhPTH for
NPS in accordance with NPS' requirements in order to facilitate NPS'
Clinical Trials and NPS' early commercial launch of rhPTH after NDA
approval in the U.S. and elsewhere;
- - NPS desires to have SYNCO conduct such manufacturing activities to
facilitate the Clinical Trials and early commercial launch of rhPTH;
- - NPS and SYNCO (the "Parties") have signed a Letter of Intent on December
15, 2000 and Parties now desire to reach a final agreement on the
manufacture of bulk quantities of rhPTH for clinical trials and early
commercial use;
- - The Parties have agreed that SYNCO will manufacture rhPTH subject to the
provisions set forth hereinafter;
NOW, THEREFORE, in consideration of the premises, the mutual covenants, terms
and conditions hereinafter set forth, THE PARTIES AGREE AS FOLLOWS:
ARTICLE 1- DEFINITIONS
For the purpose of this Agreement the following terms shall be defined as:
1.1 "Affiliated Company" means a corporation or other entity which: (a) is
Controlled directly or indirectly by a Party; (b) Controls directly or
indirectly a Party; or (c) is under common Control with a Party. Control
herein means fifty percent (50%) or more of the voting stock or equity, or
other comparable interest.
2
1.2 "Batch" means GMP Grade rhPTH from SYNCO's production thereof in a 1500
liter fermenter as set out in the Specifications and in particular
MF-MFS-PTH-0000/MF-MFS-PTH-2500 (as referenced in Appendix A).
1.3 "Batch Production Records" (BPRs) means completed written records
providing the history of a Batch of rhPTH required to be kept by the
European Guide to Good Manufacturing Practices for Medicinal Products, the
U.S. Code of Federal Regulations, and ICH Guideline Q7A.
1.4 "Campaign" means the manufacture of thirty (30) Batches of rhPTH and any
Excess Batches ordered by NPS pursuant to Article 5.3 in a given calendar
year, namely 2002, 2003 or 2004.
1.5 "Clinical Trials" means the use of the product rhPTH pursuant to any
protocols which have received or do receive FDA approval or approval by
the counterpart European or other Agency during the term of this Agreement
for the purpose of conducting clinical studies to determine the safety,
efficacy or other characteristics of rhPTH.
1.6 "Confidential Information" means any information and data disclosed by
Parties in writing and designated confidential or, if disclosed orally,
confirmed in writing and designated confidential within thirty (30) days
after such disclosure.
1.7 "European GMP" means the current European Guide for Good Manufacturing
Practices for Medicinal Products.
1.8 "Excess Batch" means each Batch manufactured by SYNCO pursuant to Article
5.3 in excess of a Campaign of thirty (30) Batches of rhPTH in a given
year.
1.9 "FDA" means the United States Food and Drug Administration or any
successor agency having similar jurisdiction.
1.10 "GMP Grade" means rhPTH that has been produced in accordance with the
Regulatory Standards and the Specifications.
1.11 "Material" means working cell banks and analytical standards as described
in Appendix B. Appendix B will be updated if SYNCO requires further
Material from NPS pursuant to Article 3.1(i).
1.12 "NDA" means a New Drug Application as defined by the FDA for marketing of
rhPTH.
1.13 "NDA approval" means approval of a New Drug Application by FDA for the
marketing of rhPTH.
1.14 "Parties" and "Party" means SYNCO and NPS and SYNCO or NPS, respectively,
as the context may require.
3
1.15 "Plant" means SYNCO's manufacturing facility which will be used to
manufacture, package and store rhPTH and all required documentation as
provided for in this Agreement and is located at Paasheuvelweg 30, 1105 BJ
Amsterdam, The Netherlands, licensed for manufacturing under number
101972A.
1.16 "Pre-Approval Inspection" means inspection of the Plant by FDA or
corresponding European representatives in conjunction with the filing of
an NDA or corresponding European application which may include among other
things: verifying the accuracy and completeness of the
manufacturing-related information submitted in the NDA or corresponding
European application; evaluating manufacturing controls upon which
information provided in the NDA or corresponding European application is
based; evaluating U.S. cGMP compliance or European GMP compliance; and
collecting samples of GMP Grade rhPTH.
1.17 "Regulatory Standards" means (i) the Plant license requirements, (ii)
European GMP and U.S. cGMP regulations applicable to the manufacturing,
storage and handling of rhPTH at the Plant and (iii) any standards of any
governmental authority that apply to the Plant or SYNCO's manufacturing,
storage and handling of rhPTH.
1.18 "rhPTH" means recombinant human parathyroid hormone (1-84) ALX1-11 as an
active pharmaceutical ingredient (API).
1.19 "Specifications" means all specifications as described in Appendix A,
reference standards, control and test documentation, validation records,
Batch Production Records, deviation reports, quality control, storage,
packaging and labelling specifications and other information related to
rhPTH arising from U.S. cGMP and European GMP and SYNCO's performance
under this Agreement and as approved of by NPS.
1.20 "U.S. cGMP" means current Good Manufacturing Practices as described in the
U.S. Code of Federal Regulations.
