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Exhibit 10.1

CO-DEVELOPMENT/CO-PROMOTION AND LICENSE AGREEMENT

RELATING TO TYPE-3 INTERFERON FAMILY

by and among

ZymoGenetics, Inc.

and

ZymoGenetics, LLC

and

Bristol-Myers Squibb Company

Execution Date: January 12, 2009

“[    *    ]” = omitted, confidential material, which material has been separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment.


CONTENTS

 

ARTICLE ONE DEFINITIONS AND TERMINOLOGY

  

1

  

1.1    

    

Definitions

  

1

  

1.2    

    

Terminology

  

1

ARTICLE TWO SCOPE AND EXCLUSIVITY OF THIS COLLABORATION

  

2

  

2.1    

    

General

  

2

  

2.2    

    

No Competing Program or Competing Product during Exclusivity Term

  

2

  

2.3    

    

Competing Product Due to a Change of Control

  

2

  

2.4    

    

Acquisition of Hepatitis C Program Due to a Change of Control

  

3

ARTICLE THREE COORDINATION OF JOINT DEVELOPMENT PROJECT AND COMMERCIALIZATION IN THE USA

  

4

  

3.1    

    

Joint Executive Committee

  

4

  

    

3.1.1

    

Formation; Composition; JEC Action

  

4

  

    

3.1.2

    

Role and Responsibilities

  

4

  

    

3.1.3

    

Meetings and Communications

  

5

  

3.2    

    

Project Leaders and Joint Development Committee

  

6

  

    

3.2.1

    

Project Leaders; Appointment; Role and Responsibilities

  

6

  

    

3.2.2

    

Formation of Joint Development Committee

  

6

  

    

3.2.3

    

Roles and Responsibilities

  

7

  

    

3.2.4

    

Meetings and Communications

  

8

  

    

3.2.5

    

Decision Making; Formalities

  

9

  

3.3    

    

Commercialization Leaders and Joint Commercialization Committee

  

9

  

    

3.3.1

    

Commercialization Leaders; Appointment; Role and Responsibilities

  

9

  

    

3.3.2

    

Formation of Joint Commercialization Committee for a Licensed Product

  

9

  

    

3.3.3

    

Roles and Responsibilities

  

10

  

    

3.3.4

    

Meetings and Communications

  

11

  

    

3.3.5

    

Decision Making; Formalities

  

11

  

3.4    

    

Alliance Managers

  

12

  

    

3.4.1

    

Appointment

  

12

  

    

3.4.2

    

Responsibilities

  

12

  

3.5    

    

Finance Contacts

  

12

  

3.6    

    

Working Groups

  

13

  

3.7    

    

Allocation of Party Development Tasks and Party Commercialization Tasks

  

13

  

3.8    

    

Operational Decisions

  

14

  

3.9    

    

Escalation to Joint Executive Committee

  

14

ARTICLE FOUR DISCOVERY AND DEVELOPMENT OF LICENSED PRODUCTS

  

15

  

4.1    

    

Initial Joint Development Project; Collaborative Development Efforts for the Joint Development Project

  

15

  

4.2    

    

Technology Transfer

  

16

 

  

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[    *    ] Confidential Treatment Requested


  

    

4.2.1

    

Initial Transfer

  

16

  

    

4.2.2

    

Continuing Exchange of Technology

  

16

  

4.3    

    

Party Development Tasks

  

16

  

4.4    

    

Regulatory Matters

  

17

  

    

4.4.1

    

Clinical Trial Data

  

17

  

    

4.4.2

    

Regulatory Submissions

  

17

  

    

4.4.3

    

Rights of Reference

  

18

  

    

4.4.4

    

Regulatory Meetings and Communications

  

18

  

    

4.4.5

    

Regulatory Inspection Right

  

19

  

    

4.4.6

    

Clinical Trial Disclosures

  

19

  

4.5    

    

Reporting; Adverse Drug Reactions

  

20

  

    

4.5.1

    

Adverse Event Reporting

  

20

  

    

4.5.2

    

Global Safety Database and Pharmacovigilance

  

20

  

    

4.5.3

    

Recalls

  

20

  

4.6    

    

Clinical Development

  

21

  

    

4.6.1

    

Combination Studies; BMS Molecules

  

21

  

    

4.6.2

    

New Indications

  

21

  

4.7    

    

Joint Development Costs

  

21

  

    

4.7.1

    

Cost Sharing of Joint Development Costs

  

21

  

    

4.7.2

    

Accounting and Reconciliation

  

22

  

4.8    

    

Joint Development Costs Paid to Third Parties

  

24

  

4.9    

    

BMS’ Efforts Outside the Joint Development Project

  

24

ARTICLE FIVE COMMERCIALIZATION OF LICENSED PRODUCTS

  

24

  

5.1    

    

Commercialization in the USA

  

24

  

5.2    

    

USA Co-Promotion Agreement

  

25

  

5.3    

    

Loss Relief from USA Commercialization

  

25

  

5.4    

    

USA Commercialization Costs Paid to Third Parties

  

26

  

5.5    

    

BMS Sole and Primary Roles in Commercialization

  

26

  

5.6    

    

Reports of Sales in the USA

  

27

  

5.7    

    

Accounting and Reconciliation

  

27

  

5.8    

    

Commercialization in the ROW

  

28

  

5.9    

    

Reporting

  

28

ARTICLE SIX MANUFACTURE

  

29

  

6.1    

    

Preclinical and Clinical Supplies

  

29

  

6.2    

    

Commercial Manufacture

  

30

ARTICLE SEVEN CONVERSION TO EXCLUSIVE LICENSE

  

30

  

7.1    

    

Conversion to Exclusive License

  

30

  

    

7.1.1

    

Zymo’s Option

  

30

  

    

7.1.2

    

Failure to File BLA

  

31

  

    

7.1.3

    

Zymo’s Financial Condition

  

31

  

    

7.1.4

    

Effective Date of Conversion

  

31

  

7.2    

    

Zymo’s Continuing Financial Obligations; Wind Down of Activities

  

32

  

    

7.2.1

    

Joint Development Costs and USA Commercialization Costs

  

32

  

    

7.2.2

    

Wind Down of Activities

  

32

 

  

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[    *    ] Confidential Treatment Requested


  

7.3    

    

Consequences of Conversion

  

32

  

    

7.3.1

    

Governance; Responsibility for Development and Commercialization

  

32

  

    

7.3.2

    

Termination of USA Co-Promotion Agreement

  

33

  

    

7.3.3

    

No Other Changes

  

33

  

7.4    

    

Election to Co-Fund Only

  

33

  

    

7.4.1

    

Zymo’s Option

  

33

  

    

7.4.2

    

Effective Date of Election to Co-Fund Only

  

33

  

7.5    

    

Zymo’s Continuing Financial Obligations; Wind Down of Activities

  

34

  

    

7.5.1

    

Joint Development Costs and USA Commercialization Costs

  

34

  

    

7.5.2

    

Wind Down of Activities

  

34

  

7.6    

    

Consequences of Election to Co-Fund Only

  

34

  

    

7.6.1

    

Governance; Responsibility for Development and Commercialization

  

34

  

    

7.6.2

    

Termination of USA Co-Promotion Agreement

  

35

  

    

7.6.3

    

No Other Changes

  

35

  

7.7    

    

Combined Conversion and Election to Co-Fund Only

  

