Exhibit 10.76
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN
THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
COLLABORATION
AGREEMENT
by and among
GILEAD SCIENCES,
INC.,
GILEAD HOLDINGS,
LLC,
BRISTOL-MYERS SQUIBB
COMPANY,
E.R. SQUIBB & SONS,
L.L.C.,
and
BRISTOL-MYERS SQUIBB & GILEAD
SCIENCES, LLC
Dated as of December 17,
2004
TABLE OF
CONTENTS
i
ii
iii
Annexes:
Annex A – Initial Committee Members and
Alliance Managers
Annex B – Development Plan and Development
Budget as of Effective Date
Annex C – Commercialization Plan and
Commercialization Budget as of Effective Date
Annex D – BMS Patents
Annex E – Gilead Patents
Annex F – Gilead Licensed
Trademarks
Annex G – BMS Licensed
Trademarks
Annex H – Quarterly Detail
Report
Annex I – Manner of Calculation of Net
Selling Price
Annex J – Calculation of Cost of
Goods
Annex K – Calculation of Transfer
Price
Annex L – Joint Press Release
Annex M – Certain Financial
Data
Annex N – Data to be Provided to
Independent Accounting Expert Pursuant to
Section 7.1
Annex O – JV Obligations as
Sublicensee
Annex P – Key Terms of Services
Agreement
Annex Q – Pricing [*]
Annex R – List of Countries Comprising the
Developing World
iv
THIS COLLABORATION AGREEMENT (this
“Agreement”) is made as of December 17, 2004 (the
“Effective Date”), by and among Gilead Sciences, Inc.,
a corporation organized and existing under the laws of the State of
Delaware and having its principal place of business at 333 Lakeside
Drive, Foster City, CA 94404 (“Gilead Parent”), Gilead
Holdings, LLC, a Delaware limited liability company and
wholly-owned subsidiary of Gilead Parent (“Gilead Sub”
and, collectively with Gilead Parent, “Gilead”),
Bristol-Myers Squibb Company, a corporation organized and existing
under the laws of the State of Delaware and having its principal
place of business at 345 Park Avenue, New York, NY 10154
(“BMS Parent”), E.R. Squibb & Sons, L.L.C., a
Delaware limited liability company and wholly-owned subsidiary of
BMS Parent (“BMS Sub” and, collectively with BMS
Parent, “BMS”), and Bristol-Myers Squibb & Gilead
Sciences, LLC, a limited liability company organized and existing
under the laws of the State of Delaware and having its
principal place of business at 333 Lakeside Drive, Foster City, CA
94404 (the “JV”) (Gilead, BMS and the JV, collectively,
the “Parties” and each a
“Party”).
RECITALS
WHEREAS, Gilead has developed and is
marketing a proprietary nucleotide reverse transcriptase inhibitor,
Viread® (known under the generic name of tenofovir disoproxil
fumarate (“TDF”)), a proprietary nucleoside reverse
transcriptase inhibitor, Emtriva® (known under the generic
name of emtricitabine (“FTC”)), and a fixed-dose
co-formulated product containing TDF and FTC as its only active
pharmaceutical ingredients, Truvada®, for the treatment of HIV
infection in adults;
WHEREAS, BMS has developed and is
marketing a proprietary non-nucleoside reverse transcriptase
inhibitor, Sustiva® (known under the generic name of efavirenz
(“EFV”)) for the treatment of HIV infection in
adults;
WHEREAS, Gilead and BMS desire to
develop and commercialize in the United States, through a joint
venture entity, a fixed-dose, co-formulated combination product
containing TDF, FTC and EFV as its only active pharmaceutical
ingredients;
WHEREAS, for that purpose, Gilead
and BMS have formed the JV pursuant to that certain Operating
Agreement entered into as of the Effective Date by and between
Gilead Sub and BMS Sub (the “Operating
Agreement”);
WHEREAS, the Parties wish to
allocate among themselves certain rights and duties relating to the
development and commercialization of such a combination product,
upon the terms and conditions of this Agreement, the Operating
Agreement and the Ancillary Agreements (as defined below);
and
WHEREAS, pursuant to the BMS
Guarantee Agreement and the Gilead Guarantee Agreement (as such
terms are defined below), each dated as of the Effective Date, BMS
Parent and Gilead Parent are guaranteeing the performance of all of
the obligations of
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN
THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
1
BMS Sub and Gilead Sub, respectively, under this
Agreement, the Operating Agreement and all Ancillary Agreements to
which the applicable Affiliate (as defined below) is or becomes a
party;
NOW, THEREFORE, in consideration of
the mutual promises and covenants set forth below and other good
and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Parties agree as follows:
1.1
“Act”
shall mean the United States Food, Drug and Cosmetic Act, as
amended.
1.2
“Actual BMS
Percentage” shall mean, for each Calendar Year, the
percentage applicable to BMS for such Calendar Year based on
historical data and determined pursuant to
Section 7.1(b).
1.3
“Actual
Gilead Percentage” shall mean, for each Calendar Year, the
percentage applicable to Gilead for such Calendar Year based on
historical data and determined pursuant to
Section 7.1(b).
1.4
“Actual
Percentage” shall mean, with respect to BMS, the Actual BMS
Percentage and, with respect to Gilead, the Actual Gilead
Percentage.
1.5
“Actual
Yield” shall have the meaning set forth in Annex
K.
1.6
“Affiliate” of a
Person shall mean any other Person that, directly or indirectly,
through one or more intermediaries, controls, is controlled by, or
is under common control with such Person. For purposes of
this definition only, “control” and, with correlative
meanings, the terms “controlled by” and “under
common control with” shall mean (a) the possession, directly
or indirectly, of the power to direct the management or policies of
a Person, whether through the ownership of voting securities or by
contract relating to voting rights or corporate governance, or (b)
the ownership, directly or indirectly, of more than fifty percent
(50%) of the voting securities or other ownership interest of a
Person; provided , however , that if local law
restricts foreign ownership, control shall be established by direct
or indirect ownership of the maximum ownership percentage that may,
under such local law, be owned by foreign interests. For
purposes of this Agreement, the Operating Agreement and the
Ancillary Agreements, the JV shall not be deemed to be an Affiliate
of either Gilead or BMS.
1.7
“Agreement” shall
have the meaning set forth in the first paragraph
above.
1.8
“Alliance
Manager” shall have the meaning set forth in
Section 2.7(a).
1.9
“Allocated
Costs” shall have the meaning set forth in
Section 5.12.
1.10
“AMP”
shall have the meaning set forth in Annex Q.
2
1.11
“Ancillary
Agreements” shall mean, collectively, the BMS Supply
Agreement, the Gilead Supply Agreement, the Services Agreement and
the SDEA.
1.12
“
[*] ” shall have the
meaning set forth in Section 5.1(f).
1.13
“Applicable
EFV Territory” shall mean (a) with respect to any BMS
Technology licensed to BMS by the EFV Licensor or licensed to the
EFV Licensor by BMS, in each case under the EFV License Agreement,
the EFV License Agreement Territory, and (b) with respect to all
other BMS Technology, worldwide.
1.14
“Applicable
Law” shall mean the applicable laws, rules, and regulations,
including, without limitation, any rules, regulations, guidelines
or other requirements of the Regulatory Authorities, that may be in
effect from time to time in the Territory.
1.15
“Approvals” shall
mean, collectively, the approvals granted by the Regulatory
Authorities for the Manufacture, Marketing, sale and/or use of the
Combination Product in the Field in the Territory, including,
without limitation, pricing and reimbursement approvals (if
any).
1.16
“Approved
Marketing Materials” shall have the meaning set forth in
Section 5.7(a).
1.17
“
[*] Representative” shall
have the meaning set forth in Section 5.3(b).
1.18
“Authorized
Commercialization Expenses” shall have the meaning set forth
in Section 5.12.
1.19
“Authorized
Development Expenses” shall have the meaning set forth in
Section 3.8.
1.20
“Authorized
Expenses” shall mean, collectively, the Authorized
Commercialization Expenses, Authorized Development Expenses and
Authorized Other Expenses.
1.21
“Authorized
Other Expenses” shall mean all JV Expenses expressly stated
in this Agreement or the Operating Agreement or any Ancillary
Agreement to be Authorized Other Expenses or agreed by the JEC to
be Authorized Other Expenses.
1.22
“AWP”
shall have the meaning set forth in Annex Q.
1.23
“BMS”
shall have the meaning set forth in the first paragraph of this
Agreement.
1.24
“BMS Core
Improvement” shall mean any Improvement pertaining
specifically to BMS Core Technology, which Improvement is
conceived, discovered, developed, or otherwise made, as necessary
to establish authorship or inventorship under United States
copyright or patent law, as the case may be, solely or jointly, by
or on behalf of Gilead or its Affiliates or the JV in the course
of, as a result of, or in connection with the Project
Activities
3
conducted pursuant to the
Development Plan or in connection with Co-Funded Clinical Trials;
provided , however , that BMS Core Improvements shall
not include any Dual Improvements.
1.25
“BMS Core
Technology” shall mean all BMS proprietary technologies
relating specifically to the Exploitation of EFV.
1.26
“BMS
Guarantee Agreement” shall mean the guarantee agreement
executed by BMS Parent in favor of Gilead and the JV, dated as of
the Effective Date, as such agreement may be amended from time to
time.
1.27
“BMS
Indemnified Party” shall mean BMS Sub, BMS Parent and any of
their Affiliates, officers, directors and employees.
1.28
“BMS
Inventions” shall mean any Information and Inventions
(whether or not patentable; and Improvements thereto, including
Gilead Core Improvements to the extent owned by BMS)
conceived,
discovered, developed or otherwise made, as necessary to establish
authorship or inventorship under United States copyright or patent
law, as the case may be, solely (or, in the case of Gilead Core
Improvements, solely or jointly) by or on behalf of BMS or its
Affiliates, in the course of, as a result of or in connection with
the Project Activities conducted pursuant to the Development Plan
or in connection with Co-Funded Clinical Trials, but excluding any
Joint Inventions.
1.29
“BMS
Know-How” shall mean any and all Information and Inventions
under the Control of BMS or its Affiliates as of the Effective Date
or at any time during the term of this Agreement that are necessary
or reasonably useful for the Exploitation of the Combination
Product and are not generally known, but excluding any and all (a)
such Information and Inventions to the extent claimed by the BMS
Patents and (b) Joint Know-How.
1.30
“BMS
Licensed Trademarks” shall have the meaning set forth in
Section 6.6(b).
1.31
“BMS
Parent” shall have the meaning set forth in the first
paragraph of this Agreement.
1.32
“BMS
Patents” shall mean all of the Patents that BMS or its
Affiliates Control as of the Effective Date or at any time during
the term of this Agreement that would, in the absence of the
license granted by BMS in Section 6.1(b) and assuming that the
EFV active pharmaceutical ingredient therein was not purchased from
BMS, be infringed by the Exploitation of the Combination Product by
the JV in any country in the world. A list of the BMS Patents
in the Territory as of the Effective Date is attached hereto as
Annex D.
1.33
“BMS
Regulatory Documentation” shall mean all Regulatory
Documentation applicable to Sustiva (or EFV) but not Sustiva (or
EFV) in co-formulation with Viread (or TDF), Emtriva (or FTC), or
Truvada (or TDF and FTC), that is or was developed by or on behalf
of BMS or any of its Affiliates or sublicensees prior to the
Effective Date or during the term of this Agreement.
4
1.34
“BMS
Sub” shall have the meaning set forth in the first paragraph
of this Agreement.
1.35
“BMS Supply
Agreement” shall mean the supply agreement entered into
between BMS Sub and the JV concurrently with the execution and
delivery of this Agreement, as such agreement may be amended from
time to time.
1.36
“BMS
Technology” shall mean, collectively, the BMS Know-How and
the BMS Patents.
1.37
“BMS
Transfer Price” shall have the meaning set forth in
Section 7.1(a).
1.38
“Breaching
Member Party” shall have the meaning set forth in
Section 14.4(a).
1.39
“Business
Day” shall mean a day that is not a Saturday, Sunday or day
on which banking institutions in New York, New York or San
Francisco, California are required by law to remain
closed.
1.40
“
[*] Representative” shall
have the meaning set forth in Section 5.3(b).
1.41
“Calendar
Quarter” shall mean a period of three (3) consecutive
calendar months ending on March 31, June 30,
September 30 or December 31.
1.42
“Calendar
Year” shall mean a period of twelve (12) consecutive calendar
months commencing on January 1 and ending on
December 31.
1.43
“Change of
Control” shall mean, with respect to a Person, any of the
following transactions with a Third Party (a “Third Party
Acquirer”): (a) a merger or consolidation of such Person with
the Third Party Acquirer which results in the holders of the voting
securities of such Person outstanding immediately prior thereto
(other than the Third Party Acquirer, its “affiliates”
and “associates” (as such terms are used in the
Exchange Act)) ceasing to represent at least fifty percent (50%) of
the combined voting power of the surviving entity (or, if
applicable, its parent company) immediately after such merger or
consolidation; (b) the sale to the Third Party Acquirer of all or
substantially all of the business of such Person to which this
Agreement relates (whether by merger, consolidation, sale of stock,
sale of assets or other similar transaction); or (c) the Third
Party Acquirer (which shall not be any trustee or other fiduciary
holding securities under an employee benefit plan of such Person,
or any corporation owned directly or indirectly by the stockholders
of such Person, in substantially the same proportion as their
ownership of stock of such Person), together with any of the Third
Party Acquirer’s “affiliates” or
“associates”, as such terms are used in the Exchange
Act, becoming the beneficial owner of fifty percent (50%) or more
of the combined voting power of the outstanding securities of such
Person or by contract or otherwise having the right to control the
Board of Directors or equivalent governing body of such Person or
the ability to cause the direction of management of such
Person.
1.44
“Clinical
Data” shall mean any and all data (together with the results
of analysis thereof) derived or generated from any clinical trial
of a pharmaceutical product or from
5
testing or analysis of
subjects or samples from such a clinical trial (e.g. in vitro
testing of tissue samples from subjects enrolled in such a clinical
trial), in each case where such clinical trial involves either or
both of (i) any Single Agent Product or Double Agent Product,
whether alone or in combination with any other product, and (ii)
the Combination Product, whether alone or in combination with any
other product.
1.45
“Clinical
Trial Registry” shall have the meaning set forth in
Section 3.11(b).
1.46
“Clinical
Trial Results Database” shall have the meaning set forth in
Section 3.11(b).
1.47
“CMC
Data” shall mean any and all information contained in, as
well as data supporting, the “Chemistry, Manufacturing and
Control” and facilities sections (or sections corresponding
thereto) of an NDA, including, without limitation, any drug master
files referenced in the NDA.