1.21 "Yield" means grams of rhPTH bulk drug substance produced per Batch as
indicated in the Batch Production Records approved by SYNCO'S Quality
Assurance pursuant to Article 6.5.
ARTICLE 2 - SCOPE OF THE AGREEMENT
2.1 The scope of this Agreement is to manufacture bulk quantities of rhPTH for
use in Clinical Trials and as early commercial product. Parties
acknowledge that SYNCO is presently not licensed under the United States
Food and Drug Administration as a commercial manufacturer; and NPS has
presently no product licence for rhPTH issued by the United States Food
and Drug Administration or any other regulatory body. In view of this
scope, SYNCO will be responsible for obtaining and complying with those
requirements and licences as set forth in Article 5. In particular, SYNCO
will file and maintain Drug Master Files as required by the U.S. FDA and
European counterpart, to provide NPS necessary and sufficient information
and data to complete Section 7 of an NDA (including the chemistry,
formulation, manufacturing and quality control information) and pass a
Pre-Approval Inspection as required by the U.S. FDA. It is understood that
rhPTH is classified as a 'drug' by the U.S. FDA and that SYNCO is
considered a manufacturer of bulk active pharmaceutical ingredient under
the U.S. FDA Regulations.
4
2.2 Parties agree that the manufacture and delivery of rhPTH under this
Agreement will be performed by SYNCO in two (2) phases:
Phase I: Early Manufacture of rhPTH in 2001
Phase II: Manufacture of rhPTH in three (3) Campaigns in each of 2002,
2003 and 2004
Phase I and Phase II will be conducted in accordance with the timelines
and deliverables set out in Appendix D.
2.3 The following Appendices are attached hereto and are incorporated in and
are deemed to be an integral part of this Agreement.
Appendix A - Specifications
Appendix B - Material
Appendix C - Equipment Owned by NPS
Appendix D - Timelines and Deliverables
ARTICLE 3 - OBLIGATIONS OF THE PARTIES
3.1 Obligations of NPS. NPS shall at NPS' cost:
(i) NPS has provided at the Effective Date of the Agreement a
written description (QC-PCP-PTH-0046) which is the basis of
the Specifications as set out in Appendix A. If NPS desires a
change to the Specifications as set out in Appendix A, it is
NPS' obligation to provide the change in writing to SYNCO and
to negotiate with SYNCO for inclusion of this change into
Appendix A. Such changes are subject to negotiation and
written approval by SYNCO as set out in paragraph 3.2(x).
(ii) Furnish SYNCO, free of charge, with Material in sufficient
quantities, for the sole purpose of use by SYNCO in its
manufacture of rhPTH in Batch quantities in both Phase I and
Phase II. The Material will remain the exclusive property of
NPS. At the Effective Date of the Agreement, NPS has furnished
the Material to SYNCO in sufficient quantities to manufacture
the Batches in Phase I and part of Phase II. NPS shall provide
further Material to SYNCO on a timely basis for Phase II as
required. NPS' Quality Assurance will release all Material and
will supply SYNCO with a Certificate of Analysis based on 5
on-going tests for Viability and Tetracycline according to
QC-SPC-PTH-1547 (to be superseded by an equivalent document
re-written by SYNCO and approved by NPS).
5
(iii) Provide the equipment as set out in Appendix C, which
equipment will remain the property of NPS for the duration of
the Agreement and on termination of this Agreement. At the
Effective Date of the Agreement NPS has provided to SYNCO and
SYNCO has received possession and accepted the condition of
the equipment in Appendix C.
(iv) Accept delivery and perform required testing and evaluation in
a timely manner (other than what SYNCO is responsible for) for
release of each Batch of rhPTH manufactured by SYNCO as set
out in Article 6.6.
(v) Perform in a timely manner its obligations reflected in or to
be reflected in and pursuant to the provisions hereof and of
Appendix D.
(vi) NPS shall review and when acceptable notify SYNCO of NPS'
approval of all documents and changes thereto written by SYNCO
specific for rhPTH production.
(vii) NPS shall retain title in the equipment in Appendix C; the
Material; and Batches which NPS has paid for in full pursuant
to Article 8.2. NPS shall hold appropriate insurance for the
equipment in Appendix C; the Material; and Batches which NPS
has paid for pursuant to Article 8.2.
(viii) NPS is responsible for registering its title under the
appropriate legislation to the equipment in Appendix C and the
Material. NPS is responsible for registering a security
interest in the Batches which NPS has partially paid for
pursuant to Article 8.2.
3.2 Obligations of SYNCO. SYNCO shall be responsible for the activities
identified in this Agreement, in particular as identified in Article
6, and in addition thereto, and more particularly, SYNCO shall:
(i) Not transfer the Material to any third party and, at the
request of NPS, return to NPS any unused quantities of the
Material at the termination of this Agreement.