35

ARTICLE EIGHT MILESTONE PAYMENTS

  

35

  

8.1    

    

Licensing Fees

  

35

  

8.2    

    

Milestone Payments

  

35

  

8.3    

    

Reporting of Milestone Events; Payment of Milestone Payments

  

37

ARTICLE NINE PROFIT AND ROYALTY PAYMENT

  

37

  

9.1    

    

Payments on Net Profits in the USA

  

37

  

9.2    

    

Royalties on Net Sales in the ROW

  

38

  

    

9.2.1

    

Rate for Protection by Core Patent

  

38

  

    

9.2.2

    

Royalty for Protection by Other Patents and Without Applicable Patent Rights

  

38

  

    

9.2.3

    

Royalties on Follow On Products

  

38

  

    

9.2.4

    

Royalties upon Conversion

  

38

  

    

9.2.5

    

No Cumulative Royalties; Aggregation and Allocation of Net Sales for Determining Royalty Rate Breakpoints

  

39

  

    

9.2.6

    

Third Party Commercial Use Fees Paid by Zymo

  

40

  

9.3    

    

Credits Against Royalties

  

40

  

    

9.3.1

    

Credit for Third Party Commercial Use Fees Paid by BMS

  

40

  

    

9.3.2

    

Credit for Generic Products

  

40

  

    

9.3.3

    

Cumulative Credits

  

41

  

9.4    

    

Reporting and Payment

  

41

  

9.5    

    

Acknowledgment Regarding Compensation

  

41

ARTICLE TEN RECORDS, REPORTING, PAYMENT AND AUDITS

  

42

  

10.1  

    

Form of Payment; Currency Conversion

  

42

  

10.2  

    

Late Payment

  

42

  

10.3  

    

Records

  

42

  

10.4  

    

Audits

  

42

  

10.5  

    

Payments Based on Audit Results

  

43

 

  

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[    *    ] Confidential Treatment Requested


  

10.6  

    

Withholding

  

43

ARTICLE ELEVEN OWNERSHIP OF TECHNOLOGY AND LICENSES

  

43

  

11.1  

    

Ownership of Patent Rights

  

43

  

11.2  

    

Core Patents

  

44

  

    

11.2.1

    

[    *    ] of Ex-US Core Patents

  

44

  

    

11.2.2

    

[    *    ] in Ex-US Core Patents

  

44

  

    

11.2.3

    

[    *    ] in US Core Patents

  

45

  

11.3  

    

License to BMS

  

46

  

    

11.3.1

    

Grant

  

46

  

    

11.3.2

    

Exclusions

  

47

  

    

11.3.3

    

Reservation

  

47

  

11.4  

    

License to Zymo

  

47

  

11.5  

    

Rights Upon Bankruptcy

  

48

  

11.6  

    

Grant of Sublicenses

  

48

  

11.7  

    

Sublicense to Contractors

  

49

  

11.8  

    

No Other Rights

  

49

  

11.9  

    

Use of Names, Trade Names and Trademarks

  

49

ARTICLE TWELVE PATENT, TRADEMARK AND COPYRIGHT PROSECUTION AND ENFORCEMENT

  

49

  

12.1  

    

Patent Contacts

  

49

  

12.2  

    

Prosecution and Maintenance

  

50

  

    

12.2.1

    

Core Patents

  

50

  

    

12.2.2

    

BMS IP

  

50

  

    

12.2.3

    

Zymo IP

  

50

  

    

12.2.4

    

Joint Patents and Core Patents

  

50

  

    

12.2.5

    

Patent Prosecution Party’s Efforts

  

51

  

    

12.2.6

    

Discontinued Patent

  

51

  

12.3  

    

Defense of Third Party Infringement Claims

  

52

  

12.4  

    

Enforcement of Patent Rights

  

52

  

    

12.4.1

    

Licensed Product related Infringement

  

52

  

    

12.4.2

    

Non-Licensed Product related Infringement

  

53

  

    

12.4.3

    

Enforcement of Joint Patent Rights

  

54

  

    

12.4.4

    

General Provisions Relating to Enforcement of Patents

  

54

  

    

12.4.5

    

Sharing of Awards

  

55

  

12.5  

    

No Action in Violation of Law

  

55

  

12.6  

    

Data Exclusivity and Regulatory Listings

  

55

  

12.7  

    

Notification of Allegation of Invalidity

  

56

  

12.8  

    

Patent Term Extensions

  

56

  

12.9  

    

Protection of the Licensed Product Trademarks

  

56

  

12.10

    

Copyright Registrations

  

56

ARTICLE THIRTEEN CONFIDENTIALITY; MATERIALS; PUBLICITY

  

57

  

13.1  

    

Confidentiality and Non-Use

  

57

  

13.2  

    

Exceptions

  

57

  

13.3  

    

Permitted Disclosures

  

57

 

  

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[    *    ] Confidential Treatment Requested


  

13.4  

    

Materials; Permitted Uses

  

58

  

13.5  

    

Press Releases

  

58

  

13.6  

    

Publications

  

59

  

13.7  

    

Obligations of Confidentiality to Third Parties

  

59

ARTICLE FOURTEEN REPRESENTATIONS AND WARRANTIES

  

60

  

14.1  

    

Representations and Warranties of Zymo

  

60

  

    

14.1.1

    

Organization and Good Standing

  

60

  

    

14.1.2

    

Enforceability; Authority and No Current Conflicts

  

60

  

    

14.1.3

    

Invention Agreements and Obligations to Assign

  

60

  

    

14.1.4

    

Third Party Agreements

  

61

  

    

14.1.5

    

Authority to License; Ownership of Zymo Enabling Technology

  

61

  

    

14.1.6

    

No Notice of Invalidity or Unenforceability

  

61

  

    

14.1.7

    

Third Party Patent on IFN-Lambda

  

61

  

    

14.1.8

    

Compliance With Applicable Laws

  

61

  

    

14.1.9

    

No Debarment Proceedings

  

61

  

    

14.1.10

    

Manufacture in accordance with cGMP and Applicable Law

  

62

  

    

14.1.11

    

Regulatory Filings

  

62

  

14.2  

    

Representations and Warranties of BMS

  

62

  

    

14.2.1

    

Organization and Good Standing

  

62

  

    

14.2.2

    

Enforceability; Authority and No Current Conflicts

  

62

  

    

14.2.3

    

Invention Agreements with Personnel and Contractors

  

63

  

    

14.2.4

    

Third Party Agreements

  

63

  

    

14.2.5

    

Authority to License

  

63

  

    

14.2.6

    

No Notice of Invalidity or Unenforceability

  

63

  

14.3  

    

Mutual Covenants

  

63

  

    

14.3.1

    

No Future Conflicts

  

63

  

    

14.3.2

    

Compliance With Laws

  

63

  

    

14.3.3

    

No Debarment Proceedings

  

64

  

    

14.3.4

    

Third Party Agreements

  

64

  

14.4  

    

Materials

  

65

  

14.5  

    

Warranty Disclaimer

  

65

ARTICLE FIFTEEN INDEMNIFICATION; INSURANCE

  

65

  

15.1  

    

Indemnification

  

65

  

    

15.1.1

    

Matters Covered

  

65

  

    

15.1.2

    

Exclusions

  

66

  

15.2  

    

Defense of Claims

  

66

  

    

15.2.1

    

Provision of Attorney

  

66

  

    

15.2.2

    

Notice

  

