<PAGE>
REDACTED COPY
Exhibit 10.11
COLLABORATION AND LICENSE AGREEMENT
by and between
WYETH
acting through its Wyeth Pharmaceuticals Division
and
TRUBION PHARMACEUTICALS, INC.
December 19, 2005
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TABLE OF CONTENTS
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Page
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1.
DEFINITIONS....................................................................................
1
2.
LICENSES.......................................................................................
16
2.1.
Licenses
to
Wyeth......................................................................
16
2.1.1.
Exclusive
Licenses.............................................................
16
2.1.2. Retained Rights
of Trubion.....................................................
17
2.2.
License to
Trubion.....................................................................
17
2.3.
Exclusivity............................................................................
17
2.3.1. CD20 Product
Exclusivity.......................................................
17
2.3.2.
[***]......................................................Error!
Bookmark not defined
2.3.3.
Limitations....................................................................
18
2.4.
Sublicensing...........................................................................
18
2.5.
Direct
Licenses to
Affiliates..........................................................
19
2.6.
Right of
Reference.....................................................................
20
2.7.
Section
365(n) of Bankruptcy
Code......................................................
20
2.8.
No Implied
Rights......................................................................
21
3. RESEARCH
PROGRAM...............................................................................
21
3.1.
Scope and
Conduct of the Research
Program.............................................. 21
3.2.
Designation of
Targets.................................................................
22
3.2.1..................................................................................
22
3.2.2. Released
Targets...............................................................
23
3.2.3. Wyeth
Targets..................................................................
23
3.2.4. Excluded
Targets...............................................................
24
3.3.
Term and
Termination of the Research
Program........................................... 27
3.3.1. Research
Term..................................................................
27
3.3.2. Termination of
Research Program by Wyeth.......................................
27
3.4.
Joint
Research
Committee...............................................................
28
3.4.1.
Composition....................................................................
28
3.4.2.
Responsibilities...............................................................
28
3.4.3.
Meetings.......................................................................
28
3.4.4.
Voting.........................................................................
28
3.4.5. Dispute
Resolution.............................................................
28
3.4.6.
Minutes........................................................................
29
3.5.
Research
Plan..........................................................................
29
3.6.
Funding of
the Research
Program........................................................
29
3.6.1.
Research
Funding...............................................................
29
3.6.2. Reimbursement
Payments.........................................................
30
3.6.3. Records and
Audits.............................................................
30
3.7.
Data and
Deliverables..................................................................
31
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i
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3.8.
Alliance
Managers......................................................................
32
4. PRODUCT
DEVELOPMENT, MANUFACTURING, COMMERCIALIZATION AND REGULATORY
MATTERS................... 32
4.1.
Product
Development....................................................................
32
4.2.
Transfer
of Product Data and
Filings...................................................
33
4.3.
Regulatory
Approvals...................................................................
33
4.4.
Regulatory
Reporting...................................................................
34
4.5.
Progress
Reports.......................................................................
34
4.6.
CD20
Product
Development...............................................................
35
4.7.
Joint
Development
Committee............................................................
36
4.8.
Joint
Project Team; Development
Plan...................................................
37
4.9.
Manufacturing..........................................................................
37
4.10.
Commercialization......................................................................
38
4.11.
Co-Promotion
Option....................................................................
38
4.12.
Co-Promotion
Committee.................................................................
39
4.13.
Co-Branding............................................................................
39
4.14.
Marking................................................................................
39
5.
CONSIDERATION..................................................................................
39
5.1.
Initial
Research and Development Expense
Payment....................................... 39
5.2.
Equity.................................................................................
39
5.3.
Additional
Research and Development Expense
Payments................................... 39
5.4.
Royalties..............................................................................
40
5.4.1. Licensed
Product
Royalties.....................................................
40
5.4.2. CD20 Product
Royalties.........................................................
40
5.4.3.
[***].....................................................Error!
Bookmark not defined
5.4.4. Other Product
Royalties........................................................
45
5.4.5. Expiration of
Royalty Period...................................................
46
5.4.6. Royalty
Adjustments............................................................
46
5.5.
Reports
and
Payments...................................................................
47
5.5.1. Cumulative
Royalties...........................................................
47
5.5.2. Royalty
Statements and
Payments................................................
48
5.5.3. Taxes and
Withholding..........................................................
48
5.5.4.
Currency.......................................................................
49
5.5.5. Additional
Provisions Relating to
Royalties.................................... 49
5.5.6. Interest on
Past Due Payments..................................................
49
5.6.
Maintenance of Records;
Audits.........................................................
49
5.6.1. Record
Keeping.................................................................
49
5.6.2.
Audits.........................................................................
50
5.6.3.
Underpayments/Overpayments.....................................................
50
5.6.4.
Confidentiality................................................................
50
6. INTELLECTUAL
PROPERTY..........................................................................
51
6.1.
Inventions; Joint Patent
Committee.....................................................
51
6.1.1. Ownership and
Inventorship.....................................................
51
6.1.2. SMIP
Improvements..............................................................
51
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ii
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6.1.3. Joint Patent
Committee.........................................................
51
6.2.
Patent
Rights..........................................................................
52
6.2.1. Filing,
Prosecution and Maintenance of Patent
Rights........................... 52
6.2.2. Enforcement of
Patent Rights...................................................
56
6.2.3. Infringement
and Third Party Licenses..........................................
59
6.2.4. Patent
Certifications..........................................................
61
6.2.5. Patent Term
Restoration........................................................
61
6.3.
Trademarks.............................................................................
61
7.
CONFIDENTIALITY................................................................................
61
7.1.
Confidentiality........................................................................
62
7.2.
Authorized
Disclosure and
Use..........................................................
62
7.2.1.
Disclosure.....................................................................
62
7.2.2.
Use............................................................................
63
7.3.
SEC
Filings............................................................................
63
7.4.
Public
Announcements;
Publications.....................................................
64
7.4.1.
Coordination...................................................................
64
7.4.2.
Announcements..................................................................
64
7.4.3.
Publications...................................................................
64
8.
REPRESENTATIONS AND
WARRANTIES.................................................................
65
8.1.
Representations and Warranties of Each
Party........................................... 66
8.2.
Additional
Representations and Warranties of
Trubion................................... 67
8.3.
Mutual
Covenant........................................................................
67
8.4.
Additional
Covenants of
Trubion........................................................
67
8.5.
Representation by Legal
Counsel........................................................
67
8.6.
No
Inconsistent
Agreements.............................................................
67
8.7.
Disclaimer.............................................................................
67
9. GOVERNMENT
APPROVALS; TERM AND
TERMINATION.....................................................
68
9.1.
HSR
Filing.............................................................................
68
9.2.
Other
Government
Approvals.............................................................
68
9.3.
Term...................................................................................
68
9.4.
Termination Upon HSR
Denial............................................................
68
9.5.
Material
Breach........................................................................
68
9.6.
Termination by
Wyeth...................................................................
69
9.6.1. Termination
Without Cause......................................................
70
9.6.2. Termination for
a Material Safety or Regulatory Issue..........................
70
9.7.
Effects of
Termination.................................................................
70
9.7.1. Effect of
Termination by Wyeth for
Cause....................................... 70
9.7.2.
Effect of Termination
by Trubion for Cause.....................................
71
9.7.3. Effect of
Termination by Wyeth Without
Cause................................... 71
9.7.4. Effect of
Termination by Wyeth for a Material Safety or Regulatory
Issue....... 72
9.7.5.
Post-Termination Rights to Wyeth Technology and Trubion
Technology............. 72
9.7.6.
Post-Termination Licenses to Wyeth
Technology.................................. 72
</TABLE>
iii
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9.7.7.
Post-Termination Transfer of Product Data and Filings and Existing
Trademarks.. 72
9.7.8. Manufacturing
of Licensed Products After Termination...........................
73
9.7.9.
Post-Termination Disposition of Inventories of Licensed
Products............... 74
9.7.10. Continuation of Rights and Licenses Under Sections 6.1.1
and 6.1.2............. 74
9.7.11. Continuation of Other Rights and
Obligations................................... 74
9.8.
[***].............................................................Error!
Bookmark not defined
9.9.
Survival
of Certain
Obligations........................................................
74
9.10. Change of
Control......................................................................
75
9.10.1.
Definition.....................................................................
75
9.10.2. Change of Control of
Wyeth.....................................................
76
9.10.3. Change of Control of
Trubion...................................................
78
10. INDEMNIFICATION
AND
INSURANCE..................................................................
78
10.1.
Indemnification by
Wyeth...............................................................
78
10.2.
Indemnification by
Trubion.............................................................
78
10.3.
Procedure..............................................................................
79
10.4.
Insurance..............................................................................
80
11. DISPUTE
RESOLUTION.............................................................................
80
11.1.
General................................................................................
80
11.2. Failure of
Executive Officers to Resolve
Dispute....................................... 80
11.3. Disclaimer
of Consequential and Punitive
Damages....................................... 80
12.
MISCELLANEOUS..................................................................................
80
12.1. Periodic
Executive
Meetings............................................................
80
12.2.
Assignment.............................................................................
81
12.3. Further
Actions........................................................................
81
12.4. Force
Majeure..........................................................................
81
12.5.
Non-Solicitation.......................................................................
82
12.6.
Correspondence and
Notices.............................................................
82
12.6.1. Ordinary
Notices...............................................................
82
12.6.2. Extraordinary
Notices..........................................................
82
12.7.
Amendment..............................................................................
83
12.8.
Waiver.................................................................................
83
12.9.
Severability...........................................................................
84
12.10. Descriptive
Headings...................................................................
84
12.11. Governing
Law..........................................................................
84
12.12. Entire
Agreement of the
Parties........................................................
84
12.13. Independent
Contractors................................................................
84
12.14.
Counterparts...........................................................................
84
</TABLE>
iv
<PAGE>
EXHIBITS
Exhibit 1.122 - TRU-015
Exhibit 1.129 - Trubion Patent Rights
Exhibit 1.132 - Trubion Third Party Agreements
Exhibit 3.2.1 - Trubion's "Milestone One"
Exhibit 3.2.4 - Excluded Targets
Exhibit 4.4 - Adverse Event Reporting Procedures
Exhibit 5.2A - Stock Purchase Agreement
Exhibit 5.2B - Amendment to Investor Rights Agreement
Exhibit 5.3 - Additional Research and Development Expense
Payments
Exhibit 8.2(d) - Third Party Rights
Exhibit 8.2(e) - Government Funding Agreements
v
<PAGE>
REDACTED COPY
COLLABORATION AND LICENSE AGREEMENT
This
Collaboration and License Agreement (the "Agreement") is entered
into
as of December 19, 2005 (the "Signing Date"), by and between Wyeth,
together
with its Affiliates (as defined below), acting through its Wyeth
Pharmaceuticals
Division, a corporation organized and existing under the laws of
the State of
Delaware and having a place of business at 500 Arcola Road,
Collegeville,
Pennsylvania 19426 (collectively, "Wyeth") and Trubion
Pharmaceuticals, Inc.,
together with its Affiliates (as defined below), a corporation
organized and
existing under the laws of the State of Delaware and having a
principal place of
business at 2401 4th Avenue, Suite 1050, Seattle, Washington
98121
(collectively, "Trubion"). Wyeth and Trubion may each be referred
to herein
individually as a "Party" and collectively as the "Parties".
WHEREAS, Wyeth is engaged in the research, development and
commercialization of pharmaceutical and health care products;
WHEREAS, as of the Signing Date, Trubion has developed certain
SMIPs (as
defined below) and CD20 Products (as defined below), as well as
certain Patent
Rights (as defined below) and Know-How (as defined below)
pertaining to
Trubion's SMIP technology platform;
WHEREAS, Wyeth and Trubion desire to collaborate to discover,
research and
develop, and Wyeth desires to research, develop, manufacture and
commercialize,
Licensed Products (as defined below) as provided herein; and
WHEREAS, Wyeth desires to obtain from Trubion, and Trubion desires
to grant
to Wyeth, certain exclusive rights so that Wyeth may develop,
manufacture and
commercialize such Licensed Products, as provided herein.
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 hereby
agree as
follows:
1.
DEFINITIONS.
1.1.
"ADDITIONAL RESEARCH AND DEVELOPMENT EXPENSE PAYMENT" shall have
the
meaning set forth in Section 5.3 hereof.
1.2.