(ii) Confirm that the Material is satisfactory for the manufacture
of rhPTH. SYNCO will notify NPS prior to production of each
Batch if the Material is not satisfactory and can not be used
for the manufacture of GMP Grade rhPTH in accordance with this
Agreement. SYNCO will maintain records of usage of the
Material, and will inform NPS of needs for additional
quantities or changes in characteristics thereof in a timely
manner.
(iii) Purchase all raw materials required for the manufacture of
rhPTH other than the Material.
6
(iv) Perform quality control and assurance release procedures for
the release of rhPTH in accordance with Article 6.
(v) Provide all other equipment, other than that provided by NPS
as set out in Appendix C, necessary for the manufacture,
testing, storage, release, and delivery of rhPTH in accordance
with this Agreement. All of the equipment, including the
equipment in Appendix C shall be validated and maintained by
SYNCO for the manufacture of rhPTH in accordance with this
Agreement and as provided for in the Specifications. The
equipment in Appendix C will be used only for production of
rhPTH, unless otherwise agreed upon NPS, under this Agreement
and will be returned to NPS by SYNCO within six (6) months
following termination of this Agreement.
(vi) Perform the manufacturing process for the product Batches of
rhPTH as outlined in MF-MFS-PTH-2500 and in accordance with
all other Specifications in Appendix A and the Regulatory
Standards.
(vii) Prepare and maintain the Batch Production Records and related
control, distribution and other records required to comply
with Specifications.
(viii) Perform quality control and assurance review of process raw
materials and in-process materials, and Batches.
(ix) Obtain other materials including consumable materials required
for the conduct of this Agreement.
(x) All documents written by SYNCO specific for rhPTH production
shall be in the English language. Any changes to these
documents shall follow a change of control procedure in
accordance with European GMP and U.S. cGMP. In addition SYNCO
shall provide timely the MF-MFS-PTH-0000 Specification in
Appendix A which will be equivalent to MF-MFS-PTH-2500
Specification. SYNCO shall consider and use best efforts to
come to an agreement with NPS for inclusion of any changes to
Appendix A, as suggested by NPS pursuant to paragraph 3.1(i).
Any change must be approved of in writing by SYNCO.
(xi) Ensure that the manufacture of Batches of rhPTH complies with
all process requirements including quality in-process control
limits of acceptance as found in MF-MFS-PTH-2500 (and as
superseded by MF-MFS-PTH-0000), set out in Appendix A.
7
(xii) Provide and maintain appropriate personnel, facilities,
equipment, the Plant, and support documents to carry out the
manufacture of Batches of GMP Grade rhPTH as required by this
Agreement.
(xiii) Be responsible for all actions and activities at the Plant
required for U.S. cGMP and European GMP compliance.
(xiv) Dispatch all rhPTH to NPS in a timely manner and ensure such
rhPTH and other deliverables are done according to NPS'
instructions during delivery and until received by NPS.
(xv) Store the manufactured rhPTH in compliance with European GMP
and U.S. cGMP until released to NPS at NPS' request.
(xvi) Perform its obligations in a timely manner and pursuant to the
schedule in Appendix D.
(xvii) SYNCO shall co-operate fully with NPS in transferring, among
other things: know-how; equipment; technology; information;
Material; biological material; and documentation at NPS'
request to facilitate the further manufacture of rhPTH at a
third party manufacturing facility.
(xviii) Synco shall retain title in the work-in-progress and to any
Batch which has not yet been paid for in full by NPS pursuant
to Article 8.2. SYNCO shall hold appropriate insurance for the
work-in-progress and Batches for which it retains title.
(xix) SYNCO will co-operate with NPS as reasonably required by NPS
in registering NPS' title under the appropriate legislation to
the equipment in Appendix C and the Material and in
registering NPS' security interest in the Batches which NPS
has partially paid for pursuant to Article 8.2.
ARTICLE 4 - PHASE I: EARLY MANUFACTURE OF rhPTH
4.1 Phase I will comprise the manufacturing of ten (10) Batches of GMP Grade
rhPTH in 2001 by SYNCO in accordance with this Agreement. Phase I will end
when SYNCO has manufactured the ten (10) Batches of GMP Grade rhPTH and
NPS' Quality Assurance has released for clinical use or early commercial
sale these ten (10) Batches pursuant to Article 6.6.
4.2 For each Batch manufactured during Phase I, SYNCO will charge NPS a price
of two hundred and two thousand nine hundred and ninety two (202992) Euro.
4.3 Except as provided for in this paragraph, SYNCO warrants that during Phase
I, Batches of rhPTH will be GMP Grade and SYNCO will assume all
obligations under this Agreement in respect thereto. SYNCO will not
warrant a certain Yield for the ten (10) Batches.
