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E XHIBIT
10.31
CONFIDENTIAL TREATMENT
REQUESTED
Redacted Portions are
indicated by [****]
AMENDED AND RESTATED
COLLABORATION AGREEMENT
THIS AMENDED AND RESTATED
COLLABORATION AGREEMENT effective as of January 1, 2008 (the
“Agreement”) is made by and among Genzyme Corporation,
a Massachusetts corporation having its principal place of business
at 500 Kendall Street, Cambridge, Massachusetts 02142 (“
Genzyme ”), BioMarin Pharmaceutical, Inc., a Delaware
corporation having its principal place of business at 105 Digital
Drive, Novato, California 94949 (“ BioMarin ”)
and BioMarin/Genzyme LLC, a Delaware limited liability company
having its principal place of business at 500 Kendall Street,
Cambridge, Massachusetts 02142 (“ BioMarin/Genzyme LLC
”). Genzyme, BioMarin and BioMarin/Genzyme LLC are sometimes
referred to herein individually as a “ Party ”
and collectively as the “ Parties ”.
RECITALS
A. BioMarin, Genzyme and
BioMarin/Genzyme LLC are parties to a Collaboration Agreement dated
as of September 4, 1998 (the “ Original Collaboration
Agreement ”) pursuant to which BioMarin and Genzyme
through BioMarin/Genzyme LLC develop, manufacture, market and sell
Aldurazyme (as defined herein).
B. The Parties no longer
desire to develop, manufacture, market and sell Aldurazyme through
a joint venture and instead have agreed that: (1) BioMarin
will manufacture Aldurazyme and sell finished product to Genzyme;
(2) Genzyme will label and commercially distribute, market and
sell Aldurazyme globally; (3) each of Genzyme and BioMarin may
conduct its own research and development of Aldurazyme and other
Collaboration Products (as defined herein) in accordance with the
terms of this Agreement and the Manufacturing, Marketing and Sales
Agreement (as defined herein); and (4) BioMarin/Genzyme LLC
will maintain and provide intellectual property licenses and
sublicenses to BioMarin and Genzyme so that they may fulfill their
respective obligations under this Agreement, the Manufacturing,
Marketing and Sales Agreement and the Fill Agreement (as defined
herein).
C. BioMarin and Genzyme are
hereby amending and restating the Original Collaboration Agreement
so that hereafter BioMarin/Genzyme LLC will no longer engage in
commercial activities and will solely (1) hold the
intellectual property relating to Aldurazyme and license all such
intellectual property on the terms set forth herein to BioMarin and
Genzyme on the terms set forth herein and (2) engage in
research and development activities that are mutually selected and
funded by BioMarin and Genzyme.
NOW THEREFORE, in
consideration of the premises and of the covenants herein
contained, the Parties mutually agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this
Agreement, the terms defined in this Article shall have the
meanings specified below. Certain other capitalized terms are
defined elsewhere in this Agreement.
1.1 “ Affiliate
” shall mean any corporation or other entity which controls,
is controlled by, or is under common control with a Party. A
corporation or other entity shall be regarded as in control of
another corporation or entity if it owns or directly or indirectly
controls more than fifty percent (50%) of the voting stock or
other ownership interest of the other corporation or entity, or if
it possesses, directly or indirectly, the power to direct or cause
the direction of the management and policies of the corporation or
other entity or the power to elect or appoint more than fifty
percent (50%) of the members of the governing body of the
corporation or other entity.
1.2 “ Aldurazyme
” shall mean alpha-L-iduronidase meeting the
Specifications.
1.3 “
alpha-L-iduronidase ” shall mean recombinant human
alpha-L-iduronidase.
1.4 “ BioMarin
Companies ” shall mean BioMarin and BioMarin Genetics,
Inc., a Delaware corporation and a wholly-owned subsidiary of
BioMarin (“ BioMarin Genetics ”).
1.5 “
BioMarin/Genzyme Patent Rights ” shall mean the Patent
Rights that claim Joint Inventions (as such term is defined in
Section 9.1.1 hereof) that are discovered, made or conceived
during and in connection with the Program jointly by employees or
consultants of Genzyme and BioMarin to the extent that such Patent
Rights relate to or are useful for the research, development,
manufacture or commercialization of Collaboration Products for use
in the Field.
1.6 “
BioMarin/Genzyme Technology ” shall mean all
Technology discovered, made or conceived during and in connection
with the Program jointly by employees or consultants of Genzyme and
BioMarin relating to or useful for the research, development,
manufacture or commercialization of Collaboration Products for use
in the Field.
1.7 “ BioMarin
Patent Rights ” shall mean all Patent Rights Controlled
by BioMarin during the Term to the extent that such Patent Rights
relate to or are useful for the research, development, manufacture
or commercialization of Collaboration Products for use in the
Field.
1.8 “ BioMarin
Technology ” shall mean all Technology Controlled by
BioMarin during the Term to the extent that such Technology relates
to or is useful for the research, development, manufacture or
commercialization of Collaboration Products for use in the
Field.
1.9 “ BLA
” shall mean a Biologics License Application or similar
application filed with the FDA after completion of human clinical
trials to obtain marketing approval for a Collaboration Product,
including without limitation the BLA as approved by the FDA on
April 30, 2003 that provides for marketing approval for
Aldurazyme in the United States, as the same may be updated or
amended from time to time.
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1.10 “ Collaboration
Product ” shall mean any pharmaceutical compositions of
alpha-L-iduronidase (including Aldurazyme unless otherwise
indicated herein), including without limitation any and all
improvements, derivatives, analogs, combination products, delivery
systems and dosage forms related thereto.
