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Exhibit 10.1
SUPPLY, DISTRIBUTION AND
MARKETING AGREEMENT
THIS SUPPLY, DISTRIBUTION
AND MARKETING AGREEMENT (this “Agreement”) is made
effective as of August 9, 2006 (the “Effective
Date”) by and among Oscient Pharmaceuticals Corporation, a
Massachusetts corporation with a principal place of business at
1000 Winter Street, Suite 2200, Waltham, Massachusetts
(“Supplier”), Abbott International, LLC, a U.S. limited
liability company with a place of business at 200 Abbott Park Road,
Dept 64E, AP34-1, Abbott Park, IL 60064-6194
(“Purchaser”) and, solely for the purposes of Sections
1.1, 2.3, 2.5, 3.2(b), 3.3(c), 7, 8.2, 8.4, 9.4, 11, 13.3, 16, 18
and 19 herein, Abbott Laboratories, Ltd., a Canadian corporation
with a place of business at 8401, Autoroute Trans Canada,
Saint-Laurent, Québec (“Abbott Canada”) and solely
for the purposes of Section 20, Abbott Laboratories, an
Illinois corporation with a place of business at 100 Abbott Park
Road, Abbott Park, Illinois 60064. Supplier, Purchaser and Abbott
Canada are each hereafter referred to individually as a
“Party” and together as the
“Parties”.
WHEREAS , Supplier has
the capability to manufacture the Products (as defined below);
and
WHEREAS , the Parties
desire that Supplier supply Purchaser with the Products under this
Agreement on the terms and subject to the conditions set forth
below.
NOW THEREFORE , in
consideration of the mutual covenants contained herein, and for
other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the Parties hereby agree as
follows:
| 1. |
DEFINITIONS AND INTERPRETATION |
1.1 Definitions . Whenever
used in the Agreement with an initial capital letter, the terms
defined in this Article 1 shall have the meanings
specified.
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(a) |
“ ABS ” shall mean
acute bacterial sinusitis. |
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(b) |
“ Actual Selling Price ” shall be
equal to the aggregate Net Sales for all Product in the applicable
month divided by the number of tablets sold by Purchaser and Abbott
Canada to wholesalers, pharmacies or hospitals in such applicable
month. |
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(c) |
“ Actual Transfer Price
” shall have the meaning ascribed thereto in
Section 10.2(b). |
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(d) |
“ AECB ” shall mean acute bacterial
exacerbations of chronic bronchitis. |
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(e) |
“ Affiliate ” shall
mean in respect of any Party any corporation, firm, limited
liability company, partnership or other entity which directly
Controls or is Controlled by or is under common Control with such
Party. For purposes of this definition only, “control”
means ownership, directly or indirectly through one or more
Affiliates, of fifty percent (50%) or more of the shares of
stock entitled to vote for the election of directors, in the case
of a corporation, or fifty percent
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-1-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
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(50%) or more of the
equity interests in the case of any other type of legal entity,
status as a general partner in any partnership, or any other
arrangement whereby a party controls or has the right to control
the Board of Directors or equivalent governing body of a
corporation or other entity.
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(f) |
“ Adverse Event ” shall
mean a noxious and unintended response in a patient (human or
animal) being administered a drug, whether or not such response is
related to the drug, which occurs at doses normally used or tested
for the diagnosis, treatment or prevention of a disease or the
modification of an organic function. |
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(g) |
“ Applicable Percentage ” shall equal
(i) [*]% for the period prior to Purchaser’s achievement
of Product Net Sales of $[*] Million (calculated in Canadian
dollars); (ii) thereafter, [*]% until Purchaser’s
achievement of Product Net Sales of $[*] Million (calculated in
Canadian dollars); and (iii) [*]% for any period
thereafter. |
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(h) |
“ Business Day ” any day which
is not a Saturday, Sunday or day observed as a holiday under the
laws of the Province of Quebec or the federal laws of Canada
applicable therein or under the laws of Massachusetts or the
federal laws of the United States of America applicable
therein. |
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(i) |
“ Call ” shall mean a
personal visit by a Sales Representative to a member of the Target
Audience in the Territory during which such Sales Representative
Details a Product. |
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(j) |
“ CAP ” shall mean community-acquired
pneumonia of mild-to-moderate severity. |
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(k) |
“ Certificate of Analysis and Compliance
” means a written certification, substantially in the
form attached as Exhibit A , delivered by Supplier to
Purchaser with each shipment of Finished Products that
(i) sets forth the analytical test results for said shipment
of Finished Product, and (ii) states that the said shipment of
Finished Product was manufactured in compliance with the
Specifications and the GMP. |
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(l) |
“ Commercialize ” and “
Commercialization ” shall mean, with respect to
the Product, all activities relating to the marketing, promotion,
handling, distribution, storage, sale, shipping, offer for sale and
importation for sale of the Product in the Territory. |
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(m) |
“ Compound ” shall mean
the form of gemifloxacin mesylate having the molecular formula
[*]. |
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(n) |
“ Contract Year ” shall
mean for the purpose of this Agreement, a period consisting of
twelve (12) consecutive calendar months commencing on the
first day of December in each calendar year, provided, however that
the first and last Contract Year for the purpose of this Agreement
may be shorter than twelve (12) months whereby (i) the
first Contract Year thereof shall commence on the
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-2-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
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Effective Date and
terminate on the earlier to occur of November 30 following the
Effective date or the commencement of Manufacture of the Product by
the Purchaser pursuant to the Purchaser’s exercise of its
Manufacturing option set forth in Section 5 below, and
(ii) the last Contract Year thereof shall terminate on the
earlier to occur of the last day of the Term or the commencement of
the Manufacture of the Product by the Purchaser pursuant to the
Purchaser’s exercise of its Manufacturing option set forth in
Section 5 below.