"ADDITIONAL THIRD PARTY LICENSES" shall have the meaning set forth
in
Section 6.2.3(a) hereof.
1.3.
"AFFILIATE(S)" shall mean, with respect to any Person, any
other
Person which controls, is controlled by or is under common
control
with such Person. A Person shall be regarded as in control of
another
entity if it owns
<PAGE>
or controls at least fifty percent (50%) of the equity securities
of
the subject entity entitled to vote in the election of directors
(or,
in the
case of an entity that is not a corporation, for the election
of the corresponding managing authority); provided, however, that
the
term "Affiliate" shall not include subsidiaries or other entities
in
which a Party or its Affiliates owns a majority of the ordinary
voting
power necessary to elect a majority of the board of directors or
other
governing board, but is restricted from electing such majority
by
contract or otherwise, until such time as such restrictions are
no
longer in effect.
1.4.
"AGREEMENT" shall have the meaning set forth in the preamble
hereof.
1.5.
"BANKRUPTCY CODE" shall have the meaning set forth in Section
2.7
hereof.
1.6.
"BLA" shall have the meaning set forth in Section 1.100 hereof.
1.7.
"CALENDAR QUARTER" shall mean the respective periods of three
(3)
consecutive calendar months ending on March 31, June 30, September
30
or December 31, for so long as this Agreement is in effect.
1.8.
"CATEGORY 1 COVERED SMIP IMPROVEMENT" shall have the meaning set
forth
in Section 6.1.3(b) hereof.
1.9.
"CATEGORY 2 COVERED SMIP IMPROVEMENT" shall have the meaning set
forth
in Section 6.1.3(b) hereof.
1.10. "CD20 ANTIGEN" shall mean the human protein antigen that is
known as
CD20, and identified as a full length CD20 protein antigen in
GenBank,
and identified by [***] or [***], and any other protein that [***]
as
the foregoing.
1.11. "CD20 EFFECTIVE ROYALTY RATE" shall have the meaning set
forth in
Section 5.4.2(a) hereof.
1.12. "CD20 PRODUCT" shall mean any TRU-015 Product and/or
Follow-On CD20
Product (as the context requires).
1.13. "CELL LINES" shall mean the cell lines and any other
expression
systems that produce or express any SMIP.
1.14. "CHANGE OF CONTROL" shall have the meaning set forth in
Section
9.10.1 hereof.
1.15. "CLINICAL STUDY SUPPLIES" shall have the meaning set forth in
Section
4.9 hereof.
2
<PAGE>
1.16. "COMBINATION PRODUCT" shall mean any product containing as
active
ingredients both (a) a Product and (b) one or more other
pharmaceutically active compounds or substances.
1.17. "COMBINATION SALE" shall have the meaning set forth in
Section 1.76
hereof.
1.18. "COMMERCIALIZATION" OR "COMMERCIALIZE" shall mean activities
directed
to marketing, promoting, distributing, importing or selling a
product.
Commercialization shall not include any activities related to
Manufacturing or Development.
1.19. "COMMERCIALLY REASONABLE EFFORTS" shall mean, with respect to
the
efforts to be expended by any Party with respect to any
objective,
those reasonable, diligent, good faith efforts to accomplish
such
objective as such Party would normally use to accomplish a
similar
objective under similar circumstances. With respect to any
objective
relating to the Development and/or Commercialization of a
Licensed
Product by any Party, "COMMERCIALLY REASONABLE EFFORTS" shall
mean
those efforts and resources normally used by such Party with
respect
to a product owned or controlled by such Party, or to which such
Party
has similar rights, which product is of similar market potential
and
is at a
similar stage in its development or life as is such Licensed
Product, taking into account issues of safety, efficacy,
product
profile, the competitiveness of the marketplace, the
proprietary
position of the Licensed Product, the regulatory structure
involved,
profitability of the Licensed Product and other relevant
commercial
factors. A "COMMERCIALLY REASONABLE" action or decision of a
Party
refers in this Agreement to an action or decision taken or made
by
such Party using its Commercially Reasonable Efforts.
1.20. "CONFIDENTIAL INFORMATION" of a Party shall mean all Know-How
or
other information, including, without limitation, proprietary
information and materials (whether or not patentable) regarding
such
Party's technology, products, business information or objectives,
that
is communicated in any way or form by the Disclosing Party to
the
Receiving Party, either prior to or after the Effective Date of
this
Agreement, and whether or not such Know-How or other information
is
identified as confidential at the time of disclosure; provided
that,
information not identified as confidential by the Disclosing
Party
shall be deemed to be Confidential Information of the Disclosing
Party
if the Receiving Party knows, or should have had a reasonable
expectation, that the information communicated by the Disclosing
Party
is
Confidential Information of the Disclosing Party. The terms and
conditions of this Agreement shall be considered Confidential
Information of both Parties.
3
<PAGE>
1.21. "CONJUGATE(S)" shall mean SMIP(s) fused genetically or
linked, either
directly or through a linker molecule, with any biological,
cytostatic, cytotoxic or radioactive agent.
1.22. "CONTROL" OR "CONTROLLED" shall mean with respect to any (a)
item of
information, including, without limitation, Know-How, or (b)
intellectual property right, the possession (whether by ownership
or
license, other than pursuant to this Agreement) by a Party of
the
ability to grant to the other Party a license or to extend
other
rights as provided herein, under such item or right without
violating
the terms of any agreement or other arrangements with any Third
Party.
1.23. "CO-PROMOTION" shall mean the joint promotion of a CD20
Product in
the United States by both Parties and/or their respective
Affiliates
under the same CD20 Product Trademark(s). "CO-PROMOTE," when used
as a
verb, shall mean to engage in such Co-Promotion.
1.24. "CO-PROMOTION PERIOD" shall have the meaning set forth in
Section
4.11 hereof.
1.25. "COVERED SMIP IMPROVEMENT" shall have the meaning set forth
in
Section 6.1.2 hereof.
1.26. "DEPOSITED PROTEIN" shall have the meaning set forth in
Section 1.45
hereof.
1.27. "DESIGNATED TARGET(S)" shall have the meaning set forth in
Section
9.8 hereof.
1.28. "DEVELOPMENT" OR "DEVELOP" shall mean non-clinical and
clinical drug
development activities pertaining to a product, including,
without
limitation, toxicology, pharmacology, test method development
and
stability testing, process development, formulation
development,
delivery system development, quality assurance and quality
control
development, statistical analysis, clinical studies (including
pre-
and post-approval studies), regulatory affairs, pharmacovigilance
and
Regulatory Approval and clinical study regulatory activities
(including regulatory activities directed to obtaining pricing
and
reimbursement approvals).
1.29. "DEVELOPMENT PLAN" shall mean the written plan for the
Development of
CD20 Products described in Section 4.8 hereof.
1.30. "DISCLOSING PARTY" shall have the meaning set forth in
Section 7.1
hereof.
1.31. "EFFECTIVE DATE" shall mean the later to occur of (a) the
Signing
Date and (b) the HSR Clearance Date.
4
<PAGE>
1.32. "EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as
amended.
1.33. "EXCLUDED TARGET(S)" shall mean the Target(s) described in
Section
3.2.4 hereof as Excluded Target(s).
1.34. "EXCLUSIVITY COVENANTS" shall have the meaning set forth in
Section
9.10.2(c) hereof.
1.35. "EXECUTIVE OFFICERS" shall mean the President of Wyeth
Pharmaceuticals (or an executive officer of Wyeth designated by
such
President of Wyeth Pharmaceuticals) and the Chief Executive Officer
of
Trubion (or an executive officer of Trubion designated by such
Chief
Executive Officer).
1.36. "EXERCISE NOTICE" shall have the meaning set forth in
Section
9.10.2(c) hereof.
1.37. "EXISTING ACTIVITIES" shall have the meaning set forth in
Section
9.10.2(c) hereof.
1.38. "EXISTING TRADEMARKS" shall have the meaning set forth in
Section
9.7.1(a).
1.39. "FDA" shall mean the United States Food and Drug
Administration or
any successor agency thereto.
1.40. "FD&C ACT" shall mean the United States Federal Food,
Drug, and
Cosmetic Act (21 U.S.C. Section 301 et seq.), as amended, and
the
rules and regulations promulgated thereunder.
1.41. "FIRST COMMERCIAL SALE" shall mean, with respect to a given
Licensed
Product and any country in the Territory, the first sale or
transfer
for value of such Licensed Product under this Agreement by Wyeth
or
its sublicensees to a Third Party in such country following receipt
of
marketing authorization from the appropriate Regulatory
Authority
permitting
commercial sale of such Licensed Product in such country.
1.42. "FOLLOW-ON CD20 PRODUCT" shall mean any product containing
a
Follow-On CD20 SMIP.
1.43. "FOLLOW-ON CD20 SMIP" shall mean any SMIP (other than
TRU-015)
directed against the CD20 Antigen or a portion thereof.
1.44. "FTE" shall mean a full time equivalent scientific person
(M.S. or
Ph.D. level) year, consisting of a minimum of a total of one
thousand
eight hundred eighty (1,880) hours per year of scientific work by
an
employee of Trubion on or directly related to and in support of
the
Research Program.
5
<PAGE>
Work on or directly related to the Research Program can include,
but
is not limited to, experimental preclinical laboratory and
research
work, recording and writing up results, reviewing literature
and
references, holding scientific discussions, managing and
leading
scientific staff and carrying out management duties, in each
case
where such activities are directly related to the Research
Program.
1.45. [***]
1.46. [***]
1.47. [***]
1.48. [***]
1.49. [***]
1.50. "HSR ACT" shall mean the Hart-Scott-Rodino Antitrust
Improvements Act
of 1976, as amended, and the rules and regulations promulgated
thereunder.
1.51. "HSR FILING" shall mean filings by Wyeth and Trubion with the
United
States Federal Trade Commission and the Antitrust Division of
the
United States Department of Justice of a Notification and Report
Form
for Certain Mergers and Acquisitions (as that term is defined in
the
HSR Act) with respect to the matters set forth in this
Agreement,
together with all required documentary attachments thereto.
1.52. "HSR CLEARANCE DATE" shall mean the earliest date on which
the
Parties have actual knowledge that all applicable waiting
periods
under the HSR Act with respect to the transactions contemplated
hereunder have expired or have been terminated.
1.53. "IND" shall mean an Investigational New Drug Application, as
defined
in the FD&C Act, that is required to be filed with the FDA
before
beginning clinical testing of a Licensed Product in human subjects,
or
an equivalent foreign filing.
1.54. "INDEMNIFIED PARTY" shall have the meaning set forth in
Section 10.3
hereof.
1.55. "INDEMNIFYING PARTY" shall have the meaning set forth in
Section 10.3
hereof.
1.56. "INITIAL TERM" shall have the meaning set forth in Section
3.3.1
hereof.
1.57. "JDC" shall have the meaning set forth in Section 4.7
hereof.
6
<PAGE>
1.58. "JOINT INVENTION(S)" shall have the meaning set forth in
Section
6.1.1 hereof.
1.59. "JOINT KNOW-HOW" shall mean that Know-How related to the
Licensed
Products that is jointly owned by the Parties in accordance
with
Section 6.1.1 of this Agreement.
1.60. "JOINT PATENT COMMITTEE" shall mean the committee described
in
Section 6.1.3 hereof.
1.61. "JOINT PATENT RIGHT(S)" shall mean those Patent Right(s) that
claim
Joint Know-How or Joint Invention(s).
1.62. "JOINT TECHNOLOGY" shall mean the Joint Patent Rights, the
Joint
Inventions and the Joint Know-How.
1.63. "JPT" shall have the meaning set forth in Section 4.8
hereof.
1.64. "JRC" shall have the meaning set forth in Section 3.4.1
hereof.
1.65. "JRC LIAISON" shall mean a JRC member designated by a Party
as its
"JRC Liaison" in accordance with Section 3.4.3 hereof.
1.66. "KNOW-HOW" shall mean inventions, discoveries, data,
information,
processes, methods, techniques, materials, technology, results
or
other know-how, whether or not patentable.
1.67. "LIABILITIES" shall have the meaning set forth in Section
10.1
hereof.
1.68. "LICENSED PRODUCT(S)" shall mean any Product(s) or
Combination
Product(s).
1.69. "LICENSED TARGET(S)" shall mean any Trubion Target(s) or
Wyeth
Target(s), so long as they remain the subject of the licenses
granted
to Wyeth under this Agreement.