1.11 “
Commercialization Costs ” with respect to a
Collaboration Product shall mean the variable costs and fixed costs
incurred by BioMarin/Genzyme LLC with respect to work performed by
the Parties and their Affiliates and subcontractors in connection
with the performance of and in accordance with the
commercialization plan for such Collaboration Product, including
without limitation, sales and marketing costs related to performing
market research, advertising, producing promotional literature,
sponsoring seminars and symposia, sales training meetings and
seminars, originating sales, providing reimbursement and other
patient support services. For purposes of this Section 1.11,
“ variable costs ” shall be deemed to be the
cost of labor, raw materials, supplies and other resources directly
consumed in the conduct of the Commercialization Plan and
manufacture of Collaboration Product for use in commercialization
activities, as well as amounts paid to Third Parties under a Third
Party Agreement as a result of performance of the Commercialization
Plan, to the extent not included in Development Costs or Fully
Absorbed Cost of Goods. For purposes of this Section 1.11,
“ fixed costs ” shall be deemed to be the cost
of facilities, utilities, insurance, equipment depreciation and
other fixed costs directly related to the conduct of and in
accordance with the Commercialization Plan and the manufacture of
Collaboration Product for use in commercialization activities,
allocated based upon the proportion of such costs directly
attributable to support or performance of the Commercialization
Plan and the manufacture of Collaboration Product for use in
commercialization activities or by such other method of cost
allocation as may be approved by the Steering Committee. All cost
determinations made hereunder shall be made in accordance with
GAAP.
1.12 “
Commercialization Party ” shall have the meaning set
forth in Section 7.1 below.
1.13 “ Control
” shall mean possession of the ability to grant a license or
sublicense as provided for herein without violating the terms of an
agreement with a Third Party.
1.14 “ Development
Costs ” with respect to a Collaboration Product shall
mean the variable costs and fixed costs incurred by
BioMarin/Genzyme LLC with respect to work performed by the Parties
and their Affiliates and subcontractors in connection with the
conduct of and in accordance with the Development Plan for such
Collaboration Product, including without limitation
(a) direct, out-of-pocket external costs, including clinical
grants, clinical laboratory fees, positive controls and the cost of
studies conducted and services provided by contract research
organizations and individuals, consultants, toxicology contractors,
and manufacturers necessary or useful for the purpose of obtaining
Regulatory Approvals for such Collaboration Product,
(b) amounts paid to Genzyme and BioMarin by BioMarin/Genzyme
LLC with respect to research and development and
pre-commercialization sales and marketing efforts as set forth in
the Development Plan for such Collaboration Product, including
without limitation the efforts of Genzyme and BioMarin to develop
and document process methods and procedures for the manufacture of
such Collaboration Product and the Fully Absorbed Cost of Goods for
batches of such Collaboration Product manufactured and supplied for
use in preclinical and clinical trials and pre-commercialization
activities, (c) costs related to data management, statistical
designs and studies, document preparation and other expenses
associated with the clinical testing program for such Collaboration
Product, (d) costs for preparing,
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submitting, reviewing or developing data
or information for the purpose of submission of applications to
obtain Regulatory Approvals for such Collaboration Product,
(e) license fees and other amounts paid to a Third Party
pursuant to any Third Party Agreement other than those fees and
other amounts payable with respect to Aldurazyme under the Third
Party Agreements in effect as of the Effective Date, and
(f) costs relating to the prosecution and maintenance of
Patent Rights which claim, or disclose subject matter relevant to,
the manufacture or use of such Collaboration Product. For purposes
of this Section 1.14, “ variable costs ”
shall be deemed to be the cost of labor, raw materials, supplies
and other resources directly consumed in the conduct of and in
accordance with the Development Program and the manufacture of the
Collaboration Product for use in preclinical and clinical trials
and pre-commercialization activities. For purposes of this
Section 1.14, “ fixed costs ” shall be
deemed to be the cost of facilities, utilities, insurance, facility
and equipment depreciation and other fixed costs directly related
to the conduct of the Development Program and the manufacture of
the Collaboration Product for use in preclinical and clinical
trials and pre-commercialization activities, allocated based upon
the proportion of such costs directly attributable to the support
or performance of the Development Program and the manufacture of
the Collaboration Product for use in preclinical and clinical
trials and pre-commercialization activities or by such other method
of cost allocation as may be approved by the Steering Committee.
All cost determinations made hereunder shall be made in accordance
with GAAP.
1.15 “ Development
Plan ” shall mean, with respect to a particular
Collaboration Product, the comprehensive three (3) year
rolling plan and budget for the development of such Collaboration
Product under the Development Program, as more specifically
described in Section 5.1.2 hereof.
1.16 “ Development
Program ” shall mean, with respect to a particular
Collaboration Product, the preclinical and clinical development of
such Collaboration Product including post-marketing studies and the
preparation and filing of all applications for Regulatory Approvals
for such Collaboration Product, all as determined by the Steering
Committee or as otherwise set forth herein.
1.17 “ Effective
Date ” shall mean January 1, 2008.
1.18 “ Field
” shall mean any and all therapeutic applications of
alpha-L-iduronidase for MPS I and other alpha-L-iduronidase
deficiencies. Notwithstanding the foregoing, the Field shall not
include Gene Therapy for MPS I or other alpha-L-iduronidase
deficiencies. For purposes of this Agreement, “ Gene
Therapy ” shall mean treatment or prevention of MPS I or
other alpha-L-iduronidase deficiencies by means of ex vivo
or in vivo introduction (via viral or nonviral gene transfer
systems) of nucleotide sequences (including without limitation,
DNA, RNA and complementary and reverse complementary nucleotide
sequences thereto, whether coding or noncoding).
