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Exhibit 10.2

 

CONFIDENTIAL TREATMENT

 

 

 

 

CO-PROMOTION AGREEMENT

 

by and between

 

CUBIST PHARMACEUTICALS, INC.

 

and

 

OPTIMER PHARMACEUTICALS, INC.

 

Dated as of April 5, 2011

 

 

 


*Confidential Treatment Requested.  Omitted portions filed with the Securities and Exchange Commission (the “Commission”).

 



 

Execution Copy

 

TABLE OF CONTENTS

 

1.

DEFINITIONS AND CONSTRUCTION

1

 

1.1

Definitions

1

 

1.2

Construction

13

2.

PROGRAMS GENERALLY

13

 

2.1

Engagement of Cubist

14

 

2.2

Program Commencement Dates

14

 

2.3

Launch

14

 

2.4

Launch Meeting

14

 

2.5

Sales Force

14

 

2.6

Medical Affairs Force

14

 

2.7

Responsibility for Forces

14

3.

SALES PROMOTION ACTIVITIES

15

 

3.1

Sales Program Plan

15

 

3.2

Sales Force Activities

15

 

3.3

Promotional Medical Education Programs

15

 

3.4

Incentive Compensation by Cubist

16

 

3.5

Sales Materials

16

 

3.6

Sales Force Training

17

 

3.7

Samples

18

4.

MEDICAL AFFAIRS PROGRAM

18

 

4.1

Medical Affairs Program Plan

18

 

4.2

Medical Affairs Force Activities

18

 

4.3

Performance Goals for Cubist Medical Affairs Force

19

 

4.4

Medical Affairs Materials

19

 

4.5

Medical Affairs Force Training

20

 

4.6

Information Requests

21

 

4.7

Studies

21

 

4.8

Expenses

22

 

4.9

Additional Services

22

5.

GOVERNANCE

22

 

5.1

Alliance Manager

22

 

5.2

Joint Steering Committee

22

 

5.3

Joint Clearance Committee

24

6.

OPTIMER RESPONSIBILITIES

25

 

6.1

Manufacture and Supply

25

 

6.2

Stockout Notice

25

 

6.3

Other Responsibilities

25

 

6.4

Contracting Matters

26

7.

REPORTING AND AUDITS

26

 

7.1

Reporting by Cubist

26

 

7.2

Reporting by Optimer

27

 

7.3

Other Information

27

 


*Confidential Treatment Requested. Omitted portions filed with the Commission.

 

i



 

 

7.4

Information Technology

27

 

7.5

Audit Rights

27

8.

CONSIDERATION

28

 

8.1

Service Fee

28

 

8.2

Sales Target Bonuses

28

 

8.3

Promotion Profit Share

28

 

8.4

Consequences of a New Cubist Product

29

 

8.5

Payments; Records; Audits

29

9.

ADVERSE EVENT REPORTING, REGULATORY MATTERS, PRODUCT INFORMATION AND COMPLIANCE

29

 

9.1

Regulatory Reporting and Related Matters

29

 

9.2

Threatened Agency Action

33

 

9.3

Compliance Program

33

 

9.4

Product Information

33

 

9.5

Compliance with Laws and Policies

35

10.

RETURNED/RECALLED PRODUCT

35

 

10.1

Returned Product

35

 

10.2

Recalled Product

35

11.

INDEPENDENT CONTRACTOR STATUS OF CUBIST, INCLUDING THE SALES FORCES

35

12.

NONCOMPETITION; NONSOLICITATION

36

 

12.1

Noncompetition

36

 

12.2

Non-Solicitation

36

13.

CONFIDENTIALITY

36

 

13.1

Confidential Information

36

 

13.2

Exceptions to Confidentiality

36

 

13.3

Residual Knowledge and Inadvertent Disclosure

37

 

13.4

Authorized Disclosure

37

 

13.5

Notification

38

 

13.6

Remedies

38

 

13.7

Use of Names

39

 

13.8

Confidential Treatment

39

14.

TRADEMARKS AND OTHER INTELLECTUAL PROPERTY RIGHTS

39

 

14.1

Product Trademarks; Optimer House Marks; and Cubist Trademarks

39

 

14.2

Ownership

40

 

14.3

Trademark Maintenance

40

 

14.4

Trademark Infringement

40

15.

WARRANTIES; INDEMNITIES; INSURANCE

40

 

15.1

Representations, Warranties and Covenants

40

 

15.2

Optimer Indemnification

43

 

15.3

Cubist Indemnification

43

 

15.4

Indemnification Procedure

44

 

15.5

Insurance

46

 


*Confidential Treatment Requested. Omitted portions filed with the Commission.

 

 

ii



 

16.

TERM AND TERMINATION

46

 

16.1

Term

46

 

16.2

Termination

46

 

16.3

Effect of Expiration or Termination

48

 

16.4

Accrued Rights; Surviving Obligations

49

17.

MISCELLANEOUS

50

 

17.1

Governing Law, Jurisdiction, Venue and Service of Process

50

 

17.2

Force Majeure

50

 

17.3

Waiver

50

 

17.4

Notices

51

 

17.5

Entire Agreement

52

 

17.6

Successors; Assigns; Subcontracting

52

 

17.7

Exhibits

53

 

17.8

Counterparts

53

 

17.9

Severability

53

 

17.10

Affiliates

53

 

17.11

Expenses

53

 

17.12

Further Assurances

53

 

17.13

Construction

54

 

17.14

No Joint Venture

54

 


*Confidential Treatment Requested. Omitted portions filed with the Commission.