1.70. "MAJOR INDICATION(S)" shall mean, with respect to any CD20
Product,
any indication with a prevalence-based patient population of at
least
[***] patients in the United States, including, without
limitation,
[***].
1.71. "MAJOR MARKET COUNTRY" shall mean any of the United States,
the
United Kingdom, France, Germany, Italy, Spain or Japan.
1.72. "MANUFACTURING" or "MANUFACTURE" shall mean activities
directed to
producing, manufacturing, processing, filling, finishing,
packaging,
labeling, quality assurance testing and release, shipping and
storage
of a product.
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1.73. "NCBI" shall have the meaning set forth in Section 3.2.1
hereof.
1.74. "NDA" shall have the meaning set forth in Section 1.100
hereof.
1.75. "NET COMBINATION SALE AMOUNT" shall have the meaning set
forth in
Section 1.76 hereof.
1.76. "NET SALES" shall mean the gross amounts charged for sales
of
Licensed Products (on which payments are due under this Agreement)
by
Wyeth or its sublicensees to Third Parties, less the sum of (a)
and
(b) where (a) is a provision, determined under Generally
Accepted
Accounting Principles in the United States and in accordance
with
Wyeth's customary and usual accrual procedures, consistently
applied,
for the accrual of (i) trade, cash, quantity and wholesaler
discounts
or rebates (other than price discounts granted at the time of
sale),
if any, allowed or paid, (ii) credits or allowances given or made
for
rejection or return of, previously sold Licensed Products or
for
retroactive price reductions (including Medicaid, managed care
and
similar types of rebates), (iii) taxes, duties or other
governmental
charges levied on or measured by the billing amount (excluding
income
and franchise taxes), as adjusted for rebates and refunds, and
(iv)
charges for packing, freight, and shipping to the extent included
in
the invoice price and (b) is a periodic adjustment (positive or
negative, as applicable), determined under Generally Accepted
Accounting Principles in the United States and in accordance
with
Wyeth's customary and usual adjustment procedures, consistently
applied, of the provision determined in (a) to reflect amounts
actually incurred for (i), (ii), (iii) and (iv) based on
amounts
actually invoiced or as separately set forth in agreements with
Third
Parties or as deducted or paid as required by applicable law or
regulations. (The deductions described in (i), (ii), (iii) and
(iv)
are referred to herein as "Permitted Deductions.") In the case of
any
sale of Licensed Products for consideration other than cash, Net
Sales
shall be calculated on the fair market value of the
consideration
received.
Notwithstanding the foregoing, if a Licensed Product is sold as
a
Combination Product (a "Combination Sale"), the Net Sales for
such
Combination Product shall be the portion of such Combination
Sale
allocable to the Licensed Product determined as follows:
Except as provided below, the Net Sales amount for a Combination
Sale
shall equal the gross amount invoiced for the Combination Sale,
reduced by the Permitted Deductions (the "Net Combination Sale
Amount"), multiplied by the fraction A/(A+B), where:
A is the invoice price, in the country where such Combination
Sale occurs, of the Licensed Product contained in the
Combination
Product, if sold as a separate product in such country by Wyeth
or
8
<PAGE>
its sublicensees, as the case may be, and B is the aggregate of
the invoice price or prices, in such country, of products which
collectively contain as their respective sole active ingredient
such other pharmaceutically active compounds or substances, as
the case may be, included in the Combination Product, if sold
separately
in such country by Wyeth or its sublicensees, as
applicable.
In the event that Wyeth or its sublicensees sell the Licensed
Product
included in a Combination Product as a separate product in a
country,
but do not separately sell all of the other pharmaceutically
active
compounds or substances, as the case may be, included in such
Combination Product in such country, the calculation of the Net
Sales
amount for such Combination Sale shall be determined by
multiplying
the Net Combination Sale Amount by the fraction A/C where:
A is the average wholesale price, in such country, charged by
Wyeth or its sublicensees, as the case may be, for the Licensed
Product contained in such Combination Product, when sold as a
separate product by Wyeth or its sublicensees, as applicable,
and
C is the average wholesale price, in such country, charged by
Wyeth or its sublicensees, as applicable, for the entire
Combination Product.
In the event that Wyeth or its sublicensees do not sell the
Licensed
Product included in a Combination Product as a separate product in
a
country where such Combination Sale occurs, but do separately
sell
products which collectively contain as their respective sole
active
ingredient all of the other pharmaceutically active compounds
or
substances, as the case may be, included in the Combination Product
in
such country, the calculation of Net Sales resulting from such
Combination Sale shall be determined by multiplying the Net
Combination Sale Amount by the fraction (C-D)/C, where:
C is the average wholesale price, in such country, charged by
Wyeth or its sublicensees, as the case may be, for the entire
Combination Product, and D is the average wholesale price
charged
by Wyeth or its sublicensees, as the case may be, for the
products which collectively contain as their sole active
ingredient such other pharmaceutically active compounds or
substances, as the case may be, included in the Combination
Product.
Where active ingredient portions of a Combination Product are
sold
separately as other products but in different dosage strengths
than
are in the Combination Product, the calculation of the Net
Sales
amount for such Combination Product shall be based on
appropriate
proration of the
9
<PAGE>
amounts of each active ingredient component included therein
when
applying the formulas set forth above.
Where the calculation of Net Sales resulting from a Combination
Sale
in a country cannot be determined by any of the foregoing methods,
the
calculation of Net Sales for such Combination Sale shall be
that
portion of the Net Combination Sale Amount reasonably determined
in
good faith by the Parties as properly reflecting the value of
the
Licensed Product included in the Combination Product.
Notwithstanding the foregoing, Net Sales shall not include any
reimbursement received by Wyeth or its sublicensees in respect of
the
use of a Licensed Product in a country solely as part of a
clinical
trial prior to the receipt of marketing authorization required
to
commence commercial sales of such Licensed Product in such
country.
1.77. "NEW PROTEIN" shall have the meaning set forth in Section
1.45
hereof.
1.78. "NICHE INDICATION(S)" shall mean, with respect to any CD20
Product,
any indication, including, but not limited to, [***], for such
CD20
Product other than a Major Indication.
1.79. "NOTICE OF BREACH" shall have the meaning set forth in
Section 9.5
hereof.
1.80. "NOTICE OF MODIFICATION" shall have the meaning set forth in
Section
9.5 hereof.
1.81. "NOTICE OF TERMINATION" shall have the meaning set forth in
Section
9.5 hereof.
1.82. "OTHER PRODUCT" shall mean any product containing a SMIP
directed
against a Wyeth Target or a portion thereof.
1.83. "PART(Y/IES)" shall have the meaning set forth in the
preamble
hereof.
1.84. "PATENT RIGHTS" shall mean any and all (a) patents, (b)
pending
patent applications, including, without limitation, all
provisional
applications, substitutions, continuations,
continuations-in-part,
divisions, renewals, and all patents granted thereon, (c) all
patents-of-addition, reissues, reexaminations and extensions or
restorations by existing or future extension or restoration
mechanisms, including, without limitation, supplementary
protection
certificates or the equivalent thereof, (d) inventor's
certificates,
and (e) all United States and foreign counterparts of any of
the
foregoing.
1.85. "PERSON" shall mean an individual, sole proprietorship,
partnership,
limited partnership, limited liability partnership,
corporation,
limited liability
10
<PAGE>
company, business trust, joint stock company, trust,
incorporated
association, joint venture or similar entity or organization,
including a government or political subdivision, department or
agency
of a government.
1.86. "PERMITTED DEDUCTION" shall have the meaning set forth in
Section
1.76 hereof.
1.87. "PHASE I CLINICAL STUDY" shall mean a study of a Licensed
Product in
human subjects with the endpoint of determining initial
tolerance,
safety or pharmacokinetic information in single dose, single
ascending
dose, multiple dose and/or multiple ascending dose regimens.
1.88. "PHASE II CLINICAL STUDY" shall mean a study of a Licensed
Product in
human patients to determine initial efficacy and dose range
finding
before embarking on Phase III Clinical Studies.
1.89. "PHASE IIA CLINICAL STUDY" shall mean Trubion's TRU-015
Protocol
15001.
1.90. "PHASE IIB CLINICAL STUDY" shall mean Trubion's TRU-015
Protocol
15002.
1.91. "PHASE III CLINICAL STUDY" shall mean a pivotal study
(whether or not
denominated a "Phase III" clinical study under applicable
regulations)
in human patients with a defined dose or a set of defined doses of
a
Licensed Product designed to ascertain efficacy and safety of
such
Licensed Product for the purpose of enabling the preparation
and
submission of Regulatory Approval Applications to the competent
Regulatory Authorities in a country of the Territory.
1.92. "PREVIOUSLY DEPOSITED PROTEIN" shall have the meaning set
forth in
Section 3.2.4(b) hereof.
1.93. "PRODUCT" shall mean any CD20 Product, [***], or Other
Product, or
any Conjugate of any CD20 Product, [***], or Other Product.
1.94. "PRODUCT DATA AND FILINGS" shall mean (a) all clinical
protocols,
studies, clinical data and results used in or resulting from
any
clinical trial of any Licensed Product and (b) all INDs,
Regulatory
Approval Applications and Regulatory Approvals regarding any
Licensed
Product.
1.95. "PRODUCT LICENSE" shall have the meaning set forth in Section
2.1.1
hereof.
1.96. "PRODUCT-RELATED PATENT RIGHTS" shall have the meaning set
forth in
Section 6.2.1(a) hereof.
11
<PAGE>
1.97. "PROVISIONAL EXCLUDED TARGET" shall mean a Target described
in
Section 3.2.4 hereof as a Provisional Excluded Target.
1.98. "RECEIVING PARTY" shall have the meaning set forth in Section
7.1
hereof.
1.99. "RECOMBINANT DNA" shall mean the DNA sequences encoding any
SMIP
including, without limitation, any DNA plasmid expression
construct
encoding any such SMIP.
1.100. "REGULATORY APPROVAL" shall mean the technical, medical
and
scientific licenses, registrations, authorizations and
approvals
(including, without limitation, approvals of New Drug
Applications
("NDAs") or Biologic License Applications ("BLAs"), supplements
and
amendments, pre- and post- approvals, pricing approvals, and
labeling
approvals) of any national, supra-national, regional, state or
local
regulatory agency, department, bureau, commission, council or
other
governmental entity, necessary for the commercial Manufacture,
distribution, marketing, promotion, offer for sale, use,
import,
export and sale of Licensed Product(s) in a regulatory jurisdiction
in
the Territory. For the sake of clarity, Regulatory Approval shall
not
be deemed to have been obtained in a country other than the
United
States until any applicable governmental pricing approvals have
also
been obtained in such country. Regulatory Approval of a
Licensed
Product shall be deemed to have been obtained in the United
States
immediately upon BLA approval for such Licensed Product in the
United
States.
1.101. "REGULATORY APPROVAL APPLICATION" shall mean an
application
submitted to the appropriate Regulatory Authority seeking
Regulatory
Approval of a Licensed Product for use in one or more
therapeutic
indications in a regulatory jurisdiction within the Territory.
1.102. "REGULATORY AUTHORIT(Y/IES)" shall mean any national (e.g.,
the
FDA), supra-national (e.g., the European Commission, the Council
of
the European Union, or the European Agency for the Evaluation
of
Medicinal Products), regional, state or local regulatory
agency,
department, bureau, commission, council or other governmental
entity
in each country of the Territory involved in the granting of
Regulatory Approval for a Licensed Product.
1.103. "RELEASED TARGET" shall have the meaning set forth in
Section 3.2.2
hereof.
1.104. "REPLACEMENT TARGET" shall have the meaning set forth in
Section
3.2.3 hereof.
1.105. "RESEARCH
BUDGET" shall have the meaning set forth in Section 3.5
hereof.
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<PAGE>
1.106. "RESEARCH PLAN" shall mean the written plan for the conduct
of the
Research Program described in Section 3.5 hereof as approved
and
amended by the Parties in accordance with Section 3.5 hereof.
1.107. "RESEARCH PROGRAM" shall have the meaning set forth in
Section 3.1
hereof.
1.108. "RESEARCH PROGRAM DATA" shall have the meaning set forth in
Section
3.7 hereof.
1.109. "RESEARCH TERM" shall have the meaning set forth in Section
3.3.1
hereof.