1.19 “ FDA
” shall mean the United States Food and Drug Administration,
any successor agency, or the regulatory authority of any country
other than the United States with responsibilities comparable to
those of the United States Food and Drug Administration.
1.20 “ Fully
Absorbed Cost of Goods ” with respect to units of
Collaboration Product shall mean (a) the variable costs and
fixed costs incurred by a Party associated with the manufacture
(inclusive of finishing processes including filling, packaging,
labeling and/or other preparation)
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quality assurance, quality control and
other testing, storage and shipping of batches of such units of
Collaboration Product or (b) if such units or portions of
Collaboration Product are not manufactured by the Parties, the
amounts paid to the vendor plus costs associated with acquisition
from such vendor. For purposes of this Section 1.20, “
variable costs ” shall be deemed to be the cost of
labor, raw materials, supplies and other resources directly
consumed in the manufacture, quality assurance, quality control and
other testing, storage and shipping of batches of such
Collaboration Product. For purposes of this Section 1.20,
“ fixed costs ” shall be deemed to be the cost
of facilities, utilities, insurance, facility and equipment
depreciation and other fixed costs directly related to the
manufacture, quality assurance, quality control and other testing,
storage and shipping of batches of such Collaboration Product, as
well as amounts paid to Third Parties under a Third Party Agreement
as a result of the manufacture, use or sale of such units of
Collaboration Products. Fixed costs shall be allocated to such
units of Collaboration Product based upon the proportion of such
costs directly attributable to support of the manufacturing,
quality assurance, quality control and other testing, storage and
shipping processes for such Collaboration Product. If a facility is
used to manufacture Collaboration Products and has the capacity to
manufacture products for other programs of either Genzyme or
BioMarin, fixed costs shall be allocated in proportion to the
actual use of such facility for the manufacture of Collaboration
Products and the capacity to manufacture products for such other
programs. For the avoidance of doubt, no idle capacity of a
manufacturing facility shall be included in Fully Absorbed Cost of
Goods unless such facility is appropriately sized and dedicated
solely to the manufacture of Collaboration Products. Fully Absorbed
Cost of Goods shall exclude all costs otherwise reimbursed pursuant
to this Agreement. In the event that either BioMarin or Genzyme
subcontracts with the other Party to perform any work on its behalf
in connection with the manufacturing responsibilities assigned to
BioMarin or Genzyme, respectively, pursuant to Section 7.1.1
hereof, BioMarin and Genzyme (i) shall each directly charge
BioMarin/Genzyme LLC their respective Fully Absorbed Cost of Goods
and (ii) shall not include any part of the other Party’s
Fully Absorbed Cost of Goods in the amount so charged to
BioMarin/Genzyme LLC. Except as otherwise provided in this
Agreement, all cost determinations made hereunder shall be made in
accordance with GAAP.
1.21 “ GAAP
” shall mean the then-current United States generally
accepted accounting principles, consistently applied, except when
different accounting principles are required under the terms of the
Operating Agreement, in which case the accounting principles
mandated under the Operating Agreement shall control.
1.22 “ Genzyme
Patent Rights ” shall mean all Patent Rights Controlled
by Genzyme during the Term to the extent that such Patent Rights
relate to or are useful for the research, development, manufacture
or commercialization of Collaboration Products for use in the
Field.
1.23 “ Genzyme
Technology ” shall mean all Technology Controlled by
Genzyme during the Term to the extent such Technology relates to or
is useful for the research, development manufacture or
commercialization of Collaboration Products for use in the
Field.
1.24 “ Manufacturing
Party ” shall have the meaning set forth in
Section 7.1.1.
1.25 “ Manufacturing
Know-How ” shall mean all information, techniques,
inventions, discoveries, improvements, practices, methods,
knowledge, skill, experience and other technology, whether or not
patentable or copyrightable, and any copyrights based thereon,
relating to or
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necessary or useful for the production,
purification, packaging, storage and transportation of
Collaboration Products, including without limitation
specifications, acceptance criteria, manufacturing batch records,
standard operating procedures, engineering plans, installation,
operation and process qualification protocols for equipment,
validation records, master files submitted to the FDA, process
validation reports, environmental monitoring processes, test data
including pharmacological, toxicological and clinical test data,
cost data and employee training materials.
1.26 “
Manufacturing, Marketing and Sales Agreement ” shall
mean the Manufacturing, Marketing and Sales Agreement of even date
herewith by and among the Parties.
1.27 “ Member
” shall have the meaning set forth in the Operating
Agreement.
1.28 “ Members
Agreement ” shall have the meaning set forth in the
recitals.
1.29 “ MPS-I
” shall mean mucopolysaccharidosis I.
1.30 “ Operating
Agreement ” shall mean the Operating Agreement of
BioMarin/Genzyme LLC dated as of September 4, 1998 by and
among the BioMarin Companies and Genzyme.
1.31 “ Original Date
of Execution ” shall mean September 4,
1998.
1.32 “ Patent
Rights ” shall mean any U.S. and foreign patents and
patent applications (including continuations,
continuations-in-part, divisionals, reissues, re-examinations,
renewals, supplemental protection certificates and
extensions).
1.33 “ Percentage
Interest ” shall have the meaning set forth in the
Operating Agreement.
1.34 “ Program
” shall mean the collaboration among BioMarin/Genzyme LLC,
BioMarin and Genzyme described in this Agreement.