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(o) |
“ Copyrights ” shall
mean all copyright works including literary and artistic works
utilized in the Commercialization of the Products. |
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(p) |
“ Confidential Information ”
shall mean with respect to a Party (the “Receiving
Party”), all information which is disclosed by another Party
(the “Disclosing Party”) to the Receiving Party
hereunder or to any of its employees, consultants, Affiliates,
licensees or Sub-Distributors, except to the extent that the
Receiving Party can demonstrate by written record or other suitable
physical evidence that such information, (a) as of the date of
disclosure is demonstrably known to the Receiving Party or its
Affiliates other than by virtue of a prior confidential disclosure
to the Receiving Party or its Affiliates by the Disclosing Party;
(b) as of the date of disclosure is in, or subsequently
enters, the public domain, through no fault or omission of the
Receiving Party; (c) is obtained from a third party having a
lawful right to make such disclosure free from any obligation of
confidentiality to the Disclosing Party; or (d) is
independently developed by or for the Receiving Party without
reference to or reliance upon any Confidential Information of the
Disclosing Party. |
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(q) |
“ Detail ” or “
Detailing ” shall mean, with respect to the
Product, the communication by a Sales Representative during a Call
to a member of the Target Audience (i) involving face-to-face
contact, (ii) describing in a fair and balanced manner the
approved indicated uses and other relevant characteristics of such
Product, (iii) using marketing, promotional and educational
materials in an effort to increase the Target Audience prescribing
and/or hospital ordering preferences of a Product for its approved
indicated uses, and (iv) made at the Target Audience
member’s office, in a hospital, at marketing meetings
sponsored by the Purchaser or Abbott Canada for the Products or
other appropriate venues conducive to pharmaceutical product
informational communication where the principal objective is to
place an emphasis, either primary, secondary or tertiary, on a
Product and not simply to discuss a Product with a member of the
Target Audience. |
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(r) |
“ Develop ” shall mean, with respect
to any Product, all activities relating to seeking, obtaining
and/or maintaining Regulatory Approvals and public and private
formulary listings, regulatory affairs, statistical analysis and
report writing and the preparation, submission, review and
development of data related thereto and all other pre-approval
activities, but excluding (i) the Manufacture of the Product;
or (ii) clinical or non-clinical research and drug development
activities of the Product. |
-3-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
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(s) |
“ Diligent Efforts ”
means using reasonable efforts, consistent with prudent business
judgment, including the carrying out of obligations or tasks
consistent with the standard of practice in the pharmaceutical
industry in the Territory for the Commercialization of a
pharmaceutical product having similar market potential, profit
potential or strategic value as the Product, based on conditions
then prevailing, including, without limitation, the maturity of the
Product and the intellectual property protection surrounding the
Product and furthermore requires that each of Supplier, Purchaser
or Abbott Canada, at a minimum, provided that such actions are
commercially reasonable: (i) determine the general industry
practices with respect to the applicable activities;
(ii) reasonably promptly assign responsibility for such
obligations to specific employee(s) who are held accountable for
progress, and monitor such progress on an on-going basis;
(iii) set and consistently seek to achieve specific and
meaningful objectives for carrying out such obligations; and
(iv) make and implement decisions and allocate resources
designed to advance progress with respect to such
objectives. |
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(t) |
“ Estimated Exchange Rate
” means the rate of exchange of Canadian dollars
to U.S. dollars as determined by Purchaser, in good faith, for each
applicable Contract Year using historic exchange rate information
from nationally published sources for the preceding year. Each
Estimated Exchange Rate will be established by Purchaser at least
thirty (30) days prior to the applicable Contract
Year. |
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(u) |
“ Estimated Transfer Price means the
aggregate Net Sales for the Product during the three (3) month
period ending August 31 immediately preceding the new Contract
Year divided by the number of Product tablets sold during such
three month period, multiplied by the Applicable Percentage (as
calculated based on Net Sales commencing from the First Commercial
Sale through and including the period covered by such new Contract
Year), multiplied by the Estimated Exchange Rate; provided that,
the Estimated Transfer Price may be revised to reflect any
adjustments to Actual Selling Price resulting from new competition
or material changes in the market dynamics. |
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(v) |
“ Excess Run Quantities ” shall mean
the amount of Product remaining and held by Supplier after
processing the Minimum Run Quantities pursuant to a Purchaser Order
after subtracting the amount of Product actually Purchased by
Purchaser and the amount of Product designated from such Minimum
Run Quantities to Safety Stock Inventory. |
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(w) |
“ Exhibits ” means the exhibits to
this Agreement, unless otherwise specified, and the following are
the Exhibits attached to and incorporated in this Agreement by
reference and deemed to be part hereof: |
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| Exhibit |
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Description
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| A |
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Certificate of Analysis and Compliance |
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| B |
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Form of
Purchase Order |
-4-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
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(x) |
“ First Commercial Sale
” shall mean the date of the first arm’s length
sale of the Product by or on behalf of Purchaser or Abbott Canada
in the Territory, other than sales by Purchaser to Abbott
Canada. |
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(y) |
“ Final Packaging ” means the
labeling and packaging of Processed Product in accordance with
Laws, including the package inserts and other components reasonably
necessary for the sale or distribution of the Product to
wholesalers, pharmacies and physicians in the
Territory. |
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(z) |
“ Finished Product ” shall mean a
Product in its finished form in Final Packaging, ready for sale to
the market or distribution as Professional Samples. |
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(aa) |
“ Generic ” shall mean
a pharmaceutical product that has the same active ingredient as the
Product (gemifloxacin), has the same route of administration, is
bioequivalent to the Product and is approved for the same
indications by the relevant Canadian governmental authority (other
than the Product sold by Purchaser). |
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(bb) |
“ Good Manufacturing Practices
” or “ GMP ”
shall mean the good manufacturing practices and standards as set
forth in Division 2 of the Food and Drug Regulations and the GMP
Guidelines and as otherwise established or required by applicable
Regulatory Authorities in effect at the time and place for
activities relating to the Product, and subject to any
arrangements, additions or clarifications agreed from time to time
between the Supplier and Purchaser. |
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(cc) |
“ HC ” shall mean
Health Canada, Health Products and Food Branch, Therapeutic