8
4.4 A Future Guaranteed Average Yield will be established by the parties for
Phase II. The Future Guaranteed Average Yield, unless otherwise agreed to
by the parties, shall be:
(i) for Campaign 1, Phase II:
(a) the average of the Yield per Batch over all Batches of rhPTH
manufactured during Phase I and released by NPS and which
Batches are not subject to deviations which NPS believes
affects Yield; or
(b) 40 grams/Batch if (a) is less then 40 grams/Batch;
(ii) for Campaigns 2 and 3, Phase II:
(a) the average of the Yield per Batch over all Batches of rhPTH
manufactured during Phase I and released by NPS and which
Batches are not subject to deviations which NPS believes
affects Yield; or
(b) if requested by NPS, the average of the Yield per Batch over
the first ten (10) Batches manufactured in Campaign 1 of Phase
II in 2002 and released by NPS and which first ten (10)
Batches are not subject to deviations which NPS believes
affects Yield; or
(c) 40 grams/Batch if (a) and (b) are each less then 40
grams/Batch.
ARTICLE 5 - PHASE II: MANUFACTURE OF rhPTH
5.1 Phase II will start after Phase I is completed pursuant to Article 4.1 or
earlier upon request of the parties. During Phase II, SYNCO warrants that
the Batches of rhPTH will be GMP Grade and SYNCO assumes all other
obligations in respect thereto, including guaranteeing an average Yield
per Batch of the manufacturing process (as established according to
Article 4.4), as calculated over thirty (30) Batches manufactured during
Phase II which are released by NPS in accordance with Article 6.6.
5.2 SYNCO will manufacture Batches of rhPTH on a Campaign basis with a minimum
fixed quantity of thirty (30) Batches. If SYNCO fails to meet the total
yield based on thirty (30) times the Guaranteed Average Yield, NPS may
request that SYNCO at its own expense manufacture further Batches to make
up the shortfall. In the alternative, if SYNCO fails to meet the total
yield based on thirty (30) times the Guaranteed Average Yield, and at NPS'
request, NPS will receive a discount equal to the number of grams SYNCO
manufactured below the total yield multiplied by a price per gram based on
the price per Batch (pursuant to Article 4.2) divided by the Guaranteed
Average Yield.
5.3 NPS will give SYNCO three (3) months advance notice in writing prior to
January 1 of the years 2002, 2003, or 2004 should NPS require Excess
Batches. NPS may order up to a maximum of twenty (20) Excess Batches or
the equivalent yield (based on the Future Guaranteed Average Yield) in any
or all of years 2002, 2003 and 2004. Based on available capacity, SYNCO
will begin production of excess quantity of rhPTH ordered, 9 within nine
(9) months of receipt of the notice in writing ordering such Excess
Batches, and will perform such production in a manner calculated not to
effect any change in delivery of the first thirty (30) Batches in a
Campaign.
9
5.4 A price per gram of rhPTH for delivery of Batches and/or for Excess
Batches will be established in good faith negotiations between the Parties
prior to each Campaign in Phase II and based on, among other things, price
per Batch as established in Article 4.2 and the Future Guaranteed Average
Yield as established in Article 4.4.
5.5 For each Batch manufactured during Phase II, SYNCO will charge NPS a price
of two hundred and two thousand nine hundred ninety-two (202992) Euro
(price level year 2001), excluding price indices as described in Article
8.3. If NPS decides to order the equivalent grams of rhPTH (based on the
Future Guaranteed Average Yield) instead of the thirty (30) batches, NPS
will pay the price per gram as established according to Article 5.4,
excluding price indices as described in Article 8.3.
5.6 The manufacturing, release and delivery of GMP Grade rhPTH for each
Campaign shall be done according to the schedule in Appendix D.
ARTICLE 6 - REGULATORY AFFAIRS AND QUALITY ASSURANCE
6.1 SYNCO will exercise all reasonable skill, care and diligence customary in
the industry in the performance of its duties under this Agreement and in
accordance with the requirements of European GMP and U.S. cGMP. SYNCO
shall obtain and maintain all permits required under Dutch legislation in
order to manufacture rhPTH. SYNCO will inform NPS of all permits filed
under Dutch legislation or otherwise and their status with respect to
approval.
6.2 The parties acknowledge that the manufacture of rhPTH in accordance with
this Agreement and the Specifications is believed to correspond to GMP
requirements in all material respects. However, NPS will cooperate with
SYNCO, in obtaining full and complete compliance with the relevant U.S.
Code of Federal Regulations by identifying with the aid of a Consultant
identified by NPS and reasonably acceptable to SYNCO, (which Consultant
shall be hired by SYNCO and paid for by NPS under terms of employment and
compensation reasonably acceptable to NPS) those areas where modification
or improvement should be considered by SYNCO intended to maintain and
improve GMP compliance for the Plant or manufacture of rhPTH, including,
among others: Standard Operating Procedures; methods; documentation
practices; rhPTH product manufacture, storage, labelling and packaging;
and operations. SYNCO agrees to seek, perform, and implement all such
recommendations of the Consultant as shall be reasonably requested by NPS.
6.3 SYNCO will file and maintain for its facility in Amsterdam a Plant Master
File ("PMF") with the Health Protection Branch in Canada and with the
regulatory agency in The Netherlands. SYNCO will also file and maintain
Drug Master Files (DMFs) as required by the U.S. FDA. The timelines for
these filings is set out in Appendix D. For regulatory purposes, including
the filing of an NDA, NPS shall have rights to refer 10 to the PMF and
DMFs and to similar documents and SYNCO will give NPS access to
information in the PMF, DMFs and to similar documents which are necessary
to complete regulatory documentation and are related to rhPTH and its
manufacture in the Plant.