1.48
“Co-Funded
Clinical Trial” shall have the meaning set forth in
Section 3.2(b).
1.49
“Collaboration
Principles” shall have the meaning set forth in
Section 2.9.
1.50
“Combination
Product” shall mean the fixed-dose co-formulated product
developed pursuant to this Agreement containing, as its only active
pharmaceutical ingredients per single daily dose, 300 mg TDF, 200
mg FTC and 600 mg EFV.
1.51
“Combination Product
Regulatory Documentation” shall mean all Regulatory
Documentation applicable to the Combination Product that is
developed by or on behalf of any Party pursuant to, and during the
term of, this Agreement, but excluding all BMS Regulatory
Documentation and all Gilead Regulatory Documentation.
1.52
“Combination Product
Trademarks” shall mean the trademark or trademarks selected
by the JCC for the Combination Product, all packaging designs and
other trade dress used in connection with the Combination Product,
other Trademarks relating thereto and any registrations thereof or
any pending applications relating thereto. For the avoidance
of doubt, the following shall not be considered Combination Product
Trademarks: (a) BMS Licensed Trademarks, (b) Gilead Licensed
Trademarks and (c) the names, logos and other Trademarks of the
Member Parties.
1.53
“Commercialization
Activities” shall mean Marketing and other activities for the
commercialization of the Combination Product including those set
forth in the Commercialization Plan and any other of the following
conducted for the Combination Product: execution of product
positioning, preparation of promotional and marketing materials,
market research and advertising activities, Promotion, advocacy,
national accounts, government relations activities, pricing,
reimbursement and patient assistance programs.
1.54
“Commercialization
Budget” shall have the meaning set forth in
Section 5.11(b). The initial Commercialization Budget is
attached hereto as Annex C.
6
1.55
“Commercialization
Budget Deadlock” shall have the meaning set forth in
Section 2.10(d).
1.56
“Commercialization
Plan” shall mean the plan for Marketing and otherwise
commercializing the Combination Product as described in
Section 5.11(b), as updated from time to time pursuant to
Section 5.11(c). The initial Commercialization Plan is
attached hereto as Annex C.
1.57
“Commercialization Plan
Deadlock” shall have the meaning set forth in
Section 2.10(d).
1.58
“Commercially
Reasonable Efforts” shall mean, with respect to (a) the
Development Activities that a Member Party is required to perform
with respect to the Combination Product pursuant to the Development
Plan, or (b) the Commercialization Activities that a Member Party
is required to perform with respect to the Combination Product
pursuant to the Commercialization Plan, as the case may be, the
level of effort that would generally be used by a Member Party to
conduct such development or commercialization activities in a
manner consistent with the minimum level of expenditure
contemplated for such activities by the Development Budget or
Commercialization Budget, as the case may be, for a product or
compound owned by it or to which it has rights, which is of
comparable market potential, profit potential or strategic value to
such Member Party and is at a similar stage in its development or
product life, taking into account, without limitation, issues of
safety and efficacy, product profile, the proprietary position, the
then-current competitive environment for such product or compound
(and any individual agent comprising part of such product or
compound), the likely timing of the product’s or
compound’s (and any such individual agent’s) entry into
the market, the then-current market penetration, the return on
investment potential of such product (and any individual agent
comprising part of such product), the regulatory environment and
status of the product (and any individual agent comprising part of
such product), and other relevant scientific, technical and
commercial factors, in each case as measured by the facts and
circumstances at the time such efforts are due.
1.59
“Commercial
Record Request” shall have the meaning set forth in
Section 5.10(b).
1.60
“Competing
Product” shall mean (a) in the case of Gilead as the
assigning Member Party, a [*] , and (b) in the case of BMS
as the assigning Member Party, a [*] .
1.61
“Confidential
Information” shall have the meaning set forth in
Section 12.3(a).
1.62
“Continuing
Member Party” shall mean a Member Party as so designated
pursuant to Section 14.5.
1.63
“Control” or
“Controlled” shall mean, with respect to any item of
Information and Inventions, Patents or other intellectual property
rights, the right, whether by ownership, license or otherwise, to
grant a license, sublicense or other right to or under such item,
Patent or right as provided for in this Agreement without violating
the terms of any agreement or other binding arrangement with any
Third Party. For purposes of this
Section 1.63,
7
the consent referred to in
Section 6.12 shall be deemed to have been obtained as of the
Effective Date.
1.64
“Core
Technology” shall mean the BMS Core Technology or the Gilead
Core Technology, as the case may be.
1.65
“Cost
Allocation Proposal” shall have the meaning set forth in
Section 5.12.
1.66
“Cost of
Goods” shall have the meaning set forth in Annex J
hereto.
1.67
“Court” shall
have the meaning set forth in Section 15.15.
1.68
“Detail” shall
mean an in-person presentation to a health care provider
specializing in treatment of HIV infection or AIDS, and who has
prescribing authority, by a sales representative who is fully
equipped with knowledge of, and (subject to Section 5.7)
Approved Marketing Materials and product labels and inserts with
respect to, the Combination Product, in which the characteristics
of the Combination Product are described by such sales
representative in a fair and balanced manner consistent with the
requirements of Applicable Law and of this Agreement, and in a
manner that is customary in the industry for the purpose of
promoting a prescription pharmaceutical product, but without regard
to the position of the presentation within a call to the health
care provider. For the avoidance of doubt, a promotional
material drop or product reminder shall not constitute a
Detail. When used as a verb, to “Detail” shall
mean to engage in a Detail.
1.69
“Detail
Equivalent Amount” shall mean, for the 2005 Calendar Year and
the 2006 Calendar Year, [*] , and for each successive
Calendar Year thereafter, such amount as adjusted by the
[*] for each such Calendar
Year.
1.70
“Developing
World” shall mean the territory comprising the countries
listed in Annex R and any additional countries outside the
Territory, Canada and Europe that Gilead includes in its Gilead
Access Program, as indicated at the website for the program,
www.gileadaccess.org.
1.71
“Development
Activities” shall mean the activities set forth in the
Development Plan, as updated from time to time pursuant to
Section 3.7 and, only with respect to periods prior to the
Effective Date, activities pursuant to the MTTA.
1.72
“Development
Budget” shall mean the budget with respect to any expenses
relating to Development Activities for the Combination Product that
are chargeable to the JV, as updated from time to time pursuant to
Section 3.7. The initial Development Budget is attached
hereto as Annex B.
1.73
“Development
Plan” shall mean the plan for the regulatory, clinical,
formulation, Manufacturing Process and CMC Data development
activities to be conducted for the Combination Product, including
any Phase IV clinical studies and medical information and medical
education programs, as updated from time to time pursuant to
Section 3.7. The initial Development Plan is
attached hereto as Annex B.
8
1.74
“Development Record
Request” shall have the meaning set forth in
Section 3.6(b).
1.75
“Disclosing
Party” shall have the meaning set forth in
Section 12.1.
1.76
“
[*] ” shall have the
meaning set forth in Annex Q.
1.77
“Double
Agent Product” shall mean Truvada, the co-formulated product
developed by Gilead containing, as its only active pharmaceutical
ingredients, TDF and FTC.
1.78
“Dual
Improvement” shall mean an Improvement that constitutes both
an Improvement pertaining specifically to the Gilead Core
Technology and an Improvement pertaining specifically to the BMS
Core Technology, which Improvement is conceived, discovered,
developed, or otherwise made, as necessary to establish authorship
or inventorship under United States copyright or patent law, as the
case may be, solely or jointly, by or on behalf of BMS or its
Affiliates, Gilead or its Affiliates, the JV or jointly any
combination of them, in the course of, as a result of, or in
connection with the Project Activities conducted pursuant to the
Development Plan or in connection with Co-Funded Clinical
Trials. Any Dual Improvement shall constitute a Joint
Invention.
1.79
“Effective
Date” shall have the meaning set forth in the first paragraph
of this Agreement.
1.80
“EFV”
shall have the meaning set forth in the recitals to this
Agreement.
1.81
“EFV
License Agreement” shall mean that certain license agreement,
dated as of September 1, 1994, as amended, between the EFV
Licensor and E.R. Squibb & Sons, L.L.C., as successor in
interest to DuPont Pharmaceuticals Company (formerly named The
DuPont Merck Pharmaceutical Company).
1.82
“EFV
License Agreement Territory” shall mean BMS’ territory
under the EFV License Agreement, which, as of the Effective Date,
consists of the United States (including its territories and
possessions), Canada, France (continental area), Germany, Italy,
Spain, United Kingdom and the Republic of Ireland, provided
, however , that (a) should the EFV License Agreement be
amended to expand BMS’ territory, then EFV License Agreement
Territory shall forthwith mean BMS’ territory as so expanded;
and (b) should the EFV License Agreement be terminated as a result
of BMS’ acquisition of all the rights of the EFV Licensor
thereunder, then EFV License Agreement Territory shall forthwith
mean all countries in the world.
1.83
“EFV
Licensor” shall mean, collectively, Merck & Co., Inc., a
New Jersey corporation, and Merck and Company Incorporated, a
Delaware corporation, and their respective successors in
interest.
1.84
“Estimated
Net Selling Price” shall have the meaning set forth in
Section 7.1(c)(ii).
1.85
“Exchange
Act” shall have the meaning set forth in
Section 15.12(b).
9
1.86
“Exploitation”
shall mean the making, having made, importation, use, sale,
offering for sale or disposition of a product or process,
including, without limitation, the research, development,
registration, modification, enhancement, Improvement,
Manufacturing, storage, formulation, optimization, import, export,
transport, distribution, promotion or Marketing of a product or
process. When used as a verb, “Exploit” shall
mean to engage in any of the foregoing activities.
1.87
“Europe” shall
mean all countries comprising the European Union as it may be
constituted from time to time.
1.88
“FDA”
shall mean the United States Food and Drug Administration and any
successor agency thereto.
1.89
“Field” shall
mean the treatment of HIV infection in adult humans.
1.90
“Field
Force” shall mean sales representatives, and regional or
other subnational managers of the foregoing.
1.91
“Final
Invoice Date” shall have the meaning set forth in
Section 7.3(a).
1.92
“Finished
Product Manufacturing Data” shall mean any and all data and
information necessary or useful for the Manufacture of a finished
product, packaged and labeled, from the active pharmaceutical
ingredients thereof, in tablet, capsule or other form (but
expressly excluding the Manufacture of such active pharmaceutical
ingredients), that is not included in any CMC Data for such
finished product.
1.93
“
[*] Customers” shall have
the meaning set forth in Annex Q.
1.94
“FTC”
shall have the meaning set forth in the recitals to this
Agreement.
1.95
“GAAP” shall mean
United States generally accepted accounting principles as in effect
from time to time, as consistently applied.
1.96
“Generic
Version” shall mean, with respect to the Combination Product
or a Single Agent Product or Double Agent Product, a product
containing the same active pharmaceutical ingredients as the
Combination Product or the Single Agent Product or Double Agent
Product, as the case may be, with those being the only active
pharmaceutical ingredients in such product, and which product is
approved in the United States under an Abbreviated New Drug
Application (i.e., an ANDA).
1.97
“Generic
Version Launch” shall have the meaning set forth in
Section 14.5.
1.98
“Gilead” shall
have the meaning set forth in the first paragraph of this
Agreement.
1.99
“Gilead
Core Improvement” shall mean any Improvement pertaining
specifically to Gilead Core Technology, which Improvement is
conceived, discovered,
10
developed, or otherwise
made, as necessary to establish authorship or inventorship under
United States copyright or patent law, as the case may be, solely
or jointly, by or on behalf of BMS or its Affiliates or the JV in
the course of, as a result of, or in connection with the Project
Activities conducted pursuant to the Development Plan or in
connection with Co-Funded Clinical Trials; provided ,
however , that Gilead Core Improvements shall not include
any Dual Improvements.
1.100
“Gilead
Core Technology” shall mean all Gilead proprietary
technologies relating specifically to the Exploitation of FTC, TDF,
or any combination of FTC and TDF (including, without limitation,
the Double Agent Product, but excluding the Combination
Product).
1.101
“Gilead
Guarantee Agreement” shall mean the guarantee agreement
executed by Gilead Parent in favor of BMS and the JV, dated as of
the Effective Date, as such agreement may be amended from time to
time.
1.102
“Gilead
Indemnified Party” shall mean Gilead Sub, Gilead Parent and
any of their Affiliates, officers, directors and
employees.
1.103
“Gilead
Inventions” shall mean any Information and Inventions
(whether or not patentable; and Improvements thereto, including BMS
Core Improvements to the extent owned by Gilead) conceived,
discovered, developed or otherwise made, as necessary to establish
authorship or inventorship under United States copyright or patent
law, as the case may be, solely (or, in the case of BMS Core
Improvements, solely or jointly) by or on behalf of Gilead or its
Affiliates, in the course of, as a result of or in connection with
the Project Activities conducted pursuant to the Development Plan
or in connection with Co-Funded Clinical Trials, but excluding any
Joint Inventions.
1.104
“Gilead
Know-How” shall mean any and all Information and Inventions
under the Control of Gilead or its Affiliates as of the Effective
Date or at any time during the term of this Agreement that are
necessary or reasonably useful for the Exploitation of the
Combination Product and are not generally known, but excluding any
and all (a) such Information and Inventions to the extent claimed
by the Gilead Patents and (b) Joint Know-How.
1.105
“Gilead
Licensed Trademarks” shall have the meaning set forth in
Section 6.6(a).
1.106
“Gilead
Parent” shall have the meaning set forth in the first
paragraph of this Agreement.
1.107
“Gilead
Patents” shall mean all of the Patents that Gilead or its
Affiliates Control as of the Effective Date or at any time during
the term of this Agreement that would, in the absence of the
license granted by Gilead in Section 6.1(a) and assuming that
the TDF and FTC active pharmaceutical ingredients therein were not
purchased from Gilead, be infringed by the Exploitation of the
Combination Product by the JV in any country in the world. A
list of the Gilead Patents in the Territory as of the Effective
Date is attached hereto as Annex E.
1.108
“Gilead
Regulatory Documentation” shall mean all Regulatory
Documentation applicable to Viread (or TDF), Emtriva (or FTC), or
Truvada (or TDF in co-
11
formulation with FTC) but
not Viread (or TDF), Emtriva (or FTC) or Truvada (or TDF and FTC)
in co-formulation with Sustiva (or EFV), that is or was developed
by or on behalf of Gilead or any of its Affiliates or sublicensees
prior to the Effective Date or during the term of this
Agreement.
1.109
“Gilead
Sub” shall have the meaning set forth in the first paragraph
of this Agreement.
1.110
“Gilead
Supply Agreement” shall mean the supply agreement entered
into between Gilead Parent and the JV concurrently with the
execution and delivery of this Agreement, as such agreement may be
amended from time to time.