Products Directorate, or any replacement or successor authority
with jurisdiction over the sale of the Product in
Canada. |
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(dd) |
“ Improvements ” shall
mean any and all changes to the Product, including, without
limitation, any technical improvement, modification, invention or
discovery, whether patented or unpatented, including without
limitation, methods, formulae and processes made, discovered,
conceived, developed or acquired by either Party or their
Affiliates, sublicensees, subcontractors or employees thereof,
constituting additions and/or betterments to the
Product. |
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(ee) |
“ Intellectual Property
” shall mean the Patent Rights, Trademarks and
Copyrights. |
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(ff) |
“ Laws ” shall mean all applicable
statutes and regulations in Canada as well as all applicable
standards, policies, guidelines or codes of conduct issued by
Regulatory Authorities, including Good Manufacturing
Practices. |
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(gg) |
“ Manufacture ” shall
mean, with respect to any Product, all activities relating to
synthesis, manufacture or otherwise making or having made any
Product, the Compound, or any component or formulation thereof
(including, without limitation, process development
work). |
-5-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
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(hh) |
“ Minimum Run Quantities ” shall mean
a standard lot size of Product typically run by Supplier in its
usual course of business; provided that, the Supplier and Purchaser
agree that the actual amount of tablets delivered by Supplier may
vary from lot to lot due to final yield variations, but in any case
may never be more than [*] to [*] tablets. |
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(ii) |
“ Monthly Average Exchange Rate ”
shall mean the quotient determined by dividing (i) the sum of
the conversion rate existing in the United States (as reported in
The Wall Street Journal ) on the last business day preceding
the applicable month immediately preceding the date upon which the
Estimated Transfer Price or Actual Transfer Price, as the case may
be, is to be calculated, and the last business day of such
applicable month, by (ii) two. If The Wall Street
Journal ceases to be published, then the rate of exchange to be
used shall be that reported in such other business publication of
national circulation in the United States as the Supplier and
Purchaser reasonably agree. |
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(jj) |
“ Monthly Sales Report ” means a
report signed and certified as correct by a duly authorized senior
officer of Abbott Canada containing with respect to each applicable
month: (i) all gross to Net Sales figures of the Product and
the number of units of the Product sold; (ii) inventory status
of the Product; (iii) a computation of the Actual Transfer
Price for such month; and (iv) such other information required
to confirm the correctness and accuracy of any payment made
hereunder. |
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(kk) |
“ Net Sales ” shall
mean the gross invoiced sales price for all Products sold by
Purchaser or Abbott Canada to third parties throughout the
Territory, less the following amounts incurred or paid by Purchaser
or Abbott Canada to third parties with respect to sales of Products
regardless of the calendar quarter in which such sales were
made: |
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(i) |
trade, cash and quantity discounts or rebates, including, price
reductions, distribution services agreement fees, cash sales
incentives, cash discounts, government mandated rebates and similar
types of rebates, actually allowed or taken, where permitted by
law; |
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(ii) |
credits or allowances actually given or made for rejection of
Products; |
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(iii) |
third party freight, transport and delivery charges indicated
separately directly related to sales of Product by Purchaser to
wholesalers; |
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(iv) |
any tax, tariff, duty or governmental charge levied on the
sales, transfer, transportation or delivery of a Product to a third
party, other than franchise or income tax of any kind whatsoever,
to the extent included in the gross invoiced sales price;
and |
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(v) |
uncollectible amounts on return of previously sold Products and
returned Products. |
-6-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
Deductions due to (i), (ii),
(iii) and (v) above shall not exceed a total of [*]
percent ([*]%) of the gross invoiced sales. “Net Sales”
shall not include Professional Samples or sales or transfers
between Purchaser and Abbott Canada and their respective
Affiliates, unless the Product is consumed by such
Affiliate.
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(ll) |
“ Patent Rights ” shall
mean any of the patents and patent applications issued or pending
in the Territory during the Term related to the Products, including
those listed in Schedule C hereto, and all provisional
applications, substitutions, continuations, continuations-in-part,
divisions and renewals related thereto and all re-issues,
re-examinations and extensions thereof to the extent these are or
become available under the patent Laws of the
Territory. |
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(mm) |
“ PDE ” shall mean either
(i) one (1) Primary Detail or (ii) two
(2) Secondary Details or (iii) six (6) Tertiary
Details conducted by Purchaser. |
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(nn) |
“ Person ” or “ person
” means any individual, firm, corporation, partnership,
limited or unlimited liability company, trust, joint venture,
governmental entity, or other entity or organization. |
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(oo) |
“ Primary Detail ” shall mean
a Detail in the first mention position and consuming at least 60%
of the time spent during a Call. |
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(pp) |
“ Printed Materials ” means printed
packaging materials relating to any Processed Product and product
labels, printed packaging materials or packaging inserts relating
to any Finished Product. |
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(qq) |
“ Processing Activities ” means
activities relating to production of the Products, including
purchasing raw materials, manufacturing, processing, quality
control, filling, labeling, packaging, finishing, release and
storage and other activities required to be undertaken by Supplier
or its suppliers and its subcontractors in order to produce
Finished Product, and the tests and analyses conducted in
connection therewith. |
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(rr) |
“ Processed Product ” means a Product
that has undergone the Processing Activities, prior to being in,
and as released for, Final Packaging. |
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(ss) |
“ Professional Samples ” means
Processed Product in Final Packaging intended for distribution as
professional samples. |
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(tt) |
“Product ” or “
Products ” shall mean all oral human
pharmaceutical tableted products containing the Compound (commonly
distributed under the trademark “Factive”), but
specifically excluding any single enantiomer-based product or
non-oral formulations, including all different dosages, strengths,
presentations, and indications thereof . |
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(uu) |
“ Regulatory Approval ”
shall mean any and all approvals, product and establishment
licenses, registrations or authorizations of any kind of any
Regulatory Authority necessary for the Development or
Commercialization of a
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-7-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
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Product, including,
without limiting the generality of the foregoing, the notice of
compliance issued by HC and the drug identification number assigned
by HC.