1.110. "ROYALTY PERIOD" shall mean the period of time beginning on
the date
of the First Commercial Sale of a Licensed Product in any country
and,
on a Licensed Product-by-Licensed Product and
country-by-country
basis, extending until the earlier of (a) the termination of
this
Agreement pursuant to Article 9 hereof with respect to such
Licensed
Product in such country or (b) the later of (i) the date on which
the
last Valid Claim included within the Trubion Technology ceases to
be a
Valid Claim, which Valid Claim would be infringed by the
composition,
Manufacture, use, sale, offer for sale or importing of such
Licensed
Product in such country, or (ii)(A) with respect to CD20 Products,
the
[***] anniversary of the First Commercial Sale for the first
Major
Indication of such CD20 Product in such country (provided,
however,
that if such CD20 Product has received Regulatory Approval for a
Niche
Indication in such country but has not received Regulatory
Approval
for a Major Indication in such country, the Royalty Period as
defined
under and for purposes of this clause (ii)(A) for such CD20 Product
in
such country shall be suspended beginning on the [***] anniversary
of
the First Commercial Sale of such CD20 Product in such country
until
such time, if at all, as Regulatory Approval has been obtained
permitting the marketing of such CD20 Product for a Major
Indication
in such country, at which point such Royalty Period shall
commence
with respect to such CD20 Product for a Major Indication) and (B)
with
respect to each other Licensed Product, the [***] anniversary of
the
First Commercial Sale of such Licensed Product in such country.
1.111. "SIGNING DATE" shall have the meaning set forth in the
preamble
hereof.
1.112. "SMIP(S)" or small modular immuno-pharmaceutical(s) shall
mean a
single chain polypeptide that (i) [***] (ii) binds with specificity
to
a target antigen, (iii) has a binding domain, and (iv) may have
an
effector domain which may or may not have effector function,
[***].
1.113. "SMIP IMPROVEMENT" shall mean an invention consisting of
any
modification to the polynucleotide sequence encoding or the amino
acid
13
<PAGE>
sequence of a SMIP, if the practice of such invention would
infringe
Patent Rights Controlled by Trubion at the time such invention
is
made.
1.114. [***].
1.115. "SUCCESSOR PARTY" shall have the meaning set forth in
Section
9.10.2(a) hereof.
1.116. "SUED PARTY" shall have the meaning set forth in Section
6.2.3(b)
hereof.
1.117. "TARGET" shall mean [***].
1.118. "TARGET CANDIDATE" [***].
1.119. "TERRITORY" shall mean the entire world.
1.120. "THIRD PART(Y/IES)" shall mean any Person(s) other than
Wyeth or
Trubion.
1.121. "TRADEMARK" shall mean those trademarks used in connection
with the
Commercialization of any Licensed Product by Wyeth or its
sublicensees
hereunder.
1.122. "TRU-015" shall mean the chimeric SMIP directed against the
CD20
Antigen that is currently designated by Trubion as "TRU-015,"
as
further described on Exhibit 1.122 attached hereto.
1.123. "TRU-015 PRODUCT" shall mean any product containing
TRU-015.
1.124. "TRUBION" shall have the meaning set forth in the preamble
hereof.
1.125. "TRUBION ADDITIONAL THIRD PARTY LICENSE" shall have the
meaning set
forth in Section 6.2.3(a) hereof.
1.126. "TRUBION INDEMNIFIED PARTY" shall have the meaning set forth
in
Section 10.1 hereof.
1.127. "TRUBION KNOW-HOW" shall mean any Know-How, other than the
Joint
Know-How, that (a) Trubion Controls as of the Effective Date or
that
comes into the Control of Trubion during the term of this
Agreement
(other than through the grant of a license by Wyeth) and (b)
relates
to any Cell Lines, Conjugates, Licensed Products, Recombinant
DNA,
SMIPs, Licensed Targets, Target Candidates or the Development,
Manufacture or use of any of the foregoing.
1.128. "TRUBION LAWYERS" shall have the meaning set forth in
Section 3.2.1
hereof.
14
<PAGE>
1.129. "TRUBION PATENT
RIGHTS" shall mean Patent Rights, other than Joint
Patent Rights, that (a) Trubion Controls as of the Effective Date
or
that come into the Control of Trubion during the term of this
Agreement and (b) claim any Trubion Know-How. Those Trubion
Patent
Rights known to be existing as of the Signing Date are listed
on
Exhibit 1.129 attached hereto.
1.130. "TRUBION TARGET" shall mean each of the human CD20 Antigen
and/or
[***], as the context may require.
1.131. "TRUBION TECHNOLOGY" shall mean Trubion's interest in the
Trubion
Patent Rights, the Trubion Know-How, the Joint Technology and
the
Research Program Data.
1.132. "TRUBION THIRD PARTY AGREEMENT(S)" shall mean the
agreements
specified on Exhibit 1.132 between Trubion and the indicated
Third
Parties that relate to the research, Development, Manufacture
and/or
Commercialization of Licensed Products under this Agreement.
1.133. "U.S. WYETH PHARMACEUTICALS" shall have the meaning set
forth in
Section 12.5 hereof.
1.134. "VALID CLAIM" shall mean a claim that (a) in the case of
any
unexpired United States or foreign patent, shall not have been
dedicated to the public, disclaimed, nor held invalid or
unenforceable
by a court or government agency of competent jurisdiction in an
unappealed or unappealable decision, or (b) in the case of any
United
States or foreign patent application, (i) shall not have been
cancelled, withdrawn or abandoned, without being refiled in
another
application in the applicable jurisdiction, (ii) shall not have
been
finally rejected by an administrative agency or other
governmental
action from which no appeal can be taken and (iii) shall not have
been
pending for more than [***], in either case which claim (if
issued)
would cover the Manufacture, use or sale of any Licensed Product.
For
purposes of this definition, the time period for which a claim
is
pending shall begin on the priority date for such claim, and
shall
continue until such claim is either issued or is no longer deemed
to
be a
Valid Claim in accordance with the preceding sentence
regardless
of whether such claim is amended or refiled in another application
in
the applicable jurisdiction. If a claim of a patent application
which
ceased to be a Valid Claim under (b) due to the passage of time
later
issues as part of a patent described within (a) then it shall again
be
considered to be a Valid Claim effective as of the issuance of
such
patent.
1.135. "WYETH" shall have the meaning set forth in the preamble
hereof.
1.136. "WYETH APPLIED TECHNOLOGY" shall mean, with respect to any
Licensed
Product, that Wyeth Technology which (a) Wyeth had applied to
such
15
<PAGE>
Licensed Product prior to any termination of any rights under
this
Agreement with respect to such Licensed Product, provided that
such
Wyeth Technology is necessary or useful for the continued
research,
Development, Manufacture or Commercialization of such Licensed
Product
as it exists at the time of such termination, or (b) Wyeth had
incorporated into such Licensed Product prior to any termination
of
rights under this Agreement with respect to such Licensed
Product;
provided that Wyeth shall use its Commercially Reasonable Efforts
to
sublicense or otherwise transfer rights under any Third-Party
license
to which the use or exploitation of such Wyeth Applied Technology
is
subject; and further provided, however, that with respect to each
of
clauses (a) and (b) of this Section 1.136, such Wyeth Technology
shall
not include any of Wyeth's conjugation technology.
1.137. "WYETH INDEMNIFIED PARTY" shall have the meaning set forth
in
Section 10.2 hereof.
1.138. "WYETH KNOW-HOW" shall mean any Know-How, other than the
Joint
Know-How, that (a) Wyeth Controls as of the Effective Date or
that
comes into the Control of Wyeth (other than as a result of the
licenses granted by Trubion to Wyeth under Section 2.1 hereof)
during
the term of this Agreement and (b) relates to the Cell Lines,
Conjugates, Recombinant DNA, Licensed Products, SMIPs, Target
Candidates or Licensed Targets or the Development, Manufacture, use
or
Commercialization of any of the foregoing.
1.139. "WYETH PATENT RIGHTS" shall mean Patent Rights, other than
the Joint
Patent Rights, that (a) Wyeth Controls as of the Effective Date
or
that come into the Control of Wyeth (other than as a result of
the
licenses granted by Trubion to Wyeth under Section 2.1 hereof)
during
the term of this Agreement and (b) claim any Wyeth Know-How.
1.140. "WYETH TARGETS" shall mean the Targets designated by Wyeth
under the
Research Program, as described in Section 3.2 hereof.
1.141. "WYETH TECHNOLOGY" shall mean Wyeth's interest in the Wyeth
Patent
Rights, the Wyeth Know-How, the Joint Technology and the
Research
Program Data.
2. LICENSES.
2.1.
LICENSES TO WYETH.
2.1.1. EXCLUSIVE LICENSES. Subject to the terms and conditions of
this
Agreement, Trubion, effective as of the Effective Date, hereby
grants to Wyeth an exclusive license (exclusive even as to
Trubion,
16
<PAGE>
except to the extent necessary for Trubion to perform its
obligations under this Agreement), with the right to grant
sublicenses in accordance with the provisions of Section 2.4
hereof, under the Trubion Technology, to research, Develop,
have
Developed, make, have made, Manufacture, use, have used,
import,
have imported, export, have exported, distribute, have
distributed, market, have marketed, offer and have offered for
sale, sell, have sold and Commercialize (subject to Section
4.11)
Licensed Products in the Territory (the license granted under
this Section 2.1.1 is sometimes referred to herein as the
"Product License").
2.1.2. RETAINED RIGHTS OF TRUBION. For the avoidance of doubt,
but
subject to Sections 2.3 and 3.2 hereof, Trubion shall retain:
(a)
all rights under the Trubion Technology with respect to the
research, Development, Manufacture, use and Commercialization
of
SMIPs that (i) [***] to Targets that are not Licensed Targets
and
(ii) do not [***] to any Licensed Targets; and (b) the right to
use SMIPs which [***] to one or more Licensed Targets in in
vitro
studies conducted solely as part of Trubion's internal research
efforts, provided, however, that Trubion shall not provide any
such SMIP (that [***] to a Licensed Target) to any Third Party
or
utilize any such SMIP (that [***] to a Licensed Target) in a
collaboration with any Third Party, except with Wyeth's prior
written
consent.
2.2.
LICENSE TO TRUBION. Wyeth hereby grants to Trubion a
royalty-free
non-exclusive license, with no right to grant sublicenses, under
the
Wyeth Technology, solely for the purpose of, and limited to,
Trubion's
use of the Wyeth Technology in connection with the Trubion
Technology
to research, Develop, have Developed, make, have made, use and
have
used Licensed Products to fulfill its obligations under this
Agreement. In addition, Wyeth hereby grants to Trubion the
non-exclusive license under Wyeth's rights to Covered SMIP
Improvements as set forth in greater detail in Section 6.1.2.
2.3.
EXCLUSIVITY.
2.3.1. CD20 PRODUCT EXCLUSIVITY. Subject to Section 2.3.3, and
except
for Development of the CD20 Products pursuant to the terms of
this Agreement, neither Party shall Develop any human
therapeutic
product that contains a protein that [***] to the CD20 Antigen
during the time period beginning on the Effective Date and
ending
on the earlier of: (a) the First Commercial Sale of any CD20
Product for a Major Indication in a Major Market Country or (b)
the termination of the licenses granted by Trubion to Wyeth
under
this Agreement with respect to all CD20 Products.
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<PAGE>
Subject to Section 2.3.3, and except for Commercialization of
the
CD20 Products pursuant to the terms of this Agreement, neither
Party shall Commercialize any human therapeutic product that
contains a protein that [***] to the CD20 Antigen during the
time
period beginning on the Effective Date and ending on the
earlier
of (a) five (5) years after the First Commercial Sale of any
CD20
Product for a Major Indication in a Major Market Country or (b)
the termination of the licenses granted by Trubion to Wyeth
under
this Agreement with respect to all CD20 Products.
2.3.2. [***] EXCLUSIVITY. Subject to Section 2.3.3, and except
for
Development of
the [***] pursuant to the terms of this Agreement,
neither Party shall Develop any human therapeutic product that
contains a protein that [***] to the [***] during the time
period
beginning on the Effective Date and ending on the earlier of:
(a)
the First Commercial Sale of any [***] in any Major Market
Country or (b) the termination of the licenses granted by
Trubion
to Wyeth under this Agreement with respect to all [***].