1.111
“Gilead
Technology” shall mean, collectively, the Gilead Know-How and
the Gilead Patents.
1.112
“Gilead
Transfer Price” shall have the meaning set forth in
Section 7.1(a).
1.113
“
[*] ” shall have the
meaning set forth in [*] .
1.114
“
[*] ” shall have the
meaning set forth in Section 5.3(d).
1.115
“Good
Clinical Practice” or “GCP” shall mean the
then-current standards for clinical trials for pharmaceutical
products, as set forth in the Act and applicable regulations
promulgated thereunder, as the same may be amended from time to
time.
1.116
“Good
Laboratory Practice” or “GLP” shall mean the
then-current standards for laboratory activities for pharmaceutical
products, as set forth in the Act and applicable regulations
promulgated thereunder, as the same may be amended from time to
time.
1.117
“Good
Manufacturing Practice” or “GMP” shall mean the
regulatory requirements for current good manufacturing practices
for pharmaceutical products promulgated by the FDA, including as
set forth in U.S. Food, Drug and Cosmetic Act, 21 C.F.R. (parts
210, 211, 600 and 610), as the same may be amended from time to
time.
1.118
“Improvement”
shall mean any modification to a compound, composition, product or
technology or to any discovery, device, process or formulation
related to such compound, composition, product or technology,
whether or not patented or patentable, including, without
limitation, any enhancement in the efficiency, operation,
Manufacture, ingredients, preparation, presentation, formulation,
means of delivery, packaging or dosage of a compound, composition,
product or technology, or of any discovery, device, process or
formulation related thereto; any discovery or development of any
new or expanded indications or applications for a compound,
composition, product or technology; any discovery or development
that improves the stability, safety or efficacy of a compound,
composition, product or technology; or any discovery or development
of a new dosage regimen for a product or method of use or
administration for a compound, composition, product or
technology.
1.119
“IND”
shall mean an Investigational New Drug Application to be filed with
the FDA in accordance with Applicable Law.
12
1.120
“Indemnified
Party” shall mean a Person seeking indemnification for Losses
pursuant to Section 13.8.
1.121
“Indemnifying Member
Party” shall have the meaning set forth in
Section 13.6.
1.122
“Indemnifying
Party” shall mean a Party from which indemnification is
sought pursuant to Section 13.8.
1.123
“Independent Accounting
Expert” shall have the meaning set forth in
Section 7.1(d).
1.124
“Information and
Inventions” shall mean all technical, scientific and other
know-how and information, trade secrets, knowledge, technology,
means, methods, processes, practices, formulas, instructions,
skills, techniques, procedures, experiences, ideas, technical
assistance, designs, drawings, assembly procedures, computer
programs, apparatuses, specifications, data, results and other
material, including, without limitation, pre-clinical and clinical
trial results, Manufacturing procedures, test procedures, and
purification and isolation techniques, (whether or not
confidential, proprietary, patented or patentable) in written,
electronic or any other form now known or hereafter developed, and
all Improvements, whether to the foregoing or otherwise, and all
other discoveries, developments, inventions (whether or not
confidential, proprietary, patented or patentable), and tangible
embodiments of any of the foregoing.
1.125
“Infringement”
shall have the meaning set forth in
Section 11.3(a).
1.126
“Infringing
Combination Product” shall have the meaning set forth in
Section 11.3(a).
1.127
“Initial
Launch Period” shall mean the first [*] commencing with the Launch of
the Combination Product in the Territory.
1.128
“Initiating
Member” shall have the meaning set forth in
Section 7.1(e).
1.129
“Interim
BMS Unit Transfer Price” shall have the meaning set forth in
Section 7.1(a).
1.130
“Interim
Gilead Unit Transfer Price” shall have the meaning set forth
in Section 7.1(a).
1.131
“Interim
Unit Transfer Price” shall mean, for each Calendar Year, with
respect to BMS, the Interim BMS Unit Transfer Price and with
respect to Gilead, the Interim Gilead Unit Transfer
Price.
1.132
“Joint
Commercialization Committee” or “JCC” shall have
the meaning set forth in Section 2.4(a).
13
1.133
“Joint
Development Committee” or “JDC” shall have the
meaning set forth in Section 2.3(a).
1.134
“Joint
Executive Committee” or “JEC” shall have the
meaning set forth in Section 6.1 of the Operating
Agreement.
1.135
“Joint
Finance Committee” or “JFC” shall have the
meaning set forth in Section 2.5(a).
1.136
“Joint
Inventions” shall mean (a) any and all Information and
Inventions pertaining specifically to the Combination Product
(whether or not patentable; and Improvements thereto) conceived,
discovered, developed or otherwise made, as necessary to establish
authorship or inventorship under United States copyright or patent
law, as the case may be, by or on behalf of BMS or its Affiliates,
Gilead or its Affiliates, the JV, or jointly any combination of
them, in the course of, as a result of or in connection with the
Project Activities conducted pursuant to the Development Plan or in
connection with Co-Funded Clinical Trials; and (b) any Dual
Improvement.
1.137
“Joint
Know-How” means all Information and Inventions included in
the Joint Inventions that are not generally known, but excluding
any Information and Inventions to the extent claimed by the Joint
Patents. For the avoidance of doubt, “Joint
Know-How” shall include all Clinical Data from the proposed
bioequivalence study contemplated by the Development
Plan.
1.138
“Joint
Patents” shall mean any Patents to the extent that such
Patents claim Joint Inventions.
1.139
“Joint
Technology” shall mean, collectively, the Joint Know-How and
the Joint Patents.
1.140
“JV”
shall have the meaning set forth in the first paragraph of this
Agreement.
1.141
“JV
Expenses” shall mean all direct, out-of-pocket expenses that
Gilead or BMS may incur (or cause their Affiliates to incur) in
performing the Project Activities on behalf of the JV. For
the avoidance of doubt, with respect to any JV Expenses incurred by
a Member Party (or its Affiliates), such expenses are chargeable to
the JV by such Member Party only if such expenses constitute
Authorized Expenses.
1.142
“Key
Regulatory Submissions” shall have the meaning set forth in
Section 3.4(a).
1.143
“Launch” shall
mean, with respect to the Territory, either (a) the date on which
the Combination Product is first shipped by or on behalf of the JV
for commercial sale to Third Parties or (b) for any Generic Version
product referred to in Section 14.5, the date on which it is
first available for commercial sale and purchase, as the case may
be.
14
1.144
“Losses” shall
mean judgments, fines, amounts paid in settlement, and
out-of-pocket expenses (including reasonable attorneys’ fees)
reasonably incurred by a Party (or other indemnitee as provided in
Section 13) in a Proceeding.
1.145
“
[*] ” shall have the
meaning set forth in Annex Q.
1.146
“Manufacture” or
“Manufacturing” means, with respect to a product or
compound, the manufacturing, processing, formulating, packaging,
labeling, holding, and quality control testing of such product or
compound.
1.147
“Manufacturing
Process” shall mean any process or step thereof that is
necessary or useful for Manufacturing the Combination Product from
bulk active pharmaceutical ingredients, any Improvements thereto or
any intermediate of the foregoing.
1.148
“Market” or
“Marketing” shall mean all programs and activities
relating to the Promotion and sale and other commercialization of
the Combination Product in the Territory, including, without
limitation, Detailing and advertising, as well as selling,
contracting for sale of, and distributing the Combination
Product.
1.149
“Material
Default” shall have the meaning set forth in
Section 14.4(a).
1.150
“Member
Parties” shall mean, collectively, Gilead and
BMS.
1.151
“Members” shall
mean, collectively, Gilead Sub and BMS Sub.
1.152
“Member
Vote” shall have the meaning set forth in
Section 2.6(f).
1.153
“
[*] ” shall have the
meaning set forth in Section 5.1(f).
1.154
“
[*] ” shall have the
meaning set forth in Section 5.1(f).
1.155
“MTTA” shall have
the meaning set forth in Section 15.14.
1.156
“NDA”
shall mean a New Drug Application to be filed with the FDA in
accordance with Applicable Law for the purpose of obtaining
marketing approval for a pharmaceutical product in the United
States.
1.157
“
[*] ” shall have the
meaning set forth in Annex Q.
1.158
“Net
Sales” shall mean, with respect to a product for any period,
the gross amount invoiced for commercial sales of that product in
such period by or on behalf of the selling Party to Third Parties
(provided that amounts invoiced for product sold or provided for
use in the Developing World, if any, shall not be included), less
deductions for: (a) normal and customary quantity and/or cash
discounts and sales returns and allowances, including, without
limitation, those granted on account of price adjustments, billing
errors, rejected goods, damaged goods, returns, rebates,
administrative or other fees or reimbursements or similar payments
to wholesalers or other distributors (including without limitation
pursuant to inventory management agreements), buying groups, AIDS
Drug Assistance Programs, pharmacy benefit management
15
organizations, health care
insurance carriers or other institutions, allowances, rebates, fees
paid to distributors and chargebacks actually allowed or given; (b)
freight, postage, shipping and insurance expenses (if separately
identified in such invoice); (c) customs or excise duties or other
duties related to the sales making up the gross invoice amount (if
separately identified in such invoice); (d) any rebates or similar
payments accrued with respect to sales paid for by any governmental
or regulatory authority such as, by way of illustration and not in
limitation of the foregoing in this clause (d), United States
Federal or state Medicaid, Medicare or similar state program or any
government imposed retroactive price reduction; and (e) sales and
other taxes and duties directly related to the sale, to the extent
that such items are included in the gross invoice price (but not
including taxes assessed against the income derived from such
sale). Any of the deductions listed above that involves a
payment by such Party shall not be taken as a deduction prior to
the date accrued in accordance with GAAP as consistently applied in
such Party’s audited financial statements. For purposes
of determining Net Sales pursuant to Section 14.6(b)(ii), the
Combination Product shall be deemed to be sold when
invoiced.
For purposes of calculating Net
Sales, sales between or among a Party and/or Affiliates shall be
excluded from the computation of Net Sales, but sales by such Party
and its Affiliates to Third Parties shall be included in the
computation of Net Sales.
1.159
“Net
Selling Price” shall mean the price of a pharmaceutical
product as calculated in accordance with Annex I
hereto.
1.160
“Non-Breaching Member
Party” shall have the meaning set forth in
Section 14.4(a).
1.161
“Operating
Agreement” shall have the meaning set forth in the recitals
to this Agreement.
1.162
“Operating
Committees” shall mean, collectively, the JCC, the JDC and
the JFC.
1.163
“Optional
Update” shall have the meaning set forth in
Section 5.7(d).
1.164
“Paragraph
(iv) Certification” shall have the meaning set forth in
Section 11.3(a).
1.165
“Party” and
“Parties” shall have the meanings set forth in the
first paragraph of this Agreement.
1.166
“Patents” shall
mean (a) all patents and patent applications (including, without
limitation, provisional applications), (b) any substitutions,
divisions, continuations, continuations-in-part, reissues,
renewals, registrations, confirmations, re-examinations,
extensions, supplementary protection certificates and the like, and
(c) any foreign or international equivalents of any of the
foregoing.
1.167
“PCT”
shall mean the Patent Cooperation Treaty, opened for signature
June 19, 1970, 58 U.S.T. 7645.
16
1.168
“Permitted
Assignee” shall have the meaning set forth in
Section 15.4(a).
1.169
“Person” shall
mean an individual, sole proprietorship, partnership, limited
partnership, limited liability partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or other similar entity
or organization, including, without limitation, a government or
political subdivision, department or agency of a
government.
1.170
“Prescription Drug
Marketing Act” or “PDMA” shall have the meaning
set forth in Section 5.1(d).
1.171
“Pricing
Committee” shall have the meaning set forth in
Section 5.3(b).
1.172
“Pricing
Information” shall have the meaning set forth in
Section 5.3(h).
1.173
“Proceeding”
shall mean a civil, criminal, administrative or investigative
proceeding brought by or a demand made by a Third
Party.
1.174
“Product
Detail Period” shall have the meaning set forth in
Section 5.1(e).
1.175
“Product
EFV Yield” shall have the meaning set forth in Annex
K.
1.176
“Product
FTC Yield” shall have the meaning set forth in Annex
K.
1.177
“Product
TDF Yield” shall have the meaning set forth in Annex
K.
1.178
“Project
Activities” shall mean any and all activities undertaken or
performed by or on behalf of any of the Parties, pursuant to this
Agreement or the MTTA, in the course of, as a result of or in
connection with the research, development, Marketing, sale or use
of the Combination Product, including, without limitation, the
Development Activities and the Commercialization Activities;
provided , however , that Project Activities shall
not include any activities undertaken or performed by or on behalf
of either Member Party or its Affiliates or sublicensees to the
extent that they arise in the course of, as a result of or in
connection with the Exploitation of the Combination Product for use
outside the Territory (including, without limitation, any
activities undertaken or performed by Gilead in the exercise of its
rights under the license granted in
Section 6.2(d)).
1.179
“Promotion” shall
mean the conduct of activities normally undertaken by a
pharmaceutical company’s Field Force to implement plans and
strategies for marketing and other commercialization aimed at
encouraging the approved use of a pharmaceutical product, including
but not limited to Detailing. When used as a verb,
“Promote” shall mean to engage in any of the foregoing
activities.
1.180
“PSUR” means a
periodic safety update report required to be submitted to the
FDA.
1.181
“Publication
Standards” shall have the meaning set forth in
Section 3.11(a).
17
1.182
“
[*] ” shall have the
meaning set forth in Section 5.1(f).
1.183
“Recalculated Transfer
Price” shall have the meaning set forth in
Section 7.1(c)(iii).
1.184
“Receiving
Party” shall have the meaning set forth in
Section 12.1.
1.185
“Regulatory
Authorities” shall mean any applicable supra-national,
federal, national, regional, state, provincial or local regulatory
agencies, departments, bureaus, commissions, councils or other
government entities, including, without limitation, the FDA, or
other entity exercising regulatory authority with respect to the
Exploitation of the Combination Product in the
Territory.
1.186
“Regulatory
Documentation” shall mean all submissions to Regulatory
Authorities in the Territory, including, without limitation, all
INDs, NDAs, sNDAs, CMC Data, drug master files, correspondence with
regulatory agencies (registrations and licenses, regulatory drug
lists, advertising and promotion documents), PSURs, adverse event
files, complaint files and manufacturing records.
1.187
“Relevant
Experience Information” shall mean adverse experience
reports, reports based on marketing data and other documentation of
relevant drug experience.
1.188
“Requesting
Member” shall have the meaning set forth in
Section 5.3(g).
1.189
“Required
Update” shall have the meaning set forth in
Section 5.7(b).
