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CLINICAL SUPPLY AGREEMENT
THIS CLINICAL SUPPLY AGREEMENT (the “Agreement”) is entered into as of the 1 st day of June, 2006 (the “Effective Date”) by and between SCHERING AKTIENGESELLSCHAFT , a German corporation having a principal place of business at Müllerstraße 178, D-13342 Berlin, Germany (“Schering”) and SONUS PHARMACEUTICALS, INC. , a Delaware corporation having a principal place of business at 22026 20th Avenue SE, Bothell, Washington 98021 (“Sonus”). Schering and Sonus are referred to individually as a “Party” and collectively as “Parties.”
WHEREAS , Schering and Sonus have entered into a Collaboration and License Agreement having an effective date of October 17, 2005 (the “License Agreement”) for the development and commercialization of the Product in the Territory (each as defined below);
WHEREAS , pursuant to the License Agreement, Sonus has granted to Schering exclusive rights to develop and commercialize the Product in the Territory, which rights include, among other rights, the right to elect to make the Product and have the Product made on its behalf;
WHEREAS , Schering gave written notice of its election to assume responsibility for manufacture and supply of Product on March 2, 2006, but has not yet established internal or external manufacturing capabilities for the Product, and the Parties desire that Sonus supply Schering with clinical supplies of the Product pursuant to the MSA (as defined below) until Schering establishes such manufacturing capabilities; and
WHEREAS , pursuant to Section 7.02 of the License Agreement, the Parties wish to provide for each Party’s rights and responsibilities in connection with the clinical supply of the Product to Schering by Sonus as set forth in the terms and conditions of this Agreement.
NOW, THEREFORE , in consideration of the premises and the mutual covenants and agreements contained herein, the Parties agree as follows:
Capitalized terms used in this Agreement (other than the headings of the Articles and Sections), whether used in the singular or plural, shall have the meaning set forth below, or, if not listed below, the meaning as designated in the text of this Agreement.
“ Affiliate ” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by or is under common control with such Person. For the purposes of this definition, a Person shall be deemed to control another Person if such Person possesses the power to direct or cause the direction of the management, business and policies of such Person, whether through ownership of fifty percent (50%) or more of the voting securities of such Person, by contract or otherwise.
“ API ” or “ Active Pharmaceutical Ingredient ” means any component of the Product that is intended to furnish pharmacological activity or other direct effect in the diagnosis, cure, mitigation, treatment, or prevention of disease, or to affect the structure or any function of the
body of man or animals, but does not include intermediates used in the synthesis of such ingredients.
“ Certificate of Analysis ” means a certificate that accompanies each shipment of Product certifying that the Product meets the Specifications.
“ Certificate of Compliance ” means a certificate that accompanies each shipment of Product certifying that the Product has been manufactured according to cGMP.
“ cGMP ” means current Good Manufacturing Practices regulations promulgated by FDA, as they may be amended from time to time. cGMP also includes published standards of FDA (or other standards of FDA that are generally recognized within the United States pharmaceutical industry) that relate to the testing, manufacturing, processing, packaging, holding or distribution of drug substances and finished drugs. cGMP also includes similar standards, guidelines and regulations promulgated or otherwise required by the European Commission, and published standards of the European Commission (and other standards of the European Commission that are generally recognized within the European pharmaceutical industry), including the Guide to Good Manufacturing Practices for Medicinal Products as promulgated under European Directive 91/356/EEC, as amended from time to time, that relate to the testing, manufacturing, processing, packaging, holding or distribution of drug substances and finished drugs..
“ Confidential Information ” means all information and materials regarded by the disclosing Party as confidential (including, without limitation, information relating to the Sonus Technology, as defined in the License Agreement) furnished by one Party to the other pursuant to this Agreement and all information created or developed during the course of the Parties’ collaboration hereunder, whether in oral, written, graphic or electronic form. Confidential Information shall not include any information which the receiving party can prove by competent evidence:
(a) is now or hereafter becomes, through no fault or failure to act on the part of the receiving Party, generally known or available,
(b) is known by the receiving Party, without obligations of confidentiality, at the time of receiving such information, as demonstrated by written evidence,
(c) is hereafter furnished to the receiving Party by a third party, as a matter of right and without restriction on disclosure,
(d) is independently developed by the receiving Party without the aid, application or use of the disclosing party’s Confidential Information, as demonstrated by written evidence, or
(e) is the subject of written permission to disclose provided by the disclosing Party.
“ Contract Manufacturing Agreement ” means an agreement between Sonus and a Third Party contract manufacturer regarding the manufacture of all or part of the clinical supply of the
Product. For the avoidance of doubt, the MSA and the Quality Agreement shall be considered Contract Manufacturing Agreements.
“ EU ” means the countries of the European Union as constituted from time to time.
“FDA” means the United States Food and Drug Administration or successor agency thereto.
“ FD&C Act ” means the United States Federal Food, Drug and Cosmetic Act, as amended.
“Field” means all uses of the Product for the diagnosis, prevention, treatment, cure or mitigation of all disease states, conditions, disorders and indications in humans or in animals
“ Investigator Sponsored Study ” or “ ISS ” means any clinical study with respect to the Product in the Field where the sponsor of the study is a physician or group of physicians acting as sponsor-investigator(s) and neither of the Parties nor any of their Affiliates or sublicensees accept the role of sponsor or co-sponsor of such a study.
“ MSA ” means the Manufacturing and Supply Agreement between Sonus and Gensia Sicor Pharmaceutical Sales, Inc. (now known as Sicor Pharmaceuticals, Inc.), effective as of June 26, 2002.
“ NDA ” means New Drug Application, as described in FDA regulations, 21 C.F.R. 50, including all amendments and supplements to the application.
“ NDA Support Trial ” means any clinical study with respect to the Product in the Field that will be part of the initial NDA (as defined in the License Agreement) submission, excluding the Pivotal Trial (as defined in the License Agreement).
“ Product ” means the product known as TOCOSOL® Paclitaxel, as more particularly described in the License Agreement.
“ Quality Agreement ” means the Quality Agreement for the Manufacturing and Supply of Tocosol® Paclitaxel Injectable Emulsion between Sonus and Sicor Pharmaceuticals, Inc., effective as of February 1, 2005. A complete copy of the Quality Agreement is attached hereto as Exhibit A.
“ ROW ” means all countries, territories and geographical areas of the world, excluding the United States of America and its territories, commonwealths and possessions.
“ ROW Registrational Trial ” means any clinical study with respect to the Product in the Field that will be part of an application for approval by any regulatory authority in the ROW.
“ Schering Sponsored Study ” or “ CSS ” means any non-registrational clinical study with respect to the Product in the Field where the sponsor of the study is Schering or its Affiliates.
“ Specifications ” means the regulatory, manufacturing, quality control and quality assurance procedures, processes, practices, standards, instructions and any other attributes that the Parties agree upon, or that are otherwise required, in connection with the manufacture of the Product, as may be amended by the Parties from time to time. A complete copy of the Specifications, as agreed by the Parties, is attached hereto as Exhibit B.
“ Term ” has the meaning specified in Section 6.1 of this Agreement.
“ Territory ” means the entire world.
“ Third Party ” means any entity other than Schering, Sonus or any of their Affiliates.
2. Supply of Product
2.1 Clinical Supply. Pursuant to the terms hereof, Sonus shall, during the term of this Agreement, manufacture, either by itself of through a Third Party, and supply to Schering clinical supply of the Product necessary to support ISS, CSS, NDA Support Trials, ROW Registrational Trials, and any other investigational study sponsored or conducted by Schering.
2.2 Quality of Product. All Product