10
6.4 Subject to reasonable prior notice, NPS or its designated representatives
may audit and inspect the Plant for the purpose of reviewing manufacturing
of rhPTH and quality assurance standards and for determining compliance
with European GMP and U.S. cGMP at reasonable times during the term of
this Agreement, to the extent that such inspections relate solely to
SYNCO's manufacture of rhPTH for NPS and subject to SYNCO's obligations of
confidentiality to third parties. SYNCO will provide full cooperation for
these inspections.
6.5 SYNCO shall review and approve all Batch Production Records for Quality
Assurance and shall investigate all deviations on such Batch Production
Records within sixty (60) days of production. SYNCO's Quality Assurance
department shall also ensure that SYNCO's Plant and manufacturing
operations for rhPTH are in compliance with the Specifications, Regulatory
Standards, U.S. cGMP, European GMP and SYNCO's SOPs and with any other
applicable law or regulation in effect during the time of manufacture of
rhPTH.
6.6 SYNCO will supply NPS with copies of all Batch Production Records,
deviation reports and test results (including out of specification test
results) for each Batch produced at the time of invoice. NPS will have
final responsibility for confirming Quality Assurance and for the release
of each Batch of GMP Grade rhPTH manufactured by SYNCO for use in Clinical
Trials or commercial use.
6.7 SYNCO will retain raw material samples as required under U.S. cGMP and
European GMP. Initially, SYNCO will release raw materials after identity
testing and obtaining a certificate of analysis. However, in accordance
with U.S. cGMP, Vendor Qualification specific to the raw materials used to
manufacture rhPTH pursuant to this Agreement or full specification testing
according to raw material specifications as set out in Appendix A, in
particular in MF-MSF-PTH-2500, will be conducted. Appendix D sets out the
timeline for Vendor Qualification or full specification testing.
6.8 SYNCO will obtain NPS' written approval, not to be unreasonably withheld,
in advance of any modifications to the raw materials, facility, utilities,
process, procedures, production or Plant equipment used in the manufacture
of rhPTH. None of these modifications will be inconsistent with
maintaining compliance with the Specifications or to the applicable law or
regulations to the extent required under this Agreement for producing GMP
Grade rhPTH.
6.9 SYNCO will retain complete, accurate and authentic documents on
manufacturing data, test records, Batch Production Records, deviation
reports, standard operating procedures and raw material samples and any
other documents, samples and information as required by U.S. cGMP and
European GMP and permit NPS access to all originals of such material for
the term appropriate for compliance with U.S. cGMP and European GMP. All
original manufacturing data, test records, Batch Production Records and
other materials required by U.S. cGMP and European GMP for the production
of rhPTH, will be delivered promptly upon NPS request. Parties recognize
that this transfer of documentation to NPS may be in conflict with the
provisions of article 9.1 of European GMP. Therefore, Parties agree that
the transfer will only be effected if the Pharmaceutical Inspection in The
Netherlands would relieve SYNCO from its duties under this article 9.1 of
European GMP.
11
6.10 SYNCO will cooperate fully with recognised regulatory authorities of the
European Community (EC) and with the FDA during inspections related to the
manufacture of rhPTH in the Plant. The expected timeline for Pre-Approval
Inspection is set out in Appendix D. SYNCO will notify NPS immediately of
any such inspections and will make arrangements, where feasible, for NPS
to attend any such inspections.
ARTICLE 7 - WARRANTIES AND LIABILITY
7.1 In addition to other warranties provided for in this Agreement, SYNCO
warrants that:
(a) SYNCO has and will maintain all permits under Dutch legislation in
order to manufacture rhPTH;
(b) The Material, when received, will be stored in accordance with the
relevant Specifications, U.S. cGMP and European GMP;
(c) rhPTH produced by SYNCO under this Agreement will comply with the
Specifications and Regulatory Standards, it will be GMP Grade, will
have been manufactured, packed, stored and delivered in compliance
with this Agreement and applicable laws, orders and regulations,
including U.S. cGMP and European GMP, and that the Plant, equipment
and personnel used to produce rhPTH will be at all times qualified
to manufacture GMP Grade rhPTH;
(d) For the term of this Agreement, the Plant will be operated and
maintained in accordance with all applicable laws, rules, orders and
regulations, including U.S. cGMP and European GMP;
(e) SYNCO agrees that it will not carry on activities in the Plant that
could reasonably prevent rhPTH from being manufactured, packed and
stored in accordance with applicable laws, rules and regulations,
including U.S. cGMP and European GMP;
(f) The manufacturing, release and delivery of GMP Grade rhPTH for each
Campaign shall be done according to the schedule in Appendix D,
unless otherwise agreed to by the Parties.