1.190
“Respective
Percentage” shall mean, with respect to Gilead, the Actual
Gilead Percentage, and with respect to BMS, the Actual BMS
Percentage; provided , however , that whenever this
Agreement provides that an amount shall be allocated between the
Member Parties based on their Respective Percentages, such
allocation shall first be made on the basis of the Member
Parties’ respective Working Percentages at the time of the
relevant event, which allocation shall then be adjusted, if
applicable, after the determination of the Member Parties’
respective Actual Percentages for the Calendar Year in which the
relevant event occurs, which adjustments shall occur no later than
April 1 of the next Calendar Year unless otherwise provided in
this Agreement or the Operating Agreement, or otherwise agreed in
writing by the Member Parties.
1.191
“Right of
Reference” shall have the meaning set forth in 21 C.F.R.
§ 314.3(b) or alternatively shall mean equivalents
thereto in jurisdictions outside the Territory. For the
avoidance of doubt, as used in this Agreement “Right of
Reference” shall refer to the right of Regulatory Authorities
to rely upon and otherwise use the applicable information, but
shall not confer on the Member Party to which such Right of
Reference is granted any right to receive or access such
information.
1.192
“
[*] ” shall have the
meaning set forth in Section 5.3(a).
1.193
“SDEA” or
“Safety Data Exchange Agreement” shall have the meaning
set forth in Section 9.1.
18
1.194
“Selected
Product Liability Claim” shall have the meaning set forth in
Section 13.7(c).
1.195
“Services
Agreement” shall mean the distribution services agreement to
be entered into between Gilead Parent and the JV after the
Effective Date, the key terms of which are outlined in Annex P
hereto, as such agreement may be amended from time to
time.
1.196
“Single
Agent Product” shall mean each of Viread, Emtriva, and
Sustiva.
1.197
“Study
934” shall mean the clinical study initiated by Gilead prior
to the Effective Date under Gilead’s clinical study protocol
entitled “A Phase 3, Randomized, Open-Label, Multicenter
Study of the Treatment of Antiretroviral-Naïve, HIV-1-Infected
Subjects comparing Tenofovir Disoproxil Fumarate and Emtricitabine
in Combination with Efavirenz Versus Combivir®
(lamivudine/zidovudine) and Efavirenz” (as such protocol may
be revised and such study may be extended or expanded from time to
time, in each case by Gilead). For the avoidance of doubt,
the conduct of Study 934 shall not be deemed a Development Activity
or Project Activity for purposes of this Agreement, and Clinical
Data derived or generated from Study 934 or from testing or
analysis of subjects or samples from Study 934 shall be Gilead
Know-How, not Joint Know-How.
1.198
“Subsequent
Launch Period” shall mean the [*] after the Launch of the
Combination Product in the Territory.
1.199
“Supplier” shall
mean each Person selected as a commercial supplier of the
Combination Product pursuant to Section 4.2(a).
1.200
“Supply
Agreements” shall mean, collectively, the BMS Supply
Agreement and the Gilead Supply Agreement.
1.201
“Supply
Party” shall mean, with respect to any Supplier, (a) if a
Member Party is the Supplier, such Member Party, or (b) if a Third
Party is the Supplier, the Member Party that is designated pursuant
to Section 4.2(a) to manage the relationship with such
Supplier.
1.202
“TDF”
shall have the meaning set forth in the recitals to this
Agreement.
1.203
“Technology”
shall mean the BMS Technology or the Gilead Technology, as the case
may be.
1.204
“Terminated
Member Party” shall mean a Member Party as so designated
pursuant to Section 14.5.
1.205
“Territory” shall
mean the United States, the Commonwealth of Puerto Rico and any
other territories and possessions of the United States.
1.206
“Third
Party” shall mean any Person other than Gilead, BMS, the JV
and their respective Affiliates.
1.207
“Third
Party Acquirer” shall have the meaning set forth in
Section 1.43.
19
1.208
“Trademark” shall
include any word, name, symbol, color, designation or device or any
combination thereof, including, without limitation, any trademark,
trade dress, service mark, service name, brand mark, trade name,
brand name, logo or business symbol.
1.209
“Transfer
Price” shall mean the BMS Transfer Price or the Gilead
Transfer Price, as the case may be.
1.210
“Transferring Member
Party” shall have the meaning set forth in
Section 15.4(b).
1.211
“
[*] ” shall have the
meaning set forth in Section 5.3(d).
1.212
“WAC”
shall have the meaning set forth in Annex Q.
1.213
“Working
BMS Percentage” shall mean, for each Calendar Year, the
preliminary percentage applicable to BMS for such Calendar Year
determined pursuant to Section 7.1(c)(i).
1.214
“Working
Gilead Percentage” shall mean, for each Calendar Year, the
preliminary percentage applicable to Gilead for such Calendar Year
determined pursuant to Section 7.1(c)(i).
1.215
“Working
Percentage” shall mean, with respect to BMS, the Working BMS
Percentage and, with respect to Gilead, the Working Gilead
Percentage.
SECTION 2 .
COLLABORATION MANAGEMENT
2.1
General
. As set
forth in this Agreement and in the Operating Agreement, the Member
Parties desire to establish a Joint Executive Committee which shall
oversee the Member Parties’ collaboration under this
Agreement and facilitate communications between the Member Parties
with respect to the development, Approval, Manufacturing and
commercialization of the Combination Product in the
Territory. Subject to the foregoing, the Member Parties also
desire to establish specialized committees to focus more closely on
the Parties’ Development Activities, Commercialization
Activities and finance activities hereunder. Each such
committee shall have only the responsibilities and authority
delegated to or vested in such committee in this Section 2 or
elsewhere in this Agreement and the Operating
Agreement.
2.2
Role of the Joint Executive
Committee . The
establishment, composition, governance, powers and limitations on
powers of the Joint Executive Committee (or “JEC”) are
governed by Section 6 of the Operating Agreement and by this
Section 2.2. The initial JEC members are identified in
Annex A hereto. The JEC shall have overall authority and
responsibility with respect to the Development Activities and
Commercialization Activities for the Combination Product (except
for those matters reserved to the Member Parties pursuant to this
Agreement or the Operating Agreement). Without limitation of
the foregoing, the JEC shall have the following powers and
duties:
20
(i)
to oversee the
work of the Operating Committees and, if possible, resolve disputes
referred to it by the Alliance Managers pursuant to
Section 2.8;
(ii)
to oversee the activities of Gilead
in keeping the JV’s books and records pursuant to
Section 8.1;
(iii)
to adopt guidelines for compliance
by the Parties with antitrust laws in connection with the JV
activities;
(iv)
to approve the initial Capital
Contributions (as defined in the Operating Agreement) of the
Members, to approve each Capital Contribution planning schedule,
and to issue certain requests for additional Capital Contributions,
in each case pursuant to Section 4.1 of the Operating
Agreement;
(v)
to approve (x) each annual update of
the Development Plan and the Development Budget and (y) any interim
update of the Development Plan or Development Budget, as the case
may be, as to which the JDC is unable to reach
agreement;
(vi)
to approve (x) each annual update of
the Commercialization Plan and the Commercialization Budget and (y)
any interim update of the Commercialization Plan or
Commercialization Budget, as the case may be, as to which the JCC
is unable to reach agreement;
(vii)
to approve unit volume forecasts as
to which the JCC is unable to reach agreement for use in
preparation of Commercialization Plans and Commercialization
Budgets and (regardless of whether there is a Commercialization
Plan or Commercialization Budget) for use in planning for
Manufacture of the Combination Product, planning for
Commercialization Activities and for the Member Parties’ own
financial planning purposes;
(viii)
to approve Cost Allocation
Proposals;
(ix)
to approve the JFC’s reports
on financial matters that the JEC determines to be reasonably
necessary or appropriate for the implementation of the financial
aspects of the JV;
(x)
to review recommendations of the JFC
with respect to, and approve, one or more means of reconciling, one
to the other, the internal reporting and accounting standards of
each of the Member Parties where reasonably necessary, and methods
of charging costs and expenses of each of the Member
Parties;
(xi)
to review and, if applicable,
recommend to the Member Parties changes to the [*] pursuant
to Section 5.3(i);
(xii)
to resolve disputes within the JDC
with respect to (A) any required approval of publications or
presentations pursuant to Section 3.11(a), and (B) a Member
Party’s obligation under Section 3.6(b), if any, to
provide the other Member Party with access to certain of such
Member Party’s records, documentation and data;
21
(xiii)
to resolve disputes within the JCC
with respect to (A) the initially proposed marketing materials for
the Combination Product for the Territory, and thereafter, updates
of any Approved Marketing Materials, (B) a Member Party’s
obligation, if any, pursuant to Section 5.10 to provide the
other Member Party with access to certain of such Member
Party’s records, documentation and data, (C) issues relating
to the patient assistance programs arising under
Section 2.4(b)(vii) and (D) issues relating to Suppliers and
alternate suppliers arising under
Section 2.4(b)(ix);
(xiv)
to decide major strategic issues and
any other matters relating to the JV that are not (i) within the
purview of the Operating Committees or (ii) reserved to the Member
Parties pursuant to this Agreement or the Operating Agreement;
and
(xv)
to take such other actions as are
reserved to the JEC in this Agreement or the Operating Agreement or
as the Parties may mutually agree in writing, except that the JEC
may not amend or take any action that would conflict with any
provision of this Agreement, the Operating Agreement or any
Ancillary Agreement and may not resolve any issue regarding
termination of this Agreement for a potential or actual Material
Default.
2.3
Joint
Development Committee .
(a)
Each Member shall
appoint four (4) members of a joint development oversight and
management committee (the “Joint Development Committee”
or “JDC”). Gilead Sub shall appoint one (1) of
the members designated by Gilead Sub, to serve as chairperson of
the JDC through the first anniversary of the Effective Date.
Thereafter a member designated by BMS Sub and then a member
designated by Gilead Sub shall serve alternately as chairperson, on
a rotating annual basis from each anniversary of the Effective
Date. The initial JDC members and the chairperson are
identified in Annex A hereto.
(b)
Subject to the
oversight of the JEC, the JDC shall have the following powers and
duties:
(i)
to (x) review and propose to the
JEC for its approval each annual update of the Development Plan and
Development Budget and (y) review and approve each interim update
of the Development Plan and Development Budget, in each case
proposed pursuant to Section 3.7;
(ii)
to oversee and coordinate the
Parties’ activities under the Development Plan;
(iii)
to oversee and manage matters
relating to clinical supply of the Combination Product, including,
without limitation, Manufacturing requirements, inventory
projections and inventory control;
(iv)
with the Alliance Managers, (x) to
assist in coordinating scientific interactions between the Parties
during the course of implementing the Development Plan and (y) to
facilitate the exchange among the Parties of data, information,
materials and results relating to clinical manufacturing, clinical
trials, and communications and filings with Regulatory Authorities
for the Combination Product (in each case solely to the extent that
such
22
data, information and materials are required
to be exchanged among the Parties, or with respect to which one
Member Party has the right to gain access from the other Member
Party or the JV, pursuant to this Agreement or the Operating
Agreement);
(v)
to oversee regulatory matters for
the JV, including, without limitation, approving all Combination
Product Regulatory Documentation to the extent required pursuant to
Section 3.4, overseeing Gilead’s activities as the
JV’s liaison with Regulatory Authorities in the Territory,
and overseeing the activities conducted pursuant to the SDEA and
other pharmacovigilance and safety reporting;
(vi)
to oversee the Member
Parties’ activities pursuant to their respective Supply
Agreements and to oversee and coordinate with the JCC with respect
to matters relating to the monitoring of Manufacturing capacity,
forecasts and orders for the active pharmaceutical ingredients of
the Combination Product;
(vii)
to resolve disputes between
the Member Parties with respect to (A) any required approval of
publications or presentations pursuant to Section 3.11(a), and
(B) a Member Party’s obligation under Section 3.6(b), if
any, to provide the other Member Party with access to certain of
such Member Party’s records, documentation and
data;
(viii)
to oversee medical affairs and
medical communications activities;
(ix)
to review and approve or reject
proposals for Phase IV clinical studies of the Combination
Product;
(x)
to provide updates on the
JDC’s activities and achievements to the JEC each Calendar
Quarter; and
(xi)
to perform such other functions as
the Member Parties may mutually agree in writing from time to
time.
2.4
Joint
Commercialization Committee .
(a)
Each Member shall
appoint four (4) members of a joint commercialization oversight and
management committee (the “Joint Commercialization
Committee” or “JCC”). BMS Sub shall appoint
one (1) of the members designated by BMS Sub, to serve as
chairperson of the JCC through the first anniversary of the
Effective Date. Thereafter a member designated by Gilead Sub
and then a member designated by BMS Sub shall serve alternately as
chairperson, on a rotating annual basis from each anniversary of
the Effective Date. The initial JCC members and the
chairperson are identified in Annex A hereto.
(b)
Subject to the
oversight of the JEC, the JCC shall have the following powers and
duties:
(i)
to oversee and coordinate the
Parties activities under the Commercialization Plan;
23
(ii)
to (x) review and propose to the
JEC for its approval each annual update of the Commercialization
Plan and Commercialization Budget and (y) review and approve each
interim update of the Commercialization Plan and Commercialization
Budget, in each case proposed pursuant to
Section 5.11(c);
(iii)
to oversee Gilead’s
activities pursuant to the Services Agreement;
(iv)
to develop and approve (x) initial
marketing materials for the Combination Product for the Territory,
and (y) updates to such materials from time to time as may be
reasonably necessary or appropriate, all in accordance with
Section 5.7;
(v)
to develop and approve unit volume
forecasts for use in preparation of Commercialization Plans and
Commercialization Budgets and (regardless of whether there is a
Commercialization Plan or Commercialization Budget) for use in
planning for Manufacture of the Combination Product, planning for
Commercialization Activities and for the Member Parties’ own
financial planning purposes;
(vi)
to coordinate with the JDC with
respect to Manufacturing and labeling matters;
(vii)
to (x) determine how the JV will
respond to requests from health care providers or from individual
patients who have or may obtain prescriptions for the Combination
Product but are unable to afford it, and (y) to establish the
appropriate procedures and response times that shall apply in
responding to such requests, in each case ((x) and (y)) in
accordance with Section 5.2(a);
(viii)
to make recommendations to the JEC
with respect to Cost Allocation Proposals;
(ix)
to maintain one Supplier and one
or more alternate suppliers pursuant to Section 4.2(a) for
Manufacture of commercial supplies of the Combination
Product;
(x)
oversee and coordinate with the
JDC with respect to matters relating to the Manufacturing and
labeling of the Combination Product for commercial supply,
including, in the case of Manufacturing, with respect to quality
control matters, and the monitoring of Manufacturing capacity,
forecasts and orders for the Combination Product to ensure adequate
commercial supply to meet the demand therefor in the Territory as
projected by the JCC and approved by the JEC;
(xi)
to resolve disputes between the
Member Parties with respect to a Member Party’s obligation,
if any, pursuant to Section 5.10 to provide the other Member
Party with access to certain of such Member Party’s records,
documentation and data;
(xii)
to provide updates on the
JCC’s activities and achievements to the JEC each Calendar
Quarter; and
24
(xiii)
to perform such other functions as
the Member Parties may mutually agree in writing from time to
time.