|
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(vv) |
“ Regulatory Authorities ” shall mean
any applicable Canadian federal, provincial or local regulatory
agency, department, bureau or other governmental entity of any
jurisdiction or any non-governmental regulator having
responsibility in Canada for any Regulatory Approvals of any kind
or the regulation of any aspect of the Commercialization of
pharmaceuticals and any successor agency or authority thereto. For
greater certainty, this includes without limitation, HC, provincial
Ministries of Health, the Patented Medicine Prices Review Board
(“PMPRB”), Pharmaceutical Advertising Advisory Board
(“PAAB”), Advertising Standards Canada
(“ASC”), Rx&D and Canadian Agencies for Drugs and
Technologies in Health (formerly Canadian Coordinating Office for
Health Technology Assessment). |
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(ww) |
“ Sale ” by Purchaser
or Abbott Canada shall be deemed to occur at the earliest of a
Product being (i) shipped by Purchaser or Abbott Canada,
(ii) invoiced by Purchaser or Abbott Canada, or
(iii) paid for by or on behalf of Purchaser’s or Abbott
Canada’s customer. |
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(xx) |
“ Sales Representative ” shall mean a
professional pharmaceutical sales representative engaged or
employed by Purchaser or Abbott Canada to conduct, among other
sales responsibilities, Detailing and other promotional efforts
with respect to the Products. |
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(yy) |
“ Schedules ” means the schedules to
this Agreement, unless otherwise specified, and the following are
the Schedules attached to and incorporated in this Agreement by
reference and deemed to be part hereof: |
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| Schedule |
|
Description
|
| A |
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Specifications |
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| B |
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Trademarks |
|
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| C |
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Patents |
|
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| D |
|
Next Year Estimated Transfer Price
Determination |
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| E |
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Actual Transfer Price Quarterly Reconciliation |
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(zz) |
“ Secondary Detail ” shall mean a
Detail in the second mention position and consuming at least 30% of
time spent during a Call. |
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(aaa) |
“ Specifications ” means, for
each Product, such specifications as set forth in Schedule A
, as such specifications may be supplemented or modified from time
to time hereafter in accordance with the provisions of this
Agreement. |
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(bbb) |
“ Steering Committee ”
shall have the meaning ascribed thereto in
Section 8.3. |
-8-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
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(ccc) |
“ Sub-Distributor ”
shall mean Abbott Canada or any Person to whom Purchaser has
granted the right to distribute Products under the Trademarks in
the Territory pursuant to the terms of this Agreement. |
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(ddd) |
“ Target Audience ” shall mean, for
the Product, a licensed medical physician, authorized to write
prescriptions for the Product pursuant to provincial statutes who
prescribes pharmaceutical products or issues hospital orders for
pharmaceutical products in the Territory as identified in the
Marketing Plan for the Product. |
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(eee) |
“ Trademarks ” shall mean the
trademarks described in Schedule B attached
hereto. |
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(fff) |
“ Term ” shall have the
meaning ascribed thereto in Section 16 hereof. |
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(ggg) |
“ Tertiary Detail ” shall mean a
Detail in the third mention position and consuming at least ten
percent (10%) of the time spent during a Call. |
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(hhh) |
“ Territory ” shall
mean Canada. |
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(iii) |
“ Valid Claim ” shall
mean a claim in any unexpired and issued Patent Right that has not
been disclaimed, revoked or held invalid by a final unappealable
decision of a court or government agency of competent
jurisdiction. |
In this Agreement a reference
to:
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(1) |
Article and Section numbers refer to Articles and Sections of
this Agreement, and all references to Schedules and Exhibits refer
to the Schedules and Exhibits attached hereto; |
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(2) |
the singular shall include the plural and vice versa and a
reference to any gender shall include all genders; |
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(3) |
a statutory provision includes a reference to the statutory
provision as modified or re-enacted or both from time to time
before or after the date of this Agreement and any subordinate
legislation made under the statutory provision (as so modified or
re-enacted) before or after the date of this Agreement; |
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(4) |
a document (or section thereof) is a reference to that document
as modified, amended, restated or replaced from time to
time; |
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(5) |
a “month” is a reference to a calendar
month; |
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(6) |
“herein”, “hereof”,
“hereunder”, “hereafter”, and words of
similar import refer to this Agreement as a whole and not to any
particular Article or Section hereof; |
-9-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
| |
(7) |
money herein or “$” are references to United States
Dollars unless otherwise specifically noted and |
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(8) |
“include”, “includes”,
“including” and “such as” are to be
construed as if they were immediately followed by the words
“without limitation”. |
1.3 If any payment is required to
be made or other action required to be taken pursuant to this
Agreement on a day which is not a Business Day, then such payment
or action shall be made or taken on the next Business
Day.
1.4 In calculating interest
payable under this Agreement for any period of time, the first day
of such period shall be included and the last day of such period
shall be excluded.
1.5 The table of contents hereto
and the headings of any Article, Section or part thereof are
inserted for purposes of convenience only and do not form part of
this Agreement.
2.1 Appointment and Acceptance
. Subject to the terms and conditions of this Agreement, in
connection with the distribution, marketing and Sale of the
Products, Supplier hereby appoints Purchaser as its distributor
with the exclusive right to Commercialize the Products in the
Territory, and Purchaser hereby accepts such appointment. Supplier
hereby grants to Purchaser, and Purchaser hereby accepts, a
non-royalty bearing license to use the Trademarks and Copyrights
solely in connection with the Commercialization of the Products in
the Territory.
2.2 Right to Appoint
Sub-Distributor . Purchaser may appoint a Sub-Distributor;
provided , however , that (a) Supplier shall be
notified of and shall have consented to such grant, which consent
not to be unreasonably withheld or delayed; provided, however,
Supplier confirms its consent to the appointment of Abbott Canada
as the Sub-Distributor, (b) the terms of the agreement with
the Sub-Distributor shall be equivalent to the terms and conditions
of this Agreement, except for the financial terms and except that
Sub-Distributor shall have no right to further appoint a
Sub-Distributor, nor to assign or delegate all or any part of its
rights, (c) Purchaser shall remain obligated for the payment
to Supplier of all of its payment obligations hereunder,
(d) Purchaser shall make its best efforts to require
Sub-Distributor to fulfill all of its obligations as described in
this Agreement; (e) except as Supplier may in its discretion
agree in writing, any agreement with the Sub-Distributor shall
provide for termination upon termination of this Agreement, and
(f) Purchaser shall provide Supplier with a copy of each such
agreement within thirty (30) days of execution. If
Sub-Distributor is any person other than Abbott Canada, then such
person shall replace Abbott Canada as a Party to this Agreement and
all references hereunder to Abbott Canada shall be deemed to be a
reference to Sub-Distributor.
2.3 Retained Rights
. Subject to the other terms of this Agreement, Supplier retains
all rights not expressly granted under this Agreement, including
the right to use and exploit the Trademarks and Copyrights for
(i) uses in the Territory relating to governmental obligations
or requirements and investor promotions (i.e., Supplier exhibit
booths or magazine publications discussing Supplier’s
business), and (ii) any and all uses outside of the Territory.