Subject to Section 2.3.3, and except for Commercialization of
the
[***] pursuant to the terms of this Agreement, neither Party
shall Commercialize any human therapeutic product that contains
a
protein that [***] to the [***] during the time period
beginning
on the Effective Date and ending on the earlier of: (a) five
(5)
years after the First Commercial Sale of any [***] in any Major
Market Country or (b) the termination of the licenses granted
by
Trubion to Wyeth under this Agreement with respect to all
[***].
2.3.3. LIMITATIONS. The exclusivity provisions of Sections 2.3.1
and
2.3.2 above (a) shall not apply to Wyeth's Manufacture of any
product for a Third Party pursuant only to a contract
manufacturing or supply agreement between Wyeth and such Third
Party where Wyeth is acting only as a contract manufacturer or
supplier for such Third Party, (b) shall in no way limit any of
the licenses granted by Trubion to Wyeth under Section 2.1
hereof, and (c) shall in no way limit any of the retained
rights
of Trubion set forth in Section 2.1.2 hereof.
2.4.
SUBLICENSING. Wyeth may grant to one or more Third Parties
sublicenses
of the rights granted to it under Section 2.1 hereof at any
time;
provided that Wyeth shall execute a written agreement with each
such
sublicensee and shall comply with the following: Each such
sublicense
(a) shall be subject and subordinate to, and consistent with,
the
terms and conditions of this Agreement, (b) shall not in any
way
diminish, reduce or eliminate any of Wyeth's obligations under
this
Agreement, (c) shall require each such sublicensee to comply with
all
applicable terms of this Agreement,
18
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including to keep books and records, and permit Wyeth to audit
(either
directly or through an independent auditor) such books and
records,
and (d) shall provide that any such sublicensee shall not
further
sublicense except on terms consistent with this Section 2.4.
Wyeth
shall provide Trubion with a copy of each such sublicense
agreement
within thirty (30) days after the execution thereof. Such copy may
be
redacted to exclude confidential, non-Licensed Product-related
information and financial information (other than such
financial
information that is necessary for assessing the obligations to
Trubion
under this Agreement). Upon Trubion's request and at Trubion's
expense, Wyeth shall exercise its right to conduct an audit of
a
sublicensee's books and records pertaining to the sale of a
Licensed
Product under any such sublicense agreement at the next time
that
conducting such an audit is permissible under such sublicense
agreement. Wyeth shall provide Trubion with a copy of the report
of
the findings made in any such audit. If such audit reveals that
such
sublicensee has understated its Net Sales by [***] or more,
Wyeth
shall be responsible for the costs of the audit. Wyeth shall
remain
responsible for its obligations hereunder and for the performance
of
its sublicensees (including, without limitation, making all
payments
due Trubion by reason of any Net Sales of Licensed Products),
and
shall ensure that any such sublicensees comply with all
relevant
provisions of this Agreement. In the event of any uncured
material
breach by any sublicensee under a sublicense agreement that
would
constitute a breach of Wyeth's obligations under this Agreement,
Wyeth
will promptly inform Trubion in writing and shall take such
action
which in Wyeth's reasonable business judgment will address such
default; provided, however, any such uncured material breach by
such
sublicensee of an obligation that would constitute a breach of
Wyeth's
obligations under this Agreement shall be deemed an uncured
material
breach of Wyeth hereunder unless Wyeth cures such material
breach
within the time provided under Section 9.5 hereof.
2.5.
DIRECT LICENSES TO AFFILIATES. Wyeth may at any time request
and
authorize Trubion to grant licenses within the scope of Section
2.1
directly to Affiliates of Wyeth by giving written notice
designating
to which Affiliate a direct license is to be granted. Upon receipt
of
any such notice, Trubion shall enter into and sign a separate
direct
license agreement with such designated Affiliate of Wyeth. All
such
direct license agreements shall be consistent with the terms
and
conditions of this Agreement, except for such modifications as may
be
required by the laws and regulations in the country in which
the
direct license will be exercised; provided, however, that
Trubion
shall have no obligation to enter into any such direct license
agreement if the effect of entering into such agreement (and
continuing as a Party to this Agreement) would be to increase
the
level of obligations owed by Trubion, decrease the obligations owed
to
Trubion or
19
<PAGE>
the enforceability thereof, or decrease the consideration owed
to
Trubion relative to the obligations owed by or to, or the
consideration owed to, Trubion under this Agreement, had such
direct
license(s) not been granted. In countries where the validity of
such
direct license agreement requires prior government approval or
registration, such direct license agreement shall not become
binding
between the parties thereto until such approval or registration
is
granted, which approval or registration shall be obtained by
Wyeth.
All costs of making such direct license agreement(s), including
Trubion's reasonable attorneys' fees, under this Section 2.5 shall
be
borne solely by Wyeth.
2.6.
RIGHT OF REFERENCE. Trubion hereby grants to Wyeth a "Right of
Reference," as that term is defined in 21 C.F.R. Section 314.3(b),
to
any data Controlled by Trubion that relates to any CD20 Product
(and
any other Licensed Product, to the extent applicable), and
Trubion
shall provide a signed statement to this effect, if requested
by
Wyeth, in accordance with 21 C.F.R. Section 314.50(g)(3).
2.7.
SECTION 365(N) OF BANKRUPTCY CODE. All rights and licenses now
or
hereafter granted under or pursuant to any Section of this
Agreement,
including Sections 2.1 and 2.5 hereof, are rights to
"intellectual
property" (as defined in Section 101(35A) of Title 11 of the
United
States Code, as amended (such Title 11, the "Bankruptcy Code")).
In
the event this Agreement is rejected under Section 365 of the
Bankruptcy Code, Trubion hereby grants to Wyeth, subject to
Wyeth's
obligations under Sections 365(n)(2)(A) and (B), a right of access
and
to obtain possession of and to benefit from each of the
following
embodiments to the extent related to Wyeth's exercise of its
license
rights to any Licensed Products or otherwise related to any rights
or
licenses granted under or pursuant to any Section of this
Agreement:
(i) copies
of pre-clinical and clinical research data and results,
(ii) aliquots of laboratory samples, (iii) Licensed Product
samples
and inventory, (iv) Cell Lines expressing Licensed Products,
libraries
encoding Licensed Products or components thereof and sequences
thereof, (v) copies of laboratory notes and notebooks pertaining
to
Licensed Products, (vi) copies of data and results related to
clinical
trials of Licensed Products, (vii) regulatory filings and approvals
of
Licensed Products, (viii) rights of reference in respect of
regulatory
filings and approvals of Licensed Products, and (ix) plasmid
and
vectors encoding Licensed Product SMIPs, all of which
constitute
"embodiments" of intellectual property pursuant to Section 365(n)
of
the Bankruptcy Code, and (xi) all other embodiments of such
intellectual property in Trubion's possession or control.
Recognizing
that the embodiments described above may be useful or necessary
to
Trubion in connection with its continued operation of its
business,
and that a Third Party may also have a right of access to such
embodiment under Section 365(n) of the Bankruptcy Code or
applicable
non-bankruptcy law, where there is a fixed
20
<PAGE>
or limited quantity of any biological material or other tangible
item
of such embodiment described above, Wyeth shall be entitled to a
pro
rata portion thereof. Trubion agrees not to interfere with
Wyeth's
exercise under the Bankruptcy Code of rights and licenses to
intellectual property licensed hereunder and embodiments thereof
in
accordance with this Agreement and agrees to use Commercially
Reasonable Efforts (short of any obligation of Trubion to incur
expenses in connection therewith) to assist Wyeth to obtain
such
intellectual property and embodiments thereof in the possession
or
control of Third Parties as reasonably necessary or useful for
Wyeth
to exercise such rights and licenses in accordance with this
Agreement; provided, however, that Trubion's Commercially
Reasonable
Efforts for purposes of this Section 2.7 shall not be deemed to
include an obligation to make payments to Third Parties to obtain
such
intellectual property rights and embodiments thereof. The
Parties
hereto acknowledge and agree that reimbursement payments pursuant
to
Sections 3.6 and 4.6 and all other payments by Wyeth to Trubion
hereunder other than royalty payments pursuant to Section 5.4
and
Additional Research and Development Expense Payments under Section
5.3
do not constitute royalties within the meaning of Bankruptcy
Code
Section 365(n) or relate to licenses of intellectual property
hereunder.
2.8.
NO IMPLIED RIGHTS. Except as expressly provided in this
Agreement,
neither Party shall be deemed by estoppel or implication to
have
granted the other Party any license or other right with respect to
any
intellectual property of such Party.
3. RESEARCH
PROGRAM.
3.1.
SCOPE AND CONDUCT OF THE RESEARCH PROGRAM. Under the terms and
conditions set forth herein, Trubion and Wyeth shall
collaborate
through one or more joint project teams in the conduct of a
pre-clinical research program to identify and evaluate (a)
SMIPs
directed against Licensed Targets and (b) Licensed Products,
including
CD20 Products, [***] and Other Products (collectively, the
"Research
Program").
Such activities shall include, but not be limited to, the
following:
[***]
Subject to and in accordance with the Research Plan and the
Development Plan (to the extent applicable), the JRC shall
determine
the appropriate activities to be undertaken by Trubion and
Wyeth;
provided, however, that, as of the Signing Date, the Parties
anticipate that Trubion shall conduct activity (i) above (with
input
from Wyeth), Wyeth shall conduct activities (v), (vi) and (vii)
above,
and Trubion and Wyeth shall jointly conduct activities (ii), (iii)
and
(iv) above. The Research Program shall be conducted in accordance
with
the Research Plan, and each Party shall use its Commercially
Reasonable Efforts to perform all of its obligations
21
<PAGE>
under the Research Program in accordance with the Research Plan
and
current good laboratory practices.
3.2.
DESIGNATION OF TARGETS..
3.2.1. DESIGNATION OF TARGETS. Within thirty (30) days after
the
Effective Date, Wyeth shall provide Trubion's Vice President,
Legal Affairs & Chief Patent Counsel with a list of up to
[***]
Targets (each a "Target Candidate") from which Wyeth shall have
the exclusive right, until [***], to designate up to [***]
Wyeth
Targets, in accordance with the following provisions (subject
to
Wyeth's right under Section 3.2.3 to designate as Wyeth Targets
up to [***] Targets (of the [***] Targets that Wyeth may
designate as Wyeth Targets) that are not Target Candidates at
the
time of selection). In the case of protein Targets that are
Target Candidates, Wyeth shall designate each such Target
Candidate on the list by its GenBank accession number provided
by
the National Center for Biotechnology Information ("NCBI")
(including any nomenclature describing such Target Candidate
that
is provided therewith) or, if an NCBI GenBank accession number
is
not available for such Target Candidate, by its nucleotide and
amino acid sequences. For the avoidance of doubt, Wyeth may not
designate as Target Candidates any Targets that are Excluded
Targets. Subject to the following procedures, Trubion shall not
undertake any research or Development activities beyond
Milestone
One (as defined on Exhibit 3.2.1 attached hereto) of Trubion's
internal product development process, or propose to enter into
or
enter into any agreement with any Third Party with respect to
any
SMIP directed against any Target Candidate or with respect to
any
Licensed Product containing such a SMIP, unless and until such
Target Candidate becomes a Released Target, Excluded Target or
Provisional Excluded Target. Trubion, through its Legal
Department, shall maintain a copy of the list of Target
Candidates in a secure location. Trubion shall take reasonable
measures and implement reasonable procedures to ensure that
only
its inside attorneys who are employees of its Legal Department
and its outside patent counsel (collectively, "Trubion
Lawyers")
have knowledge of and access to Wyeth's Target Candidate list.
The Target Candidate list shall be considered Confidential
Information of Wyeth, and except as expressly permitted under
this Section 3.2 or otherwise under this Agreement, Trubion
shall
not use or disclose the Target Candidate list or the
information
set forth therein to any of its Affiliates, to any Third Party,
or to any employees, officers or agents of Trubion other than
Trubion Lawyers. For so long as a Target remains a Target
Candidate, Trubion, through its Legal Department, shall
implement
reasonable
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<PAGE>
procedures to maintain records of all Third Party inquiries to
Trubion and Trubion's responses to same, relating to the Target
Candidate list made pursuant to this Section 3.2. The Trubion
Legal Department shall also maintain the list of Released
Targets, Excluded Targets and Provisional Excluded Targets in
accordance with the provisions of Sections 3.2.2 and 3.2.4. In
the event of a bona fide dispute arising under this Agreement
relating to the Target selection process described in this
Section 3.2, Trubion shall provide to an independent Third
Party
selected by Wyeth and reasonably acceptable to Trubion access
to
the lists of Target Candidates, Released Targets, Excluded
Targets and Provisional Excluded Targets and records and
processes related thereto (to the extent relevant to the bona
fide dispute) maintained by Trubion in accordance with this
Section 3.2. Such independent Third Party may only communicate
to
Wyeth whether or not the Target selection process was properly
performed by Trubion's Lawyers.