2.5
Joint Finance
Committee .
(a)
Each Member shall
appoint two (2) members of a joint finance committee to support the
JEC, the JDC and the JCC (the “Joint Finance Committee”
or “JFC”). Gilead Sub shall appoint one (1) of
the members designated by Gilead Sub, to serve as chairperson of
the JFC through the first anniversary of the Effective Date.
Thereafter a member designated by BMS Sub and then a member
designated by Gilead Sub shall serve alternately as chairperson, on
a rotating annual basis from each anniversary of the Effective
Date. The initial JFC members and the chairperson are
identified in Annex A hereto.
(b)
Subject to the
oversight of the JEC, the JFC shall have the following powers and
duties:
(i)
to work with the JEC and the other
Operating Committees to assist in financial, budgeting and planning
matters as required, including assisting in the preparation of
budgets and annual and long-term plans;
(ii)
to recommend, for approval by the
JEC, procedures, formats and timelines consistent with this
Agreement for reporting financial data as well as additional or
alternative reporting procedures concerning financial aspects of
the JV;
(iii)
to prepare such reports on
financial matters as are approved by the JEC for the implementation
of the financial aspects of the JV;
(iv)
to coordinate audits of financial
data where appropriate and required or allowed by this
Agreement;
(v)
to address issues of
implementation relating to the financial mechanics and calculations
under this Agreement and the Operating Agreement;
(vi)
to recommend, for approval by the
JEC, a means of reconciling, one to the other, the internal
reporting and accounting standards of each of the Member Parties
where necessary and methods of charging costs and expenses of each
of the Member Parties;
(vii)
to review the appropriate
allocation of costs and expenses with respect to Authorized
Expenses;
(viii)
to calculate or cause to be
calculated, as the case may be, those matters expressly required to
be calculated (or caused to be calculated) by the JFC pursuant to
this Agreement, including Sections 7.1(c) and 7.1(d), and pursuant
to the Operating Agreement, and to address issues of implementation
relating to the cash netting procedures set forth in
Section 4.1(c) of the Operating Agreement;
25
(ix)
to develop and recommend to the
JEC for approval the initial Capital Contributions (as defined in
the Operating Agreement) of the Members and each Capital
Contribution planning schedule, and to recommend to the JEC certain
requests for additional Capital Contributions, in each case
pursuant to Section 4.1 of the Operating
Agreement;
(x)
to provide updates on the
JFC’s activities and achievements to the JEC each Calendar
Quarter; and
(xi)
to perform such other functions as
the Member Parties may mutually agree in writing from time to
time.
2.6
Procedural
Rules of the Operating Committees .
(a)
Each of BMS Sub
and Gilead Sub shall designate representatives with appropriate
expertise to serve as members of each Operating Committee, and each
representative may serve on more than one (1) Operating Committee
(and/or the JEC) as appropriate in view of the individual’s
expertise. The Members shall endeavor to match their
respective representation on each Operating Committee, in terms of
functional areas and management level.
(b)
A member of an
Operating Committee may be removed or replaced at any time, with or
without cause, by the Member that appointed such committee
member. Such action shall be accomplished by written notice
to the other Member. Each member of an Operating Committee
shall serve until a successor is named by the Member that appointed
such committee member (or until his or her earlier resignation or
removal).
(c)
The JFC shall
meet at least one (1) time per Calendar Quarter during the term of
this Agreement. The JDC shall meet at least one (1) time per
Calendar Quarter until the first anniversary of the Launch of the
Combination Product, and thereafter at least semiannually (or on
such other schedule as may be determined by the JDC).
The JCC shall meet at least one (1) time per Calendar Quarter until
the second anniversary of the Launch of the Combination Product,
and thereafter at least semiannually (or on such other
schedule as may be determined by the JCC). Each
Operating Committee shall meet at times and places in the United
States mutually agreed by BMS Sub and Gilead Sub. The
respective Operating Committees shall meet to discuss the overall
progress of the Development Activities in the Development Plan or
Commercialization Activities in the Commercialization Plan, or the
financial aspects of the JV, as the case may be, and any problems
arising in the course of such activities; the status of the
Development Plan and Development Budget, the Commercialization Plan
and Commercialization Budget, or other financial aspects of the JV,
as the case may be; and any other matter that a member of such
Operating Committee may reasonably request. Each Operating
Committee shall keep accurate and complete minutes of its meetings
to record all proposals, recommendations and actions taken.
All such minutes and other records of each Operating Committee
shall be available to each Member Party.
(d)
The chairperson
shall organize committee meetings, prepare the meeting agenda based
on items submitted by committee members, take or cause to be
taken
26
accurate minutes of
meetings, circulate draft minutes within seven (7) days after the
meeting for approval by the other Member’s committee members,
and circulate final minutes to the committee members promptly
following such approval. Notice of, and the agenda for, each
meeting (and any accompanying materials) shall be circulated to the
members of the applicable Operating Committee sufficiently in
advance so that in the normal course such materials will be
received at least five (5) Business Days in advance of such
meeting; provided , however , that under reasonable
circumstances such materials may be circulated within a lesser
period of time in advance of the meeting, so long as each Member
agrees to the inclusion on such agenda of any items proposed for
consideration by the other Member. Any member of an Operating
Committee may waive notice of a meeting thereof, and shall be
deemed to waive such notice (but not, if applicable, his or her
right to object to the inclusion of a particular agenda item or
items as set forth in the proviso to the previous sentence) if he
or she attends the meeting and does not object to the meeting
because of a lack of notice prior to its commencement.
(e)
At least two (2)
members appointed by Gilead Sub and two (2) members appointed by
BMS Sub must be in attendance at a meeting of an Operating
Committee to establish a quorum for the conduct of business.
Committee members may attend meetings in person or, as long as each
attendee is able to hear the others, by telephone or by video
conference equipment; provided , however , that at
least two (2) meetings per Calendar Year of each Operating
Committee shall be held in person until the Launch of the
Combination Product, and thereafter at least one (1) meeting per
Calendar Year of each Operating Committee shall be held in
person. Each Operating Committee may also act by unanimous
written consent of its members without a meeting.
(f)
At each meeting
of an Operating Committee, each Member’s designees on such
Operating Committee shall, collectively, have one (1) vote on all
matters to be acted upon (the “Member Vote”).
Each Operating Committee shall take action by unanimous Member
Vote. If an Operating Committee is unable to reach agreement
on a matter properly presented to such Operating Committee for its
consideration, the matter shall be resolved by the procedure set
forth in Section 2.8 (except as otherwise provided
therein).
(g)
Each Operating
Committee may, as it deems appropriate, delegate its
decision-making authority for specific matters or types of matters
(other than, as applicable in the case of the JDC and JCC, approval
of updates of the Development Plan, Commercialization Plan,
Development Budget or Commercialization Budget for which that
Operating Committee is responsible, or as provided in
Section 3.4) to subcommittees or specific groups, each with
representatives from both Members, which shall make such decisions
by consensus. If such subcommittees or groups do not reach
consensus on a matter, either Member may refer such matters back to
such Operating Committee for resolution.
(h)
Notwithstanding
the enumerated authority of the JEC in this Agreement and the
Operating Agreement and the express reservation to the
decision-making authority of the Member Parties of certain matters
herein and therein: in the event that the JEC, acting (i) by
unanimous affirmative Member Votes (as defined in the Operating
Agreement) pursuant to Section 6.5(d) of the Operating
Agreement, or (ii) by unanimous written consent pursuant to
Section 6.5(c) of the Operating Agreement, takes action on a
matter relating to the Exploitation of the Combination Product, but
with respect to which matter authority and
27
responsibility have not been
delegated to or vested in the JEC, the Member Parties shall be
deemed to waive any objection to the effect that the JEC acted
beyond the scope of its authority or responsibility, and the
resolution of such matter shall be binding on the Member Parties
for purposes of this Agreement and the Operating
Agreement.
2.7
Alliance
Managers .
(a)
Gilead and BMS
shall each designate within their respective organizations an
alliance manager (an “Alliance Manager”) with
responsibility for facilitating the interaction and cooperation
between Gilead and BMS with respect to the JV and the Exploitation
of the Combination Product in the Territory. The initial
Alliance Managers are identified in Annex A hereto. Each
Member Party may change its Alliance Manager from time to time upon
written notice to the other Member Party.
(b)
The Alliance
Managers shall attend all meetings of the JEC and each Operating
Committee (other than the JFC) and support the chairpersons of the
JEC and each Operating Committee in the discharge of their
responsibilities. The Alliance Managers shall be nonvoting
participants in such meetings, unless they are also appointed
members of the applicable committee(s). Each Alliance Manager
shall endeavor to create and maintain a collaborative work
environment within and among the JEC and the Operating
Committees. In addition, each Alliance Manager: (i) shall be
the point of first referral in certain matters subject to dispute
resolution as provided in Section 2.8; (ii) shall coordinate
the relevant functional representatives of the Member Parties;
(iii) shall provide a single point of communication for seeking
consensus both internally within the respective Member
Parties’ organizations and between the Member Parties; (iv)
shall identify and bring disputes to the attention of the JEC or an
Operating Committee as appropriate in a timely manner; (v) shall
plan and coordinate cooperative efforts and internal and external
communications; and (vi) shall take responsibility for ensuring
that governance activities, such as the conduct of required JEC and
Operating Committee meetings and production of meeting minutes,
occur as set forth in this Agreement and in the Operating Agreement
and that relevant action items agreed upon at such meetings are
appropriately carried out or otherwise addressed.
(c)
Notices given by
a Member Party to the other Member Party with respect to
Development Activities, Combination Product or EFV, TDF or FTC bulk
active pharmaceutical ingredient Manufacturing and
Commercialization Activities shall be made to the other Member
Party’s Alliance Manager and to such other Operating
Committee or JEC member of such other Member Party as is most
directly involved in or informed of the relevant activity, except
that if Gilead or BMS is selected as the Supplier pursuant to
Section 4.2(a), it shall not be required to provide such
notice to the other Member Party’s Alliance Manager with
respect to its toll manufacturing activities.
2.8
Dispute
Resolution .
(a)
Disputes may be
referred to the JEC for resolution, as follows: (i) if an
Operating Committee is unable to reach agreement on a matter
properly presented to such Operating Committee for its decision,
the Operating Committee shall refer the matter to the Alliance
Managers for Gilead and BMS, and if the Alliance Managers are
unable to resolve the
28
dispute within
[*] after such referral, then the
matter shall be referred to the JEC; and (ii) either Member
Party may refer to the JEC any issue arising under this Agreement
or the Operating Agreement and not otherwise covered by clause
(i).
(b)
If the JEC is
unable to resolve a dispute referred to it by the Alliance Managers
or by a Member Party pursuant to Section 2.8(a) within
[*] after such referral, or in
the event that the JEC is unable to resolve a dispute arising
within the JEC, then the dispute shall be referred for resolution
to the Chief Executive Officer of Gilead Parent and, for BMS, the
Chief Executive Officer of BMS Parent or any direct report
designated by the Chief Executive Officer of BMS Parent (who shall
not be a member of the JEC or any Operating Committee).
(c)
If the Chief
Executive Officer of Gilead Parent and Chief Executive Officer (or
designee, as applicable) of BMS Parent are unable to reach
agreement on a disputed matter referred to them pursuant to
Section 2.8(b) within [*] after such referral, then
either Gilead or BMS may refer the disputed matter to binding
arbitration pursuant to Section 15.6 if and only if, and to
the extent that (A) the disputed matter relates to or arises out of
the validity, interpretation or construction of, or the compliance
with or breach of, this Agreement, the Operating Agreement, any
Ancillary Agreement, or any other agreement contemplated by this
Agreement to which a Member Party (or its Affiliates) and the JV
and/or the other Member Party (or its Affiliates) are parties; (B)
the disputed matter came before the JEC pursuant to
Section [*]
or
Section [*]
(provided that
any dispute relating to the [*] may be submitted to
arbitration only with respect to the issue of whether
specific [*]
are
[*] , any dispute relating
to [*] pursuant to
[*] may be submitted to
arbitration only with respect to the issue of [*] , any dispute relating
to [*] may be submitted to
arbitration only with respect to matters arising pursuant to
[*] , and any dispute relating
to [*] may be submitted to
arbitration only with respect to matters arising pursuant to
[*] ; or (C) there is a dispute
as to whether the [*]
are satisfied
with respect to a matter.
(d)
For the avoidance
of doubt, the dispute resolution procedures set forth in Sections
2.8(a), 2.8(b) and 2.8(c) shall not apply to any deadlock within
the JEC or any Operating Committee resulting from a proposal by one
Member’s committee members to reverse or modify a decision of
the JEC or such Operating Committee with respect to a matter
previously presented to it for decision and approved by unanimous
Member Vote or unanimous written consent of its members, unless all
of the following conditions are satisfied: (i) such proposal
is [*] the applicable JEC or
Operating Committee decision; (ii) the deadlock
involves [*]
; and (iii) the
applicable JEC or Operating Committee decision, if not reversed or
modified, would [*]
pursuant to this
Agreement (it being understood that if only certain aspects of the
applicable JEC or Operating Committee decision produce these
results, only they shall be subject to the dispute resolution
procedures set forth in Sections 2.8(a), 2.8(b) and 2.8(c), and the
balance of such decision shall remain in effect);
provided , however , that this Section 2.8(d)
shall not apply to the deliberations and decisions of the JCC
pursuant to Sections [*] , and deliberations and
decisions of the JEC with respect to any disputes that arise within
the JCC with respect thereto; and provided ,
further , that the JCC’s and the JEC’s
reconsideration of prior decisions with respect to the matters
covered by the preceding proviso shall be governed by
[*] , respectively, and in the
event of any such reconsideration (and any dispute resolution and
arbitration in connection therewith), the prior decision in force
at the time of reconsideration shall remain in force
and
29
continue to apply until such
time, if any, as a modified position may be agreed by the JCC or
the JEC, or adopted by the arbitrator(s), as the case may
be.
(e)
Nothing in this
Section 2.8 shall affect the right of a Member Party to
exercise its rights under Section 14.4 with respect to a
Material Default by the other Member Party, concurrently with the
exercise of its rights under this Section 2.8. In the
event that, at any time prior to completion of the dispute
resolution procedures set forth in this Section 2.8, the
Non-Breaching Member Party delivers a notice of Material Default to
the Breaching Member Party, the sixty (60) day cure period referred
to in Section 14.4(a) shall begin to run upon the receipt of
such notice and shall run concurrently with the procedures set
forth in this Section 2.8.