All rights not expressly granted under this Agreement to Purchaser
or Abbott Canada are reserved to Supplier.
-10-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
2.4 Modification of Product
.
Supplier reserves the right to make
Improvements during the Term and shall give prior notice to the
Purchaser of any Improvement, which could require approval by
Regulatory Authorities under applicable Laws. For greater
certainty, prior notice to the Purchaser is required for
Improvements that are considered a “Level 1 Change”
(i.e. change requiring a Supplement to a New Drug Submission), a
“Level 2 Change” (i.e. Notifiable Change) or a
“Level 3 Change” (i.e. Notice of Change) under
HC’s Changes to Marketed New Drug Products Policy. For a
“Level 4 Change” as described in HC’s Changes to
Marketed New Drug Policy, Supplier will provide to Purchaser a copy
of revised batch documents for Canadian GMP Product release
purposes as and when they are revised. For a “Level 1
Change” and a “Level 2 Change”, Supplier and
Purchaser shall agree upon the procedure and a reasonable period of
time for the implementation of the Improvements, including, without
limitation, for obtaining any necessary Regulatory Approvals with
regard to any such Improvement pursuant to Section 7 hereof
and the launch thereof. In the event that material changes are made
to HC’s Changes to Marketed New Drug Products Policy, then
the following applies: For any Improvement that requires prior
notice to HC or approval from HC prior to implementation, the
Parties shall agree in advance upon the procedure and a reasonable
period of time for the implementation of the Improvements. For all
other Improvements, Oscient shall provide Abbott Canada with
regular updates and documentation of any Improvements made,
including whenever requested by Abbott Canada due to an upcoming or
actual inspection by HC or a request by HC.
2.5 Grant of Rights to
Supplier . Each of Purchaser and Abbott Canada hereby grant
to Supplier a non-exclusive, perpetual, fully paid-up, irrevocable,
fully sub-licensable, worldwide (not including the Territory during
the Term) license to use the information, materials, data,
documents and plans relating to Products, including regulatory
applications and Regulatory Approvals and, pursuant to
Purchaser’s election under Section 3.2(d) herein,
packaging documents, data and plans (“Purchaser
Information”), which come into the possession or under the
control of Purchaser and/or Abbott Canada in the course of and as a
result of (i) Purchaser’s participation in the
Development and Commercialization of the Product pursuant to
Purchaser’s rights under this Agreement, and (ii) Abbott
Canada’s participation in the Development and
Commercialization of the Product pursuant to Abbott’s
Canada’s rights under this Agreement.
3.1 Supply Terms .
Until expiration of the Term, Supplier will use commercially
reasonable efforts to supply to Purchaser, and Purchaser will
exclusively purchase, all of Purchaser’s requirements for
Finished Product pursuant to purchase orders delivered from time to
time by Purchaser to Supplier in accordance with Section 4.2.
During the Term, neither Supplier nor any of its Affiliates shall
have the right to manufacture or supply any Product for or to any
other Person in the Territory. Unless otherwise specified herein or
expressly consented to in writing by Purchaser and Supplier, as
between Purchaser and Supplier, Supplier shall have control of and
discretion over performance of all activities necessary to supply
Purchaser with Finished Product as contemplated hereunder, in each
case which shall be exercised in Supplier’s reasonable
judgment in the ordinary course of business. Unless provided
otherwise and only as and if permitted herein, a Party’s
sublicensing, subcontracting or delegating activities to be
performed under this Agreement to an Affiliate or third party shall
not release such Party from the performance of any of its
responsibilities hereunder.
-11-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
3.2 Packaging .
(a) Packaging Layout .
Supplier shall package the Products with the Trademarks and the
trademarks of Purchaser’s Affiliate in accordance with the
applicable Law, and such packaging shall indicate that Supplier, or
its applicable Affiliate, is the fabricator thereof. The packaging
and any other Printed Materials shall bear notices bearing
trademark ownership. Supplier shall provide Purchaser with
information regarding the dimensions and parameters of the Printed
Materials. At least one hundred and fifty (150) days prior to
the Required Delivery Date (as defined below), Purchaser shall
provide Supplier with all artwork, copy or other material developed
or produced by Purchaser or Abbott Canada for the Printed
Materials. Supplier will review such suggested layout and make any
reasonable objections or comments that it may have to such layout
in writing no more than ten (10) Business Days after receipt.
Notwithstanding this, Purchaser is responsible for ensuring Printed
Material complies with Laws. The Supplier and Purchaser will then
discuss the merits of such objections or comments and use their
respective commercially reasonable efforts to mutually agree upon
any disputed items with respect to the final layout and content of
the Printed Materials. Supplier shall, at Purchaser’s sole
cost and expense, provide Purchaser with proofs or samples of the
Printed Materials to be used with Product for Purchaser’s
prior review and approval; provided that, Purchaser shall prepare
or arrange for the production of camera-ready artwork for the
agreed Printed Materials.
(b) Changes to
Packaging . Purchaser may from time to time request changes to
the Printed Materials, which request shall be handled in accordance
with Section 3.2(a). In addition, pursuant to the provisions
of Section 7.1 below, Abbott Canada shall submit for approval
changes to the approved labeling (including package inserts and
primary packages) for the Product with the Regulatory Authority, to
the extent approval is required, at Purchaser’s sole cost and
expense.
(c) Obsolete Packaging
. Supplier shall promptly implement any agreed change or approved
change, as the case may be, to the Printed Materials pursuant to
Section 3.2(b), or on such other specific timeframe as agreed
by the Supplier and Purchaser on a case-by-case basis. In the event
that Abbott Canada requests or is required by an applicable Law or
Regulatory Authority to make changes in the Printed Materials for
the Product, and Supplier has components for such Printed Materials
in stock that it has purchased specifically for such Product,
Purchaser shall have the obligation to purchase, at
Supplier’s cost, the lesser of (a) six months’
supply of such components based on forecasts made by Purchaser for
the Product with respect to the next six months, and (b) all
of the Supplier stock of such components; provided that, the
Parties agree, within 90 days of the date hereof, to re-negotiate
this provision in good faith, so that, upon a change to Printed
Materials, Purchaser bears the economic burden of components
purchased on the basis of Purchaser’s Forecast in a minimum
order quantity and which can only be used by Supplier to
manufacture Product in the Territory (i.e., foil, cartons and
product inserts).
