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Exhibit 10.18
Portions redacted
* Certain information on this page has been
omitted and filed separately with the
Securities and Exchange Commission.
Confidential treatment has been requested
with respect to the omitted portions.
COLLABORATION AGREEMENT
THIS AGREEMENT is made as of April 30, 2001,
BETWEEN:
Transworld Pharmaceuticals Corporation Inc., a company having
offices
at Sassoon House, Shirley Street, Nassau, New Providence,
Bahamas, and
Toray Trading Corp. a Cyprus company
("TPh / Toray")
AND:
Dragon Pharmaceuticals Inc., a corporation having an office at
543
Granville St., Vancouver, BC. Canada V6C lX8
("Dragon")
WHEREAS:
(A) Transworld Pharmaceuticals Corporation, together with Toray,
having
control and ownership of certain intellectual property, to whit:
methods of
formulation of purified bulk recombinant Human erythropoietin
(rHu EPO) with
recombinant Hyaluronic Acid (rHA), for the achievement of a
novel slow-release
formulation of rHu EPO.
(B) TPh / Toray has agreed to grant certain rights to Dragon
to
manufacture and sell the Product in a specified market, and to
manufacture the
product on a fee-for-service basis for sale to TPh / Toray;
THIS AGREEMENT WITNESSES that in consideration of $1 paid and
other
consideration given, by each party to each other party, the
receipt and
sufficiency of which each party acknowledges, the parties
severally AGREE as
follows:
PART l
DEFINITIONS AND INTERPRETATION
Definitions
1.1 In this Agreement, except as otherwise expressly provided or
as the
context otherwise requires:
(a) Affiliate of a party means a corporation or entity that,
directly or
indirectly, controls, is under common control with or is
controlled by the
specified party;
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(b) current GMP means current good manufacturing practices as
determined
by the World Health Organization;
(c) Indication means the use of the Product to treat a
particular
condition as described in Schedule A;
(d) Marketing Approval has the meaning set out in ss.2.9;
(e) Product means the formulation of rHu EPO and rHA achieving a
novel
slow release formulation
(f) Purchase Orders has the meaning set out in ss.4.5
Interpretation
1.2 In this Agreement, except as otherwise expressly provided or
as the
context otherwise requires,
(a) "this Agreement" means this agreement as from time to
time
supplemented or amended by one or more agreements entered into
pursuant to
the applicable provisions of this Agreement,
(b) a reference to a Part is to a Part of this Agreement, and
the symbol
ss. followed by a number or some combination of numbers and
letters refers
to the section, paragraph, subparagraph, clause or subclause of
this
Agreement so designated,
(c) headings are solely for convenience of reference and are not
intended
to be complete or accurate descriptions of content or to be
guides to
interpretation of this Agreement or any part of it,
(d) the word "including", when following a general statement or
term, is
not to be construed as limiting the general statement or term to
any
specific item or matter set forth or to similar items or
matters. but
rather as permitting the general statement or term to refer also
to all
other items or matters that could reasonably fall within is
broadest
possible scope,
(e) an accounting term not otherwise defined herein has the
meaning
assigned to it, and every calculation to be made hereunder is to
be made,
in accordance with accounting principles generally accepted in
the United
States applied on a consistent basis,
(f) a reference to currency means United States currency,
(g) a reference to a statute includes all regulations made
thereunder, all
amendments to the statute or regulations in force from time to
time, and
every statute or regulation that supplements or supersedes such
statute or
regulations,
(h) a reference to an entity includes any successor to that
entity,
(i) a word importing the masculine gender includes the feminine
and
neuter, a word in the singular includes the plural, a word
importing a
corporate entity includes an individual, and vice versa,
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(j) and a reference to "approval", "authorization" or "consent"
means
written approval, authorization or consent.
PART 2
GRANT OF LICENSE
License
2.1 Subject to the terms of this Agreement, TPh / Toray hereby
grants to
Dragon an exclusive license to manufacture and sell the Products
in the Market
Area for treatment of the Indications. Additionally, Dragon is
to be the sole
manufacturer of the product for markets both within its
territory, as well as
for territories in which TPh / Toray market the product.
2.2 Nothing in this Agreement confers on Dragon any interest,
licence or
right in respect of Products other than as set out herein, and
the Products will
remain the exclusive property of TPh / Toray and its Affiliates.
Sales outside
of the Market Area are prohibited, unless granted in writing to
Dragon by TPh /
Toray. New Drug Licenses and production permits for the product
within China are
to be owned by Dragon.
2.3 Dragon will forthwith disclose to TPh / Toray every
improvement to or
further development of the Products, including the results of
any research,
testing or clinical trials conducted by or on behalf of Dragon.
The results of
such research, testing, trials and improvements will be
immediately disclosed to
TPh / Toray and will be jointly owned by TPh / Toray and Dragon,
without any
obligation of Dragon, with respect to the ownership or use of
such information
or the payment of any compensation.
Dragon's Regulatory Obligations
2.4 Dragon will be responsible for obtaining, at its expense,
all
registrations from applicable regulatory authorities in order to
permit the
manufacture and sale of the product in the Market Area (the
"Marketing
Approval"). In particular, Dragon will
(a) Complete any and all actions required to register the
product with the
State Drug Administration of the People's Republic of China in
order to
obtain a new drug license and manufacturing permit for the
product.