2.9
Collaboration
Principles . The Parties agree to
abide by the following principles (“Collaboration
Principles”) in their conduct of the Development Activities
and the Commercialization Activities, and to cause their
representatives on the JEC and the Operating Committees to observe
these principles in connection with their committee-related
activities:
(a)
Subject to
Sections 2.9(b) and (c), the purposes of the JV are (i) to develop,
manufacture, and commercialize the Combination Product for use
within the Territory, and (ii) to optimize the commercial potential
of the Combination Product within the Commercialization Plan,
subject to the Commercialization Budget. For the avoidance of
doubt, nothing in this Agreement or in the Operating Agreement
shall be deemed to restrict or prohibit either Member Party or any
of its Affiliates from (x) commercializing its Single Agent
Product(s) and/or Double Agent Product as applicable, (y) subject
to Sections 3.10 and 5.6, developing, manufacturing and
commercializing combination products (other than the Combination
Product) for the treatment of HIV infection or otherwise,
including, without limitation, any product containing such
Party’s Single Agent Product(s) and/or Double Agent Product
or (z) conducting clinical studies involving one or more of EFV,
FTC and TDF, or any combination thereof (including the Combination
Product).
(b)
Subject to
Section 5.7, each Party’s Promotion of the Combination
Product in the Territory shall be in accordance with the Approved
Marketing Materials, the FDA-approved label and the package insert
for the Combination Product; provided , however ,
that subject to the foregoing, each Party shall have a right to
position the Combination Product within its HIV product portfolio
in its sole discretion.
(c)
Except as
expressly provided otherwise in this Agreement (or in the Operating
Agreement or any Ancillary Agreement) and notwithstanding the
powers and authority delegated to a Party, the JEC or an Operating
Committee, neither Party shall have any obligation (i) to conduct
activities in support or furtherance of the Exploitation of the
Combination Product, unless mutually agreed in writing by the
Parties or expressly set forth in this Agreement, the
Commercialization Plan or Development Plan, or (ii) to make
payments or incur expenses or liabilities in support or furtherance
of the Exploitation of the Combination Product unless mutually
agreed in writing by the Parties or expressly set forth in the
Commercialization Budget or the Development Budget.
2.10
Commercialization Budget/Plan
Deadlocks . In the event of a
Commercialization Budget Deadlock or a Commercialization Plan
Deadlock (as such terms are
30
defined below) with respect
to any portion of the period from the Effective Date through the
end of the Subsequent Launch Period, then in lieu of any other
dispute resolution procedures set
forth in this Agreement or in the Operating Agreement, the Parties
agree that the dispute shall be conclusively resolved as
follows:
(a)
If a
Commercialization Budget Deadlock relates to any Calendar Year (or
part thereof) during the period from the Effective Date through the
end of the Initial Launch Period, the level of aggregate
expenditure for the Calendar Year (or part thereof) in dispute
shall be fixed, upon notice given by a Member Party to the other
Member Party, at (i) in the case of disputes on annual updates, the
level for the Calendar Year in dispute provided for in the initial
version of the Commercialization Budget included in Annex C hereto
(as most recently updated, if applicable), or (ii) in the case of
disputes on interim updates, the level then in effect for the
relevant part of the current Calendar Year.
(b)
If a
Commercialization Budget Deadlock relates to any Calendar Year (or
part thereof) during the Subsequent Launch Period, (i) the level of
aggregate expenditure for the Calendar Year (or part thereof) in
dispute shall be fixed, upon notice given by a Member Party to the
other Member Party, at (A) in the case of disputes on annual
updates, [*]
of the level (as
most recently updated) budgeted for the Calendar Year immediately
preceding the Calendar Year in dispute unless both Members, through
their respective representatives on the JEC have proposed levels of
aggregate expenditure both of which are lower than the
aforesaid [*]
level, in which
case the level of aggregate expenditure for the Calendar Year in
dispute shall instead be fixed at the [*] of the [*] by the Members through their
respective representatives on the JEC, or (B) in the case of
disputes on interim updates, the level then in effect for the
relevant part of the current Calendar Year, and (ii) if there is a
dispute regarding the level of aggregate expenditure provided for
in a subsequent annual update to the Commercialization Budget
covered by the foregoing clause (A), such level shall be fixed,
upon notice given by a Member Party to the other Member Party, at
the amount [*]
which is
the [*] of the [*] by the Members through their
respective representatives on the JEC.
(c)
If a
Commercialization Plan Deadlock relates to any Calendar Year (or
part thereof) during the Initial Launch Period, the
[*] for the Calendar Year (or
part thereof) in dispute shall be fixed, upon notice given by a
Member Party to the other Member Party, at (i) in the case of
disputes on annual updates, the level for the Calendar Year in
dispute provided for in the initial version of the
Commercialization Plan included in Annex C hereto (as most recently
updated, if applicable), or (ii) in the case of disputes on interim
updates, the level then in effect for the relevant part of the
current Calendar Year.
(d)
If a
Commercialization Plan Deadlock relates to any Calendar Year (or
part thereof) during the Subsequent Launch Period, (i) the
[*] for the Calendar Year (or
part thereof) in dispute shall be fixed, upon notice given by a
Member Party to the other Member Party, at (A) in the case of
disputes on annual updates, [*] of the level (as most
recently updated) in effect for the Calendar Year immediately
preceding the Calendar Year in dispute, unless both Members,
through their respective representatives on the JEC, have
proposed [*]
both of which
are lower than the aforesaid [*] level, in which case
the [*] for the Product Year in
dispute shall instead be fixed at the [*] of the [*] by the Members through their
respective representatives on the JEC, or (B) in the case of
disputes on interim updates, the level then in effect for the
relevant
31
part of the current Calendar
Year, and (ii) if there is a dispute regarding the
[*] provided for in a subsequent
annual update to the Commercialization Plan covered by the
foregoing clause (A), such level shall be fixed, upon notice given
by a Member Party to the other Member Party, at the amount
[*] which is the
[*] of the [*] by the Members through their
respective representatives on the JEC.
For Calendar Years (or any part
thereof) commencing after the Subsequent Launch Period, any
aggregate expenditures in a Commercialization Budget, and any
[*] in a Commercialization Plan, shall be decided by the
mutual agreement in writing of the Member Parties; failure to reach
agreement thereon shall not be subject to dispute resolution
hereunder. As used in this Agreement, (x) a
“Commercialization Budget Deadlock” shall mean that the
JEC is unable to reach agreement, by unanimous Member Vote (as
defined in the Operating Agreement) or unanimous written consent of
the members of the JEC, on the level of aggregate expenditure in
any annual or (in the case of clause (y) of Section 2.2(vi))
interim update to the Commercialization Budget covering all or any
portion of the period from the Effective Date through the end of
the Initial Launch Period or all or any portion of the Subsequent
Launch Period and (y) a “Commercialization Plan
Deadlock” shall mean that the JEC is unable to reach
agreement, by unanimous Member Vote or unanimous written consent of
the members of the JEC, on the [*] to be conducted in any
annual or (in the case of clause (y) of Section 2.2(vi))
interim update to the Commercialization Plan covering all or any
portion of the Initial Launch Period or the Subsequent Launch
Period.
2.11
Expenses
. Gilead
and BMS shall each bear their own expenses related to the
management of the JV, including without limitation all expenses
relating to the meetings of the JEC and the Operating Committees,
the participation of the Members’ representatives in such
meetings, communications with the other Member in connection with
such meetings or matters within the authority of the committees,
and travel to and from such meetings, and such expenses shall not
be deemed JV Expenses or Authorized Other Expenses.
SECTION 3.
DEVELOPMENT ACTIVITIES
3.1
General
. Under the
oversight of the JDC, Gilead and BMS shall each perform, or cause
its Affiliates to perform, on behalf of and in the name of the JV,
the Development Activities designated for such Member Party in the
Development Plan, in each case in accordance with the timeline set
forth in the Development Plan. For the avoidance of doubt,
Gilead, on its own behalf and in its own name, shall have the sole
right to [*]
in its sole
discretion and without oversight by the JDC or the JEC, but
shall [*] with respect to
[*] such [*] .
3.2
Clinical
Development .
(a)
Without
limitation of Section 3.1, Gilead, under the oversight of the
JDC, shall have primary responsibility for the development of the
Combination Product and the conduct of any clinical trials and
bioequivalence studies required for obtaining approval of an NDA
for the Combination Product in the Territory in the Field, in each
case only as set forth in the Development Plan or otherwise
mutually agreed upon by the Member Parties.
32
(b)
In the event that
either Member Party desires (i) to conduct or sponsor, or cause to
be conducted or sponsored, jointly with the other Member Party, or
in the name of the JV, a clinical trial of the Combination Product
(whether such clinical trial would involve the Combination Product
alone, or with one or more other products) other than any clinical
trial contemplated by the Development Plan, including, without
limitation, an expanded access program or Phase IIIb/IV study, or
(ii) to support jointly with the other Member Party (either on
their own behalf or in the name of the JV) any such clinical trial
sponsored by an investigator, such Member Party shall so notify the
other Member Party. The Member Parties shall then discuss the
particulars of the proposed clinical trial. In the event that
the Member Parties, each in its sole discretion, agree to conduct
jointly or sponsor jointly such clinical trial (either on their own
behalf or in the name of the JV), the JDC representatives shall
prepare and agree upon a trial protocol and designate a Member
Party to take the lead in conducting or supervising such clinical
trial and negotiating any necessary clinical trial agreements, as
the case may be, and the external, out-of-pocket costs of the
Member Parties, if any, without any markup, relating to such
clinical trial shall be treated as Authorized Development
Expenses. In the event that the Member Parties, each in its
sole discretion, agree to support jointly (either on their own
behalf or in the name of the JV) any investigator-sponsored
clinical trial, the Member Parties shall coordinate with the
investigator seeking to conduct such clinical trial and agree upon
an appropriate grant of support (including, without limitation,
support in the form of funding or the contribution of drug
product), and the external, out-of-pocket costs of the Member
Parties, if any, without any mark up, with respect to such clinical
trial shall be treated as Authorized Development Expenses.
Each clinical trial that the Member Parties shall determine to
conduct, sponsor or support jointly pursuant to the preceding two
sentences shall be referred to as a “Co-Funded Clinical
Trial.” The Clinical Data with respect to any Co-Funded
Clinical Trial shall be deemed to be Joint Know-How;
provided , however , that, in the case of any
investigator-sponsored clinical trial, the Clinical Data resulting
from any such Co-Funded Clinical Trial shall be deemed to be Joint
Know-How only if and to the extent that the JV or either or both
Member Parties obtains any right, title and interest in and to such
Clinical Data.
For the avoidance
of doubt, nothing contained in this Section 3.2 is intended,
or shall be construed, to restrict or prohibit either Member Party
from conducting independently or together with one or more Third
Parties, any clinical trial of the Combination Product (whether
such clinical trial would involve the Combination Product alone, or
with one or more other products). Prior to a Member
Party’s commencing any such clinical trial sponsored by such
Member Party, whether independently or together with one or more
Third Parties, the applicable Member Party shall provide a brief
summary of the protocols to the other Member Party’s
representatives on the JDC (it being understood that neither such
representatives nor the JDC shall have any approval rights with
respect to such study or protocols), provided that (A) each such
summary shall constitute Confidential Information of the disclosing
Member Party to the extent that the information provided in such
summary satisfies the criteria set forth in Section 12.3, (B)
the receiving Member Party’s representatives shall not use
such summary for any purpose other than providing comments thereon
to the disclosing Member Party (which comments may be accepted or
rejected by the disclosing Member Party in its sole discretion),
and (C) the receiving Member Party’s representatives shall
not disclose such summary to any Persons other than employees of
such Member Party who have an obligation (x) not to further
disclose such summary and (y) to use such summary solely in order
to assist such Member Party’s representatives in providing
comments thereon. For the avoidance of doubt, a
Member
33
Party’s providing such
summary with respect to any such clinical trial pursuant to this
Agreement shall not be construed to have the effect of causing the
activities with respect to such clinical trial to be deemed to be
Project Activities for purposes of this Agreement.
(c)
In the event that
the Member Parties determine to conduct additional
Development Activities for an alternative formulation or
presentation of the Combination Product, and conduct or cause to be
conducted such additional activities, the external, out-of-pocket
costs of the Member Parties, if any, without any markup, with
respect to such activities shall be treated as Authorized
Development Expenses.
3.3
Formulation
and CMC Data . Without limitation of
Section 3.1, Gilead, under the oversight of the JDC, shall
have primary responsibility for formulation and Manufacturing
Process development for, and preparation of the CMC Data relating
to, the Combination Product as contemplated by the Development
Plan. Formulation development shall include, without
limitation, conducting the formulation screening, optimization,
scale-up and technology transfer for the Combination Product in the
Field.
3.4
Regulatory
Matters .
(a)
Without
limitation of Section 3.1, Gilead, under the oversight of the
JDC and with the participation of BMS as described in this
Section 3.4, shall have primary responsibility for preparing
and filing all necessary Regulatory Documentation and for acting as
liaison on behalf of the JV for all communications with the
Regulatory Authorities in the Territory relating to the obtaining
of approval of the Combination Product in the Field under an NDA
separate from the respective NDAs for Sustiva, Viread, Emtriva and
Truvada. Gilead shall prepare and file all Combination
Product Regulatory Documentation with Regulatory Authorities in the
Territory in the name of the JV. All submissions of
Combination Product Regulatory Documentation consisting of any
INDs, NDAs, sNDAs, CMC Data, drug master files and PSURs
(collectively, the “Key Regulatory Submissions”) shall
be approved in advance by the JDC (which shall not delegate such
approval to any subcommittees or groups referred to in
Section 2.6(g)). If permitted by Applicable Law, the
label for the Combination Product shall list the agents in the
following order: [*] .