-12-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
(d) Option to Package
Finished Product . Supplier hereby grants to Purchaser the
option to acquire the right to package Products, including an
option to acquire a sublicense to the necessary Trademarks to
complete packaging. Purchaser shall notify Supplier in writing of
its decision to exercise its rights under this Section 3.2(d),
and the Purchaser and Supplier (i) shall thereby enter into
good faith negotiations regarding the terms and conditions of such
sublicense and (ii) agree to negotiate revisions to the
Initial Transfer Price or the Actual Transfer Price (each as
defined in Section 10 below), as the case may be, that are
fair and reasonable given the reduction in packaging services
provided by Supplier.
3.3 Quality Agreement .
The Supplier and Purchaser shall negotiate and agree within sixty
(60) days following the date hereof a quality agreement (the
“Quality Agreement”), which shall (a) be on terms
consistent with applicable Law and those terms standard in the
industry for transactions similar to this Agreement and
(b) become effective as of the Effective Date. Each Party
agrees to comply with the procedures set forth in the Quality
Agreement regarding quality and GMP related responsibilities and
complaints. To the extent there are any inconsistencies or
conflicts between this Agreement and the Quality Agreement, the
terms and conditions of this Agreement shall control unless
otherwise agreed to in writing by Supplier and Purchaser in the
form of an amendment to this Agreement. In the event that the
Quality Agreement contains material provisions that differ from
applicable Law, the applicable Law shall control.
3.4 Documentation,
Monitoring and Recordkeeping . To the extent responsible
for any Processing Activities hereunder, the Supplier, Purchaser
and/or Abbott Canada shall maintain complete and accurate
documentation of all validation data, stability testing data, batch
records, quality control and laboratory testing, as applicable, and
any other data required under applicable Law and other requirements
of any relevant Regulatory Authority in connection with the
performance of any Processing Activities hereunder. Throughout the
term of this Agreement, and for so long thereafter as is required
by applicable Law, Supplier shall monitor and maintain reasonable
records respecting its compliance with GMP, including through the
establishment and implementation of such operating procedures as
are reasonably necessary to assure such compliance.
| 4. |
FORECASTING, ORDERING AND SHIPPING |
4.1 Rolling Forecasts
. Throughout the Term of this Agreement, Purchaser shall
provide Supplier, at the beginning of each month, with a
non-binding rolling forecast (“ Forecast ”)
prepared in good faith by Purchaser projecting Purchaser’s
requirements of Finished Product, for the [*] ([*]) month period
commencing on the first day of the aforementioned month,
specifically indicating such projected requirements for each month
during such [*] ([*]) month period
4.2 Submission of Purchase
Orders . Purchaser acknowledges that Supplier is obligated
to produce only Minimum Run Quantities of Product upon orders of
Finished Product from Purchaser. Supplier hereby agrees to use
commercially reasonable efforts to facilitate a smaller minimum run
quantity. Purchaser may order Finished Product in quantities other
than the Minimum Run Quantities (each a “ Split Batch
”) upon payment, in addition to the transfer price set forth
in Section 10 herein, to Supplier of any additional costs
incurred by Supplier in delivering such Split Batch, including the
price charged to Supplier by a third party manufacturer
-13-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
for the fill and finish of the Product
tablets from its third party vendors related to such Split Batch
(such costs not to exceed $[*] for each Split Batch ordered)
provided, however, that no additional costs shall be payable with
respect to any changeover between commercial pack and sample pack.
On or before the [*] day preceding the commencement of each
calendar month, Purchaser shall issue a purchase order, in the
format attached hereto as Exhibit B (each a
“Purchase Order”) , for the Products to be
manufactured and shipped to it on a date (the “
Required Delivery Date ” ) not less than [*] ([*])
days from the first day of the calendar month immediately following
the date that the purchase order is submitted; provided that,
Purchaser has delivered all camera ready art for the final
packaging of the Product as set forth in Section 3.2(a)
herein. The quantities of Products ordered in each such purchase
order shall be firm and binding on Purchaser and shall not be
subject to reduction by Purchaser. All purchase orders shall be
sent by Purchaser to the attention of the employee of Supplier as
may from time to time be designated by Supplier. To the extent the
terms of any purchase order or acknowledgment thereof are
inconsistent with, or additional to, the terms of this Agreement,
such terms are of no force and effect. Notwithstanding anything to
the contrary contained herein, the terms and conditions of this
Agreement shall prevail over any terms and conditions contained on
the Purchase Order and any and all terms and conditions contained
in a Purchase Order shall be null and void.
4.3 Terms of Delivery
. Supplier shall execute all accepted purchase orders
consistent with this Agreement and deliver Finished Product to
Purchaser’s designated carrier at Supplier’s facility,
to be delivered on the delivery date specified in Purchaser’s
purchase orders, and in no event more than five (5) days
before the delivery date specified in Purchaser’s purchase
orders, in accordance with Section 4.2; provided that, if
Supplier shall engage a new third party vendor to package Finished
Products and such vendor shall require additional time to complete
orders due to Purchaser’s packaging requirements, the Parties
shall in good faith mutually agree to extend each Required Delivery
Date for such order only by a reasonable amount of time to
accommodate Supplier’s arrangements with its new Finished
Product packager. Purchaser shall be responsible for arranging, at
its expense, all shipping, freight and insurance for its orders of
Finished Product. Title and risk of loss will pass to Purchaser
when each order of Finished Product is delivered to
Purchaser’s designated carrier at Supplier’s facility.
If Purchaser does not timely indicate in writing its selection of a
carrier to Supplier, Supplier shall be entitled to select an
appropriate carrier. Supplier shall package each order of Finished
Product for shipment in accordance with its customary practices
therefor, unless otherwise reasonably specified in writing by
Purchaser.
4.4 Accompanying
Documentation . With each shipment of Finished Product,
Supplier shall provide Purchaser with commercially appropriate
shipping documentation (including Purchaser’s purchase order
number and the quantity of the Finished Product) and with a
Certificate of Analysis and Compliance identifying the applicable
lot and batch numbers and indicating conformance of the shipment
with the Specifications.