66

  

    

15.2.3

    

Tender of Defense

  

66

  

    

15.2.4

    

Assistance

  

67

  

15.3  

    

Insurance

  

67

ARTICLE SIXTEEN EFFECTIVE DATE; TERM AND TERMINATION; BANKRUPTCY

  

67

 

  

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[    *    ] Confidential Treatment Requested


  

16.1  

    

HSR Act Filing; Effective Date

  

67

  

16.2  

    

Term

  

68

  

16.3  

    

Termination by Mutual Consent

  

68

  

16.4  

    

Termination for Material Breach

  

68

  

16.5  

    

Termination by BMS for Convenience

  

69

  

16.6  

    

Bankruptcy

  

69

  

16.7  

    

Termination of License [    *    ]

  

70

  

16.8  

    

Transfer of Project Following Termination

  

70

  

16.9  

    

[    *    ] to Zymo of Ex-US Core Patents

  

72

  

16.10

    

Exception for Termination for Safety Reasons

  

72

  

16.11

    

Consequences of Expiration and Termination

  

72

  

    

16.11.1

    

Accrued Rights

  

72

  

    

16.11.2

    

Sale of Inventory

  

72

  

    

16.11.3

    

Surviving Provisions

  

73

  

    

16.11.4

    

Cumulative Remedies

  

73

ARTICLE SEVENTEEN DISPUTE RESOLUTION

  

73

  

17.1  

    

Goal; Cooperative Decision-Making

  

73

  

17.2  

    

Procedure

  

73

  

17.3  

    

Business Judgments; BMS “Tie-Breaking Vote

  

73

  

17.4  

    

Arbitration

  

73

  

    

17.4.1

    

Matters to be Arbitrated

  

73

  

    

17.4.2

    

Venue and Rules

  

74

  

    

17.4.3

    

Composition of Tribunal

  

74

  

    

17.4.4

    

Tribunal’s Jurisdiction

  

74

  

    

17.4.5

    

Costs

  

74

  

    

17.4.6

    

Continuing Performance

  

74

  

    

17.4.7

    

Equitable Remedies

  

74

  

17.5  

    

Disputes Relating to Patents

  

75

  

17.6  

    

Governing Law

  

75

ARTICLE EIGHTEEN GENERAL

  

75

  

18.1  

    

Entire Agreement

  

75

  

18.2  

    

No Strict Construction

  

75

  

18.3  

    

Notices

  

75

  

18.4  

    

Force Majeure

  

76

  

18.5  

    

Assignability

  

77

  

18.6  

    

Non-Solicitation

  

78

  

18.7  

    

Amendments and Waivers

  

78

  

18.8  

    

Severability

  

78

  

18.9  

    

Counterparts

  

78

  

18.10

    

Relationship

  

79

  

18.11

    

Affiliates

  

79

 

  

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[    *    ] Confidential Treatment Requested


LIST OF EXHIBITS

 

Exhibit A

  

Definitions

Exhibit B

  

Existing Third Party Agreements

Exhibit C

  

Press Release

Exhibit D

  

Core Patents and Certain Non-Core Patents

Exhibit E

  

Allocated Net Sales of Combination Products

Exhibit F

  

Preliminary Long-Range Development Plan

Exhibit G

  

Principal Terms of USA Co-Promotion Agreement

Exhibit H

  

Type-3 Interferon Family

Exhibit I

  

Clinical Trial Disclosures And Adverse Event Reporting

Exhibit J

  

Exhibit C to BMS VANLEV Settlement

Exhibit K

  

BMS’ Procedure for Clinical Trial Registration and Disclosure of Results

 

  

-vii-

  

[    *    ] Confidential Treatment Requested


CO-DEVELOPMENT/CO-PROMOTION AND LICENSE AGREEMENT

RELATING TO TYPE-3 INTERFERON FAMILY

This Co-Development/Co-Promotion and License Agreement relating to Type-3 Interferon Family is made as of the Effective Date by and among ZymoGenetics, Inc., a Washington corporation (“ ZGEN ”), and ZymoGenetics, LLC, a Delaware limited liability company (“ ZG LLC ”), and Bristol-Myers Squibb Company, a Delaware corporation (“ BMS ”). ZGEN and ZG LLC are referred to collectively as “ Zymo ”, and any obligations attributed to Zymo hereunder shall apply jointly and severally to ZGEN and ZG LLC, however, as the owner of the Core Patents, ZG LLC has the sole right to receive the initial license fee, all Milestone Payments, all royalties and Net Profits.

RECITALS

A. Each party has an interest in the Development of potential therapies for human diseases.

B. ZG LLC has certain rights to the Type-3 Interferon Family, and the Type-3 Interferon Family has potential therapeutic value.

C. By combining their substantial experience and expertise, the parties wish, for their exclusive and mutual benefit, to work collaboratively to expedite the Development, Regulatory Approval and Commercialization of Licensed Products.

D. Each party wishes to grant to the other party certain licenses under its intellectual property rights to permit the other party to Develop, Manufacture and Commercialize Licensed Products as set forth herein.

AGREEMENT

NOW, THEREFORE, the parties, intending to be legally bound, agree as follows:

ARTICLE ONE

Definitions and Terminology

1.1 Definitions

In addition to other terms defined elsewhere in this Agreement, words and phrases with initial capitals shall have the meanings stated in Exhibit A.

1.2 Terminology

Where words and phrases are used herein in the singular, such usage is intended to include the plural forms where appropriate to the context, and vice versa. The words “ including ,” “ includes ” and “ such as ” are used in a non-limiting sense and have the same meaning as “ including without limitation ” and “ including, but not limited to .” References to Articles, Sections, Subsections and paragraphs are to the same with all their subparts as they appear in this Agreement. “ Herein ” means anywhere in this Agreement. “ Hereunder ” and

 

  

  

[    *    ] Confidential Treatment Requested


hereto ” mean under or pursuant to any provision of this Agreement. “ Exhibit ” means an Exhibit explicitly referenced as such in this Agreement. All such Exhibits are by such references incorporated into this Agreement as if fully set forth herein. The Article and Section headings contained herein are for reference only and shall not be considered a part of this Agreement, nor shall they in any way affect the interpretation hereof. All references to dollars or $ are to the currency of the USA.

ARTICLE TWO

Scope and Exclusivity of this Collaboration

2.1 General

Except as expressly set forth in this Agreement, the parties and their Affiliates shall, in the case of the USA, during the Joint Commercialization Period and, in the case of the ROW, during the Royalty Period, work exclusively with each other to Develop, Manufacture and Commercialize Licensed Products (this “ Collaboration ”) solely in accordance with the terms of this Agreement. Except as set forth in Section 2.2 , 2.3, or 2.4 , each party shall be free to work alone or with Affiliates or Third Parties to research, Develop, Manufacture and/or Commercialize any product that is not a Licensed Product.

2.2 No Competing Program or Competing Product during Exclusivity Term

Subject to Sections 2.3 , and 2.4 , neither Zymo nor BMS nor any of their Affiliates shall, at any time during the Exclusivity Term, conduct (directly or indirectly, and either with or without a bona fide collaborator) outside of this Collaboration, any Competing Program. BMS acknowledges that pursuant to the [    *    ], by and between [    *    ] and ZG LLC, in certain circumstances [    *    ] could obtain the right to develop and commercialize [    *    ] discovered by Zymo; provided that Zymo agrees [    *    ] (as would otherwise be permitted under the [    *    ]) during the Exclusivity Term.