 

 

iii



 

EXHIBITS

Exhibit 1.1.29

Cubist Trademarks

Exhibit 1.1.47

Initial Medical Affairs Program Terms

Exhibit 1.1.48

Initial Sales Program Terms

Exhibit 1.1.72

Optimer House Marks

Exhibit 7.1

Form of Cubist Report

Exhibit 17.6.1

Cubist Affiliates

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

 

iv



 

CO-PROMOTION AGREEMENT

 

This Co-Promotion Agreement (the “ Agreement ”) is entered into as of April 5, 2011 (the “ Effective Date ”), by and between Cubist Pharmaceuticals, Inc., a Delaware corporation (“ Cubist ”) and Optimer Pharmaceuticals, Inc., a Delaware corporation (“ Optimer ”). Cubist and Optimer are each referred to in this Agreement as a “ Party ” and collectively as the “ Parties .”

 

RECITALS

 

WHEREAS, Optimer intends to market that certain pharmaceutical compound known as fidaxomicin in prescription form;

 

WHEREAS, Optimer acknowledges Cubist’s experience in commercializing and otherwise promoting pharmaceutical products and wishes to engage the services of Cubist to Promote (as defined herein) and provide other services related to the Product (as defined herein) in the Territory (as defined herein); and

 

WHEREAS, the Parties hereto wish to jointly Promote (as defined herein) the Product in the Territory (as defined herein) and perform certain other activities, all on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the respective covenants, representations, warranties and agreements set forth herein, and intending to be legally bound hereby, the Parties hereby agree as follows:

 

1.              DEFINITIONS AND CONSTRUCTION

 

1.1            Definitions .

 

Unless specifically set forth to the contrary herein, the following terms shall have their indicated meanings when used in this Agreement (including the exhibits):

 

1.1.1                 Act ” means the Federal Food, Drug, and Cosmetic Act, as amended, and the rules, regulations and guidelines of the FDA promulgated thereunder, as may be in effect from time to time.

 

1.1.2                 Adverse Event ” means any adverse drug experience described in the FDA’s New Drug Application postmarketing reporting regulations, 21 C.F.R. 314.80, as they may be amended from time to time.

 

1.1.3                 Affiliate ” means, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by or is under Common Control with such first Person.

 

1.1.4                 Agency ” means any governmental authority or Regulatory Authority in the Territory.

 

1.1.5                 Agreement ” is defined in the Preamble.

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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1.1.6                 Alliance Manager ” is defined in Section 5.

 

1.1.7                 Annual Gross Profit Share Amount Due ” is defined in Section 8.3.

 

1.1.8                 Applicable Law ” means all federal, state and local laws, and the rules, regulations, guidelines and guidances of all Agencies, in effect from time to time, applicable to the marketing, promotion, distribution and sale of the Product in the Territory, including, to the extent applicable, (i) the American Medical Association Guidelines on Gifts to Physicians from Industry, (ii) the PhRMA Code on Interactions with Healthcare Professionals, (iii) the Health Insurance Portability and Accountability Act of 1996, including the Privacy Standards (45 C.F.R. Parts 160 and 164), as amended by the American Recovery and Reinvestment Act of 2009 and any regulations promulgated thereunder, (iv) the Social Security Act and any regulations promulgated thereunder, (v) the Act, (vi) the PDMA, and (vii) state and federal anti-kickback statutes, false claims statutes, statutes that govern price reporting and reimbursement, and statutes that govern marketing disclosure and physician payments, and all rules and regulations promulgated thereunder, in each case in the Territory.

 

1.1.9                 Business Day ” shall mean a day other than a Saturday or Sunday or any public holiday in the United States. For the avoidance of doubt, references in this Agreement to “days” shall mean calendar days.

 

1.1.10               Business Policies ” means the Cubist Business Policies and the Optimer Business Policies.

 

1.1.11               Call ” means an interactive in-person visit to and discussion with a medical professional by a pharmaceutical sales representative that consists of one or more details of a product.

 

1.1.12               Change in Control ” means, with respect to a Party, an event or series of related events in which:

 

(a)            Any Person or group (as such term is defined in the Securities Exchange Act of 1934, as amended) (other than one or more Affiliate(s) of such Party that were Affiliates immediately prior to such event (any such Affiliate with respect to such Party, an “ Existing Affiliate ”)), acquires beneficial ownership (as determined pursuant to Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended) of securities of such Party or any Affiliate thereof that directly, or indirectly through one or more intermediaries, Controls such Party (any such Affiliate with respect to such Party, a “ Controlling Entity ”) representing more than 50% of the voting power of the then outstanding securities of such Party or its Controlling Entity, if any, with respect to the election of members of the Board of Directors or similar governing body of such Party or its Controlling Entity, if any;

 