1.35 “ Program
Costs ” shall mean all Program-related costs, including
without limitation Development Costs and Commercialization Costs,
in each case as such costs are incurred or accrued by
BioMarin/Genzyme LLC on or after the Original Date of Execution.
Notwithstanding anything herein to the contrary, it is understood
that the Parties shall apply mutually agreed upon cost allocation
methods in determining Program Costs hereunder. It is understood
and agreed that, with respect to Aldurazyme, “Program
Costs” shall be limited to Program Costs incurred (i) on
or prior to December 31, 2007 or (ii) solely pursuant to
development activities identified in the Development Plan attached
hereto as Appendix A and other development activities added
pursuant to Section 5.1.4 hereof or agreed to by the Steering
Committee on or after the Effective Date, and shall exclude
(x) all Commercialization Costs incurred on or after
January 1, 2008, (y) all Fully Absorbed Costs incurred on
or after January 1, 2008 except with respect to quantities of
Collaboration Products required for the activities described in
clause (ii) above and (z) all other costs that are
allocated between the Parties under the Manufacturing, Marketing
and Sales Agreement or the Fill Agreement of even date herewith by
and between BioMarin and Genzyme (the “ Fill Agreement
”). The Parties shall maintain separate records for Program
Costs incurred on or prior to December 31, 2007 and for
Program Costs incurred on or after the Effective Date.
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1.36 “ Program
Management Team ” shall mean the joint team composed of
representatives of Genzyme and BioMarin described in
Section 8.1.1 hereof.
1.37 “ Regulatory
Approvals ” shall mean all approvals from regulatory
authorities in any country in the Territory required lawfully to
manufacture and market Collaboration Products in any such country,
including without limitation approval of any BLA, any establishment
license application filed with the FDA to obtain approval of the
facilities and equipment to be used to manufacture a Collaboration
Product, and any product pricing approvals where
applicable.
1.38 “ Regulatory
Scheme ” shall mean the United States Public Health
Service Act and the regulations, interpretations and guidelines
promulgated thereunder by the FDA or the regulatory scheme
applicable to the Collaboration Products in any country other than
the United States, as such statutes, regulations, interpretations
and guidelines or regulatory schemes may be amended from time to
time.
1.39 “ Related
Agreements ” shall mean the Manufacturing, Marketing and
Sales Agreement, the Members Agreement, the Fill/Finish
Manufacturing Agreement and the Operating Agreement.
1.40 “
Specifications ” with respect to a particular
Collaboration Product (other than Aldurazyme) shall mean the
written specifications for such Collaboration Product determined by
the Program Management Team and approved by the Steering Committee;
provided that such specifications shall at all times comply
with the relevant Regulatory Scheme in the country of sale and in
the country of use. Such Specifications may be amended from time to
time by the Program Management Team provided that such
amendments are approved by the Steering Committee or the written
agreement of the Parties, as the case may be. Copies of the
then-current Specifications shall be maintained by both BioMarin
and Genzyme and shall become a part of this Agreement as if
incorporated herein. The term “Specifications” with
respect to Aldurazyme shall have the meaning set forth in the
Manufacturing, Marketing and Sales Agreement.
1.41 “ Steering
Committee ” shall mean the governing body of
BioMarin/Genzyme LLC composed of representatives of BioMarin and
Genzyme appointed as described in Section 8.2.1
hereof.
1.42 “
Technology ” shall mean inventions, trade secrets,
copyrights, know-how, data and other intellectual property of any
kind (including without limitation any proprietary biological or
other materials, compounds or reagents, but not including Patent
Rights).
1.43 “ Term
” shall mean the period commencing on September 4, 1998
and ending with the effective date of any termination of this
Agreement pursuant to Article 13 hereof.
1.44 “ Territory
” shall mean the world.
1.45 “ Third
Party ” shall mean any entity other than BioMarin/Genzyme
LLC, BioMarin or Genzyme and their respective
Affiliates.
1.46 “ Third Party
Agreements ” shall mean collectively those Third Party
agreements listed on Schedule 1.47 hereto or such other
Third Party agreements pursuant to which a Party obtains
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rights applicable to the development,
manufacture, sale or use of Collaboration Products hereunder. If
after the Effective Date any of BioMarin, Genzyme and/or
BioMarin/Genzyme LLC enter into an agreement to license or acquire
rights from a Third Party with respect to subject matter to be
utilized in connection with Collaboration Products in accordance
with Section 3.1.4 below, such agreements shall also be
included in the definition of Third Party Agreements for purposes
of this Agreement.
ARTICLE II
SCOPE AND STRUCTURE OF THE
COLLABORATION
2.1 General .
BioMarin/Genzyme LLC will undertake the Development Program, with
each of the Parties assuming responsibility for those portions of
the Development Program allocated to it under this Agreement in
accordance with the Development Plan then in effect. Upon receipt
of Regulatory Approval in any country within the Territory, the
Manufacturing Party or Parties will manufacture the Collaboration
Products and the Commercialization Party will distribute, market
and sell the Collaboration Products in such country all on the
terms and conditions set forth in the Manufacturing, Marketing and
Sales Agreement and such other terms and conditions as the Parties
may agree upon. All services provided by or on behalf of BioMarin,
Genzyme or their respective Affiliates for BioMarin/Genzyme LLC in
connection with the Program shall be provided at cost. For
avoidance of doubt, “cost” for services provided by a
Third Party on behalf of BioMarin, Genzyme or their respective
Affiliates for BioMarin/Genzyme LLC in connection with the Program
shall be the amount paid for such services plus costs associated
with the acquisition, including quality control, of such services
from such Third Party.