4.5 Retention of
Samples . Supplier shall properly store and retain
appropriate samples (identified by lot and batch number) of
Finished Product that it supplies to Purchaser in conditions and
for times consistent with all applicable Law and to permit
appropriate or required internal and regulatory checks and
references (collectively, the “Shipment
Samples”).
-14-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
4.6 Shortage and Safety
Stock . Supplier shall maintain (a) [*] months of
safety stock inventory of Finished Product for Product to be sold
to wholesalers, pharmacies or hospitals, and (b) [*] month of
safety stock inventory of Finished Product for Professional
Samples, determined pursuant to written notice to be delivered by
Purchaser to Supplier on a monthly basis concurrently with the
delivery of its Forecast (the “ Safety Stock Inventory
”); provided, however, that (i) Safety Stock Inventory
shall be depleted on a first in first out basis to satisfy Purchase
Orders submitted by Purchaser, (ii) pursuant to
Section 16.6(f) below and subject to the terms thereof,
Purchaser shall purchase all Safety Stock Inventory at the price
determined pursuant to the terms of Section 10 below and
(iii) specific terms and condition regarding the logistics,
delivery and warehousing requirements and inventory management
costs relating to such Safety Stock Inventory shall be agreed to by
the Parties in good faith within thirty (30) days of the date
hereof. In the event that Finished Product is in short supply,
Supplier shall notify Purchaser of such shortage as soon as
possible and firstly use Safety Stock Inventory to fill
Purchaser’s orders and once depleted, secondly allocate to
Purchaser a prorated share of same available to Supplier taking
into consideration Purchaser’s relative sales volume in
relation to Supplier and Supplier’s other customers. Supplier
shall take commercially reasonable efforts to eliminate, cure or
overcome such shortage and to resume performance of its obligations
hereunder as soon as reasonably possible. The Safety Stock
Inventory shall, subject to Section to 4.7 below, have a shelf life
of no less than twenty four (24) months from the date of
delivery of Product from such Safety Stock Inventory. The Parties
agree that on the second anniversary of the date hereof, they
shall, in good faith, discuss the financial obligations and
logistics relating to the Safety Stock Inventory.
4.7 Shelf Life .
All Products Manufactured by Supplier shall have a shelf life of no
less than thirty-six (36) months from the date of
Manufacturing and no less than twenty four (24) months from
the date of delivery. Notwithstanding the foregoing, Purchaser
shall accept Product with more than [*] months of shelf life but
less than twenty four (24) months of shelf life (the “
Risk-Dated Product ”). Purchaser’s obligation to
accept Risk-Dated Product, however, shall not exceed more than [*]
Product tablets per Minimum Run Quantity; provided that, Supplier
shall be obligated to repurchase from Purchaser [*]% of any
Risk-Dated Product that has less than [*] months of shelf-life at
the price paid by Purchaser and credit Purchaser for the difference
between the Actual Transfer Price paid and/or calculated for such
Risk-Dated Product and Supplier’s cost for the other
[*]%.
| 5. |
OPTION TO MANUFACTURE FINISHED PRODUCT. |
5.1 Supplier hereby grants to
Purchaser the option, subject to Sections 5.2 to 5.5 below, to be
exercised by notice in writing (the “Purchaser’s Option
Notice”) to Supplier to acquire the right to Manufacture
Products, including an option to acquire a sublicense to the
Patents to the extent necessary to Manufacture Products, whether in
the Territory or outside the Territory solely for the purpose of
Commercialization in the Territory (the “Manufacturing
License”), to be exercised solely in the event that
(x) Regulatory Approval is obtained by another drug
manufacturer to market a Generic in the Territory, (y) an
interruption in the supply of the Products continues for more than
[*] days beyond the ninety (90) day delivery schedule, or
(z) the Actual Transfer Price calculated for any applicable
month is less than $[*] per tablet for more than six
(6) consecutive months due to changes in the Monthly Average
Exchange Rate.
-15-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
5.2 Purchaser hereby acknowledges
that the Manufacturing License may require the prior written
approval of LG Life Sciences, Ltd. and that the grant by Supplier
of such Manufacturing License is subject to Supplier’s
receipt of written consent from and the rights of LG Life Sciences,
Ltd. Consequently, in the event Purchaser exercises its option
under Section 5.1, (i) Supplier shall grant to Purchaser
any and all rights it may lawfully have regarding the Manufacture
of Products in accordance with Section 5.1 above, and
(ii) Supplier shall provide to Purchaser such commercially
reasonable efforts as may be necessary to obtain from LG Life
Sciences, Ltd., or its successor-in-title, if applicable, all other
required rights necessary for the Manufacture of Products in
accordance with this Section 5; provided that, Supplier shall
not be required to make any payments or agree to any material
undertakings in connection therewith.
5.3 Upon the grant of the
Manufacturing License, Purchaser shall, at its expense, obtain all
Regulatory Approvals necessary to Manufacture the Product in
accordance with the Specifications and Supplier shall subject to
any restrictions pursuant to the rights secured from LG Life
Sciences, Ltd. pursuant to Section 5.2(ii), promptly provide
all Product information in its possession required to be provided
by Purchaser to any Regulatory Authority in order to obtain such
Regulatory Approvals.
5.4 The obligations under
Sections 3 and 4 shall terminate when Purchaser is capable and
lawfully authorized to Manufacture the Products.
5.5 Royalty . As
consideration for the Manufacturing License, prior to Purchaser
receiving the rights set forth under Section 5.1 above,
Purchaser and Supplier shall enter into good faith negotiations
regarding the terms and conditions of such Manufacturing License
and further agree to negotiate a royalty that is fair and
reasonable to both Parties and consistent with all applicable Laws
and the economics of the transactions contemplated
hereunder.
5.6 Relationship .
The Parties hereto agree that any royalty determined pursuant to
Section 5.5 above shall not constitute a sharing of profits
between Purchaser and Supplier. The collection, holding and
remittance of any such royalty by Purchaser shall in no way
constitute Supplier as an agent or partner of Purchaser and the
Parties hereto specifically renounce any intent to form a
partnership or joint venture that may be inferred in connection
with such royalty. Neither Party hereto has any authority to assume
or create any obligation or liability, express or implied, on
behalf of or in the name of the other Party in connection with the
collection, holding and remittance of such royalty.