(b)            Such Party or its Controlling Entity, if any, enters into a merger, consolidation or similar transaction with another Person (other than an Existing Affiliate of such Party) and (A) the members of the Board of Directors of such Party or Controlling Entity, as applicable, immediately prior to such transaction constitute (i) less than one half of the members of the Board of Directors of such Party or Controlling Entity, as applicable, following such transaction, or (ii) less than one half of the Board of Directors of any new Controlling Entity

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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resulting from such transaction; or (B) the Persons who beneficially owned the outstanding voting securities of such Party or Controlling Entity, as applicable, immediately prior to such transaction cease to beneficially own securities of such Party or Controlling Entity, as applicable, representing more than 50% of the voting power of the then outstanding securities of such Party or Controlling Entity, as applicable, with respect to the election of members of the Board of Directors immediately after such transaction in substantially the same proportions as their ownership of securities of such Party or Controlling Entity, as applicable, immediately prior to such transaction;

 

(c)            Such Party or its Controlling Entity, if any, sells or transfers to any Person(s) (other than a transfer by a Controlling Entity to Existing Affiliate(s) of such Party) in one or more related transactions, properties or assets (A) representing more than 50% of such Party’s or Controlling Entity’s, as applicable, consolidated total assets as reflected on its most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q, (B) from which more than 50% of such Party’s or Controlling Entity’s, as applicable, consolidated operating income for its most recent fiscal year as reflected on its most recent Annual Report on Form 10-K was derived or (C) representing substantially all of the properties or assets related to such Party’s obligations under this Agreement; or

 

(d)            Such Party or its Controlling Entity, if any, fails to maintain its corporate existence or liquidates (unless, in connection with the foregoing, the assets of such Party or Controlling Entity, as applicable, are acquired by an Existing Affiliate of such Party and the liabilities of such Party or Controlling Entity (including, if applicable, the Party’s obligations under this Agreement) are assumed by such Existing Affiliate of such Party).

 

1.1.13               Combination Promotional Medical Education Program ” is defined in Section 3.3.2.

 

1.1.14               Commercially Reasonable Efforts ” of a Party mean (i) with respect to Cubist, those efforts that are consistent with Applicable Law and with industry standards and practices followed by a similarly situated pharmaceutical company in the Promotion of pharmaceutical products with a potential market comparable to the Product, and (ii) with respect to Optimer, those efforts that are consistent with Applicable Law and with industry standards and practices followed by a similarly situated pharmaceutical company in connection with the manufacture, Promotion, distribution and sale of pharmaceutical products in a similar stage in product life as the Product and with a potential market and profit potential comparable to the Product (based on conditions then prevailing). For clarity, if a Party is required hereunder to use Commercially Reasonable Efforts with respect to a given activity and such activity is performed by an Affiliate of such Party, rather than such Party, such Party shall cause such Affiliate to use Commercially Reasonable Efforts to perform such activity.

 

1.1.15               Competing Product ” means any product, other than the Product, that has [ ]* in the Territory, [ ]*.

 

1.1.16               Competing Program ” is defined in Section 13.3.

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

3



 

1.1.17               Confidential Information ” means (i) any and all information or material, that, at any time before or after the Effective Date has been or is provided or communicated to the Receiving Party by or on behalf of the Disclosing Party, including by or on behalf of any of its Affiliates, pursuant to this Agreement or in connection with the transactions contemplated hereby or any discussions or negotiations with respect thereto (including any information disclosed pursuant to the Mutual Non-Disclosure Agreement between the Parties effective as of July 9, 2009, as amended); (ii) any data, ideas, concepts or techniques contained in any of the foregoing; and (iii) any modifications of any of the foregoing or derivations of any of the foregoing. Confidential Information may be disclosed orally, visually, in writing, by delivery of materials containing Confidential Information, or in any other form now known or hereafter invented; provided, however, that any information or material specifically relating to the Product, including the Promotion thereof (but excluding, without limitation, (a) the identity of and information regarding the Target Accounts and Target Prescribers and the allocation of Cubist’s Sales Force thereto, and (b) information relating to the Disease State generally), shall be the Confidential Information of Optimer regardless of which Party first disclosed such information, and Optimer and Cubist shall be deemed the Disclosing Party and Receiving Party, respectively, with respect thereto. The terms of this Agreement shall be the Confidential Information of both Parties.

 

1.1.18               Control ” and, with correlative meanings, the terms “Controlled by” and “under Common Control with,” means (i) the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of voting securities, by contract, resolution, regulation or otherwise or (ii) the ownership, directly or indirectly, of more than 50% of the voting securities or other ownership interest of a Person (or, with respect to a limited partnership or other similar entity, its general partner or controlling entity).

 

1.1.19               Controlling Entity ” is defined in Section 1.1.12(a).

 

1.1.20               Cost of Goods Sold ” means the standard cost of goods for the Product sold in the applicable time period, which standard cost shall be determined and allocated by Optimer in accordance with GAAP, including Optimer’s good faith estimate of (A) Optimer’s and its Affiliates’ [ ]*, (B) all of Optimer’s and its Affiliates’ [ ]*, (C) [ ]*, and (D) [ ]*. Notwithstanding the foregoing, Cost of Goods Sold for Product from [ ]* shall be determined in accordance with clauses (A) through (D) above whether or not [ ]*.