2.3 Competing Product Due to a Change of Control

In the event that during the Exclusivity Term, due to a Change of Control of a party, or assignment of this Agreement by a party pursuant to Section 18.5 , such party together with its Affiliates:

(a) is either (i) conducting (directly or indirectly, and either with or without a bona fide collaborator) outside the scope of this Collaboration any Competing Program; or (ii) commercializing a Competing Product; and

(b) has the power to control decisions relating to the Competing Program or Competing Product as a result of, and subsequent to, a Change of Control, such party must:

(i) continue to Develop and Commercialize any corresponding existing Licensed Product(s) using a level of Reasonable Commercial Efforts that assumes the Competing Program was not in-licensed ( i.e. , the same level of Reasonable Commercial Efforts that such party had used prior to acquiring such Competing Program pursuant to such Change of Control); and

 

  

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[    *    ] Confidential Treatment Requested


(ii) use Reasonable Commercial Efforts, either:

(1) to (x) in the case of BMS, terminate this Agreement under Section 16.5, or (y) in the case of Zymo, (A) if the Competing Product is not a Competing Product as defined in paragraph 1.30(a) of Exhibit A [    *    ], give notice of a Conversion under Section 7.1.1. (assuming there has not been an earlier Conversion) or (B) if the Competing Product is a Competing Product as defined in paragraph 1.30(a) of Exhibit A [    *    ], give notice of a Conversion under Section 7.1.1 or, at Zymo’s option, an Election to Co-Fund Only under Section 7.4 ;

(2) to outlicense or divest such Competing Program to a Third Party; or

(3) to discontinue such Competing Program;

and in any case ((1), (2) or (3) above) provide written notice to the other party of its decision with respect to this Section 2.3 within, in the case of subparagraph (ii)(1)(y)(B) , [    *    ] and, in all other cases, within [    *    ] of such Change of Control and use Reasonable Commercial Efforts to effect such decision as soon as practicable but in any case no later than [    *    ] subsequent to such written notice in the case of a decision on (1), and [    *    ] subsequent to such written notice in the case of a decisions on (2) or (3). For avoidance of doubt, a party will not be deemed to be in breach of this Agreement during the period of time such actions are being taken in accordance with this Section 2.3 .

2.4 Acquisition of Hepatitis C Program Due to a Change of Control

BMS shall have the right to require Zymo to give notice of a Conversion under Section 7.1.1 or, at Zymo’s option, an Election to Co-Fund Only under Section 7.4 if:

(a) there has been a Change of Control of Zymo and not a Change of Control of BMS;

(b) the acquirer of Zymo has a continuing program to develop a product for which the primary indication is [    *    ] and as part of such program the company acquiring Zymo (x) has [    *    ] or (y) plans to [    *    ] within [    *    ] after the effective date of such Change of Control; and

(c) BMS provides written notice exercising its right to require Zymo to give notice of a Conversion under Section 7.1.1 or an Election to Co-Fund Only under Section 7.4 within [    *    ] after the later event referenced above in Subsection (b) .

 

  

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ARTICLE THREE

Coordination of Joint Development Project and Commercialization in the USA

3.1 Joint Executive Committee

3.1.1 Formation; Composition; JEC Action

(a) The Collaboration shall be governed by a joint executive committee (the “ Joint Executive Committee ” or “ JEC ”). Each party shall appoint its representatives on the initial JEC in writing within thirty (30) days following the Effective Date and shall promptly thereafter notify the other party in writing of such appointment. Each party shall appoint representatives of sufficient seniority to make strategic decisions regarding the Joint Development Project, finally approve the Joint Development Plan and otherwise make final decisions on the sorts of matters likely to come before the JEC on behalf of their respective companies.

(b) The JEC shall have a total of six (6) members. Zymo and BMS shall each appoint three (3) members. If at any time a vacancy occurs for any reason, the party that appointed the prior incumbent shall as soon as reasonably practicable appoint a successor. Each party shall promptly notify the other party of any substitution of another person as its appointee on the JEC.

(c) All official actions, decisions or rulings of the JEC under this Agreement must be taken by JEC Action; provided that, BMS shall have final decision making authority with regards to any dispute related to the content of any [    *    ] or [    *    ], [    *    ] reports, [    *    ] and [    *    ] strategies and plans, [    *    ], [    *    ], [    *    ], [    *    ] (including [    *    ]-related) decisions, tactical [    *    ], and the decision to [    *    ] for any [    *    ] (other than for [    *    ]) that is not resolved by the JEC, without referring such dispute to the Senior Executives in accordance with Section 17.2 .

3.1.2 Role and Responsibilities

Subject to Sections 3.7 and 3.8 , the JEC shall be responsible for the overall direction of the Joint Development Project and Party Commercialization Tasks, including oversight of the other Committees, Working Groups, Finance Contacts and Patent Contacts. The responsibilities of the JEC shall include:

(a) Review and approval of each Long-Range Development Plan and each Annual Development Plan.

(b) Review and approval of each Long-Range Commercialization Plan and each Annual Commercialization Plan.

(c) Approval of any Combination Studies.

(d) Approve the go/no go criteria for each Decision to Proceed to Phase II and Decision to Proceed to Phase III and make each Decision to Proceed to Phase II and Decision to Proceed to Phase III. No Phase III Clinical Trial or Phase II Clinical Trial shall be Initiated as part of the Joint Development Plan without a Decision to Proceed to Phase III or Decision to Proceed to Phase II as applicable.

 

  

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(e) Review of the Development strategies in the Joint Development Territory and the Commercialization strategies in the USA for the Licensed Products; provided that BMS shall update the JEC on global Development and Commercialization.

(f) Review and approval of Development of additional Licensed Products in addition to IFN-Lambda.

(g) Review and approval of lifecycle management and new indications for which a Licensed Product is proposed by the JDC to be Developed ([    *    ]).

(h) Review of all significant and strategic issues within the purview of another Committee or Working Group or between the parties’ respective Finance Contacts or Patent Contacts.

(i) Review and approval of the terms of all Third Party Agreements of the type described in subparagraph (a)  but not (b)  of paragraph 1.140 of Exhibit A to the extent related to rights or activities in the USA and that are proposed to be entered into by either Zymo, BMS or one of their respective Affiliates following the Effective Date.

(j) Oversight of intellectual property protection for Licensed Products.

(k) Subject to Section 3.9 , provision of a forum for dispute resolution for issues arising from the other Committees, Working Groups or between the parties’ respective Finance Contacts or Patent Contacts.

(l) Such other responsibilities as may be assigned to the JEC pursuant to this Agreement or as may be agreed between the parties from time to time.

The JEC may, on its own initiative and at any time, act or reverse action, within the scope of another Committee or Working Group or the parties’ respective Finance Contacts or Patent Contacts after consultation with the relevant Committee or Working Group, Finance Contacts or Patent Contacts, as appropriate.

