<PAGE>
CONFIDENTIAL TREATMENT REQUESTED
Exhibit 10.4
RESEARCH COLLABORATION
AND LICENCE AGREEMENT
BY AND BETWEEN
ASTRAZENECA UK LIMITED
AND
AVANIR PHARMACEUTICALS
<PAGE>
(i)
TABLE OF CONTENTS
<TABLE>
<S>
<C>
1
DEFINITIONS..........................................................
1
2
CONSTRUCTION.........................................................
17
3 GRANT OF
RIGHTS......................................................
17
4 CONFIRMATORY PATENT
LICENCES......................................... 22
5 THE RESEARCH
COLLABORATION...........................................
23
6 MANAGEMENT OF THE
RESEARCH COLLABORATION............................. 27
7
REPORTS..............................................................
37
8 DEVELOPMENT
PROJECT..................................................
38
9 RESEARCH
FUNDING.....................................................
41
10
CONSIDERATION........................................................
43
11 REIMBURSEMENT OF DEVELOPMENT
STOCK AND PRE-CLINICAL STUDIES.......... 57
12 OWNERSHIP OF INTELLECTUAL
PROPERTY................................... 60
13 ADVERSE EVENT
REPORTING..............................................
62
14 CONFIDENTIALITY &
NON-DISCLOSURE..................................... 62
15
TRADEMARKS...........................................................
67
16 REPRESENTATIONS, WARRANTIES
AND COVENANTS............................ 68
17
INDEMNITY............................................................
72
18 MAINTENANCE AND PROSECUTION
OF PATENTS............................... 77
19 ENFORCEMENT OF
PATENTS............................................... 81
20 POTENTIAL THIRD PARTY
RIGHTS......................................... 83
21 TERM AND
TERMINATION.................................................
86
22 FORCE
MAJEURE........................................................
96
23
ASSIGNMENT...........................................................
97
24
SEVERABILITY.........................................................
99
</TABLE>
<PAGE>
(ii)
<TABLE>
<S> <C>
<C>
25 GOVERNING LAW; DISPUTE
RESOLUTION.................................... 99
26 INTERPRETATION OF CERTAIN
EVIDENCE................................... 100
27
NOTICES..............................................................
101
28 RELATIONSHIP OF THE
PARTIES.......................................... 102
29 ENTIRE
AGREEMENT.....................................................
102
30 ENGLISH
LANGUAGE.....................................................
102
31
AMENDMENT............................................................
103
32 WAIVER AND NON-EXCLUSION OF
REMEDIES................................. 103
33 EQUITABLE
RELIEF.....................................................
103
34 FURTHER
ASSURANCE....................................................
104
35
EXPENSES.............................................................
104
</TABLE>
SCHEDULES
Research Plan
Schedule 1
Licensed Know-How
Schedule 2
IND Filing Plan
Schedule 3
Licensed Patents and Applications
Schedule 4
Confirmatory Patent Licenses
Schedule 5
Key Personnel and AstraZeneca Principal
Scientist
Schedule 6
Press Release
Schedule 7
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CONFIDENTIAL TREATMENT REQUESTED
RESEARCH COLLABORATION AND LICENCE AGREEMENT
This Research Collaboration and Licence
Agreement (the "Agreement") is made
effective as of the 8th day of July 2005
(the "Effective Date") by and between:
(1) ASTRAZENECA UK LIMITED, a company
incorporated in England whose registered
office is at 15
Stanhope Gate, London, WIK 1LN, England ("ASTRAZENECA");
and
(2) AVANIR PHARMACEUTICALS, a company
incorporated in California, with offices
at 11388
Sorrento Valley Road, Suite 200, San Diego, CA 92121, USA
("AVANIR").
RECITALS
(A) WHEREAS, Avanir is engaged in
research regarding reverse cholesterol
transportation
involving reverse cholesterol transport promotors, and
Avanir has in
the course thereof developed the AVP 26452 Compound and the
Back-Up
Compounds (as such terms are defined below); and
(B) WHEREAS, AstraZeneca and its
Affiliates have specialised experience in,
among other
things, the research, development, manufacturing and
commercialisation of pharmaceutical compounds worldwide; and
(C) WHEREAS, the Parties wish to
engage in a research collaboration utilising
the Parties'
respective knowledge, skills and proprietary technology to
develop the
Back-Up Compounds or Collaboration Compounds (as defined below)
up to the
selection of Candidate Drug (as defined below); and
(D) WHEREAS, the Parties wish
AstraZeneca to be responsible, as a general
matter, for
clinical development and commercialisation of the AVP 26452
Product (as
defined below); and
(E) WHEREAS, the Parties wish
AstraZeneca, after the selection of Candidate
Drug, to be
responsible for developing and commercialising the Licensed
Products (as
defined below); and
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CONFIDENTIAL TREATMENT REQUESTED
(F) WHEREAS, the Parties wish to
collaborate as set forth above, and Avanir
desires to grant
a licence to AstraZeneca, and AstraZeneca desires to take
a licence, to
develop and commercialise the Licensed Products, in
accordance with
the terms and conditions set forth below.