2.2 Exclusive
Relationship . Except as otherwise expressly provided herein or
in any Related Agreement, during the Term, neither BioMarin/Genzyme
LLC, Genzyme nor BioMarin, nor any of their respective Affiliates
shall independently, or with or through a Third Party, conduct
research or development activities regarding, or engage in the
manufacture, marketing, sale or distribution of, Collaboration
Products in the Field and in the Territory other than as part of
the Program. In addition, during the two-year period following
termination of this Agreement, neither (a) the breaching Party
and its Affiliates in the case of termination pursuant to
Section 12.2.1 of the Manufacturing, Marketing and Sales
Agreement, (b) (c) the terminating Party and its
Affiliates in the case of termination pursuant to
Section 12.2.2 of the Manufacturing, Marketing and Sales
Agreement or (d) the non-terminating Party and its Affiliates
in the case of termination pursuant to Sections 12.2.3 or
12.2.4 of the Manufacturing, Marketing and Sales Agreement shall
independently, or with or through a Third Party, conduct research
regarding, or engage in the manufacture, marketing, sale or
distribution of, Collaboration Products in the Field and in the
Territory; provided, however, that in the event that this
Agreement is terminated pursuant to Section 12.2.2 of the
Manufacturing, Marketing and Sales Agreement and the
non-terminating Party does not exercise its option under
Section 12.3.2(a) thereof, then the restrictions set forth in
this sentence shall not apply. Notwithstanding the foregoing,
except as provided in Section 3.1.5 nothing herein is intended
to restrict BioMarin, Genzyme or their respective Affiliates from
conducting research or development activities regarding, or
engaging in the manufacture, marketing, sale or distribution of
Gene Therapy products targeted to MPS I and other
alpha-L-iduronidase deficiencies.
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ARTICLE III
GRANTS AND RESERVATIONS OF
RIGHTS
3.1 Licenses of Rights to
BioMarin/Genzyme LLC .
3.1.1 Grants from
BioMarin . Except as otherwise expressly provided herein,
BioMarin hereby grants to BioMarin/Genzyme LLC a worldwide,
exclusive, royalty-free right and license during the term of this
Agreement under the BioMarin Patent Rights, BioMarin Technology,
BioMarin/Genzyme Patent Rights and the BioMarin/Genzyme Technology
and Manufacturing Know-How Controlled by BioMarin to develop, make,
have made, use, offer for sale, sell, have sold, import and export
Collaboration Products for use in the Field and in the
Territory.
3.1.2 Grants from
Genzyme . Except as otherwise expressly provided herein,
Genzyme hereby grants to BioMarin/Genzyme LLC a worldwide,
exclusive, royalty-free right and license during the term of this
Agreement under the Genzyme Patent Rights, Genzyme Technology,
BioMarin/Genzyme Patent Rights and the BioMarin/Genzyme Technology
and Manufacturing Know-How Controlled by Genzyme to develop, make,
have made, use, offer for sale, sell, have sold, import and export
Collaboration Products for use in the Field and in the
Territory.
3.1.3 BioMarin/Genzyme LLC
Undertakings; Sublicenses . In consideration of the licenses
granted under this Section 3.1, except as provided herein,
BioMarin/Genzyme LLC hereby undertakes to pay all royalties,
sublicense fees and other costs or expenses payable to Third
Parties under a Third Party Agreement associated with the
acquisition or exercise of such licenses by or on behalf of
BioMarin/Genzyme LLC for use in connection with the Program. The
licenses granted or to be granted under Sections 3.1.1 and
3.1.2 above shall include the right to grant and further authorize
sublicenses within the scope of such licenses; provided,
however, all sublicenses granted by BioMarin/Genzyme LLC (other
than those provided in Section 3.2.1 below) shall be subject
to prior approval by the Steering Committee. Notwithstanding
anything to the contrary herein, pursuant to the Manufacturing,
Marketing and Sales Agreement, Genzyme shall be solely responsible
for all royalties payable to Third Parties under Third Party
Agreements that are payable based on the commercialization of
Aldurazyme.
3.1.4 Rights of
BioMarin/Genzyme LLC to Patent Rights or Technology Developed
Outside the Program . In the event that either BioMarin or
Genzyme develops, acquires or otherwise Controls Patent Rights,
Technology or Manufacturing Know-How after the Original Date of
Execution other than in connection with the Program and such Patent
Rights, Technology or Manufacturing Know-How are useful in the
Field (“ Additional Technology ”), the Party
Controlling such Additional Technology hereby grants to
BioMarin/Genzyme LLC an option exercisable at the discretion of the
Steering Committee to obtain an exclusive, irrevocable (during the
Term) right and license, with the right to grant sublicenses, to
such Additional Technology limited to use in the Field and in the
Territory to the extent necessary or appropriate to enable
BioMarin/Genzyme LLC to develop, make, have made, use, offer for
sale, sell, have sold, import and export Collaboration Products, in
each case subject only to BioMarin/Genzyme LLC’s undertaking
to pay (a) a commercially reasonable portion of all costs
incurred by BioMarin or Genzyme, as the case may be, to acquire or
develop such Additional Technology, (b) a commercially
reasonable portion of any and
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all development costs
relating to the Additional Technology incurred by BioMarin or
Genzyme, as the case may be, since the date such Party acquired or
developed such Additional Technology and (c) a pro rata
share of all royalties, sublicense fees and other costs or expenses
payable to Third Parties under a Third Party Agreement associated
with the acquisition or exercise of such license by or on behalf of
BioMarin/Genzyme LLC, allocated based upon the proportion of such
costs attributable to the acquisition or use of such Additional
Technology by BioMarin/Genzyme LLC; provided, however, that
if BioMarin or Genzyme, as the case may be, has more limited rights
to such Additional Technology that those described above, the
license subject to BioMarin/Genzyme LLC’s option hereunder
shall be consistent with the rights held by BioMarin or Genzyme, as
the case may be, with respect to such Additional Technology.