3.1.3 Meetings and Communications

The JEC shall meet face-to-face at least semi-annually at mutually agreed upon times and locations. Unless otherwise agreed, the location of such meetings will alternate between the parties’ facilities, and the party hosting a meeting shall be responsible for chairing the meeting and secretarial duties ( i.e. , circulating an agenda and taking minutes). Either or both of the parties may, with the consent of the other party (not to be unreasonably withheld), bring other personnel employed by them or their Contractors to meetings of the JEC as observers or to present data and information relevant to the Joint Development Project or the Party Commercialization Tasks. The JEC shall also address issues as they arise in the interim via telephone conference, videoconference or electronic mail. A written agenda for each face-to-face meeting shall be circulated in advance of the meeting by the Alliance Managers, and written minutes of each meeting shall be taken by the Alliance Managers and shall include the issues discussed, decisions made and action items, if any, arising from the meeting; provided that before adjourning the JEC shall approve a written (including electronic e.g., PowerPoint slides)

 

  

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summary of all JEC Actions taken at a particular meeting. Each face-to-face meeting of the JEC shall conclude with approval by JEC Action of the minutes of prior meetings and of all actions taken through interim communications since the last face-to-face meeting. Meeting minutes and written summaries of any action taken by way of interim communications shall be promptly submitted by the Alliance Managers:

(a) to the Project Leaders;

(b) to all members of the JEC;

(c) to the extent such minutes or action involve financial matters, to the Finance Contacts;

(d) to the extent such minutes or action involve Patent Rights or other intellectual property rights, to the Patent Contacts; and

(e) to the extent such minutes or actions involve matters related to Commercialization of a Licensed Product, to the Commercialization Leaders.

3.2 Project Leaders and Joint Development Committee

3.2.1 Project Leaders; Appointment; Role and Responsibilities

(a) Each party shall appoint its initial project leader to coordinate Development of the initial Licensed Product (each a “ Project Leader ”) within thirty (30) days following the Effective Date and shall promptly thereafter notify the other party in writing of such appointment. If at any time a vacancy occurs for any reason, the party that appointed the prior incumbent shall as soon as reasonably practicable appoint a successor. Each party shall promptly notify the other party of any substitution of another person as its Project Leader.

(b) Subject to Sections 3.7 and 3.8 , the Project Leaders shall coordinate the parties’ respective Party Development Tasks. Each party’s Project Leader will be available throughout the Term (including following any disbanding of the JDC) to answer any reasonable questions from the other party’s Project Leader.

(c) The Project Leaders and Commercialization Leaders shall meet as frequently as they deem necessary to ensure that the Joint Development Plan and the Joint Commercialization Plan are consistent and mutually supportive. In addition, the Project Leaders shall coordinate with the Commercialization Leaders in the submission of the Joint Development Plan and Joint Commercialization Plan to the JEC for review and approval.

3.2.2 Formation of Joint Development Committee

(a) The Project Leaders shall form and hold the first meeting of the initial product team to manage the Development of the initial Licensed Product (the “ Joint Development Committee ” or “ JDC ”) in the Joint Development Territory by the thirtieth (30 th ) day following the Effective Date.

 

  

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(b) The JDC may have any number of members as may be approved by JEC Action. While the parties need not be equally represented in number of members on the JDC, the JDC will be co-led by the two (2) Project Leaders and each party shall have a single vote in the decisions of the JDC.

(c) The Project Leaders may form additional JDCs for distinct Licensed Products; provided that the individuals serving on the JDC for a Licensed Product may serve on the JDC for one or more different Licensed Products.

3.2.3 Roles and Responsibilities

(a) Within ninety (90) days after the date on which the JEC approves any Licensed Product for Development hereunder (and in the case of IFN-Lambda within sixty (60) days after the Effective Date), the JDC shall prepare and submit to the JEC a long-range development plan and high level budget forecast ( “Long-Range Development Plan” ) covering a multi-year period of at least three (3) years of the Joint Development Project for such Licensed Product consistent with each party’s long range financial forecasting. The JDC shall, as appropriate from time to time and not less often than annually, prepare and submit to the JEC any proposed updates and amendments to the Long-Range Development Plan to cover a rolling, multi-year period of at least three (3) years. A preliminary Long-Range Development Plan covering the first five (5) years of the Joint Development Project for the initial Licensed Product is attached hereto as Exhibit F, within ninety (90) days after the Effective Date the JDC shall finalize the preliminary Long-Range Development Plan for the initial Licensed Product.

(b) Within sixty (60) days after the Effective Date, the JDC shall meet to review the preliminary Long-Range Development Plan and prepare an initial development plan and budget to cover in detail the parties’ respective Party Development Tasks for the first Calendar Year of the of the Joint Development Project for the initial Licensed Product (“ Annual Development Plan ”). Thereafter, the JDC shall, as appropriate from time to time and not less often than annually, prior to the start of the Calendar Year prepare and submit to the JEC an updated Annual Development Plan to cover the forthcoming Calendar Year. In addition, within ninety (90) days after the date on which the JEC approves any additional Licensed Product for Development hereunder, the JDC shall prepare and submit to the JEC a preliminary Annual Development Plan covering the first year of the Joint Development Project for such additional Licensed Product following approval by the JEC of such additional Licensed Product.

(c) The JDC shall under the direction of the Project Leaders review the global Development and regulatory strategy, monitor its implementation for conflicts with the Joint Development Plan and make suggestions for avoiding such conflicts.

(d) Subject to Sections 3.7 and 3.8 , the JDC shall, under the direction of the Project Leaders:

(i) Plan, allocate and coordinate the respective Party Development Tasks.

(ii) Establish and monitor compliance with timelines and budgets in the Joint Development Plan for Development of the Licensed Products, including details regarding external costs and internal costs incurred against the budgeted costs. The JDC shall promptly

 

  

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report to the JEC any actual or anticipated cost overruns in excess of [    *    ] in any budgeted category.

(iii) Formulate and propose to the JEC go/no go criteria for a Decision to Proceed to Phase II and Decision to Proceed to Phase III.

(iv) Review all material information generated in the course of implementing the Joint Development Plan.

(v) Design, in collaboration with the JCC, pharmacoeconomic studies or Phase IV Clinical Trials in the Joint Development Territory.

(vi) Monitor and coordinate all regulatory actions, communications and submissions for Licensed Products in the Joint Development Territory, including establishing the schedule and implementation strategy for all Regulatory Filings for Licensed Products.

(vii) Formulate timing and criteria for initiating the Development of a Licensed Product for new indications for consideration by the JEC, [    *    ].

(viii) Coordinate preliminary market research to support Phase III Clinical Trial design in collaboration with the JCC.

(ix) Provide on a quarterly basis updates on its activities and achievements to the JEC for review and comment.

(x) Resolve disagreements during the course of implementing the Joint Development Plan.

(xi) Coordinate with the JCC to develop and implement a publication strategy for each Licensed Product.

(xii) Coordinate with the JCC to develop and implement a strategy to engage key opinion leaders for each Licensed Product.

(xiii) Otherwise monitor compliance with the Joint Development Plan and perform such other responsibilities as may be assigned to the JDC pursuant to the Agreement or as may be agreed between the parties from time to time.

3.2.4 Meetings and Communications

The JDC shall meet as often as is deemed necessary by the Project Leaders, but at least quarterly until the First Commercial Sale of a Licensed Product, and thereafter as needed. Meetings shall take place in person, by videoconference or by telephone conference, as mutually agreed by the Project Leaders. There shall be an agenda for each meeting of the JDC, and written minutes of each meeting shall be taken by the Alliance Managers and shall include the issues discussed, decisions made and action items, if any, arising from such meeting. Unless otherwise agreed, the responsibility for chairing meetings shall alternate between the Project Leaders and the responsibility for secretarial duties ( i.e. , circulating an agenda and taking

 

  

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minutes) shall alternate between the Alliance Managers. At each meeting of the JDC, BMS will update Zymo on any material information relating to the Development of the Licensed Products outside the Joint Development Project. Meeting minutes shall be submitted to the members of the JDC and the JEC by the Alliance Managers. The Project Leaders shall communicate at such other times as necessary to coordinate the activities of the parties.