 

1.1.21               Cubicin ” means that certain pharmaceutical compound known as daptomycin in prescription form for injection that has received Regulatory Approval from the FDA to be marketed in the Territory under the Cubist Trademark Cubicin.

 

1.1.22               Cubist ” is defined in the Preamble.

 

1.1.23               Cubist Business Policies ” means Cubist’s business policies, standard business procedures, and coaching sheets, that in each case, govern the Promotion and the Medical Affairs Program activities and, in each case, to the extent such business policies, standard business procedures, and coaching sheets are consistent with Applicable Law and this Agreement, copies of which have been provided by Cubist to Optimer prior to the Effective Date

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

4



 

(as such business policies, standard business procedures and coaching sheets may be amended from time to time by Cubist, provided that Cubist provides amended copies thereof to Optimer).

 

1.1.24               Cubist Competitor ” means any Third Party that is developing or marketing [ ]* (which, for clarification, shall not include an [ ]*) for the treatment of [ ]*. For clarity, developing, in this definition, refers to development of [ ]*.

 

1.1.25               Cubist Indemnified Parties ” is defined in Section 15.2.

 

1.1.26               Cubist Medical Affairs Force ” means the Cubist Medical Affairs Representatives (including their direct supervisors, managers, and trainers) and other Cubist employees performing Medical Affairs Program activities under this Agreement.

 

1.1.27               Cubist Report ” is defined in Section 7.1.

 

1.1.28               Cubist Sales Force ” means the Cubist Sales Representatives (including their direct supervisors, managers, and trainers) and other Cubist employees performing Sales Program activities under this Agreement.

 

1.1.29               Cubist Trademarks ” means (i) the Trademarks of Cubist and its Affiliates set forth on Exhibit 1.1.29 , and any existing, pending or future Trademark registrations, applications and unregistered Trademark rights, in each case relating to such Trademarks, and (ii) any current or future modifications or variants of any of the foregoing rights.

 

1.1.30               Detail ” means a face-to-face (a) one-on-one discussion with a Target Prescriber or (b) discussion with a group consisting of no more than [ ]* Target Prescribers at the same time, in each case during which a Sales Representative makes a presentation of certain of the Product’s attributes, such as describing the FDA-approved indicated uses, safety, effectiveness, contraindications, side effects, warnings or other relevant characteristics of the Product, consistent with the requirements of this Agreement and Applicable Law and in a manner that is customary in the industry for the purpose of promoting a prescription pharmaceutical product. When used as a verb, “Detail” means to engage in a Detail. For the avoidance of doubt, (i) a reminder presentation or a sample drop shall not constitute a Detail; and (ii) presentations to groups consisting of more than [ ]* people or containing more than [ ]* Target Prescribers, medical conventions or institutions shall not constitute Details.

 

1.1.31               Disclosing Party ” means the Party disclosing Confidential Information.

 

1.1.32               Disease State ” means Clostridium difficile infection in humans.

 

1.1.33               Effective Date ” is defined in the Preamble.

 

1.1.34               Employment Law ” means all federal, state, or local statutes, laws, ordinances, regulations or guidelines relating to (i) employment, (ii) safety and health, and (iii) the payment of taxes and required taxes and payments with respect to employees.

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

5



 

1.1.35               Existing Affiliate ” is defined in Section 1.1.12(a).

 

1.1.36               FDA ” means the United States Food and Drug Administration and any successor agency having substantially the same functions.

 

1.1.37               Field Alert ” is defined in Section 9.1.9.

 

1.1.38               First Commercial Sale ” means the first bona fide sale of the Product in the Territory to an end consumer (including any pharmacy, hospital, skilled nursing facility or similar institution) following receipt of Regulatory Approval of the Product in the Territory. For clarity, First Commercial Sale shall not include any sale, transfer or disposition of the Product as promotional samples or for charitable or pre-clinical, clinical or post-approval studies purposes.

 

1.1.39               First Sales Year ” means the 12 month period starting on the date of the First Commercial Sale and ending on the last day of the month in which the first anniversary of the First Commercial Sale date occurs.

 

1.1.40               Force Majeure Event ” is defined in Section 17.2.

 

1.1.41               GAAP ” means the United States generally accepted accounting principles, applied on a consistent basis, or any successor accounting principles generally accepted for public companies in the United States (such as International Financial Reporting Standards).

 

1.1.42               Gross Profit ” means, with respect to any period, Net Sales for such period, less the [ ]*.

 

1.1.43               Gross Sales ” means, for a given period, all sales of the Product during such period ([ ]*) by or on behalf of Optimer or its Affiliates to Third Parties in the Territory (regardless of whether Optimer or its Affiliates have received more or less than the [ ]*). For purposes of determining Gross Sales, (i) the Product shall be deemed to be sold at the point of shipment, and (ii) sales, transfers or dispositions of the Product as promotional samples or for charitable or pre-clinical, clinical or post-approval studies purposes shall be excluded from Gross Sales, and (iii) sales or transfers of the Product among Optimer and its Affiliates shall be excluded from Gross Sales, provided that any subsequent sale to a Third Party in the Territory shall be included.