Subject to BioMarin/Genzyme LLC agreeing to pay the appropriate
amounts due to a Third Party under an agreement with a Party as a
result of the acquisition of Additional Technology and/or exercise
of the rights therein by or on behalf of BioMarin/Genzyme LLC, the
same shall be a “Third Party Agreement” for purposes of
this Agreement.
3.1.5 External
Products . If at any time during the Term either Genzyme,
BioMarin or their respective Affiliates intends to collaborate with
a Third Party regarding the development and/or commercialization of
a Gene Therapy product for the treatment or prevention of MPS I or
other alpha-L-iduronidase deficiencies (an “ External
Product ”), such Party (the “ Proposing
Party ”) shall provide written notice of its intent to
the Steering Committee. The Proposing Party and the Steering
Committee shall negotiate in good faith the terms and conditions
upon which the Proposing Party and BioMarin/Genzyme LLC would be
willing to collaborate for such purposes. If the Proposing Party
and the Steering Committee are unable to agree upon such terms and
conditions within sixty (60) days after receipt by the
Steering Committee of the Proposing Party’s notice, the
Proposing Party shall have the right to develop or commercialize
such External Product with a Third Party.
3.2 Sublicenses of Rights
from BioMarin/Genzyme LLC to BioMarin and Genzyme .
3.2.1 General .
BioMarin/Genzyme LLC hereby grants to each of BioMarin and Genzyme
a worldwide, non-exclusive, royalty-free right and sublicense
during the Term under the Patent Rights, Technology and
Manufacturing Know-How licenses granted to BioMarin/Genzyme LLC
pursuant to Section 3.1 or under the Third Party Agreements
solely to the extent required to permit such Party to perform its
duties and obligations and exercise its rights under this Agreement
and any Related Agreement. BioMarin/Genzyme LLC also hereby agrees
to grant to each of BioMarin and Genzyme a worldwide,
non-exclusive, royalty-free right and license during the Term under
any Additional Technology as to which BioMarin/Genzyme LLC obtains
a license pursuant to Section 3.1.4 above solely to the extent
required to permit such Party to perform its duties and obligations
and exercise its rights under this Agreement and any Related
Agreement. BioMarin/Genzyme LLC also hereby grants a worldwide,
non-exclusive, royalty-free right and license during the Term to
use any and all present and future trademarks Controlled by
BioMarin/Genzyme LLC (i) to Genzyme in connection with the
commercialization of Aldurazyme in the Territory to the extent
required to permit Genzyme to perform its duties and obligations
and exercise its rights under this Agreement and any Related
Agreement with respect to Aldurazyme and (ii) the
Commercialization Party in connection with the commercialization of
any other Collaboration Product to the extent required to permit
such Commercialization Party to perform its duties and obligations
and exercise its rights under this Agreement and any Related
Agreement with respect to such Collaboration Product, in each case
such licenses are subject to the quality-related requirements for
Collaboration Products set forth in this Agreement and the Related
Agreements.
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3.2.2 Further
Sublicenses . The foregoing licenses granted to Genzyme and
BioMarin, respectively, shall include the right to grant and
further authorize sublicenses to Third Parties within the scope of
such licenses.
3.3 Reservation of
Rights .
3.3.1 Reservation by
BioMarin . Notwithstanding the license grants set forth in
Section 3.1 but subject to the terms and conditions set forth
in this Agreement and the Manufacturing, Marketing and Sales
Agreement, BioMarin at all times reserves the rights under the
BioMarin Patent Rights, the BioMarin Technology, the
BioMarin/Genzyme Patent Rights, the BioMarin/Genzyme Technology and
the Manufacturing Know-How Controlled by BioMarin (a) to make,
have made and use Collaboration Products for research and
development purposes only; (b) to develop, make, have made,
use, offer for sale, sell, have sold, import and export
(i) products outside the Field and (ii) products other
than a Collaboration Product; and (c) to grant licenses to
Third Parties for the foregoing purposes.
3.3.2 Reservation by
Genzyme . Notwithstanding the license grants set forth in
Section 3.1 but subject to the terms and conditions set forth
in this Agreement and the Manufacturing, Marketing and Sales
Agreement, Genzyme at all times reserves the rights under the
Genzyme Patent Rights, the Genzyme Technology, the BioMarin/Genzyme
Patent Rights, the BioMarin/Genzyme Technology and Manufacturing
Know-How Controlled by Genzyme (a) to make, have made and use
Collaboration Products for research and development purposes only;
(b) to develop, make, have made, use, offer for sale, sell,
have sold, import and export (i) products outside the Field
and/or outside the Territory and (ii) products other than a
Collaboration Product; and (c) to grant licenses to Third
Parties for the foregoing purposes.
3.4 Assignment of Orphan
Drug Designation . Except to the extent prohibited by the
applicable Regulatory Scheme, BioMarin hereby assigns and BioMarin
and Genzyme each hereby agree to assign to BioMarin/Genzyme LLC any
“Orphan Drug” (or similar designation outside the
United States) for any Collaboration Product which BioMarin has
received or which BioMarin or Genzyme may receive during the Term
in the Territory.