3.2.5 Decision Making; Formalities

All official actions, decisions or rulings of the JDC under this Agreement must receive the approval of the parties, either in writing (including by email or facsimile) or by vote at a meeting of the JDC, and all significant actions, decisions or rulings shall subsequently be entered into the minutes of meetings of the JDC. In the absence of such mutual approval, either party may, subject to Section 3.9 , by formal written notice to the JEC declare the existence of a dispute at the JDC level and thereby request that such dispute be resolved by the JEC.

3.3 Commercialization Leaders and Joint Commercialization Committee

3.3.1 Commercialization Leaders; Appointment; Role and Responsibilities

(a) Each party shall appoint its initial commercialization leader to coordinate the Commercialization of a Licensed Product in the USA (each a “ Commercialization Leader ”) within thirty (30) days the Effective Date and shall promptly thereafter notify the other party in writing of such appointment. If at any time a vacancy occurs for any reason, the party that appointed the prior incumbent shall as soon as reasonably practicable appoint a successor. Each party shall promptly notify the other party of any substitution of another person as its Commercialization Leader for a Licensed Product. Each Licensed Product for which a Phase III Clinical Trial is Initiated as part of the Joint Development Project shall have its own Commercialization Leaders; provided that the same individual may serve as Commercialization Leader for more than one Licensed Product.

(b) Subject to Sections 3.7 and 3.8 , the Commercialization Leaders for a Licensed Product shall coordinate the parties’ respective Party Commercialization Tasks for the Licensed Product. Each party’s Commercialization Leader will also be available throughout the Term (including following any disbanding of the JCC) to answer any reasonable questions from the other party’s Commercialization Leader.

(c) The Project Leaders and Commercialization Leaders shall meet as frequently as they deem necessary to ensure that the Joint Development Plan and the Joint Commercialization Plan are consistent and mutually supportive. In addition, the Commercialization Leaders shall coordinate with the Project Leaders in the submission of the Joint Development Plan and Joint Commercialization Plan to the JEC for review and approval.

3.3.2 Formation of Joint Commercialization Committee for a Licensed Product

(a) The Commercialization Leaders for a Licensed Product shall form and hold the first meeting of a commercialization team to manage the Commercialization of the Licensed Product in the USA (the “ Joint Commercialization Committee ” or “ JCC ”) within sixty (60) days following the Effective Date.

 

  

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(b) A JCC may have any number of members as may be approved by JEC Action. While the parties need not be equally represented in number of members on a JCC, a JCC will be co-led by the two (2) Commercialization Leaders and each party shall have a single vote in the decisions of the JCC.

(c) Each Licensed Product other than IFN-Lambda for which a Phase III Clinical Trial is Initiated as part of the Joint Development Project shall have its own JCC; provided that individuals may serve on the JCC for one or more different Licensed Products.

3.3.3 Roles and Responsibilities

(a) Within ninety (90) days following the Effective Date, the JCC for the first Licensed Product shall prepare and submit to the JEC an initial long-range commercialization plan and high level budget forecast covering the first three (3) years after the Effective Date (the “Long-Range Commercialization Plan” ). As appropriate from time to time and not less often than annually, the JCC for a Licensed Product shall prepare and submit to the JEC proposed updates and amendments to the Long-Range Commercialization Plan for the Licensed Product to cover, in each case, a rolling, multi-year period of at least three (3) years.

(b) Within sixty (60) days after the first JCC meeting referenced above, the JCC shall meet to review Long-Range Commercialization Plan and prepare an initial commercial plan and budget to cover in detail the parties’ respective Party Commercialization Tasks for the first Calendar Year of the of the Joint Development Project for the initial Licensed Product (“ Annual Commercialization Plan ”). Thereafter, the JCC shall, as appropriate from time to time and not less often than annually, prior to the start of the Calendar Year prepare and submit to the JEC an updated Annual Commercialization Plan to cover the forthcoming Calendar Year.

(c) Subject to Sections 3.7 and 3.8 , the JCC shall, under the direction of the Commercialization Leaders with respect to Licensed Products in the USA:

(i) Plan, allocate and coordinate the respective Party Commercialization Tasks.

(ii) Establish and monitor compliance with timelines and budgets, including details regarding external costs and internal costs incurred against the budgeted costs. The JCC shall promptly report to the JEC any actual or anticipated cost overruns in excess of [    *    ] in any budgeted category.

(iii) Review and approve advertising and promotional strategies, market research strategy, medical education strategy and early access and compassionate use strategy.

(iv) Monitor progress of the marketing, distribution and sales of Licensed Products versus the Annual Commercialization Plan and promptly report to the JEC any actual or anticipated sales short falls, timeline delays or other critical matters related to the USA Co-Promotion Agreement.

(v) Oversee plans for labeling, branding and selecting trademarks for each Licensed Product.

 

  

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(vi) Review life cycle management opportunities.

(vii) Monitor performance of the parties’ publication review board and legal-medical review processes.

(viii) Review each party’s reports pertaining to its USA Commercialization Costs.

(ix) Review pricing and reimbursement strategies for Licensed Products in the USA.

(x) Design, in collaboration with the JDC, pharmacoeconomic studies or Phase IV Clinical Trials.

(xi) Coordinate with the JDC to develop and implement a publication strategy for each Licensed Product.

(xii) Coordinate with the JDC to develop and implement a strategy to engage key opinion leaders for each Licensed Product.

The JCC will assign Party Commercialization Tasks and, as necessary, form one or more Working Groups to take responsibility for aspects of the Joint Commercialization Plan or USA Co-Promotion Agreement as applicable.

3.3.4 Meetings and Communications

The JCC shall meet as often as is deemed necessary by the Commercialization Leaders, until Initiation of the first Phase III Clinical Trial for a Licensed Product and thereafter at least quarterly. Meetings shall take place in person, by videoconference or by telephone conference, as mutually agreed by the Commercialization Leaders. There shall be an agenda for each meeting of the JCC, and written minutes of each meeting shall be taken by the Alliance Managers and shall include the issues discussed, decisions made and action items, if any, arising from such meeting. Unless otherwise agreed, the responsibility for chairing meetings shall alternate between the Commercialization Leaders and the responsibility for secretarial duties ( i.e. , circulating an agenda and taking minutes) shall alternate between the Alliance Managers. At each meeting of the JCC, BMS will update Zymo on any material information relating to the Commercialization of the Licensed Products in the ROW. Meeting minutes shall be submitted to the members of the JCC and the JEC by the Alliance Managers. The Commercialization Leaders shall communicate at such other times as necessary to coordinate the activities of the parties.

3.3.5 Decision Making; Formalities

All official actions, decisions or rulings of the JCC under this Agreement must receive the approval of the parties, either in writing (including by email or facsimile) or by vote at a meeting of the JCC, and all significant actions, decisions or rulings shall subsequently be entered into the minutes of meetings of the JCC. In the absence of such mutual approval, either party may, subject to Section 3.9 , by formal written notice to the JEC declare the existence of a dispute at the JCC level and thereby request that such dispute be resolved by the JEC.