 

1.1.44               Indemnification Claim Notice ” is defined in Section 15.4.1.

 

1.1.45               Indemnified Party ” is defined in Section 15.4.1.

 

1.1.46               Indemnifying Party ” is defined in Section 15.4.1.

 

1.1.47               Initial Medical Affairs Program Terms ” means the key terms of the Medical Affairs Program Plan set forth in Exhibit 1.1.47 attached to this Agreement as of the Effective Date.

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

6



 

1.1.48               Initial Sales Program Terms ” means the key terms of the Sales Program Plan (including the Promotional Medical Education Program) set forth in Exhibit 1.1.48 attached to this Agreement as of the Effective Date.

 

1.1.49               Initial Term ” is defined in Section 16.1.

 

1.1.50               Joint Clearance Committee ” is defined in Section 5.3.1.

 

1.1.51               Joint Steering Committee ” is defined in Section 5.2.1.

 

1.1.52               Key Opinion Leader ” means a medical professional recognized as a leading expert in his or her respective field, including any person set out on a list of such medical professionals developed jointly and agreed to in writing by the Parties.

 

1.1.53               Know-How ” means all technical knowledge, expertise, skill, practice, market research data, marketing and sales data and any other marketing-related data, proprietary rights, regulatory approvals, discoveries, inventions, improvements, trade secrets, copyrights and processes relating to the Product and all pre-clinical, clinical, stability and other data relating to the Product.

 

1.1.54               Knowledge ” means, when referring to the knowledge of Cubist or Optimer, the actual, unaided knowledge of the following individuals: (a) for Cubist, Cubist’s [ ]* and (b) for Optimer, Optimer’s [ ]*.

 

1.1.55               Losses ” is defined in Section 15.2.

 

1.1.56               Medical Affairs Force ” means each of the Cubist Medical Affairs Force and the Optimer Medical Affairs Force.

 

1.1.57               Medical Affairs Materials ” is defined in Section 4.4.3.

 

1.1.58               Medical Affairs Program ” is defined in Section 4.2.

 

1.1.59               Medical Affairs Program Commencement Date ” means the date set forth in the Medical Affairs Program Plan on which the Medical Affairs Program shall commence.

 

1.1.60               Medical Affairs Program Plan ” is defined in Section 4.1.

 

1.1.61               Medical Affairs Representative ” means a scientific or medical representative who (i) is primarily focused on infectious diseases and therapeutic areas related thereto in the Territory, (ii) has relevant clinical experience and sufficient health care experience (including at least a four-year degree and clinical, residency or fellowship experience or other highly specialized training relevant to Medical Affairs Program activities, including any such professional with a Ph.D., Pharm.D. or M.D. degree) to engage in in-depth dialogues with physicians regarding medical issues associated with the Product, (iii) is employed by a Party or any of its Affiliates on a full-time basis, and (iv) is not a Sales Representative or otherwise engaged in direct Promotion of the Product. For clarity, (a) Cubist Medical Affairs

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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Representatives would include Cubist Clinical Scientific Directors (CSDs) and (b) Optimer Medical Affairs Representatives would include Optimer Medical Education Research Liaisons (MERLs).

 

1.1.62               Medical Affairs Training Materials ” is defined in Section 4.5.2(b).

 

1.1.63               Medical Affairs Training Plan ” means that certain plan with respect to training the Medical Affairs Forces that shall be prepared by the Parties as soon as practicable after the Effective Date, as such plan may be modified from time to time by the Joint Steering Committee in accordance with this Agreement.

 

1.1.64               National Sales Meeting ” is defined in Section 3.6.3.

 

1.1.65               NDA ” means a “New Drug Application,” as defined in the Act.

 

1.1.66               Net Sales ” means, with respect to any period, Gross Sales for such period less deductions, to the extent recognized in accordance with GAAP, and not for promotional purposes for: (i) [ ]*, including (A) [ ]*, (B) [ ]*, (C) [ ]* and (D) [ ]*; (ii) [ ]*; (iii) [ ]*; (iv) [ ]* (including [ ]*; (v) [ ]* (but not including [ ]*; (vi) [ ]*; and (vii) [ ]* in accordance with GAAP [ ]*. Any of the deductions specified in this definition that involves a payment or credit shall be taken as a deduction in the Sales Quarter in which the payment or credit is accrued by Optimer or its applicable Affiliate, in accordance with GAAP. If, as part of any managed care program or arrangement, the Product is sold with other products such that it is not possible to determine which of the deductions set forth above are specifically attributable to the Product, then Optimer shall apportion the deductions across the bundle of products on a relative fair value basis. Notwithstanding anything contained herein, in no event shall any category of expense, to the extent included in Optimer’s determination of the Cost of Goods Sold for a given period, be taken as a deduction in the calculation of Net Sales for such period.

 

1.1.67               Noncompete Period ” is defined in Section 12.1.1.

 

1.1.68               Notice ” means any notice, request, report, statement or other communication to either Party by the other Party pursuant to, in connection with, or relating to, this Agreement.

 

1.1.69               Off-Label Information ” means any written, printed, graphic or oral information with respect to the Product that is inconsistent with, or outside the scope of, the FDA-approved labeling for the Product in the Territory.

 

1.1.70               Optimer ” is defined in the Preamble.

 

1.1.71               Optimer Business Policies ” means Optimer’s business policies, standard business procedures, and coaching sheets, that in each case, relate to the Programs and the manufacture of the Product and, in each case, to the extent consistent with Applicable Law and this Agreement (as such business policies, standard business procedures and coaching sheets may be amended from time to time by Optimer).