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN, SYNCO MAKES NO WARRANTIES
EXPRESS OR IMPLIED AND EXPRESSLY DISCLAIMS WARRANTIES OF FITNESS FOR A
PARTICULAR PURPOSE, AND SYNCO SHALL NOT BE LIABLE FOR INCIDENTAL OR
CONSEQUENTIAL DAMAGES IN ANY CASE OF NONCONFORMITY. NEITHER PARTY SHALL BE
LIABLE TO THE OTHER PARTY FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING
FROM ANY ALLEGED OR ACTUAL BREACH OF THIS AGREEMENT.
12
7.2 SYNCO shall promptly replace, free of charge, any quantity of rhPTH which
is not GMP Grade provided NPS notifies SYNCO in writing upon discovery of
the defect or non-conformity within a period of sixty (60) days after
receipt of all documentation and information from SYNCO by NPS pursuant to
Article 6.5 and Article 6.6, and provided NPS allows SYNCO to evaluate the
claim and to test the said quantity of rhPTH within a reasonable period of
time, not to exceed sixty (60) days. For rhPTH which is determined not to
be GMP Grade (either by agreement of the parties or by an independent
qualified expert pursuant to Article 7.3), such rhPTH shall be replaced
during the current or next Campaign, and in no event later than the
Campaign in 2004, with GMP Grade rhPTH. If such rhPTH is not replaced with
GMP Grade rhPTH as provided for in this paragraph, NPS shall receive a
full refund for any payment made for such rhPTH pursuant to Article 8.1.
(Refund shall be paid by SYNCO within thirty (30) days of the date of an
invoice from NPS.)
7.3 If the Parties disagree as to whether or not the said quantity of rhPTH is
GMP Grade, then a qualified independent party, acceptable to both parties,
will determine if the quantity of rhPTH is GMP Grade. The resulting
determination will be final and binding on SYNCO and NPS. SYNCO will bear
the cost of the third party evaluation if the testing demonstrates that
the rhPTH is not GMP Grade. If the rhPTH is determined to be GMP Grade,
then NPS shall bear all costs of the third party evaluation.
7.4 NPS will indemnify and hold SYNCO and its Affiliated Companies harmless
from and against any and all losses, claims, damages or liabilities
(including but not limited to reasonable attorney's fees), arising from
(a) any use, including clinical trials, or sale by NPS or any third party
of any rhPTH supplied by SYNCO hereunder; (b) any allegation by any third
party of infringement of its intellectual property rights by reason of the
manufacture, use or sale of rhPTH by SYNCO, NPS or any third party; (c)
breach by NPS of its representations, warranties or covenants under this
Agreement; or (d) any negligence or intentional wrongdoing of NPS.
However, NPS shall not indemnify SYNCO for such losses, claims, damages or
liabilities that are due to the negligent or reckless activities or
omissions of SYNCO, its officers, employees or agents, or as a result of,
in respect of, or arising out of any breach of any representation,
warranty or guarantee of SYNCO in connection with this Agreement.
7.5 If any claim is made for which a Party may seek indemnification from the
other, the Party seeking indemnity shall promptly notify the other Party
of the nature and basis of such claims and amounts thereof, to the extent
known. In the event any action, suit or proceeding is brought against a
Party with respect to which the other Party may have liability hereunder,
the other Party may, at its option and at its own expense, elect to assume
the defence of any such action, suit or proceeding itself, and if it does
not so elect, the Party having the action, suit or proceeding brought
against it will assume the defence thereof. Neither Party shall make any
settlement of claims without the written consent of the other party, which
consent shall not be unreasonably withheld.
13
ARTICLE 8 - PAYMENTS
8.1 For the manufacture and delivery of GMP Grade rhPTH, NPS shall pay SYNCO
as specified in Article 4 and Article 5. For each Batch of rhPTH or grams
of rhPTH manufactured by SYNCO, SYNCO shall invoice NPS after SYNCO's
Quality Assurance has approved of the Batch Production Records and
investigated all deviations as set out in Article 6.5. SYNCO will supply
NPS with copies of all Batch Production Records, deviation reports and
test results (including out of specification test results) for each Batch
produced at the time of invoice.
8.2 Invoices will be in Euro's and all payments to SYNCO shall be made in
Euro's. All payments shall be made within thirty (30) days of the date of
the invoice. Payments not made when due shall bear interest at the Dutch
bank rate. Upon mutual agreement payments can be made in U.S. Dollars. As
of the Effective Date of this Agreement, NPS has paid SYNCO four hundred
seventeen thousand eight hundred fifty five (417855) Euros which payment
shall be credited against future monies owing to SYNCO by NPS under this
Agreement.
8.3 Prices, including the price to be calculated under Article 5.4, will be
updated on an annual basis beginning January 1, 2002. The adjustment
factor will be the official National Price Index Factor prior to the
calendar year for which the price adjustment will become effective, as
published by the Government of the Netherlands plus three (3) percent.
8.4 Liability For Payment. Termination of this Agreement under this Article,
shall not release any Party from any liability for payment accrued or
accruing to the other Party prior to the termination date.