 

  

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3.4 Alliance Managers

3.4.1 Appointment

Each of the parties shall appoint a single individual to act as a single point of contact between the parties to assure a successful Collaboration (each, an “ Alliance Manager ”). Each party may change its designated Alliance Manager from time to time upon written notice to the other party. Any Alliance Manager may designate a substitute to temporarily perform the functions of that Alliance Manager by written notice to the other party.

3.4.2 Responsibilities

The Alliance Managers shall use good faith efforts to attend all Committee meetings and support the co-chairpersons (or leaders) of each Committee in the discharge of their responsibilities. Alliance Managers shall be nonvoting participants in such Committee meetings, unless they are also appointed members of such Committee. An Alliance Manager may bring any matter to the attention of any Committee if such Alliance Manager reasonably believes that such matter warrants such attention. Each Alliance Manager shall be charged with creating and maintaining a collaborative work environment within and among the Committees. In addition, each Alliance Manager:

(a) will be the point of first referral in all matters of conflict resolution;

(b) will coordinate the relevant functional representatives of the parties in developing and executing strategies and plans for the Licensed Products in an effort to ensure consistency and efficiency throughout the Collaboration;

(c) will provide a single point of communication for seeking consensus both internally within the respective parties’ organizations and between the parties regarding key strategy and plan issues;

(d) will identify and bring disputes to the attention of the appropriate Committee in a timely manner;

(e) will plan and coordinate cooperative efforts and internal and external communications; and

(f) will take responsibility for ensuring that governance activities, such as the conduct of required Committee meetings and production of meeting minutes, occur as set forth in this Agreement, and that relevant action items resulting from such meetings are appropriately carried out or otherwise addressed.

3.5 Finance Contacts

(a) Each party shall appoint its initial finance contact to coordinate accounting policies and practices and otherwise support the Committees (each a “ Finance Contact ”) within thirty (30) days following the Effective Date and shall promptly thereafter notify the other party of such appointment. If at any time a vacancy occurs for any reason, the party that appointed the

 

  

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prior incumbent shall as soon as reasonably practicable appoint a successor. Each party shall promptly notify the other party in writing of any substitution of another person as its Finance Contact.

(b) Among other things, the Finance Contacts shall coordinate the public disclosure of net sales taking into consideration BMS’ standard practices and Zymo’s reporting requirements.

(c) Each party’s Finance Contact will be available throughout the Term to answer any reasonable questions from the other party’s Finance Contact.

3.6 Working Groups

(a) From time to time, a Committee may establish and delegate duties to sub-committees or directed teams (each, a “ Working Group ”) on an “as-needed” basis to oversee particular projects or activities, which delegation shall be reflected in the minutes of the meetings of the Committee that established such Working Group. Each Working Group shall be constituted and shall operate as the Committee establishing it determines. A Working Group may be established on an ad hoc basis for purposes of a specific project, for the life of a Licensed Product, or on such other basis as the Committee establishing it determines. Each Working Group and its activities shall be subject to the oversight, review and approval of, and shall report to, the Committee that established it. In no event shall the authority of the Working Group exceed that specified for the Committee that established it. Any disagreement between the designees of BMS and Zymo on a Working Group shall be referred to the Alliance Managers and the Committee that established it for resolution.

(b) Concurrent with the formation of the initial JDC pursuant to Section 3.2.2 , a Manufacturing Working Group reporting to the JDC will be formed. The Manufacturing Working Group shall develop a plan and timeline and work with the Finance Contacts to develop a budget for Manufacturing technology transfer and any additional process Development efforts to support the Joint Development Plan, provided that after all Manufacturing-related activities to be conducted by Zymo under the Joint Development Plan have been completed (including all such process transfer), unless otherwise provided by the JDC, the Manufacturing Working Group will dissolve. The Manufacturing Working Group’s plan will be forwarded to the JDC for comment and subsequent proposal to the JEC for review and approval at the first JEC meeting as part of the Joint Development Plan.

3.7 Allocation of Party Development Tasks and Party Commercialization Tasks

The JEC, JDC and JCC shall during the Joint Commercialization Period allocate the Party Development Tasks and Party Commercialization Tasks so as to:

(a) Develop each Licensed Product for Regulatory Approval in the Joint Development Territory in accordance with the Joint Development Plan;

(b) execute the Annual Commercialization Plan;

 

  

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(c) endeavor to take advantage of the respective resources, capabilities and expertise of Zymo and BMS; and

(d) endeavor to:

(i) maintain, to the extent reasonably practical and commercially appropriate, continuity in functions and commitments of personnel and physical resources of the parties;

(ii) avoid duplication of efforts by the parties; and

(iii) foster efficient use by the parties of resources and personnel, consistent with this Agreement, the applicable Joint Development Plan and the applicable Joint Commercialization Plan.

For clarity, as between the parties, BMS shall be solely responsible for the Commercialization of each Licensed Product in the ROW.

3.8 Operational Decisions

Day-to-day operational level decisions concerning a Party Development Task or a Party Commercialization Task shall be made by the party to which responsibility for such task has been allocated under this Agreement; provided that such decisions are not inconsistent with the Joint Development Plan, applicable Annual Development Plan, Joint Commercialization Plan or the express terms and conditions of this Agreement.

3.9 Escalation to Joint Executive Committee

While the parties desire whenever possible to resolve differences of opinion by mutual agreement, they also intend that members of the Committees will be high-level decision-makers within each party’s organizations. Consequently, the parties agree to the following process:

(a) Prior to referring any dispute to the JEC from another Committee or the Finance Contacts, the parties respective Alliance Managers shall meet and discuss the matter to facilitate the resolution of the dispute. The Alliance Managers shall meet as soon as practicable but in any event within ten (10) business days after they became aware of the dispute. If the matter [    *    ] on the [    *    ], [    *    ] or [    *    ] set forth in an Annual Development Plan or Annual Commercialization Plan, then either the Alliance Managers, a Project Leader or Commercial Leader may refer the matter to the JEC, and the Alliance Managers shall ensure that summaries of the dispute are prepared in writing and circulated to the members of the JEC. The Alliance Managers shall circulate the summary to the JEC as soon as practicable but in any event within thirty (30) days after they became aware of the dispute.

(b) Any dispute at the level of a Working Group shall be referred to the Committee that formed such Working Group and to the parties’ respective Alliance Managers for resolution and have such dispute resolved in accordance with Section 3.2.5 or 3.3.5 , as applicable.

(c) Any dispute between the Patent Contacts shall be referred to the parties’ respective Alliance Managers who shall summarize the dispute in writing and circulate it to the

 

  

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members of the JEC as soon as practicable but in any event within thirty (30) days of becoming aware of such dispute.

ARTICLE FOUR

Discovery and Development of Licensed Products

4.1 Initial Joint Development Project; Collaborative Development Efforts for the Joint Development Project

(a) The initial Joint Development Project’s first priority as of the Effective Date will be to achieve Regulatory Approval of IFN-Lambda in the USA for the treatment of hepatitis C in accordance with the Joint Development Plan. For clarity, this may include the conduct of studies to support the Regulatory Approval of IFN-Lambda throughout the Joint Development Territory.

(b) Each of the parties shall use its respective Reasonable Commercial Efforts during the Joint Commercialization Period to:

(i) Develop each Licensed Product for Regulatory Approval by both the FDA and the European Commission, including performing its Party Development Tasks in accordance with the Joint Development Plan; and

(ii) provide the other party with such information and other assistance as is reasonably required for such other party to perform its Party Development Tasks.