(b)
Gilead shall
notify BMS as early as reasonably practicable in advance of all
meetings (whether face to face or by teleconference) and
communications with representatives of the Regulatory Authorities
in the Territory concerning the Combination Product and in order to
provide BMS with an opportunity to be present at such meetings and
to review and comment on such communications; provided ,
however , that in no event shall Gilead, after using
reasonable efforts to provide BMS with an opportunity to be present
at any such meeting or to review and comment on such
communications, be required to postpone any such meeting to ensure
that BMS attends such meeting or to postpone any such communication
in order to ensure that BMS’ comments are received by Gilead
in advance of its submission to Regulatory Authorities, as the case
may be. In order to enhance the efficiency of the Member
Parties’ coordination on regulatory matters concerning the
Combination Product, and increase the likelihood that BMS will have
a meaningful opportunity to participate in such activities, during
the term of this Agreement, BMS will cause one of its employees
with the necessary regulatory expertise and decision-making
authority to be dedicated on a full-time basis to
serving
34
as a conduit for BMS’
participation in such activities. Gilead shall promptly
forward to BMS in advance of any such meeting copies of all
documents and other relevant information relating to such
meeting. Notwithstanding anything contained in this Agreement
to the contrary, (i) at any such meeting with, or any such
communication to, the Regulatory Authorities in the Territory
concerning the Combination Product, at which BMS and Gilead are
present or in which both Member Parties participate, each Member
Party shall take the lead on matters relating to its respective
Single Agent Product(s) or Double Agent Product and (ii) at any
such meeting with, or any such communication to, such Regulatory
Authorities concerning the Combination Product, at which only one
Member Party meets or in which communication only one Member Party
participates (without the other Member Party’s presence or
participation), such Member Party shall not engage in any
substantive discussions pertaining to the other Member
Party’s Single Agent Product(s) or Double Agent Product, as
the case may be, including, without limitation, with respect to API
consisting of EFV, TDF or FTC, as the case may be, as it relates to
the Combination Product.
(c)
Each Member Party
shall promptly forward to the other Member Party any written
communications received from representatives of the Regulatory
Authorities relating to the Combination Product. BMS shall
provide Gilead with full access to and copies (including electronic
copies if requested) of the BMS Regulatory Documentation, including
without limitation the NDA for Sustiva, as Gilead may reasonably
request in connection with (and solely for the purpose of) the
performance of its duties under this Section 3.4.
(d)
Nothing in this
Section 3.4 shall prohibit or restrict either Member Party
from communicating with the Regulatory Authorities on matters
relating to the Exploitation of any of its respective Single Agent
Product(s), Double Agent Product or other pharmaceutical
products. Each Member Party shall promptly notify the other
Member Party of any label change for the first Member Party’s
respective Single Agent Product(s) or Double Agent Product that may
result in a label change for the Combination Product. If any
communications from Regulatory Authorities regarding potential
label changes for the Combination Product are reasonably expected
to lead to a label change for a Member Party’s Single Agent
Product or Double Agent Product, then, notwithstanding anything in
this Agreement to the contrary, the affected Member Party shall
take the lead in dealing with the Regulatory Authorities on such
matter.
3.5
Performance;
Subcontracting . Gilead and BMS each
shall perform its respective Development Activities in material
compliance with GCP, GLP, and GMP, in each case to the extent
applicable, and the requirements of Applicable Law, and so long as
there is a Development Plan in effect, shall use Commercially
Reasonable Efforts to perform its Development Activities under the
Development Plan efficiently and expeditiously, subject to the
Development Budget. Either Member Party may subcontract the
performance of its respective Development Activities;
provided , however , that the subcontracting Member
Party shall oversee the performance by its subcontractors of the
subcontracted Development Activities in a manner that would be
reasonably expected to result in their timely and successful
completion and shall remain responsible for the performance of such
Development Activities in accordance with this Agreement and the
Development Plan.
35
3.6
Records
.
(a)
Maintenance of
Records . Gilead and BMS each
shall severally (in accordance with their respective allocations of
responsibilities with respect to Project Activities) maintain, or
cause to be maintained, all Combination Product Regulatory
Documentation and final supporting records and documentation
therefor (but not draft records or documentation therefor except as
otherwise required by Applicable Law), in sufficient detail and in
material compliance with GCP, GLP, and GMP, in each case to the
extent applicable. Such records shall be
complete and accurate and shall fully and properly reflect all work
done and results achieved in the performance of its respective
Development Activities in a manner appropriate for any regulatory
purpose and, when applicable, for use in connection with Patent
filings, prosecution and maintenance. Such documentation and
records shall be retained for at least (i) three
(3) years or
(ii) such longer period as may be required by Applicable
Law.
(b)
Access to
Records . Each Member Party
shall have the right, during normal business hours and upon
reasonable notice, to inspect and copy any Combination Product
Regulatory Documentation and final supporting records and
documentation therefor generated or maintained by the other Member
Party, for use by the receiving Member Party solely in connection
with the performance of its Development Activities in a manner
consistent with the Development Plan. Subject to the terms
and conditions of this Section 3.6(b), each Member Party shall
also have the right, during normal business hours and upon
reasonable notice, to obtain from the other Member Party access to
or copies of scientific, regulatory and technical records,
documentation and data solely to the extent relating to the
Combination Product or such other Member Party’s Single Agent
Product(s) and/or Double Agent Product, as the case may be, and
solely to the extent (i) necessary in order for the receiving
Member Party to perform its obligations with respect to Development
Activities in a manner consistent with the Development Plan, (ii)
necessary for the receiving Member Party to confirm compliance with
and/or to comply with GLP, GCP and GMP (to the extent applicable),
and other Applicable Law, as it relates to Project Activities,
and/or (iii) necessary to enable the receiving Member Party to
conduct reasonable diligence on matters potentially giving rise to
liability on the part of the JV and/or such receiving Member Party,
or to conduct a defense of itself and/or the JV with respect to any
such liability, if and to the extent that a fact, circumstance or
event has arisen that gives the receiving Member Party a reasonable
basis to believe that it or the JV has or may incur such liability,
in each case for use by the receiving Member Party for the purpose
set forth in clause (i), (ii) or (iii) above, as the case may
be. Clause (iii) of the immediately preceding sentence shall
not require any Party to provide such data, documentation or
records in the event that the Parties’ interests in such
matter are or may be [*] , in which case
[*] , shall apply. Each
such request shall be made in writing and shall state the reason(s)
therefor (each a “Development Record Request”).
The Member Party from which such records, documentation or data are
requested shall have the right to raise reasonable objections in
writing in response to such Development Record Request, including,
without limitation, based on such Member Party’s interests in
protecting from disclosure to the requesting Member Party trade
secrets or other competitive business information. Upon any
such objection being asserted, the Member Parties shall promptly
confer in an attempt to address each Member Party’s concerns
and reach a resolution with respect to the matter, and in the event
that the Member Parties are unable to agree upon a mutually
agreeable resolution, either Member Party shall have the right to
refer the matter to the JDC. In the event that any such
dispute is ultimately [*] determine as a threshold
matter whether and to what extent one or more criteria set forth in
clauses (i), (ii) and/or (iii) above have been satisfied by the
requesting Member Party, and, if so, shall make a determination
with
36
respect to whether and to
what extent the disclosure of such information shall be required
by [*] , and [*] . In making such
determination, [*]
to the facts and
arguments set forth in the Development Record Request and the other
Member Party’s written response thereto, and (y) shall have
the right to require the receiving Member Party to abide by terms
and conditions for the handling, use and non-disclosure (either
within such Member Party’s organization and/or to Third
Parties) of such information as may be reasonable under the
circumstances. Except as provided in this Section 3.6, a
Member Party shall not have the right to obtain from the other
Member Party access to or copies of the other Member Party’s
records, documentation and data described above, unless otherwise
expressly permitted pursuant to this Agreement or the other Member
Party gives its consent in its sole discretion.
3.7
Updates to
Development Plan and Development Budget . Gilead shall prepare
and submit to each of the JDC and JFC (i) not less than
[*] prior to the start of each
Calendar Year, a proposed update to the Development Plan and the
Development Budget for such Calendar Year and (ii) not less
than [*] prior to the start of each
Calendar Year, a preliminary update to such Development Budget
(which may address budget issues at a general level, may be
incomplete and is subject to change). In addition, either
Member Party, directly or through its representatives on the JDC,
may propose updates to the Development Plan and the Development
Budget to the JDC from time to time as appropriate in light of
changed circumstances. Such changes and updates shall be
subject to approval by the JDC as set forth in Section 2.6(f),
with annual updates to be approved at least [*] prior to the start of such
Calendar Year. If an annual or interim update to the
Development Plan or the Development Budget is not approved by the
JDC, then, subject to Sections 2.2(v) and 2.8 as applicable, the
Development Plan or Development Budget, as the case may be, shall
continue in effect as approved and most recently updated pursuant
to this Section 3.7. Updated Development Plans shall not
cover items other than those included in the initial Development
Plan unless mutually agreed by the Member Parties.
3.8
Development
Expenses . [*] shall be [*] responsible for all costs
that it incurs (a) in its sole discretion, in connection with
the [*] or (b) in the performance
of [*] Development Activities as set
out in the initial Development Plan. The Parties agree that
the JV shall bear all JV Expenses incurred by Gilead or BMS in
connection with the performance of its respective Development
Activities to the extent meeting all of the following criteria
(“Authorized Development Expenses”): (i) such
Development Activities are conducted pursuant to the Development
Plan and are within an area of responsibility for the relevant
Member Party listed in the Development Budget as being chargeable
to the JV; (ii) the total expenses for that area of responsibility
for that Member Party for the relevant period to the extent that
they do not exceed the corresponding budgeted amount for that area
in that period by more than [*] unless approved by the JDC;
(iii) the expenses are external, out-of-pocket costs of Gilead or
BMS, without any markup; and (iv) the expenses are not
[*] costs of [*] referred to in the
[*] .
3.9
Reports
. Gilead
and BMS shall each present to the other, at a meeting of the JDC at
least once per Calendar Quarter until the first anniversary of the
Launch of the Combination Product, and, thereafter, at a meeting of
the JDC, at least semiannually, a report (oral and written, which
written report shall not be required to contain more detail than
that typically included in an executive summary) describing (i) the
Development Activities it has performed, or caused to be performed,
since the preceding meeting at which such a report was
37
presented (or, in the case
of the first meeting of the JDC, prior to such meeting) and on a
Calendar Year-to date basis, evaluating the work performed in
relation to the goals and timeline of the Development Plan, (ii)
its Development Activities in process and the future activities it
expects to initiate during the then-current Calendar Year, as
compared to the Development Plan, and (iii) in the case of the
written report the Authorized Development Expenses incurred, and
expected to be incurred, by such Member Party for the then-current
Calendar Year, as compared to the Development Budget. In
addition, Gilead and BMS shall report promptly to the JDC through
their respective committee members any material developments with
respect to Development Activities that they are responsible for
performing under the Development Plan. Notwithstanding
anything contained in this Section 3.9 to the contrary, each
Member Party’s reporting obligations under this
Section 3.9 shall automatically be deemed to terminate with
respect to any period in which there is not then in effect a
Development Plan and Development Budget.
3.10
New
Products . During the period
from the date of this Agreement through the [*] anniversary of the Effective
Date, the Member Parties agree to use commercially reasonable
efforts to evaluate and pursue an arrangement with each other for
the co-development and co-commercialization of [*] product comprising
[*] ; provided ,
however , that the Member Parties may terminate such efforts
by mutual written agreement if they determine that the proposed
product is not commercially or technically feasible, with such
agreement to terminate not to be unreasonably withheld. In
furtherance of the foregoing, notwithstanding anything in this
Agreement to the contrary, during the period from the Effective
Date through the [*]
anniversary of
the Effective Date (a) Gilead shall not (and shall cause its
Affiliates not to) [*]
an
[*] with any [*] for [*] within the Territory of
any [*] that contains
[*] with [*] that is (i)
[*] to that Third Party and
(ii) [*] in the Territory as
of [*] , and (b) BMS shall not (and
shall cause its Affiliates not to) [*] an [*] with any [*] for [*] within the Territory of
any [*] that contains
[*] in combination with
[*] that are (i) proprietary to
that Third Party and (ii) [*] in the Territory as
of [*] .
3.11
Publication
.
(a)
Either Member
Party shall have the right to publish or present data and findings
resulting from Project Activities, including, without limitation,
Co-Funded Clinical Trials, subject to the right of objection or
demand for modification by the other Member Party in the interest
of (i) protecting the Confidential Information of such other Member
Party, (ii) preserving the intellectual property rights of such
other Member Party or the JV, and/or (iii) assuring that the
publication or presentation presents such data and findings in a
fair, accurate and balanced manner in accordance with ethical,
medical and/or scientific standards. During the term of this
Agreement, each Member Party shall provide to the other Member
Party’s representatives on the JDC for review copies of all
academic, scientific and medical publications and presentations
specifically relating to the Combination Product (or otherwise
relating to the combined use of EFV, FTC and TDF) that the Member
Party proposes to submit for publication or presentation and that
result from Project Activities; provided , however ,
that notwithstanding anything contained in this Section 3.11
to the contrary, the terms and conditions of this Section 3.11
shall not apply to any publications and presentations resulting
directly or indirectly from Study 934. Review of such
publications and presentations shall be conducted only for purposes
of considering compliance with the standards set forth in clauses
(i), (ii) and (iii) above (the
38
“Publication
Standards”) and shall consider whether any portion of any
such publication or presentation should be modified or deleted in
order to conform to the Publication Standards. In addition,
in the case of any such publication or presentation resulting from
a Co-Funded Clinical Trial, the Member Party that proposes to
submit such publication or presentation shall have the right to do
so only if the other Member Party agrees that such publication or
presentation, as may be modified, conforms to the Publication
Standards, which agreement shall not be unreasonably withheld or
delayed. Such Member Party shall consider in good faith any
comments provided to it by such other Member Party with respect to
such publication or presentation, including, without limitation,
any comments of a scientific or medical nature. In the case
of any such publication or presentation resulting from other
Project Activities, the other Member Party shall have a right to
comment on such publication or presentation, provided that the
Member Party proposing such publication or presentation shall be
under no obligation to accept such comments (except to the extent
necessary to preserve the intellectual property rights of such
other Member Party or the JV) and shall be free to publish or
present, as the case may be. Written copies of each proposed
publication or presentation required to be provided for review
shall be provided to the other Member Party’s representatives
on the JDC no later than [*] before submission for
publication or presentation, except that (A) in the case of an
abstract, a copy of the abstract shall be provided as soon as
reasonably practicable in advance of the submission of such
abstract to a Third Party (which period may be less than
[*] and (B) if the deadline for
submission of such publication or presentation is less than
[*] from the date of completion
of that publication or presentation, copies will be provided as
soon as reasonably practicable in advance of such submission
deadline. In the case of any proposed publication or
presentation of a Member Party that is required to be reviewed by
the other Member Party, in the event that the Member Parties fail
to reach agreement, if applicable, on such publication or
presentation by the conclusion of the applicable review period, and
as a result there is a dispute between the Member Parties with
respect to such publication or presentation, such dispute may be
referred by either Member Party to the JDC. The Member
Parties shall comply in any publications made pursuant to this
Section 3.11 with standard academic practice regarding
authorship of scientific publications and recognition of
contribution of parties. For the avoidance of doubt, nothing
contained in this Section 3.11 shall alter or affect a Member
Party’s confidentiality obligations pursuant to
Section 12.