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

8



 

1.1.72               Optimer House Marks ” means (i) the Trademarks of Optimer set forth on Exhibit 1.1.72 and any pending or future Trademark registrations, applications and unregistered Trademark rights, in each case relating to such Trademarks, and (ii) any current or future modifications or variants of any of the foregoing rights.

 

1.1.73               Optimer Indemnified Parties ” is defined in Section 15.3.

 

1.1.74               Optimer Medical Affairs Force ” means the Optimer Medical Affairs Representatives (including their direct supervisors, managers, and trainers) and other Optimer employees performing Medical Affairs Program activities under this Agreement.

 

1.1.75               Optimer Report ” is defined in Section 7.2.

 

1.1.76               Optimer Sales Force ” means the Optimer Sales Representatives (including their direct supervisors, managers, and trainers) and other Optimer employees performing Sales Program activities under this Agreement.

 

1.1.77               Other Fidaxomicin Product ” means any form of fidaxomicin other than a Product.

 

1.1.78               Party ” and “ Parties ” is defined in the Preamble.

 

1.1.79               PDMA ” means the Prescription Drug Marketing Act of 1987, as amended, and the rules, regulations and guidelines promulgated thereunder and in effect from time to time.

 

1.1.80               Permitted Uses ” is defined in Section 14.1.1.

 

1.1.81               Person ” means any individual or entity, including a government or political subdivision, department or agency of a government.

 

1.1.82               “Primary Position Detail” means a Detail in which the Product (i) is the first product Detailed, (ii) is emphasized [ ]* and (iii) is the primary focus of such Detail, primary focus meaning [ ]*.

 

1.1.83               Proceeding(s) ” is defined in Section 15.1.3(d).

 

1.1.84               Product ” means that form of fidaxomicin in prescription form intended to be marketed by Optimer under the Product NDA.

 

1.1.85               Product Gross Margin Percentage ” means, with respect to any period, (a) [ ]*, divided by (b) [ ]*.

 

1.1.86               Product Information Request ” is defined in Section 9.4.5.

 

1.1.87               Product Labels and/or Inserts ” means (i) all FDA-approved labels and other written, printed or graphic matter affixed to any container, packaging or wrapper

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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utilized in connection with the Product, or (ii) any written material physically accompanying the Product, including Product package inserts.

 

1.1.88               Product NDA ” means NDA 201,699 for Dificid™ (fidaxomicin tablets).

 

1.1.89               Product Quality Complaint ” means any and all manufacturing or packaging-related complaints related to the Product, including (i) any complaint involving the possible failure of the Product to meet any of the specifications for the Product; (ii) any dissatisfaction with the design, package or labeling of the Product; or (iii) any Adverse Event that may involve the quality of the Product.

 

1.1.90               Product Trademarks ” means (i) the Trademark Dificid™ and the registrations thereof, (ii) any pending or future Trademark registration applications relating to the Product, (iii) any unregistered Trademark rights relating to the Product as may exist through use prior to or as of the Effective Date, (iv) any current or future modifications or variants of any of the foregoing rights, and (v) any future Trademarks adopted by Optimer or its Affiliates for use in connection with the Product. For the avoidance of doubt, “Product Trademarks” shall not include any Optimer House Marks.

 

1.1.91               Program ” means, collectively, the Sales Program and the Medical Affairs Program.

 

1.1.92               Program Employees ” means all members of the Cubist Sales Force, Cubist Medical Affairs Force, Optimer Sales Force, and Optimer Medical Affairs Force.

 

1.1.93               Promotion ” means Detailing and those other activities normally undertaken by a pharmaceutical company’s sales force, and its supervisors and managers, to implement marketing plans and strategies aimed at encouraging the appropriate use of a particular prescription pharmaceutical product. When used as a verb, “ Promote ” means to engage in such activities.

 

1.1.94               Promotional Medical Education Program Materials ” is defined in Section 3.3.3.

 

1.1.95               Promotional Medical Education Programs ” is defined in Section 3.3.1.

 

1.1.96               Public Announcement ” means public announcements, press releases, investor calls, or advertising, recruiting and other public documents.

 

1.1.97               Quarterly Amount Due ” is defined in Section 8.1.

 

1.1.98               Receiving Party ” means the Party receiving or having access to Confidential Information of the other Party.

 

1.1.99               Recipients ” is defined in Section 13.1.

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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1.1.100             Regulatory Approval ” means any and all approvals (including price and reimbursement approvals, if required), licenses, registrations, or authorizations of Regulatory Authorities in the Territory that are necessary for the marketing and sale of a product in the Territory for the treatment, prevention, modulation, or diagnosis of any disease, disorder or condition in humans.

 

1.1.101             Regulatory Authority ” shall mean any national, regional, state or local regulatory agency, department, bureau, commission, council or other governmental entity whose review and/or approval is necessary for the manufacture, packaging, use, storage, import, export, distribution, promotion, marketing, offer for sale and sale of a product in a country for the treatment, prevention, modulation, or diagnosis of any disease, disorder or condition in humans. For countries where governmental approval is required for pricing or reimbursement for a Product, “Regulatory Authority” shall also include any national, regional, state or local regulatory agency, department, bureau, commission, council or other governmental entity whose review and/or approval of pricing or reimbursement is required.

