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 / Toray, and upon at least five days prior wr