5.7 Changes to
Specifications . Subject to such restrictions as may
be imposed by LG Life Sciences, Ltd., at any time after Purchaser
commences Manufacture of the Product pursuant to the rights set
forth in this Section 5, the Purchaser may, at its sole risk
and expense, make changes to the Specifications, subject, however,
to the following:
(a) no change shall be made
unless sixty (60) days’ prior written notice thereof is
given to Supplier, together with any and all information requested
from time to time by Supplier in order to assess, review, validate
and approve same;
(b) any and all such changes
must be evaluated and approved by Supplier;
-16-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
(c) any regulatory filings
required due to any changes approved by Supplier shall be the sole
responsibility of Purchaser; and
(d) all changes to the
Specifications, as between the Parties, shall be deemed to be part
of the Specifications for the purpose of this Agreement and
Supplier shall acquire and maintain all proprietary rights in
respect thereto without any reservation of, or compensation to,
Purchaser.
5.8 Save and except as modified
by this Section 5, the obligations and rights as set forth
herein shall continue in full force and effect in accordance with
the provisions hereof.
| 6. |
INSPECTION AND DEFECTIVE PRODUCTS |
6.1 Receipt of Finished
Product by Purchaser . Purchaser shall be entitled to
reject any portion or all of any shipment of Finished Product that
does not conform to the Certificate of Analysis and Compliance or
otherwise fails to comply with the warranties set forth in Article
13 of this Agreement (unless such non-conformity was attributable
to an act or omission of Purchaser, Abbott Canada or the common
carrier once the Finished Product was delivered by Supplier to such
common carrier); provided, that (i) Purchaser shall notify
Supplier within [*] days after receipt of such shipment if it is
rejecting a shipment due to physical damage, packaging defect or
quantity discrepancies that are evident upon visual inspection of
the packaged Finished Product as shipped by Supplier and
(ii) in the case of Finished Product having defects not
reasonably susceptible to discovery upon customary inspection upon
receipt of Finished Product, Purchaser shall notify Supplier within
[*] days after discovery of such defect (but in no event after
expiration of the Product). If no notice is provided by Purchaser
within the relevant time periods, then Purchaser shall be deemed to
have accepted the shipment. Any notice of rejection by Purchaser
shall be accompanied by a reasonably detailed statement of its
reasons for rejection and a report of any pertinent analysis
performed by Purchaser on the allegedly nonconforming Finished
Product, together with the methods and procedures used. Supplier
shall notify Purchaser as promptly as reasonably possible, but in
any event within [*] Business Days after receipt of such notice of
rejection, whether it accepts Purchaser’s assertions of
nonconformity.
6.2 Replacement Finished
Product . Whether or not Supplier accepts Purchaser’s
assertion of nonconformity, promptly upon receipt of a notice of
rejection, unless otherwise specified by Purchaser, Supplier shall
use its commercially reasonable efforts to provide replacement
Finished Product for those rejected by Purchaser in the original
shipment. If the Finished Product rejected by Purchaser from such
original shipment ultimately is found to be nonconforming (whether
pursuant to Section 6.3 or if Supplier so acknowledges in
writing), Supplier shall bear all expenses for such replacement
Finished Product (including all transportation and/or disposal
charges and cost of manufacture for such nonconforming Finished
Product) to the extent Purchaser previously paid for any
corresponding nonconforming Finished Product. If it is determined
subsequently that such Finished Product was in fact conforming
(whether pursuant to Section 6.3 or if Purchaser so
acknowledges in writing), then Purchaser shall be responsible not
only for the purchase price of the allegedly nonconforming Finished
Product (including all transportation charges), but also, upon
receipt and acceptance by Purchaser in accordance with the
procedures (and at the same price charged in the original shipment)
set forth above, the replacement Finished Product. Replacement
shipments shall also be subject to the procedures contained in
Section 4.
-17-
[*] = Portions of this exhibit have been
omitted pursuant to a confidential treatment request. An unredacted
version of this exhibit has been filed separately with the
Commission.
6.3 Independent Laboratory
Analysis . If Supplier disagrees with any alleged
nonconformity timely notified to Supplier under Section 6.1,
then an independent laboratory (or other expert) of recognized
repute reasonably acceptable to Supplier and Purchaser (the
“Independent Laboratory”) shall analyze (i) a
sample from the relevant shipment provided by Purchaser and
(ii) a Shipment Sample as retained by Supplier in accordance
with Section 4.5, as may be necessary to substantiate whether
the shipment rejected by Purchaser conformed in all material
respects to the Certificate of Analysis and Compliance and any
other pertinent Specifications or otherwise failed to comply with
the warranties set forth in Article 13 of this Agreement at the
time of delivery to the common carrier. At the same time each of
Supplier and Purchaser furnishes to the Independent Laboratory its
sample, such party shall also furnish to the other party a split
sample of such sample. In conducting its analysis hereunder, the
Independent Laboratory shall use the same analytical methodology
used by Supplier. Supplier shall provide a reasonably detailed
description of such analytical methodology to the Independent
Laboratory. Both Supplier and Purchaser agree to cooperate with the
Independent Laboratory’s reasonable requests for assistance
in connection with its analysis hereunder. The Independent
Laboratory’s results of analysis, absent manifest error,
shall be deemed final as to any dispute over compliance of the
Finished Product in all material respects with the Certificate of
Analysis and Compliance and/or any other pertinent Specifications
and/or the warranties set forth in Article 13 of this Agreement. If
the analysis of the Independent Laboratory shows that the Finished
Product did not at the material time(s) conform in all material
respects to the Certificate of Analysis and Compliance or any other
pertinent Specifications or the warranties set forth in Article 13
of this Agreement at the time of delivery to the common carrier,
the costs of such analysis shall be paid by Supplier. If the
analysis of the Independent Laboratory shows that the Finished
Product did at the material time(s) conform in all material
respects to the Certificate of Analysis and Compliance and any
other pertinent Specifications and the warranties set forth in
Article 13 of this Agreement at the time of delivery to the common
carrier, the costs of such analysis shall be paid by
Purchaser.
6.4 Disposition of
Non-Conforming Finished Product . If Supplier acknowledges
an alleged nonconformity (or if the Independent Laboratory
concludes that the Finished Product was nonconforming in accordance
with Section 6.3), Supplier promptly (and in any case within
thirty (30) days thereafter) shall make arrangements
f
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