(c) Each party shall be responsible for the selection and supervision of its personnel who are assigned any Party Development Tasks pursuant to this Agreement, and shall conduct all of its Development and regulatory activities in accordance with good scientific and clinical practice, and in compliance in all material respects with Applicable Law to achieve its objectives efficiently and expeditiously.

(d) For the sake of clarity, BMS shall be responsible for all studies (and all Regulatory Filings and interactions with Regulatory Agencies) required solely for Regulatory Approval outside the Joint Development Territory.

(e) Zymo, under the direction and oversight of the JDC, shall be responsible for conducting those studies assigned to it in the Joint Development Plan, and in accordance with the Joint Development Plan. Zymo shall provide BMS, via the JDC and Finance Contacts, with the opportunity to review and comment on any proposed agreement with any contract research organization for the conduct of such studies and any proposed amendments thereto, and any protocols included in such agreements (or attachments thereto). Zymo will not be obligated to perform any Party Development Tasks which it does not accept at the time the Joint Development Plan is approved by JEC Action.

(f) For any pre-clinical and clinical studies conducted by Zymo pursuant to the Joint Development Plan and Annual Development Plan, Zymo shall prepare the applicable reports and support for Regulatory Filings in connection with such studies and provide same to BMS. For the ongoing Phase Ib trial, Zymo shall provide such reports to BMS for review and comment prior to filing any such reports or Regulatory Filings.

 

  

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4.2 Technology Transfer

4.2.1 Initial Transfer

Promptly following the Effective Date, Zymo shall, at its cost:

(a) provide to BMS all Materials necessary or useful for the continued Development and Manufacture of Licensed Products (including any cell lines, plasmids, constructs, or material useful in the production of Licensed Products such as IFN-Lambda) that are within the Zymo Enabling Technology existing as of the Execution Date, other than the supplies to be provided pursuant to Section 6.1 ; and

(b) disclose to BMS all material data and information, including all data from the IND, including annual reports and amendments, CMC information, Manufacturing processes and protocols, material safety information and exposure guidelines, clinical and preclinical data, safety monitoring reports, Regulatory Filings (including any regulatory correspondence and contact reports), quality and compliance information, and study reports that are within the Zymo Enabling Technology existing as of the Execution Date (including, for clarity, all material data and information related to IFN-Lambda).

In addition, pursuant to Section 6.1(c) Zymo shall provide the first [    *    ] of consulting time to transition the Manufacturing processes for IFN-Lambda to BMS or a Third Party manufacturer selected by BMS at Zymo’s expense. Thereafter, such time shall be included in Joint Development Costs. Zymo shall use Reasonable Commercial Efforts to provide the consulting time needed to complete the transfer of the applicable Manufacturing processes.

4.2.2 Continuing Exchange of Technology

Throughout the Joint Commercialization Period, BMS and Zymo will each provide to the other party full disclosure, including paper reports and/or electronic access, of BMS Enabling Technology, Zymo Enabling Technology and Project Technology Controlled by such party, including process transfer and validation, assay transfer and validation and Manufacturing transfer and validation. New BMS Enabling Technology, Zymo Enabling Technology or Project Technology shall be disclosed promptly following its discovery or generation. Any costs incurred under this Section 4.2.2 shall be Joint Development Costs or USA Commercialization Costs, as appropriate.

4.3 Party Development Tasks

The Party Development Tasks shall include with respect to a particular Licensed Product, those tasks assigned to a party in the Joint Development Plan as agreed to by the parties for such Licensed Product in the Joint Development Territory. BMS shall have as a Party Development Task responsibility for sourcing all control arm and concomitant medication, i.e. , IFN alpha and ribavirin for all the relevant studies.

 

  

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4.4 Regulatory Matters

4.4.1 Clinical Trial Data

(a) All clinical data and reports related to clinical trials for Licensed Products conducted pursuant to a Joint Development Project shall be owned by BMS, provided that Zymo shall have use of, and right of reference to, all data and reports related to such clinical trials for Licensed Products solely for purposes of performing its obligations under this Agreement. All data, database information and reports from clinical trials for Licensed Products conducted pursuant to a Joint Development Project shall be centralized and held at a location to be chosen by BMS, with a duplicate set available to Zymo.

(b) Promptly following the Effective Date, the parties shall exchange their respective policies regarding the protection of patient data and hereby agree to comply with BMS’ privacy policy to allow the sharing of data and reports related to clinical trials for Licensed Products conducted pursuant to a Joint Development Project.

4.4.2 Regulatory Submissions

(a) Unless otherwise required by relevant Regulatory Agencies:

(i) Subject to Subparagraph (iii) below, BMS shall be the Lead Regulatory Party for all Development activities under the Development Plan, and it shall own all corresponding Regulatory Filings, including INDs.

(ii) Zymo shall provide to BMS copies of all Regulatory Filings described in Section 4.2.1(b) .

(iii) Zymo shall be the Lead Regulatory Party with respect to [    *    ], and it shall own all corresponding Regulatory Filings, including INDs, until at least the time of [    *    ] clinical trial; provided that, following the earlier of (A) [    *    ] and (B) the completion of the [    *    ], the JDC shall agree to a plan whereby Zymo shall assign to BMS all Regulatory Filings described in Subparagraph (ii) and this Subparagraph (iii) , after which Zymo shall no longer be the Lead Regulatory Party. The parties agree that the target date for such assignment shall be the [    *    ], however, the parties agree that the timely [    *    ] is of a high priority and the JDC may delay such assignment if necessary to expedite the [    *    ].

(b) For each Licensed Product Developed or Commercialized under this Agreement, the Lead Regulatory Party shall promptly provide the other party with, as applicable, (i) copies of all material Regulatory Filings in the Joint Development Territory; and (ii) reasonable advance notice (to the extent practicable) of scheduled meetings with the FDA or other relevant Regulatory Agency in the Joint Development Territory that pertain to such Licensed Product. Consistent with Applicable Laws, the Lead Regulatory Party shall afford representatives of the other party a reasonable opportunity to comment on such Regulatory Filings, and shall reasonably consider such comments, and, to the extent not prohibited by Applicable Law, shall afford medical, scientific and/or regulatory representatives of the other party an opportunity, at such other party’s option, to attend such meetings with the relevant Regulatory Agency in the Joint Development Territory, to the extent reasonably practicable under the circumstances. In

 

  

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addition, if Zymo receives written notice from a Regulatory Agency during the time it is the Lead Regulatory Party that it will become subject to an inspection or audit by such Regulatory Agency with respect to a Licensed Product, Zymo shall notify BMS and shall afford BMS’ regulatory representatives an opportunity, at BMS’ option, to attend such inspection or audit pertaining to such Licensed Product, to the extent reasonably practicable under the circumstances. During the time that Zymo is conducting any clinical trials with a Licensed Product pursuant to the Joint Development Plan, Zymo shall work with BMS to ensure compliance with the clinical trial disclosure obligations as described in the Safety Data Exchange Agreement.

(c) The Lead Regulatory Party shall not transfer title or otherwise attempt in any manner to dispose of any Regulatory Filings in the Territory or otherwise impair the other party’s rights in such filings or subsequent Regulatory Approvals.

(d) Prior to a Con


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