ARTICLE 9 - CONFIDENTIALITY AND INTELLECTUAL PROPERTY
9.1 A Party receiving Confidential Information (including, without limitation,
Specifications, information related to the Plant and other data designated
as confidential in writing by either Party) from the other or developing
such information hereunder shall not disclose such information to any
third party or any Affiliated Company and shall keep it in strict
confidence, use it solely for the purposes authorized under this Agreement
during the term hereof and shall not disclose such information, for a
period extending nine (9) years following termination, except as follows:
(a) to the extent such information is or becomes general public
knowledge through no fault of the recipient Party; or
(b) to the extent such information can be shown by contemporaneous
documentation of the recipient Party to have been in its possession
prior to receipt thereof hereunder; or
(c) to the extent such information is received by the recipient Party
from a third 14 party without any breach of an obligation by the
disclosing Party; or
14
(d) to the extent required by law, by local authorities for regulatory
purposes or is necessary to perform its obligations under this
Agreement, in which case, the recipient Party may disclose the
information if the recipient Party gives the other Party prior
notice of such disclosure and an opportunity to comment upon the
content of the disclosure. However, SYNCO shall have the right, at
all times and without the obligation to give notice to NPS, to use
information related to its Plant for its own business purposes and
NPS shall have the right, at all times and without the obligation to
give notice to SYNCO, to use the information related to rhPTH for
its own business purposes.
9.2 NPS hereby grants to SYNCO a royalty-free, non-transferable, non-exclusive
license, without the rights to sub-license, under all patent rights and
know-how owned or controlled by NPS, required to manufacture rhPTH for NPS
in accordance with this Agreement for the term of this Agreement.
9.3 SYNCO agrees to give NPS a royalty-free, non-exclusive license on any
ideas, innovations or inventions arising from this Agreement which are
related to or useful to the manufacture of rhPTH and to negotiate in good
faith an exclusive license at NPS' request. This non-exclusive license can
be sub-licensed.
9.4 This Agreement supersedes all other agreements, express or implied,
between the parties concerning confidentiality.
ARTICLE 10 - TERM OF AGREEMENT AND TERMINATION
10.1 Term. This Agreement shall upon signature by both Parties become effective
on the Date of Agreement and remain in effect until December 31, 2005,
unless extended by agreement of the Parties for an additional term.
10.2 Termination. A Party shall have the right without prejudice to any rights
exercisable, damages accrued or claims for damages or other relief, to
terminate this Agreement by written notice to the other Party upon
occurrence of any of the following events:
(a) if such Party becomes insolvent in that liabilities exceed assets,
is adjudged bankrupt or insolvent, applies for judicial or extra
judicial settlement with its creditors, makes an assignment for the
benefit of its creditors, voluntarily files for bankruptcy or has a
receiver or trustee (or the like) in bankruptcy appointed over its
business, property or assets, or if a Party becomes the subject of
liquidation or dissolution (except for reconstruction purposes such
as mergers etc.) or involuntary bankruptcy proceedings or otherwise
discontinues business;
(b) if such Party breaches any material term or condition of this
Agreement and the defaulting Party, having received sixty (60) days
written notice of such default from the Party asserting the breach,
fails to fully cure such breach within sixty (60) days of receipt of
such notice from the Party asserting the breach.
15
10.3 Liability For Payment. Termination of this Agreement under this Article,
shall not release any Party from any liability for payment accrued or
accruing to the other Party prior to the termination date.
10.4 Survival of Termination.
(a) Article 9.3 shall survive termination or expiration of this
Agreement (as the case may be) and shall remain in full force and
effect.
(b) The provisions of Articles 7.4, 7.5, 8.1, 8.4, 12.6, 12.8 and 12.10
shall survive termination or expiration of this Agreement (as the
case may be) and shall remain in full force and effect for five (5)
years after termination or expiration of this Agreement.
(c) The provisions of Articles 3.2(xii, xiii, xiv, xviii), 6.3, 6.4,
6.6, 6.7, 6.9 and 6.10 shall survive termination or expiration of
this Agreement (as the case may be) and shall remain in full force
and effect for two (2) years after termination or expiration of this
Agreement.
ARTICLE 11- NOTICES
11.1 Any notices or other communications to be served on or sent to either
Party shall be sufficiently served or sent if sent by fax and confirmed by
registered return receipt prepaid mail within twenty-four (24) hours after
dispatch of the fax to such Party at its address as set out below or such
other address as such Party may notify in writing to the other Party from
time to time.
Notices to SYNCO shall be to:
-----------------------------
Managing Director
SynCo Bio Partners B.V.
Paasheuvelweg 30
1105 BJ Amsterdam
The Netherlands
Attn: Mic N. Hamers, Ph.D.
Notices to NPS shall be to:
---------------------------
NPS Allelix Corp.
6850 Goreway Drive
Mississauga, Ontario L4V 1V7
Canada
Attn: Rick Wilcocks
16
With a copy to:
NPS Pharmaceuticals, Inc.
420 Chipeta Way
Salt Lake City, UT 84108
Attn: Thomas B. Marriott, Ph.D.
or to such other address as a Party may designate.