AGREEMENT
NOW, THEREFORE, in consideration of the
mutual covenants contained in this
Agreement, and other good and valuable
consideration, the receipt and
sufficiency of which are hereby
acknowledged, the Parties, intending to be
legally bound, agree as follows:
1 DEFINITIONS
Unless otherwise
specifically provided herein, the following terms, when
used with a
capital letter at the beginning, shall have the following
meanings:
1.1 "AFFILIATE" means, with respect to
a Person, any Person that controls, is
controlled by or
is under common control with, such first Person. For
purposes of this
definition only, "control" means (a) to possess, directly
or indirectly,
the power to direct the management or policies of a Person,
whether through
ownership of voting securities, by contract relating to
voting rights or
corporate governance or otherwise, or (b) to own, directly
or indirectly,
more than fifty percent (50%) of the outstanding voting
securities or
other voting ownership interest of such Person.
1.2 "ANNUAL NET SALES" means the Net
Sales made during a given Calendar Year.
1.3 "APPLICABLE LAW" means the
applicable laws, rules and regulations,
including any
rules, regulations, guidelines or other requirements of the
Health
Authorities, that may be in effect from time to time in the
Territory.
1.4 "ASTRAZENECA BACKGROUND
TECHNOLOGIES" means any (a) Information, discovery,
invention,
products, cultures, biological materials and other materials
and
compositions
(including Collaboration Materials provided by AstraZeneca to
Avanir
hereunder), owned or Controlled by AstraZeneca or its Affiliates
at
the Effective
Date or during the Collaboration Term and introduced at its
sole discretion
to Avanir under the Research
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CONFIDENTIAL TREATMENT REQUESTED
Collaboration by
AstraZeneca or its Affiliates and (b) IP Protection Rights
pertaining to
any of the foregoing.
1.5 "ASTRAZENECA IMPROVEMENTS" means
all Results that constitute Improvements
to the
AstraZeneca Background Technologies.
1.6 "ASTRAZENECA PATENTS" means
Patents with respect to AstraZeneca
Improvements.
1.7 "ASTRAZENECA INFORMATION" has the
meaning set forth in Section 14.1.2.
1.8 "ASTRAZENECA PRINCIPAL SCIENTIST"
means the principal scientist designated
by AstraZeneca
to be responsible for all Research Collaboration activities
undertaken by
AstraZeneca and serving as the primary contact for Avanir on
all matters
related to the Research Collaboration. The AstraZeneca
Principal
Scientist is listed in Schedule 6 hereto.
1.9 "AVANIR PRINCIPAL SCIENTIST" has
the meaning defined in Section 5.2.
1.10 "AVP 26452 COMPOUND" means Avanir's
proprietary compound referred to as AVP
26452 with the
chemical structure set forth in item 1.3 of the Research
Plan and any
metabolites, salts, esters, free acid forms, free base forms,
pro-drug forms,
racemates and all optically active forms thereof.
1.11 "AVP 26452 PRODUCT" means products in
final forms suitable for human,
veterinary or
agricultural use that contain the AVP 26452 Compound as the
sole active
ingredient.
1.12 "BACK-UP COMPOUND(S)" means any
compound, other than the AVP 26452
Compound, and
any metabolites, salts, esters, free acid forms, free base
forms, pro-drug
forms, racemates and all optically active forms of such
compound covered
or claimed by the Licensed Patents.
1.13 "BACK-UP PRODUCT" means products in
final forms suitable for human,
veterinary or
agricultural use that contain a Back-Up Compound as the sole
active
ingredient.
1.14 "BREACHING PARTY" has the meaning set
forth in Section 21.5.
1.15 "CALENDAR QUARTER" means each
successive period of three (3) calendar
months
commencing on 1st January, 1st April, 1st July and 1st October.
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CONFIDENTIAL TREATMENT REQUESTED
1.16 "CALENDAR YEAR" means each successive
period of twelve (12) calendar months
commencing on
1st January.
1.17 "CANDIDATE DRUG" or "CD" means a
Licensed Compound satisfying the relevant
pharmacological
and pharmaceutical criteria for clinical testing
established by
AstraZeneca at its sole discretion and selected by
AstraZeneca in
its sole discretion as a candidate for clinical development
or, if not
meeting such criteria, nevertheless is so selected by
AstraZeneca.
1.18 "***" has the meaning defined in
Section 11.1.2.
1.19 "***" has the meaning defined in
Section 11.1.2.
1.20 "CARDIOVASCULAR EVENTS" means stroke,
myocardial infarction and
cardiovascular
death.