3.2.2. RELEASED TARGETS. On or before [***], Wyeth, by written
notice
to Trubion's Vice President, Legal Affairs & Chief Patent
Counsel, shall identify [***] Target Candidates from the list
delivered pursuant to Section 3.2.1 (inclusive of any Target
Candidates that have become Released Targets during such period
pursuant to Section 3.2.4 hereof), which from the date of such
identification shall cease to be Target Candidates (each, a
"Released Target"). At the time that a Target Candidate becomes
a
Released Target, Trubion, subject to Section 2.8, shall be free
to undertake research and Development activities independent of
obligations under this Agreement, and to enter into discussions
or an agreement with a Third Party, with respect to SMIPs
directed against any such Released Target or any other
activities
in connection with such Released Target. On or before [***],
Wyeth, by written notice to Trubion, shall identify such
additional Target Candidates from the list delivered pursuant
to
Section 3.2.1, if any, as additional Released Targets, such
that
there are no more than [***] Target Candidates remaining on the
list delivered pursuant to Section 3.2.1 (less the number of
Wyeth Targets that were Target Candidates at the time of
selection as a Wyeth Target(s) pursuant to Section 3.2.3),
which
from the date of such identification shall cease to be Target
Candidates and, thereafter each shall also become a Released
Target. At the end of the Research Term, all remaining Target
Candidates, if any, shall become Released Targets.
3.2.3. WYETH TARGETS. Wyeth Targets shall be designated only
from
either (a) Target Candidates that have not become Released
Targets, or (b) any other Target (including a Released Target
that
23
<PAGE>
is or becomes available, as described below) that is not then
an
Excluded Target or a Provisional Excluded Target; provided,
however, that no more than [***] of the Targets designated by
Wyeth as Wyeth Targets may be Targets that are not Target
Candidates at the time of selection. Subject to the foregoing
sentence, Wyeth shall designate: (y) [***] Target Candidates or
other Targets as Wyeth Targets on or before [***]; and (z) up
to
[***] Target Candidates or other Targets (inclusive of those
designated as Wyeth Targets during [***] ) as Wyeth Targets on
or
[***]; provided, however, if Wyeth does not designate [***]
Wyeth
Targets on or before such [***], then the lesser number of
Wyeth
Targets so designated shall be the total number of Wyeth
Targets
under this Agreement unless Wyeth extends the Research Program,
in which case Wyeth may designate, before[***], [***]
additional
Wyeth Targets (up to a cumulative total [***] in the
aggregate).
For the avoidance of doubt and subject to the following
sentence,
Wyeth may designate only up to [***] Wyeth Targets from the
Effective Date of this Agreement through the end of the
Research
Program (even if extended). During the term of the Research
Program, Wyeth shall have the right to [***]; provided that
[***]
(a "REPLACEMENT TARGET") must be [***]. In the event that Wyeth
nominates as a Wyeth Target (whether as a proposed initial
designation of a Wyeth Target or as a replacement designation
as
a Wyeth Target) a Target that is not then a Target Candidate,
Trubion's Legal Department, within ten (10) business days after
receiving written notice of such nomination, shall determine
and
advise Wyeth in writing whether such Target is an Excluded
Target
or a Provisional Excluded Target, as described below (and shall
indicate whether such Target is an Excluded Target or is a
Provisional Excluded Target). If such Target is an Excluded
Target or a Provisional Excluded Target, it shall not be
eligible
to be considered a Wyeth Target. If a proposed Replacement
Target
is not an Excluded Target or a Provisional Excluded Target,
then
the JRC shall either approve or disapprove designation of such
proposed Replacement Target as a Wyeth Target; provided that
the
original Wyeth Target that Wyeth proposes to replace shall be
automatically deemed a Released Target upon the JRC's approval
of
the designation of the Replacement Target.
3.2.4. EXCLUDED TARGETS. Excluded Targets are not eligible to be
Wyeth
Targets for so long as they remain Excluded Targets. The
Targets
deemed "Excluded Targets" as of the Effective Date are set
forth
in Exhibit 3.2.4 attached hereto. Trubion may add additional
Targets as Excluded
Targets or Provisional Excluded Targets
24
<PAGE>
(which may be selected from Released Targets and other Targets,
but would not include any Wyeth Targets or any Target Candidate
that has not become a Released Target) in accordance with the
following procedures:
(A) During the period
when [***], and upon the written request
of a potential Third Party collaborator and/or licensee of
Trubion pertaining to the identification, generation and/or
Development of SMIPs directed against a Target or Targets,
Trubion's Legal Department shall promptly determine whether
or not any of such Targets is a Wyeth Target.
(B) With respect to
any Target newly submitted by a Party to
Trubion's Legal Department hereunder, Trubion's Lawyers will
determine whether such submitted Target [***] Licensed
Targets, Target Candidates, Released Targets, Excluded
Targets and Provisional Excluded Targets available to
Trubion's Lawyers (each a "Previously Deposited Protein").
By way of example only,[***]. Should Wyeth designate a
Target that is not a protein, the Parties agree to negotiate
in good faith the procedure for identifying and testing
whether a subsequent proposed non-protein Target is the
"same as" such designated non-protein Target for purposes of
this Section 3.2.
(C) If Trubion's Legal Department
determines, in accordance with
Section 3.2.4(b) above, that any such Target is a Wyeth
Target, Trubion shall not proceed with such potential Third
Party collaboration or license with respect to such Target.
If any of such Targets is not a Wyeth Target or a Target
Candidate, such Target shall automatically be deemed a
"Provisional Excluded Target". If such Target is a Target
Candidate, Trubion shall notify Wyeth in writing of
Trubion's request that a Target Candidate be recategorized
as a Released Target, in order for Trubion to be able to
enter substantive negotiations with such Third Party
regarding such Target that is a Target Candidate (i.e.,
Trubion shall "Put" such Target Candidate to Wyeth). Trubion
shall have no obligation to notify Wyeth of the identity of
such Third Party or the purpose of the proposed
collaboration or license. From the date that Trubion "Puts"
such Target Candidate to Wyeth, Wyeth shall have [***] with
respect to such Puts made to Wyeth prior to [***], and shall
have [***] with respect to such Puts made thereafter, to
notify Trubion in writing whether
25
<PAGE>
Wyeth designates such Target Candidate as a Wyeth Target or
recategorizes such Target Candidate as a Released Target. If
Wyeth fails to notify Trubion within such [***] period,
respectively, then such Target Candidate shall automatically be
deemed a Released Target. Any such Released Targets shall be
deemed to be Provisional Excluded Targets.
(D) If Trubion and
such potential Third Party collaborator
and/or licensee do not enter into a definitive agreement
regarding such Provisional Excluded Target within [***]
after the date that such Target is deemed a Provisional
Excluded Target (such [***] being subject to a [***]
extension by Trubion, if Trubion declares, in writing, to
Wyeth that at least one draft definitive agreement has been
exchanged between Trubion and such potential Third Party
collaborator and/or licensee), thereafter such Provisional
Excluded Target would revert to being a Released Target. If
Trubion and such potential Third-Party collaborator and/or
licensee enter into a definitive agreement within the time
period provided above, such Provisional Excluded Target
shall be deemed an Excluded Target.
(E) During the period
when [***], if Trubion itself identifies
internally a Target that has progressed to Milestone One (as
defined in Exhibit 3.2.1 attached hereto) of Trubion's
internal product development process, Trubion's Legal
Department shall promptly determine whether or not such
Target is a Target Candidate. If such Target is not a Target
Candidate, such Target shall be deemed an Excluded Target.
If Trubion thereafter abandons work on such Excluded Target,
Trubion shall notify Wyeth in writing that Trubion has
abandoned work on such Excluded Target and such Excluded
Target shall thereafter be deemed a Released Target. If such
Target is a Target Candidate, Trubion may Put such Target
Candidate to Wyeth. From the date that Trubion Puts such
Target Candidate to Wyeth, Wyeth shall have [***] with
respect to such Puts made to Wyeth prior to [***], and shall
have [***] with respect to such Puts made thereafter, to
notify Trubion in writing whether Wyeth designates such
Target Candidate as a Wyeth Target or recategorizes such
Target Candidate as a Released Target. If Wyeth fails to
notify Trubion within such[***], respectively, then such
Target Candidate shall automatically be deemed a Released
Target. Any such Released Target shall be deemed to be
Excluded Target. If
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<PAGE>
Trubion thereafter abandons work on any such Excluded
Target, Trubion shall notify Wyeth in writing that Trubion
has abandoned work on such Excluded Target and such Excluded
Target shall thereafter be deemed a Released Target.
(F) With respect to
the Puts described in (c) and (e) above,
Trubion shall not be permitted to Put more than [***] Target
Candidates to Wyeth during the first [***] of the Research
Program.
3.3.
TERM AND TERMINATION OF THE RESEARCH PROGRAM.
3.3.1. RESEARCH TERM. The term of the Research Program (the
"Research
Term") shall begin on the Effective Date and shall continue
until
[***] (the "Initial Term"), subject to extension as described
below. At Wyeth's option (exercisable by providing written
notice
to Trubion no later than [***] prior to the end of the Initial
Term of the Research Program or any extension year thereof),
the
Research Term may be extended for up to [***] additional [***]
periods and, thereafter, shall be renewable annually only upon
mutual written agreement of the Parties.
3.3.2. TERMINATION OF RESEARCH PROGRAM BY WYETH. Commencing on
the
first anniversary of the Effective Date, Wyeth shall have the
right to terminate the Research Program, at will, at any time,
in
its entirety, upon one (1) year prior written notice to
Trubion;
provided that Trubion shall have no obligation after the
effective termination date to complete any Research Program
activities in connection with any Trubion Target, Wyeth Target,
SMIP or Licensed Product. Such termination of the Research
Program shall not constitute termination of this Agreement and
shall not affect the Parties' rights and obligations under this
Agreement other than those relating to the Research Program.
27
<PAGE>
3.4.
JOINT RESEARCH COMMITTEE.
3.4.1. COMPOSITION. Within thirty (30) days after the Effective
Date,
the Parties shall establish a Joint Research Committee (the
"JRC") to oversee the Research Program. The JRC will be in
effect
only during the Research Term. The JRC shall be composed of
three
(3) representatives from each Party. Each Party may replace any
of its representatives at any time upon written notice to the
other Party. From time to time, the JRC may establish
subcommittees to oversee particular projects or activities, and
such subcommittees shall be constituted as the JRC decides.
3.4.2. RESPONSIBILITIES. The JRC shall be responsible for
establishing, reviewing and recommending modifications and
updates to the Research Plan, including the Research Budget, in
accordance with Section 3.5 hereof, monitoring and reporting to
the Parties on activities conducted pursuant to the Research
Plan, and for such other functions as agreed by the Parties.
3.4.3. MEETINGS. The JRC shall meet as soon as practicable after it
is
established by the Parties and, thereafter, at such additional
times as the Parties deem appropriate, not less frequently than
quarterly. Each Party shall designate one of its JRC members as
its "JRC Liaison" to co-chair meetings, prepare and circulate
JRC
meeting agendas and JRC meeting minutes. The meetings of the
JRC
shall be held in the United States, and shall alternate between
the Parties'
business locations or as otherwise decided by the
JRC. JRC meetings may be conducted in person, by telephone or
by
videoconference. Each Party shall use reasonable efforts to
cause
its representatives to attend the meetings of the JRC. If a
representative of a Party is unable to attend a meeting, such
Party may designate an alternate member to attend such meeting
in
place of the absent member.
3.4.4. VOTING.
Decisions of the JRC shall be made by unanimous
consent, with each Party having one vote. The JRC may act
without
a meeting if an action by unanimous written consent is signed
by
each Party's JRC Liaison.