(b)
Subject to
compliance with Section 3.11(a), nothing in this Agreement
shall restrict either Member Party from providing information on
Co-Funded Clinical Trials conducted by the other Member Party to
any Clinical Trials Registry or Clinical Trials Results Database,
in accordance with Applicable Law and industry practice. For
purposes of this Section 3.11(b), (i) “Clinical Trial
Registry” means any listing of Clinical Trials which have
been initiated, whether maintained by the U.S. federal government (
e.g., www.clinicaltrials.org) or an independent organization
(e.g., PhRMA) and (ii) “Clinical Trials Results
Database” means any database which provides access to
Clinical Trial results to physicians, patients and the general
public, whether maintained by any government, Regulatory Authority
or independent organization (e.g., PhRMA).
3.12
Certain
Inspections . Each Member Party
shall involve the other Member Party, to the extent feasible, in
its GCP, GLP and GMP audit process for any facilities used in the
performance of Development Activities for the Combination Product
(including the facilities of any subcontractors to the extent
permitted pursuant to the terms of the applicable subcontract
or
39
otherwise permitted by the
applicable subcontractor) and shall consider in good faith any
issues concerning such compliance or any safety and efficacy issues
with respect to the Combination Product or the active
pharmaceutical ingredient(s) of the other Member Party’s
Single Agent Product(s) or Double Agent Product, as applicable,
that are raised by the other Member Party on a reasonable basis as
a result of such audits. Each Member Party shall also have
the right, during normal business hours and upon reasonable notice,
to inspect the other Member Party’s facilities (or the
facilities of any subcontractor to the extent permitted pursuant to
the terms of the applicable subcontract or otherwise permitted by
the applicable subcontractor), used in the performance of
Development Activities for the Combination Product, if the Member
Party desiring such inspection has a reasonable basis on which to
raise in good faith any such compliance, safety or efficacy issues
apart from the aforementioned audit inspections. Any audit
referred to in this Section 3.12 shall be subject to
reasonable restrictions on access to confidential information and
trade secrets by the inspecting Member Party to the extent such
confidential information and trade secrets are not expressly
required to be disclosed by such Member Party to the other Member
Party pursuant to this Agreement.
3.13
Medical
Affairs and Medical Communications .
(a)
Gilead and BMS
shall determine independently how to utilize and deploy their
respective medical science liaisons for activities relating to the
Combination Product. The JDC shall develop and approve
presentation materials for use by each Member Party’s medical
science liaisons when engaging in activities to support Promotion
of the Combination Product, and the medical science liaisons shall
use only such approved presentation materials in such
activities. The JDC shall develop, and the Member Parties
shall implement, procedures to coordinate the training of each
Member Party’s medical science liaisons on any approved
presentation materials.
(b)
The JDC shall
develop guidelines and procedures for determining and providing
appropriate responses to medical inquiries about the Combination
Product, including assigning responsibilities for medical
communications. The Parties shall develop a set of standard
response documents for the Member Parties to use in responding to
medical inquiries about the Combination Product, as follows:
(i) each Member Party shall develop standard response documents
relating to their respective Single Agent Product(s) and Double
Agent Product as incorporated in the Combination Product, and (ii)
Gilead shall develop draft standard response documents relating to
the Combination Product as a whole (substantially incorporating
that developed by each Member Party for its Single Agent Product(s)
and/or Double Agent Product), for review, comment and approval by
the JDC.
SECTION 4 .
MANUFACTURING AND SUPPLY
4.1
Clinical
Supply . Gilead shall
Manufacture or have Manufactured through a subcontractor, on behalf
of the JV, clinical supplies of the Combination Product in such
quantities as may be needed for the clinical trials and studies
required to obtain initial Approvals of an NDA. In connection
with such Manufacture, Gilead and BMS each shall donate to the JV
quantities of FTC and TDF, in the case of Gilead, and EFV, in the
case of BMS. Each Member
40
Party’s Cost of Goods
of such supply, as well as Gilead’s Cost of Goods for
Manufacture of the clinical supplies of the Combination Product,
shall not be chargeable to the JV.
4.2
Commercial
Supply .
(a)
The initial
Development Plan designates the initial commercial Supplier of the
Combination Product, which Supplier shall be the source of
Combination Product supply for purposes of the NDA filing and
Launch in the Territory. Within [*] after the Effective Date,
the JCC shall determine the most cost-efficient manner in which to
source the commercial supply of the Combination Product, including,
without limitation, one or more alternate suppliers.
Thereafter, during the term of this Agreement, the JCC shall review
annually the appropriate source(s) of commercial supply of the
Combination Product after Launch and agree upon appropriate
changes. Each Member Party may propose interim changes with
respect thereto from time to time between such reviews, which
changes the JCC shall adopt if failure to do so would be likely to
have a material adverse effect on the Combination Product
business. If Gilead or BMS desires to be considered as a
possible Supplier of the Combination Product, it shall submit a
confidential written proposal to the JV for consideration by the
JCC alongside written proposals submitted by recognized, reliable
and sufficiently capitalized Third Parties and/or the supply terms
pertaining to the initial Supplier. Any proposal submitted by
a possible Supplier shall include an offer to perform any required
tableting, blistering, packaging, labeling, analytical testing and
storage activities with respect to commercial supplies of the
Combination Product. The JCC shall select a Person to supply
the JV with commercial supplies of the Combination Product on the
basis of price, quality, reliability, GMP compliance, security of
supply and other relevant commercial considerations. If a
Third Party is selected as a Supplier, the JCC shall designate a
Member Party to manage the relationship with that Supplier. Any
supply contract between the JV and Gilead or BMS as Supplier shall
be negotiated on an arm’s-length basis and shall contain such
terms and conditions as are customary in the pharmaceutical
industry, modified as appropriate for the Combination
Product.
(b)
The JCC, directly
or through a designated Member Party, and in coordination with the
JDC, shall monitor Manufacturing capacity of, and forecasts and
orders for, the Combination Product submitted to the relevant
Supplier(s) to ensure that adequate commercial supplies of the
Combination Product will be available to meet the demand therefor
as projected by the JCC in commercial unit volume forecasts.
The JCC shall prepare [*] rolling unit volume forecasts
at least [*]
before the
commencement of each forecast period, and shall update such unit
volume forecasts on a [*] basis, or as the JCC deems
necessary and appropriate.
(c)
In connection
with the Manufacture by the Supplier of the commercial supply of
the Combination Product for the JV, Gilead and BMS each shall
supply to the JV quantities of FTC and TDF, in the case of Gilead,
and EFV, in the case of BMS, and in each case in the form of bulk
active pharmaceutical ingredient, pursuant to and in accordance
with their respective Supply Agreements. In consideration of
such supply, the JV shall pay to Gilead and BMS, respectively, the
Gilead Transfer Price and the BMS Transfer Price. The JDC
shall monitor orders under the respective Supply Agreements to
assure consistency in the quantities of FTC, TDF and EFV ordered by
the JV thereunder.
41
SECTION 5.
COMMERCIALIZATION ACTIVITIES
5.1
Co-Promotion
Obligations .
(a)
Gilead and BMS
each shall use Commercially Reasonable Efforts to perform in the
Territory the Commercialization Activities that such Member Party
is required to perform under the Commercialization Plan in
accordance with the Commercialization Budget as applicable to such
activities, for so long as there is a Commercialization Plan in
effect. Each Member Party shall be required, during the
Initial Launch Period and (to the extent there is a
[*] applicable thereto) the
Subsequent Launch Period, to [*] per Calendar Quarter, and
take the other actions, applicable to it as specified in the
Commercialization Plan. Subject to Section 2.10,
[*] shall apply (i) during the
Subsequent Launch Period unless approved by the JEC or JCC as
applicable, as part of a Commercialization Plan update pursuant to
Section 5.11(c), and (ii) after the Subsequent Launch Period
unless approved by the Member Parties. Each Member Party
shall be free to engage in [*] , and to engage in
[*] when there is no longer a
Commercialization Plan in effect, in each case in its sole
discretion.
(b)
Gilead and BMS
shall select independently the target prescribers to which each
shall Promote the Combination Product.
(c)
In accordance
with Section 2.9(b), Gilead and BMS shall each cause its Field
Force to use only the FDA-approved product labels and inserts and,
subject to Section 5.7, the Approved Marketing Materials in
Promoting the Combination Product, and to make only such statements
and claims regarding the Combination Product as are consistent with
Applicable Law and FDA-approved product labels and inserts.
Gilead and BMS shall not provide or give access to samples of the
Combination Product to health care practitioners or patients in
connection with Promotion of the Combination Product.
(d)
Gilead and BMS
shall each Detail the Combination Product and perform its other
Promotional activities under this Agreement in the Territory in
strict adherence to regulatory and professional requirements, and
to all Applicable Law, including, to the extent applicable, the
Act; the FDA Guidance for Industry-Supported Scientific and
Educational Activities; the Pharmaceutical Research and
Manufacturers of America Code on Interactions with Healthcare
Professionals; the Office of Inspector General Compliance Program
Guidance for Pharmaceutical Manufacturers; the American Medical
Association Guidelines on Gifts to Physicians from Industry; the
Pharmaceutical Marketing Research Group Guidelines on market
research activities; the Prescription Drug Marketing Act of 1987,
as amended (“PDMA”); and all federal, state and local
“fraud and abuse,” consumer protection and false claims
statutes and regulations, including but not limited to the Medicare
and State Health Programs Anti-Fraud and Abuse Amendments of the
Social Security Act, the “Safe Harbor Regulations”
found at 42 C.F.R. §1001.952 et seq. As among the
Parties, each Member Party shall treat its sales representatives
engaged in Detailing the Combination Product as its (or its
Affiliate’s) own employees for all purposes, including,
without limitation, federal, state and local tax and employment
laws.
(e)
Within
[*] after the end of each
Calendar Quarter (or part thereof) falling within (i) the Initial
Launch Period, (ii) (to the extent there is a [*] applicable thereto)
the
42
Subsequent Launch Period, or
(iii) any period commencing after the Subsequent Launch Period if
mutually agreed by the Member Parties pursuant to Section 2.10
(clauses (i), (ii) and (iii) being referred to herein collectively
as the “Product Detail Period”), Gilead and BMS shall
each furnish the other Parties with a written report, in the form
set forth in Annex H attached hereto, setting out the number of
Details that it has conducted during such Calendar Quarter (or part
thereof) in the Territory. The number so reported shall be
determined in accordance with applicable self-reporting procedures
for details customarily employed by such Member Party in the
Territory for other similarly detailed and similarly reported HIV
products to the target health care audience, consistently
applied.
(f)
In each Calendar
Year (or part thereof) falling within the Product Detail Period,
subject to the terms of this Section 5.1(f), each Member Party
shall [*] to conduct (x) the
[*] for each Calendar Quarter (or
part thereof) specified in the Commercialization Plan (the
“ [*]
”) and (y)
the [*] for such Calendar Year (or
part thereof) specified in the Commercialization Plan ( i.e
., the [*]
) (the
“ [*]
”).
To the extent that the Product Detail Period includes part but not
all of a Calendar Quarter, then the [*] for such Calendar Quarter
shall be [*]
. If, in
any Calendar Quarter during the applicable Calendar Year,
the [*] of Details conducted by a
Member Party is [*]
for such Calendar
Quarter (such [*]
being a
[ *] ”), such Member Party
may [*] of Details it conducts
[*] , if any, during the
[*] , and in [*] , in each case in order
to [*] some or all of the
[*] . Subject to
Section 5.1(g), if, in any Calendar Year, the
[*] of Details conducted by a
Member Party is [*]
the
[*] for such Calendar Year
(such [*] being a [*] ), then notwithstanding
anything in this Agreement to the contrary, (i) the other Member
Party shall [*]
to such
[*] , and (ii) any failure by a
Member to comply with this Section 5.1(f) which results in
such [*] shall not be subject to
the [*] .
(g)
If, during any
Calendar Quarter, a Member Party expects that it will experience
a [*] for the succeeding Calendar
Quarter (or part thereof), it shall inform the other Member Party
of the anticipated [*]
by written notice
as promptly as practicable but no later than the due date of the
report referred to in Section 5.1(e). The other Member
Party shall have the right to [*] in such succeeding Calendar
Quarter (or part thereof) by up to the anticipated
[*] for such succeeding Calendar
Quarter (or part thereof) by giving notice to the first
Member Party of its intent to do so within [*] of receiving the
notice. For the avoidance of doubt, if the other Member Party
gives such notice and so [*] , the first Member Party
shall [*] to the other Member Party an
amount equal to the product of [*] multiplied by the
[*] multiplied by the
[*] . In any such case,
the [*] of the [*] , if any, under
[*] shall be [*] .
5.2
Distribution
Obligations .
(a)
Gilead shall have
the sole responsibility and right to fill orders with respect to
the Combination Product on behalf of the JV. If for any
reason BMS receives sales orders for the Combination Product, it
shall promptly forward such order to Gilead. An order for the
Combination Product may be rejected by Gilead only if such
rejection is commercially reasonable under the circumstances.
The JCC shall determine how the JV shall respond to requests from
individual patients who have or may obtain prescriptions for the
Combination Product but may be unable to afford it, and from health
care providers on behalf of such patients, including, without
limitation, establishing appropriate procedures and response times
that shall apply in responding to such requests; provided ,
however , that the JCC shall
43
structure the applicable
program in a manner that will make evident to such health care
providers and patients the participation of the JV (and, as
appropriate, each of its Member Parties) in such program and shall
ensure that the procedures and response times are no less favorable
to patients than the most favorable of either Member Party’s
patient assistance programs for its Single Agent Product(s) and/or
Double Agent Product as of the Effective Date. The JCC shall
review the arrangements for the patient assistance program annually
and agree upon appropriate changes. Each Member Party may
propose interim changes with respect thereto from time to time
between such reviews, which changes the JCC shall adopt if failure
to do so would be likely to have a material adverse effect on the
Combination Product business.
(b)
Without
limitation of the foregoing, Gilead shall perform all the functions
of a distributor with respect to sales of the Combination Product
on behalf of the JV, including, without limitation, inventory
management and control, warehousing and distribution, invoicing,
collection of sales proceeds, preparation of sales records and
reports, customer relations and services, and handling of returns,
in accordance with customary practice in the biopharmaceutical
industry, pursuant to a separate Services Agreement to be entered
into by the Parties within [*] of the Effective Date
substantially on the terms outlined in Annex P.
(c)
Gilead’s
relationships with wholesale distributors for the Combination
Product shall be governed by inventory management agreements to
reduce inventory fluctuations to the extent commercially feasible,
and if such agreements do not also cover Gilead’s other
products in the Field, they shall be commercially reasonable
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