ARTICLE 12 - ADDITIONAL TERMS
12.1 Force Majeure. A Party shall not be held liable to the other for any delay
in performance or non-performance of that Party directly or indirectly
caused by reason of force majeure including, but not limited to,
industrial disputes, strike, lockouts, riots, mobs, fires, floods, or
other natural disasters, wars declared or undeclared, civil strife,
embargo, lack or failure of transport facilities, currency restrictions,
or events caused by reason of laws, regulations or orders by any
government, governmental agency or instrumentality or by any other
supervening circumstances beyond the control of either Party. Provided,
however, that the Party affected shall: give prompt written notice to the
other Party of the date of commencement of the force majeure, the nature
thereof, and expected duration; and shall use its best efforts to avoid or
remove the force majeure to the extent it is able to do so; and shall make
up, continue on and complete performance when such cause is removed to the
extent it is able to do so. Either Party has the right to terminate the
Agreement with immediate effect, upon written notice to the other Party,
should the force majeure continue after three (3) months following the
first notification. For the purpose of this Agreement, termination of the
clinical development of the rhPTH will not be considered force majeure.
12.2 Non-Waiver. The failure by any Party at any time to enforce any of the
terms or provisions or conditions of this Agreement or exercise any right
hereunder shall not constitute a waiver of the same or affect the validity
of this Agreement or any part hereof, or that Party's rights thereafter to
enforce or exercise the same. No waiver by a Party shall be valid or
binding, except if in writing and signed by a duly authorized
representative of the waiving Party.
12.3 Severability. In case one or more of the provisions contained in this
Agreement shall, for any reason, be held invalid, illegal or unenforceable
in any respect, such holding shall not affect any other provisions of this
Agreement, but this Agreement shall be construed by limiting such
provision to such extent as would nearly as possible reflect the intent,
purpose and economic effect of such provision, or, if such is not
possible, by deleting such provision from this Agreement, provided that
the remaining provisions reflect the intent of the Parties, as evidenced
by this Agreement as a whole.
12.4 Assignment. This Agreement is deemed personal to SYNCO. Neither Party
shall sell, assign, transfer, encumber or otherwise dispose of its
interest in this Agreement or any of its rights or obligations, except to
an Affiliated Company, without the prior written consent of the other,
which consent shall not unreasonably be withheld.
17
12.5 Enurement. This Agreement is binding on all successors and permitted
assignees.
12.6 Non-competition. SYNCO will not manufacture rhPTH or any related compound
(for this purpose: a compound that (i) competes with rhPTH for binding to
the parathyroid hormone receptor as defined in the rat osteosarcoma (UMR
106 cell line) based receptor binding assay and (ii) shares at least
eighty percent (80%) homology with rhPTH (eighty-four (84) amino acids) or
with the thirty four (34) amino acids N-terminal fragment of rhPTH) for
itself or any third party before January 1, 2009, except if this Agreement
is terminated by SYNCO under Article 10.2.
12.7 Captions. All titles and captions in this Agreement are for convenience
only and shall not affect its interpretation.
12.8 Law and Arbitration. This Agreement shall be governed, construed and
interpreted by the laws of the Netherlands. The Parties agree that all
disputes between them arising out of or relating to this Agreement shall
be settled by arbitration in accordance with the Rules of Conciliation and
Arbitration of the International Chamber of Commerce by three arbitrators
appointed in accordance with such Rules. The Parties shall not be entitled
to terminate this Agreement during the pendency of any claim or dispute
between them under this Agreement. The arbitration proceedings shall take
place in Amsterdam, The Netherlands and shall be conducted in the English
language. Judgement on the award may be issued by and enforced by any
court of competent jurisdiction.
12.9 Entire Understanding. This Agreement (including appendices) is the entire
understanding and agreement between the Parties relating to the subject
matter hereof and supersedes (except as provided herein) any and all prior
arrangements, understandings, and agreements between the Parties whether
written or oral relating thereto. No amendments, changes, or modifications
of the terms of this Agreement shall be valid or binding unless made in
writing and signed by the duly authorized representatives of each Party.
12.10 Independent Status of Parties. Each Party is an independent trader acting
in its own name and for its own account. Neither Party has any authority
to act as an agent or representative of the other, or to contract in the
name of, or create or assume any obligation against, or otherwise legally
bind, the other Party in any way for any purpose, unless agreed separately
in writing. All costs and expenses connected with each Party's activities
and performance under this Agreement unless otherwise separately agreed or
provided for in this Agreement are to be borne solely by the Party
incurring such costs and expenses.
12.11 Duplicate Originals. This Agreement is executed in duplicate originals one
being retained by each Party hereto.
18
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed by their duly authorized representatives:
SYNCO BIO PARTNERS B.V. NPS ALLELIX CORP.
/s/ Mic N. Hamers /s/ Thomas B. Marriott
- ----------------------------- -----------------------------
Mic N. Hamers, Ph.D. Thomas B. Marriott, Ph.D.
Managing Director Vice President, Development Research
19