2.5 TPh / Toray will use reasonable efforts to assist Dragon in
obtaining
the new drug license and manufacturing permit, including
providing to Dragon
(a) Results of any and all technical research, to include full
results of
pre-clinical, phase I and phase II human studies, and
(b) TPh / Toray will work to achieve optimum formulation methods
using
purified bulk EPO provided at no cost by Dragon, and will
provide
documentation of same.
(c) Additionally, TPh / Toray will provide hands-on technical
assistance
to Dragon affiliates in China and North America during the
initial period
of collaboration.
(d) Costs to be borne by either side during the development
phase of this
collaboration are as described in Schedule A.
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2.6 All registrations made in order to obtain the Marketing
Approval in
China will be made by Dragon on its own behalf and in its own
name.
Sublicenses
2.7 Dragon may not grant sublicenses to sell the Products in the
Market
Area, except as authorised in writing by TPh / Toray.
PART 3
MARKETING
Marketing Plan
3.1 Dragon, TPh /Toray and their Affiliates will jointly develop
a
marketing plan (the "Marketing Plan") for the sale of the
products in the Market
Area, which will include targets for reasonable minimum Product
sales by Dragon.
The marketing plan will be prepared by September 1 of each year
and will cover
the following 12-month period from January 1 to December 31. The
Marketing Plan
will be reviewed quarterly by representatives of Dragon and TPh
/ Toray.
Branding
3.2 Dragon and TPh / Toray will jointly determine a name under
which the
Products will be so1d in the Market Area. At Dragon's option,
the name
"Transworld Pharma Corp." and any related trademarks will be
included in, or
linked and used with, the name selected. TPh / Toray and Dragon
will jointly own
the brand name developed.
Market Area Packaging
3.3 Dragon will work with TPh / Toray to develop distinctive
packaging
materials suitable to the Market Area. All packaging will be
subject to the
approval of TPh / Toray and will include, at the option of TPh /
Toray, such
trademark or logos of TPh / Toray or its Affiliates as
determined by TPh /
Toray. Dragon will be responsible for the costs of all
packaging.
PART 4
PRICING, ORDERS AND PAYMENT
Price
4.1 TPh / Toray will receive from Dragon royalties from net
sales of
product at rates set out in Schedule A, such rates to be in
effect until
December 31 of each year.
4.2 Notwithstanding any change in the royalty rates set out in
Schedule A,
no price change will effect the price of any Products for which
a Purchase Order
has been received and accepted by Dragon.
4.3 Dragon's price to TPh / Toray for the finished product
manufactured by
Dragon is set our in Schedule A.
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Resale Prices
4.4 Subject to all applicable laws and the approval of TPh /
Toray, which
will not be unreasonably withheld, Dragon will determine the
prices at which the
Products will be sold in the Market Area. In reviewing the
resale price for the
Products, TPh / Toray and Dragon will take into account
considerations of
consumer affordability and maintaining appropriate price
advantages over
competitors.
Delivery Times
4.5 Dragon will promptly fill all purchase Orders received from
TPh /
Toray in accordance with the terms of each Purchase Order and
will ensure,
unless a longer delivery time is specified in a Purchase Order,
a 60-day
delivery time for each such Purchase Order. If Dragon is able to
deliver the
Products in a shorter period of time than specified in the
Purchase Order, it
will notify TPh / Toray of such earlier delivery date.
4.6 Notwithstanding ss.4.7, if Dragon for any reason can not
meet the
delivery times in a Purchase Order, it will notify TPh / Toray
of the expected
delivery date when it confirms the Purchase Order under ss.4.6.
Upon receipt of
Dragon's notice of the expected delivery date, TPh / Toray may,
on notice
delivered to Dragon within five business days of Dragon's
receipt of TPh /
Toray's confirmation of the Purchase Order, withdraw the
Purchase Order. If the
Purchase Order is not withdrawn, the delivery times in ss.4.7
will be deemed to
be amended to the time set out in Dragon's confirmation of the
Purchase Order.
Payment
4.7 TPh / Toray will make full payment to Dragon for Products
shipped to
it on a date after the date of shipment agreed on a case by case
basis provided
that before the expiry of the payment period, Dragon has
received from TPh /
Toray the following documents:
(a) Dragon's detailed invoice;
(b) customs' invoice;
(c) air waybill;
(d) packing list; and
(e) pharmaceutical certificate of analysis, quality assurance
and
quality control documents and batch certificates.
Letter of Credit
4.8 TPh / Toray will, at the request of Dragon, at any time
during the
term of this Agreement, provide a standby letter of credit to
Dragon, which
letter of credit may be drawn by Dragon upon default by TPh /
Toray of payment
in collection with any Products as provided in ss.4.7.
Notwithstanding any other
provision of this Agreement, if it has requested a letter of
credit Dragon will
not be obligated to manufacture or deliver any Product until it
has received the
letter of credit.
4.9 The value of the standby letter of credit need not exceed
the value of
the Purchase Order for which Dragon has requested the letter of
credit.
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Audit Right
4.10 Dragon will keep clear and accurate books and records of
all sales of
Products in the Market Area. Up to twice a year, at the request
and expense of
TPh
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