3.5 Third Party
Agreements . Each Party shall exercise their rights under
the Third Party Agreements in a manner that is as consistent as
possible with the terms of this Agreement and the Related
Agreements in consultation with and as reasonably requested by the
other Parties. Without the prior written consent of the other
Parties (which consent shall not be unreasonably withheld, delayed
or conditioned), none of the Parties shall voluntarily
(i) amend or modify, or consent to any action that may be
taken under, any Third Party Agreement, the effect of which would
change any financial terms or conditions thereunder or materially
adversely affect the Parties’ rights under this Agreement or
any Related Agreement, (ii) take or consent to any action
taken with respect to any Patent Rights, Technology or
Manufacturing Know-How licensed under the Third Party Agreement,
the effect of which would materially adversely affect the
Party’s rights under this Agreement or any Related Agreement,
or (iii) terminate or engage in any act or omission that
constitutes or would constitute, with or without the giving of
notice or the passage of time, an event that would permit
the
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licensor under the Third Party
Agreements to terminate the Third Party Agreements. Each Party
shall immediately notify the other Parties of any such event or of
the receipt any notice of breach or termination of any Third Party
Agreement. The Party who is a party to a Third Party Agreement
shall take all reasonable actions necessary, or permit such actions
to be taken in its name by the other Parties, to maintain and
enforce the Parties’ rights under such Third Party Agreement
in a manner consistent with the terms of this Agreement and the
Related Agreement.
ARTICLE IV
PROGRAM
FUNDING
4.1 Program Funding
Commitments . Genzyme hereby undertakes to make capital
contributions to BioMarin/Genzyme LLC in an amount equal to fifty
percent (50%) of all Program Costs and BioMarin, on behalf of
the BioMarin Companies, hereby undertakes to make capital
contributions to BioMarin/Genzyme LLC in an aggregate amount equal
to fifty percent (50%) of all Program Costs. In the event that
either BioMarin, on behalf of the BioMarin Companies, or Genzyme
fails to make a capital contribution pursuant to this
Section 4.1 and Section 4.2 below, and the other Party
does not elect to terminate the Development Program pursuant to
Article 13 hereof, then the Percentage Interests in
BioMarin/Genzyme LLC and the future funding responsibility of the
Members shall be adjusted as provided in Section 4.1(b) of the
Operating Agreement.
4.2 Program Funding
Capital Contributions .
4.2.1 Quarterly Capital
Contributions . Genzyme and BioMarin, on behalf of the BioMarin
Companies, shall each make capital contributions to
BioMarin/Genzyme LLC, quarterly in advance, not later than the
fifteenth (15th) day prior to the end of the prior calendar
quarter, in an aggregate amount equal to the Program Costs budgeted
to be incurred by BioMarin/Genzyme LLC in the then-current
Development Plan for such calendar quarter, allocated between such
Parties in accordance with the funding responsibility assumed by
Genzyme and BioMarin, on behalf of the BioMarin Companies, pursuant
to Section 4.1 above. Upon receipt of each such capital
contribution from Genzyme or BioMarin, as the case may be,
BioMarin/Genzyme LLC shall promptly pay each of the Parties an
amount equal to that portion of the budgeted Program Costs to which
they are respectively entitled in accordance with this
Agreement.
4.2.2 Monthly Statements;
Quarterly Reconciliation . As soon as practicable, but in any
event prior to the tenth (10th) business day after the end of
each calendar month, each of BioMarin and Genzyme shall provide
BioMarin/Genzyme LLC with a detailed itemization of Program Costs
actually incurred by such Party during the previous month. Within
thirty (30) days following receipt of the third monthly
statement for each calendar quarter of actual Program Costs
provided by each of BioMarin and Genzyme, BioMarin, on behalf of
the BioMarin Companies, and Genzyme shall each make an additional
capital contribution to BioMarin/Genzyme LLC in the amount of any
actual Program Costs shown on the three (3) monthly statements
for such calendar quarter, taken in the aggregate, and not yet paid
for which such Party has assumed funding responsibility pursuant to
Section 4.1 above but only to the extent that such amount,
together with all prior capital contributions to date during such
year, does not exceed [****] of the total Program
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Costs budgeted year-to-date
through the end of the quarter to which such statement relates
(except to the extent such excess is approved by the Steering
Committee pursuant to Section 5.1.3 hereof). If the aggregate
amount stated to be due from BioMarin/Genzyme LLC based on such
quarterly reconciliation for actual Program Costs is less than the
amount already contributed by the Parties to the capital of
BioMarin/Genzyme LLC with respect to budgeted Program Costs for
such calendar quarter, such excess shall be credited against the
next successive quarterly capital contribution(s) due from Genzyme
or BioMarin hereunder.
4.3 Distributions .
Distributions to each Member shall be made at such times and in
such amounts as determined in accordance with the Operating
Agreement.
4.4 Books of Account;
Audit . Genzyme shall keep and maintain proper and complete
books of account, and shall maintain a bank account, on behalf of
BioMarin/Genzyme LLC. In the event that either BioMarin or Genzyme
reasonably deems the Program to be material to BioMarin or Genzyme,
as the case may be, for financial accounting purposes, then, upon
such Party’s request, audited financial statements of
BioMarin/Genzyme LLC shall be prepared by an independent accounting
firm to be selected by the Steering Committee. Each of BioMarin and
Genzyme shall keep and maintain proper and complete records and
books of account documenting all Program Costs incurred by such
Party. Each of BioMarin/Genzyme LLC, BioMarin and Genzyme shall
permit independent accountants retained by BioMarin or Genzyme (the
“Auditing Party”) to have access to its records and
books for the sole purpose of determining the appropriateness of
Program Costs charged by or accrued to the Party being audited
hereunder. Such examination shall be conducted during regular
business hours and upon reasonable notice, at the Auditing
Party’s own expense and no more than once in each calendar
year during the Term and once during the three (3) calendar
years following the expiration or termination hereof. If such
examination reveals that such Program Costs have been misstated,
any adjustment shall be promptly refunded or paid, as appropriate.