3.4.5. DISPUTE RESOLUTION. If the JRC is unable to reach agreement
on
a matter, the matter may be referred, at the request of either
Party, for resolution through good faith discussions between
Wyeth's Executive Vice President of Discovery Research and
Trubion's Senior Vice President of Research and Development or
their respective designees. Notwithstanding the foregoing, in
the
event the JRC cannot promptly resolve a disagreement or a
voting
28
<PAGE>
deadlock regarding the Research Program, Wyeth's Executive Vice
President of Discovery Research shall have the right to cast a
tie-breaking vote to resolve any such disagreement or voting
deadlock, such right and tie-breaking authority being subject
to
the terms and conditions of this Agreement.
3.4.6. MINUTES. The JRC shall keep accurate and complete minutes
of
its meetings that record all proposals and recommendations
made,
and all actions and decisions taken. The JRC minutes shall not
be
effective until approved in writing by each Party's JRC
Liaison.
All records of the JRC shall be available at all times to each
Party.
3.5.
RESEARCH PLAN. The Parties shall use their Commercially
Reasonable
Efforts to develop and approve a complete Research Plan (including
a
corresponding Research Budget) within sixty (60) days of the
Effective
Date. The Parties shall ensure that the Research Plan is
consistent
with the terms and conditions of this Agreement, and the Research
Plan
shall not impose obligations on either Party that are
inconsistent
with the terms of this Agreement. The Research Plan shall set
forth
generally (a) the activities to be undertaken by the Parties under
the
Research Program consistent with the terms of Section 3.1, (b)
the
utilization of [***] Trubion FTEs in conducting such activities,
(c)
the anticipated schedule on which such activities are to be
conducted,
(d) the desired deliverables to be provided by each Party with
respect
to each Licensed Target that is the subject of the Research
Program,
and (e) the annual budget for non-ordinary expenses (as described
in
Section 3.6.1 below)
to be incurred by Trubion under the Research
Program (the "Research Budget"). The JRC shall review the
Research
Plan, including the Research Budget, on at least an annual basis
and
submit any proposed modifications or updates to the Parties for
review
and approval; any such modifications or updates shall not
become
effective until approved in writing by an authorized officer of
each
of the Parties. The Parties shall review and consider any such
proposed modifications or updates on an expeditious basis. The
Parties
shall promptly amend the Research Plan from time to time to
address
the performance of the Research Program as it relates to any
Licensed
Targets designated by Wyeth in accordance with Section 3.2
above.
3.6.
FUNDING OF THE RESEARCH PROGRAM.
3.6.1. RESEARCH FUNDING. During each year of the Research Term (as
it
may be extended), Wyeth shall pay Trubion [***] per year for
services performed in accordance with the Research Plan.
Trubion
shall commit to the Research Program [***] FTEs per year to
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<PAGE>
provide services in furtherance of the Research Program in
accordance with the Research Plan. For the avoidance of doubt,
Trubion may, at its sole expense and discretion, devote more
than
[***] FTEs from time to time to provide services in furtherance
of the Research Program. The [***] in research funding
described
above shall be increased automatically once per calendar year
by
the percentage change in the U.S. Consumer Price Index, All
Urban
Consumers over the previous year; provided, however, that no
increase shall be effective prior to January 1, 2007. [***]
Trubion shall provide to Wyeth, prior to the first day of each
Calendar Quarter, a forecast of such expenses (by major expense
category, on an accrual basis) reimbursable under this Section
3.6.1 which Trubion expects to incur during such Calendar
Quarter
and the subsequent three Calendar Quarters, in each case shown
by
month. Other than the foregoing amounts and except as otherwise
expressly provided in this Agreement, each Party shall be
solely
responsible for its costs and expenses incurred in performing
its
obligations under the Research Program.
3.6.2. REIMBURSEMENT PAYMENTS. Reimbursement to be made to Trubion
by
Wyeth pursuant to Section 3.6.1 will be made pursuant to
invoices
submitted by Trubion to Wyeth no more often than once with
respect to any Calendar Quarter, within thirty (30) days of the
end of such Calendar Quarter. Payment shall be due within
forty-five (45) days after Wyeth receives such an invoice from
Trubion. Each invoice must be accompanied by supporting
documentation sufficiently demonstrating the expense so paid on
a
cash basis (such as receipts for out-of-pocket expenses and
other
written documentation reasonably acceptable to Wyeth) and by a
certificate executed by Trubion's VP, Finance &
Administration,
of the number of FTEs used by Trubion in such Calendar Quarter
in
performing Trubion's obligations under the Research Program.
Except as approved in writing in advance by Wyeth, Wyeth shall
not be obligated to reimburse Trubion for amounts in excess of
the applicable budgeted amounts in the Research Budget.
3.6.3. RECORDS AND AUDITS. During the Research Term, Trubion
shall
keep books and accounts of record in connection with the
expenses
reimbursable under Section 3.6.1 hereof in accordance with GAAP
and in sufficient detail to permit accurate determination of
all
figures necessary for verification of costs to be reimbursed
hereunder. Trubion shall maintain such cost records for a
period
of at least three (3) years after the end of the calendar year
in
which they were generated in order to enable audit of such
records as set forth below. Upon thirty (30) days prior written
notice from Wyeth, Trubion shall permit an independent
certified
public
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accounting firm of nationally recognized standing selected by
Wyeth and reasonably acceptable to Trubion, to examine, at
Wyeth's sole expense, the relevant books and records of Trubion
as may be reasonably necessary to verify the amount of
reimbursable out-of-pocket expenses incurred. An examination by
Wyeth under this Section 3.6.3 shall occur not more than once
in
any calendar year and shall be limited to the pertinent books
and
records for any calendar year ending not more than thirty six
(36) months before the date of the request. The accounting firm
shall be provided access to such books and records at Trubion's
facility(ies) where such books and records are normally kept
and
such examination shall be conducted during Trubion's normal
business hours. Trubion may require the accounting firm to sign
a
standard non-disclosure agreement before providing the
accounting
firm access to Trubion's facilities or records. The accounting
firm shall provide both Trubion and Wyeth a written report
disclosing whether the certificates and invoices submitted by
Trubion under Section 3.6.2 are correct or incorrect and the
specific details concerning any discrepancies. No other
information shall be provided to Wyeth. If the accounting firm
determines that the aggregate amount of out-of-pocket expenses
actually incurred by Trubion was less than the amount
reimbursed
by Wyeth during the period covered by the audit, Trubion shall
refund the excess payments to Wyeth within thirty (30) days of
its receipt of the auditor's report so concluding (or, if
later,
within fifteen (15) days after resolution of a bona fide
objection by Trubion to the findings in such report). If the
amount to be refunded exceeds more than ten percent (10%) of
the
amount that was properly payable, Trubion shall reimburse Wyeth
for the cost of the audit. All information of Trubion which is
subject to review under this Section 3.6.3 shall be deemed to
be
Confidential Information of Trubion subject to the provisions
of
Article 7, and such Confidential Information shall not be
disclosed to any Third Party or used for any purpose other than
verifying the information provided by Trubion to Wyeth;
provided,
however, that such Confidential Information may be disclosed to
Third Parties only to the extent necessary to enforce Wyeth's
rights under this Agreement, as may be necessary for Wyeth to
exercise its rights under this Agreement, or as otherwise
expressly permitted under this Agreement.
3.7.
DATA AND DELIVERABLES. During the Research Term, each Party will
use
Commercially Reasonable Efforts to promptly provide to the other
Party
the data or desired deliverables specified in the Research
Plan,
including, without limitation, (a) SMIPs, Recombinant DNA, and
Cell
Lines, to the
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extent related to Licensed Targets and/or Licensed Products,
(b)
activity evaluation of the items listed in (a) obtained from in
vitro
or in vivo assays, pharmacology studies, process development
data,
drug product formulation data, toxicology and safety studies,
and
evaluation of chemotherapy conjugates, but only to the extent and
in
the manner that items listed in (a) and (b) are set forth in
the
Research Plan. Each Party shall also disclose to the other Party
in
writing all data, information, inventions, techniques and
discoveries
(whether patentable or not) arising out of the conduct of the
Research
Program. Disclosure of all such aforementioned inventions and
discoveries shall be delivered to the other Party in a manner
mutually
agreed upon by the Joint Patent Committee. Subject to the terms
and
conditions of this Agreement, each Party shall have the right to
use
any data or information generated under the Research Program for
its
permitted activities under the Research Program and this
Agreement
(collectively, "Research Program Data"). TRUBION MAKES NO
REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, THAT IT WILL
BE
ABLE TO SUCCESSFULLY DISCOVER, DEVELOP OR DELIVER ANY SMIP
DIRECTED
AGAINST A LICENSED TARGET OR ANY LICENSED PRODUCT.
3.8.
ALLIANCE MANAGERS. Each Party shall designate a single alliance
manager, who shall perform such duties relating to the
day-to-day
worldwide coordination of the collaboration contemplated by
this
Agreement as are determined by the JRC and the JDC. Such
alliance
managers shall have experience and knowledge appropriate for
managers
with such project management responsibilities. Such alliance
managers
may attend, as non-voting members, any meetings of the
committees
contemplated by this Agreement as deemed fit by such committees.
Each
Party may change its designated alliance manager from time to
time
upon notice to the other Party.
4. PRODUCT
DEVELOPMENT, MANUFACTURING, COMMERCIALIZATION AND REGULATORY
MATTERS.
4.1.
PRODUCT DEVELOPMENT. Except as otherwise expressly provided in
Articles 2 and 3 hereof and in this Article 4, Wyeth shall have
the
sole authority, at its expense, for the Development of Licensed
Products, including the initiation and conduct of clinical
trials.
Wyeth shall be responsible for the Development of and shall use
its
Commercially Reasonable Efforts to Develop Licensed Products
throughout the Territory where it is Commercially Reasonable to do
so
(it being understood that Wyeth shall have the sole discretion
to
select those countries in which it will conduct clinical studies
of
Licensed Products and, when Commercially Reasonable to do so, to
delay
or discontinue the Development of any Licensed Product directed
against a particular Licensed Target in favor of pursuing
Development
of another Licensed
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<PAGE>
Product directed against such Licensed Target). When appropriate
based
on the data obtained during Development, Wyeth shall use its
Commercially Reasonable Efforts to secure Regulatory Approval
for
Licensed Products in the Territory.
4.2.
TRANSFER OF PRODUCT DATA AND FILINGS. Upon Wyeth's reasonable
request
and in consultation with the JDC from time to time during the term
of
this Agreement and to the extent permitted by applicable law,
Trubion
shall assign and transfer to Wyeth Trubion's entire right, title
and
interest in and to any of the Product Data and Filings pursuant to
an
instrument to such effect in form and substance reasonably
satisfactory to Wyeth and shall perform all other actions
reasonably
requested by Wyeth to effect and confirm such transfer. The
Parties
shall cooperate through the JDC to ensure that assignment and
transfer
of Trubion's right, title and interest in and to Product Data
and
Filings relating to CD20 Products is made in a manner that does
not
impede Trubion's activities and responsibilities under Section
4.6.
After receipt of Wyeth's request consistent with the foregoing,
Trubion shall provide to Wyeth, at Wyeth's expense, within sixty
(60)
days of receipt of such request, complete copies of such Product
Data
and Filings, including, without limitation, relevant clinical
data,
INDs, additional regulatory filings with FDA or other
Regulatory
Authorities, supplements or amendments thereto, all written
correspondence with FDA or other Regulatory Authorities regarding
the
regulatory filings, and all existing written minutes of meetings
and
memoranda of conversations between Trubion (including, to the
extent
practicable, Trubion's investigators) and FDA or other
Regulatory
Authorities in Trubion's possession (or in the possession of any
of
Trubion's agents and subcontractors, such as contract research
organizations used by Trubion), to the extent Trubion has the right
to
access and provide to Wyeth such Product Data and Filings,
regarding
such regulatory filings, each to the extent they relate to
Licensed
Products. Within thirty (30) days (or such later date as Wyeth
may
request) after the date of receipt of Wyeth's reasonable request
after
consultation with the JDC, Trubion shall execute and deliver a
letter
to the FDA or other Regulatory Authorities, in a form approved
by
Wyeth, transferring ownership to Wyeth of such regulatory filings,
if
any, filed in the name of Trubion that are related to Licensed
Products. After such transfer of ownership of regulatory
filings
relating to a Licensed Product, during the term of this Agreement
all
regulatory filings with the FDA or other Regulatory Authorities
pertaining to such Licensed Product shall be made in the name
of
Wyeth, in accordance with the terms of Section 4.3 below.