 

1.1.102             Residual Knowledge ” is defined in Section 13.3.

 

1.1.103             Sales Force ” means each of the Cubist Sales Force and the Optimer Sales Force.

 

1.1.104             Sales Materials ” is defined in Section 3.5.3.

 

1.1.105             Sales Program ” means the program of Promoting (including Detailing) the Product, including all supervision, management and training with respect thereto, conducted by the Parties under Section 3.

 

1.1.106             Sales Program Commencement Date ” means the date set forth in the Sales Program Plan on which the Sales Program shall commence.

 

1.1.107             Sales Program Plan ” is defined in Section 3.1.

 

1.1.108             Sales Quarter ” means each full calendar quarter during the Term, provided that (a) the first Sales Quarter shall commence on the first day of the first full calendar quarter immediately following the first day of the First Sales Year (or, if the first day of the First Sales Year is the first day of a calendar quarter, the first Sales Quarter shall commence on the first day of the First Sales Year), and (b) the last Sales Quarter shall end on the last day of the last Sales Year and, provided further, that if the first day of the First Sales Year is not the first day of a calendar quarter, the Parties’ finance contacts shall meet and in good faith discuss and attempt to agree upon adjustments and reconciliations to terms of this Agreement pertaining to payments and reporting, including adjustments to the Sales Targets, if and as necessary to account for the discrepancy between the first and last Sales Quarters and Sales Years. If the Parties’ finance contacts cannot agree upon any such adjustments and reconciliations, then “ Sales Quarter ” shall mean each consecutive three-month period during each Sales Year, provided that (i) the first Sales Quarter shall run from the first day of the First Sales Year to the end of the last day of the third full month after first day of the First Sales Year, and (ii) each subsequent Sales Quarter shall end on the last day of every third month thereafter.

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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1.1.109             Sales Representative ” means a sales representative (i) who is primarily focused on infectious diseases and therapeutic areas related thereto in the Territory, (ii) whose skills, training and experience are consistent with (a) industry standards applicable to the promotion, marketing and sale of a prescription pharmaceutical product and (b) the qualifications or requirements set forth in the Sales Program Plan, (iii) who is responsible for Promoting the Product in the Territory, and (iv) who is employed by a Party or any of its Affiliates on a full-time basis. For clarity, Cubist Sales Representatives would include Cubist Clinical Business Managers (CBMs)).

 

1.1.110             Sales Target ” means the target amount of Net Sales of the Product in the Territory for each of the First Sales Year and the Second Sales Year, as set forth on a Sales Quarterly basis in a side letter between the Parties, dated as of the Effective Date, as such target amount may be amended from time to time by mutual agreement of the Parties in writing.

 

1.1.111             Sales Target Bonus ” is defined in Section 8.2.

 

1.1.112             Sales Training Materials ” is defined in Section 3.6.2(c).

 

1.1.113             Sales Training Plan ” means that certain plan with respect to training the Sales Forces that shall be prepared by the Parties as soon as practicable after the Effective Date, as such plan may be modified from time to time by the Joint Steering Committee in accordance with this Agreement.

 

1.1.114             Sales Year ” means each of the First Sales Year and the Second Sales Year, as well as any subsequent 12 month periods for which the Agreement is extended pursuant to Section 16.1.

 

1.1.115             Second Sales Year ” means the 12 month period starting on the first day following the end of the First Sales Year and ending on the first anniversary of such starting date.

 

1.1.116             “Secondary Position Detail” means a Detail in which the Product is the second product discussed and the secondary focus of such Detail, wherein “secondary focus” means at least [ ]* and the Product is emphasized [ ]* other than [ ]*.

 

1.1.117             Stockout ” means:

 

(a)            any failure by Optimer to fulfill at least [ ]* Optimer and, as a result of such failure, [ ]* of (i) [ ]* or (ii) [ ]*; or

 

(b)            any notice or other communication by or on behalf of Optimer or its Affiliates to Target Prescribers and other Third Party medical professionals in the Territory that the Product in the Territory is or will be subject to rationing, limited availability or supply constraints.

 

1.1.118             Systems ” is defined in Section 7.4.

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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1.1.119             Target Accounts ” mean those certain institutions selected from among the institutions that Cubist has targeted as of the Effective Date or thereafter and that are identified in a side letter between the Parties, dated as of the Effective Date, as such list may be amended from time to time by amendment of the Sales Program Plan in accordance with Section 5.2.5.

 

1.1.120             Target Prescriber ” means a physician who is licensed to prescribe drugs and is in a position to directly influence or recommend the prescription or purchase of the Product and who (a) is an infectious disease physician, or (b) has already been targeted by Cubist in connection with its other promotional activities, and in each case, who practices, is employed by or otherwise provides services at a Target Account.

 

1.1.121             Term ” is defined in Section 16.1.

 

1.1.122             Territory ” means the United States of America and its territories and possessions, including Puerto Rico and the District of Columbia.