The Auditing Party shall pay the fees and expenses of the
accountant engaged to perform the audit, unless such audit reveals
an overcharge or accrual of [****] or more for the period examined,
in which case the Party who received such overpayment shall pay all
reasonable costs and expenses incurred by the Auditing Party in the
course of making such determination, including the fees and
expenses of the accountant along with interest at the rate set
forth in Section 14.4.
4.5 Enforceability of
Sections 4.1 and 4.2 . The agreements regarding capital
contributions set forth in Sections 4.1 and 4.2 hereof are by
and between, and for the benefit of, Genzyme and BioMarin only, and
are not enforceable by BioMarin/Genzyme LLC or any Third
Party.
4.6 General and
Administrative Services . Except as provided in this
Section 4.6, each of BioMarin and Genzyme shall continue to
provide general and administrative services to BioMarin/Genzyme LLC
after the Effective Date (in substantially the same manner and to
the same extent as such Party has provided such general and
administrative services to BioMarin/Genzyme LLC prior to the
Effective Date) at no cost to BioMarin/Genzyme LLC. To the extent
that there are any Third Party costs (such as legal or accounting
costs or insurance premiums), all such costs shall be paid for
[****].
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ARTICLE V
THE DEVELOPMENT
PROGRAM
5.1 Conduct of the
Development Program .
5.1.1 General . The
Parties agree to use commercially reasonable and diligent efforts
to execute and substantially perform and to cooperate with each
other in carrying out the Development Plan for each Collaboration
Product. Neither BioMarin nor Genzyme shall be required to
undertake activities in furtherance of the Development Plan in the
absence of funding from BioMarin/Genzyme LLC pursuant to the
provisions of this Agreement. As used in this Agreement, the phrase
“ commercially reasonable and diligent efforts ”
will mean that level of effort which, consistent with the exercise
of prudent scientific and business judgment, is applied by the
Party in question to its other therapeutic products at a similar
stage of development and with similar commercial
potential.
5.1.2 Development Plan
. The Development Program shall be conducted by the Parties for
BioMarin/Genzyme LLC in accordance with the then-current
Development Plan which shall describe the proposed overall program
of development for each Collaboration Product, including
preclinical studies, toxicology, formulation, manufacturing,
clinical trials and regulatory plans and other key elements.
Pursuant to the Development Plan, development work may be
subcontracted to Genzyme and BioMarin or their respective
Affiliates, at fully absorbed costs determined by GAAP. The
respective charges to BioMarin/Genzyme LLC for Development Costs
incurred by a Party shall be invoiced following completion of the
work, and shall be payable by BioMarin/Genzyme LLC within a
commercially reasonable time thereafter (but in no event later than
forty-five (45) days of the date of invoice therefor). The
Development Plan shall include (i) a summary of estimated
Development Costs expected to be incurred by each Party hereunder
in performing activities of the Development Program assigned to
such Party pursuant to Section 5.1.4 below and (ii) a
summary budget for all development projects proposed for the
applicable period and for each Collaboration Product.
5.1.3 Initial and Updated
Development Plan . The Parties have agreed to an initial three
(3) year development plan and budget for the period beginning
on the Effective Date and ending on December 31, 2010, which
is attached hereto as Appendix A . The rolling three
(3) year Development Plan shall be updated annually by the
Program Management Team and submitted to the Steering Committee for
review and approval not later than sixty (60) days prior to
January 1 of each year during the Development Program. Each
such updated Development Plan shall include (a) an overall
development plan for each Collaboration Product which sets forth
all major development tasks and (b) a detailed description and
budget for the activities proposed for the covered period. The
Project Management Team shall be primarily responsible for
preparing the annual updates to the Development Plan and, in
connection with the preparation of such updates, shall consult with
Genzyme and BioMarin regarding the identification, timing and
execution of and budget for the major tasks and detailed activities
required to perform the updated Development Plan. Each such updated
Development Plan approved by the Steering Committee shall be signed
by an authorized representative of each of BioMarin and Genzyme.
The members of the Program Management Team shall actively consult
with one another throughout the term of the Development Plan so as
to adjust
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the specific work performed
under the Development Plan to conform to evolving developments in
technology and the results of the development work performed. Any
changes in the scope or direction of the work and any changes to
the total amount budgeted in any calendar year for the Development
Program must be approved by the Steering Committee, in the absence
of which approval the most recently approved Development Plan shall
remain in effect.
5.1.4 Studies Required by
Regulatory Authorities .
(a) Existing Markets .
In the event that any regulatory authority in any country in which
Aldurazyme has received all necessary Regulatory Approvals as of
the Effective Date (“ Existing Markets ”)
requires a post-marketing study related to Aldurazyme (other than
any registry program existing on the Effective Date or
post-marketing studies related to the manufacture of Aldurazyme,
each of which shall be governed by the terms and conditions of the
Manufacturing, Marketing and Sales Agreement) that is not
contemplated by the initial Development Plan described above, then
such study shall automatically be added to the Development Program
and (i) the Program Management Team shall promptly prepare a
plan for the conduct of such required post-marketing study
(including without limitation a timeline and reasonably detailed
budget) and submit the plan to the Steering Committee for review
and approval and (ii) the Steering Committee shall promptly
review such plan and, upon approval of such plan by the Steering
Committee, the then-current Development Plan shall au
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