4.3.
REGULATORY APPROVALS. Wyeth shall have the sole authority to file,
in
its own name, at its sole expense, all Regulatory Approval
Applications for Licensed Products. Wyeth shall have the sole
authority and responsibility for communicating with any
Regulatory
Authority regarding any
33
<PAGE>
Regulatory Approval Application, or any Regulatory Approval
once
granted. To the extent necessary to satisfy applicable
regulatory
requirements with respect to the INDs for the clinical studies of
CD20
Products described in Section 4.6, Wyeth hereby grants to Trubion
a
"Right of Reference," as that term is defined in 21 C.F.R.
Section
314.3(b), to any data Controlled by Wyeth that relates to any
CD20
Products that are the subject of the clinical studies described
in
Section 4.6 hereof, and Wyeth shall provide a signed statement to
this
effect, if requested by Trubion, in accordance with 21 C.F.R.
Section
314.50(g)(3). Copies of all Wyeth regulatory filings that relate
to
Trubion's Development activities under this Agreement will be
provided
by Wyeth to Trubion upon request, subject to reasonable resource
and
time constraints.
4.4.
REGULATORY REPORTING. Wyeth shall be responsible for preparing
and
filing all reports required to be filed in order to maintain
any
Regulatory Approvals granted for Licensed Products in the
Territory,
including, without limitation, adverse drug experience reports. To
the
extent Trubion has or receives any information regarding any
adverse
drug experience which may be related to the use of any Licensed
Product or to Licensed Product Development, Trubion shall
promptly
provide Wyeth with all such information in accordance with the
Adverse
Event Reporting and pharmacovigilance procedures set forth in
Exhibit
4.4 attached hereto (as may be amended from time to time upon
written
mutual agreement of the Parties). From time to time after the
Effective Date, representatives from both Parties shall meet to
review
and revise or replace such Adverse Event Reporting and
pharmacovigilance procedures.
4.5.
PROGRESS REPORTS.
(a) Wyeth shall
provide Trubion with confidential summary
reports of its and its sublicensees' Development activities,
on a Licensed Product-by-Licensed Product basis, on a [***],
with respect to CD20 Products and [***], and on an [***],
with respect to Other Products. The form of the summary
reports, and the type of information and the appropriate and
reasonable level of detail to be included in such reports,
shall be mutually and reasonably agreed by the Parties;
provided that the Parties agree that such reports shall
include information regarding progress towards and
achievement of any event set forth in Exhibit 5.3 attached
hereto.
(b) Wyeth shall
provide Trubion with confidential summary
reports of its and its sublicensees' CD20 Product
Commercialization activities on a [***] after the First
Commercial Sale of a CD20 Product. Beginning [***]
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<PAGE>
prior to the anticipated First Commercial Sale of a CD20
Product, and thereafter on a [***], Wyeth shall meet with
Trubion and provide updates on CD20 Product
Commercialization activities.
(C) Wyeth shall
provide Trubion with confidential summary
reports of its and its sublicensees' [***] Commercialization
activities on a [***] after the First Commercial Sale of a
[***]. Beginning [***] prior to the anticipated First
Commercial Sale of a [***], and thereafter on a [***], Wyeth
shall meet with Trubion and provide updates on [***]
Commercialization activities.
(D) Wyeth shall
provide Trubion with confidential summary
reports of its and its sublicensees' Other Product
Commercialization activities on an [***] after the First
Commercial Sale of an Other Product. Beginning [***] prior
to the anticipated First Commercial Sale of an Other
Product, and thereafter on an [***], Wyeth shall meet with
Trubion and provide updates on Other Product
Commercialization activities.
(E) The meetings
described in clauses (b) - (d) above shall be
coordinated to occur at the same time, to the extent
practicable.
4.6.
CD20 PRODUCT DEVELOPMENT. Subject to Section 4.7 hereof, Trubion
shall
use its Commercially Reasonable Efforts to conduct the
following
Development activities for CD20 Products: (a) Trubion shall
continue
the Phase I Clinical Studies and Phase IIa Clinical Studies of
TRU-015
ongoing at the Effective Date for treatment of rheumatoid
arthritis
until completion or termination of such studies, including the
re-treatment periods of such studies; (b) Trubion shall initiate
and
perform the planned Phase IIb Clinical Study of TRU-015 for
treatment
of rheumatoid arthritis through the completion or termination of
such
study; (c) Trubion shall continue the Phase I Clinical Study
ongoing
at the Effective Date, and shall initiate and perform the
planned
Phase III Clinical Studies (or the appropriate subsequent
clinical
study) of TRU-015 for the treatment of [***] through the completion
or
termination of such studies; (d) Trubion shall have responsibility
for
and shall perform the clinical studies for at least two (2)
additional
Niche Indications selected by the Parties and set forth in the
Development Plan; and (e) Trubion shall continue to perform the
ongoing bioprocess development activities, and in each case (a-e)
such
activities and responsibilities of Trubion shall be performed
in
accordance with the Development Plan. None of the clinical
studies
described in this Section 4.6 shall be terminated prior to
completion
before discussion of
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<PAGE>
such matter by the JDC. Trubion shall keep accurate records of
its
clinical study activities under this Section 4.6 in accordance
with
applicable laws and, upon reasonable request, shall provide Wyeth
with
access to such records. Trubion shall maintain such records for
a
period of at least three (3) years after the end of the calendar
year
in which they were generated. The Development Plan shall provide
that
Trubion is responsible for conducting the clinical trials for
rheumatoid arthritis, [***] and additional Niche Indications
through
the completion or termination of such clinical studies described
above
and shall contain a budget for such clinical trials. Trubion shall
be
solely responsible for its internal FTE and other internal costs
for
such Development activities, but Wyeth shall reimburse Trubion for
all
out-of-pocket costs incurred by Trubion in connection with the
foregoing Development activities in accordance with the budget
contained in the Development Plan (which shall include, without
limitation, all expenses paid to one or more contract research
organizations for such Development activities). Trubion shall
provide
to Wyeth, on or before the first day of each Calendar Quarter,
a
forecast of such out-of-pocket costs (by major expense category, on
an
accrual basis) reimbursable under this Section 4.6 that Trubion
expects to incur during such Calendar Quarter and the subsequent
three
(3) Calendar Quarters, in each case shown by month. Reimbursement
to
be made to Trubion by Wyeth pursuant to this Section 4.6 will be
made
pursuant to invoices submitted by Trubion to Wyeth no more often
than
once with respect to any Calendar Quarter, within forty-five (45)
days
of the end of such Calendar Quarter. Payment shall be due
within
forty-five (45) days after Wyeth receives such an invoice from
Trubion. Each invoice must be accompanied by supporting
documentation
sufficiently demonstrating the expense so incurred (such as
receipts
for out-of-pocket expenses). The provisions of Section 3.6.3
shall
apply to the expenses reimbursable by Wyeth under this Section 4.6
in
the same manner as they apply to expenses reimbursable under
Section
3.6.1.
4.7.
JOINT DEVELOPMENT COMMITTEE. Within thirty (30) days of the
Effective
Date, Wyeth and Trubion shall establish a CD20 Product Joint
Development Committee (the "JDC"), comprised of appropriate
representatives of both Parties, to review and provide input to
Wyeth
regarding CD20 Product Development in the Territory, including
the
strategic direction of the overall CD20 Product Development
program.
Wyeth shall consider in good faith any of Trubion JDC members'
comments and recommendations regarding CD20 Product Development,
but
Wyeth shall have final decision-making authority with respect to
how
the Parties proceed with CD20 Product Development, subject to
Wyeth's
obligations under Section 4.1 in connection therewith. If
Trubion
disagrees with an action or decision by the JDC, Trubion may
express
its concerns through good faith discussions between the
Executive
Officers of Trubion and Wyeth, with Wyeth Research's President
having
the final
36
<PAGE>
decision-making authority with respect to such matter. For the
avoidance of doubt, the JDC may not impose different or greater
CD20
Product Development obligations on Trubion than those specified
in
Section 4.6.
4.8.
JOINT PROJECT TEAM; DEVELOPMENT PLAN. Trubion and Wyeth shall form
a
Joint Project Team ("JPT") comprised of appropriate representatives
of
both Parties to plan and implement the CD20 Product Development
activities in accordance with the Development Plan. The JPT
shall
report to the JDC. If the JPT cannot promptly resolve a
disagreement
or a voting deadlock regarding the CD20 Product Development
activities, the matter shall be brought before the JDC for
resolution.
Wyeth shall prepare the Development Plan with input and advice
from
Trubion through the JPT. The Development Plan will define each
Party's
roles and responsibilities, provide a mechanism to coordinate
each
Party's and/or joint activities, and provide a process for
monthly
meetings of the JPT to monitor and report on all activities of
the
Parties conducted under the Development Plan. The Development
Plan
shall not impose different or greater CD20 Product Development
obligations on Trubion than those specified in Section 4.6. The
Development Plan shall be updated annually by the JPT.
4.9.
MANUFACTURING. Wyeth shall have the exclusive right to
Manufacture
Licensed Products itself or through one or more Third Parties
selected
by Wyeth; provided, however, that Trubion shall use its
Commercially
Reasonable Efforts to Manufacture and supply Wyeth with its
requirements of the TRU-015 Product in accordance with the
Development
Plan under Trubion's existing contract Manufacturing arrangements
for
use in pre-clinical studies and clinical trials ("Clinical
Study
Supplies"); provided that Trubion cannot guarantee as of the
Effective
Date that it will be able to Manufacture and supply such
requirements.
Wyeth shall reimburse Trubion for its direct out-of-pocket cost
of
Clinical Study Supplies, including, without limitation,
out-of-pocket
expenses incurred by Trubion prior to the Effective Date that
are
directly related to the Manufacture, testing and release of
Clinical
Study Supplies to be used after the Effective Date (such
pre-Effective
Date out-of-pocket expenses not to exceed [***]. Reimbursement of
such
pre-Effective Date expenses shall be due within thirty (30) days
after
the first patient is dosed in the first Phase IIb Clinical Study
for
rheumatoid arthritis using such Clinical Study Supplies. Upon
Wyeth's
written request, Trubion shall provide reasonable assistance to
Wyeth,
until the first cGMP batch of TRU-015 Product is Manufactured in
a
Wyeth facility (or the facility of a Third Party designated by
Wyeth),
in support and facilitation of Wyeth's efforts to Manufacture
TRU-015
Products and to secure appropriate TRU-015 Product
Manufacturing
arrangements with Third Parties. Such assistance shall be at no
cost
to Wyeth; provided that Wyeth shall reimburse Trubion for all of
its
reasonable out-of-pocket expenses related thereto. If applicable,
upon
Wyeth's written request,
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<PAGE>
Trubion shall assign or otherwise transfer to Wyeth (to the
extent
allowable under such agreements) its TRU-015 Product
Manufacturing
agreements with Third Parties.
4.10. COMMERCIALIZATION. Subject to the terms and conditions of
this
Agreement, Wyeth shall have the sole authority and the exclusive
right
to Commercialize Licensed Products itself or through one or more
Third
Parties selected by Wyeth and shall have sole authority and
responsibility in all matters relating to the Commercialization
of
Licensed Products. Wyeth shall use Commercially Reasonable Efforts
to
Commercialize Licensed Products in the Territory in each country
where
Wyeth has obtained Regulatory Approval for such Licensed
Product(s)
and for each indication of such Licensed Product(s) for which
Regulatory Approval has been obtained in such country.
4.11. CO-PROMOTION OPTION. Subject to the foregoing, in the event
of a BLA
filing with the FDA for Regulatory Approval of a CD20 Product for
a
Niche Indication in the United States, Trubion shall have the
option
to Co-Promote the CD20
Product in the United States for such Niche
Indication in accordance with Wyeth's marketing plan for up to
five
(5) years after the First Commercial Sale of the first CD20
Product
for any Niche Indication in the United States (the
"Co-Promotion
Period"). The Trubion Co-Promotion option shall be exercisable
by
Trubion giving written notice to Wyeth no later than [***] after
the
date of the first BLA filing with the FDA for the first Niche
Indication for the first CD20 Product (or such longer time as
the
Parties may mutually agree). Promptly after Trubion's exercise of
such
option, the Parties shall negotiate,