 

1.1.123             Third Party ” means any Person other than the Parties and their respective Affiliates.

 

1.1.124             Third Party Claim ” is defined in Section 15.2.

 

1.1.125             Trademark ” means any trademark, trade dress, brand mark, trade name, brand name, corporate name, logo or business symbol.

 

1.1.126             Training Materials ” means, collectively, the Sales Training Materials and the Medical Affairs Training Materials.

 

1.1.127             Training Plans ” means, collectively, the Sales Training Plan and the Medical Affairs Training Plan.

 

1.1.128             Wholesale Acquisition Cost ” means, with respect to a product, a published list price for such product (which list price, for clarity, does not include prompt pay or other discounts, rebates or reductions in price) for the month in which the applicable sale of such product occurred, as such list price is publicly reported by the selling Person.

 

1.2            Construction .

 

Unless the context of this Agreement otherwise requires: (a) words of any gender include each other gender; (b) words using the singular or plural number also include the plural or singular number, respectively; (c) the terms “hereof,” “herein,” “hereby” and derivative or similar words refer to this entire Agreement; (d) the terms “Article,” “Section,” “Schedule” or “Exhibit” refer to the specified Article, Section, Schedule or Exhibit of this Agreement; (e) the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or”; and (f) the term “including” or “includes” means “including without limitation” or “includes without limitation.”

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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2.              PROGRAMS GENERALLY

 

2.1            Engagement of Cubist . Subject to the terms and conditions of this Agreement, Optimer hereby engages Cubist, and Cubist hereby accepts such engagement, as Optimer’s exclusive partner in Promoting the Product in the Territory, and conducting the Sales Program and the Medical Affairs Program with respect to the Product in the Territory.

 

2.2            Program Commencement Dates . The Parties shall mutually select and agree upon a Sales Program Commencement Date and a Medical Affairs Program Commencement Date, which shall be set forth in the Sales Program Plan and Medical Affairs Program Plan, respectively.

 

2.3            Launch . Optimer will use Commercially Reasonable Efforts to effect a full launch of the Product (as opposed to a soft launch) where such launch would occur only when the distribution network for the Product (including, for example, Optimer’s and its wholesalers’ and distributors’ capability of receiving and fulfilling orders for the Product throughout the Territory) is substantially established.

 

2.4            Launch Meeting . If the Parties so mutually agree, Cubist will participate in relevant portions of Optimer launch meetings for the Product in the Territory. [ ]* will bear the cost of [ ]* personnel attending such meetings.

 

2.5            Sales Force . By the Sales Program Commencement Date, each of Cubist and Optimer, respectively, will establish the Cubist Sales Force and the Optimer Sales Force in accordance with the Sales Program Plan. Without limiting the foregoing and notwithstanding anything to the contrary herein or in the Sales Program Plan, at all times during the Term (a) Cubist shall maintain a Sales Force consisting of at least [ ]* Sales Representatives and (b) Optimer shall maintain a Sales Force consisting of at least [ ]* Sales Representatives, in each case, at full capacity, subject to fluctuation in the ordinary course of business for vacancies, leave, and other ordinary absences; provided, however, that each Party shall use Commercially Reasonable Efforts to fill vacancies within a reasonable period of time.

 

2.6            Medical Affairs Force . By the Medical Affairs Program Commencement Date, each of Cubist and Optimer, respectively, will establish the Cubist Medical Affairs Force and the Optimer Medical Affairs Force in accordance with the Medical Affairs Plan. Without limiting the foregoing and notwithstanding anything to the contrary herein or in the Medical Affairs Program Plan, at all times during the Term (a) Cubist shall maintain a Medical Affairs Force consisting of at least [ ]* Medical Affairs Representatives, and (b) Optimer shall maintain a Medical Affairs Force consisting of at least [ ]* Medical Affairs Representatives, in each case, at full capacity, subject to fluctuation in the ordinary course of business for vacancies, leave, and other ordinary absences; provided, however, that each Party shall use Commercially Reasonable Efforts to fill vacancies within a reasonable period of time.

 

2.7            Responsibility for Forces . Except as otherwise set forth in this Agreement, each Party shall be legally responsible and liable for the actions, omissions and conduct of all of the members of its Sales Force and Medical Affairs Force. Each Party shall also be exclusively responsible for supervising the members of its Sales Force and Medical Affairs Force in all respects.

 


*Confidential Treatment Requested.  Omitted portions filed with the Commission.

 

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3.              SALES PROMOTION ACTIVITIES

 

3.1            Sales Program Plan . As soon as practicable after the Effective Date, the Parties shall prepare the Sales Program Plan for the Product (the “ Sales Program Plan ”). The Sales Program Plan shall be consistent with, and shall include, at a minimum, the Initial Sales Program Terms. The Sales Program Plan may be amended by the Joint Steering Committee in accordance with Section 5.2.2.

 

3.2            Sales Force Activities . Commencing on the Sales Program Commencement Date and for the remainder of the Term, each Party shall use Commercially Reasonable Efforts to ensure that its respective Sales Force Promotes the Product in accordance with the Sales Program Plan, including Detailing the Product to the Target Prescribers. Optimer shall also use Commercially Reasonable Efforts to cause its Sales Representatives to Promote (including Detailing) the Product to institutions and physicians (other than Target Accounts and Target Prescribers) reasonably likely to be Product cu


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