1.21 "CHANGE OF CONTROL" with respect to
any Person, means an event in which:
1.21.1 any other
Person or group of Persons not then beneficially owning
more than fifty percent (50%) of the voting power of the
outstanding
securities of such Person acquires beneficial ownership of
securities
of such first Person representing more than fifty percent (50%) of
the
voting power of the then outstanding securities of such first
Person
with respect to the election of directors of such first Person;
or
1.21.2 such
Person enters into a merger, consolidation or similar
transaction with another Person and the holders of such first
Person
do not hold a majority in interest of the voting securities of
such
surviving entity immediately following such transaction.
1.22 "COLLABORATION COMPOUND" means any
Hit, Lead or other compound, other than
the AVP 26452
Compound or the Back-Up Compounds, discovered, identified or
otherwise
selected by AstraZeneca or the Parties jointly as a direct
result
of Hit
Optimisation or Lead Optimisation and any metabolites,
prodrugs,
racemates,
isomers, enantiomers, salts,
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this Exhibit were omitted by means of
blackout of the
text (the "Mark"). This Exhibit has been filed separately
with the
Secretary of the Commission without the Mark pursuant to the
Company's
Application Requesting Confidential Treatment under Rule 24b-2
under the 1934
Act.
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CONFIDENTIAL TREATMENT REQUESTED
esters and free
acid forms of any of the foregoing, for which compound the
first
application for a Joint Patent or an AstraZeneca Patent containing
a
Valid Claim
claiming the compound as a composition of matter is made
anywhere in the
world within *** years from the expiration or termination
of the
Collaboration Term.
1.23 "COLLABORATION PRODUCT" means products
in final forms suitable for human,
veterinary or
agricultural use that contain a Collaboration Compound as the
sole active
ingredient.
1.24 "COLLABORATION MATERIALS" means any
compounds, cells, cell lines, DNA and
RNA molecules,
plasmids, proteins, crystals, coordinates, antibodies,
antibody coding
DNA sequences, antibody coding expression vectors and
antibody
expressing transfected cell lines and other materials and any
replications of
any of the foregoing, that one Party provides to the other
Party to enable
such Party to perform work under the Research
Collaboration;
provided, however, that "Collaboration Materials" shall
exclude all
Collaboration Results.
1.25 "COLLABORATION RESULTS" means Results
that are discovered, conceived,
reduced to
practice or otherwise generated through work performed under
the
Research
Collaboration, provided, however, that Collaboration Results
shall
exclude all
AstraZeneca Improvements.
1.26 "COLLABORATION TERM" has the meaning
set forth in Section 21.2.
1.27 "COLLABORATION YEAR" means the
twelve-month period starting on the
Effective Date
and any immediately subsequent twelve-month period.
1.28 "COMBINATION PRODUCTS" means products
in final forms suitable for human,
veterinary or
agricultural uses that contain a Licensed Compound as an
active
ingredient together with one or more other active ingredients
that
are sold either
as a fixed dose or as separate doses in a single package.
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CONFIDENTIAL TREATMENT REQUESTED
1.29 "COMMERCIALLY REASONABLE EFFORTS"
means, with respect to the research,
development,
Manufacture or commercialisation of a Licensed Compound or
Licensed
Product, as the case may be, efforts and resources commonly
used
in the
research-based pharmaceutical industry for compounds or
products
with similar
commercial and scientific potential at a similar stage in
their lifecycle,
taking into consideration their safety and efficacy, their
cost to develop,
the competitiveness of alternative products, the
anticipated or,
if applicable, actual claim structure and the nature and
extent of their
market exclusivity (including Patent coverage and
regulatory
exclusivity), the likelihood of regulatory approval, their
estimated
profitability, including the amounts of marketing and
promotional
expenditures
with respect to the Licensed Products and Competing Products
and all other
relevant factors. Commercially Reasonable Efforts shall be
determined on a
market-by-market basis for each Licensed Compound and each
Licensed
Product, as applicable; provided, however, that should what
would
otherwise
constitute Commercially Reasonable Efforts with respect to an
individual
market conflict with, or otherwise not constitute, Commercially
Reasonable
Efforts with respect to a group of markets out of which such
market is a part
then Commercially Reasonable Efforts shall be determined
for such group
of markets as a whole.
1.30 "COMPETING PRODUCT" has the meaning
set forth in Section 10.5.1 a).
1.31 "COMPLAINING PARTY" has the meaning
set forth in Section 21.5.
1.32 "CONFIDENTIAL INFORMATION" has the
meaning set forth in Section 14.1.1.
1.33 "CONTROL" means, with respect to any
item of Information, Patent or IP
Protection Right,
possession of the right, whether directly or indirectly,
and whether by
ownership, licence or otherwise, to assign, or grant a
licence,
sublicence or other right to or under, such Information, Patent
or
IP Protection
Right as provided for herein without violating the terms of
any agreement or
other arrangement with any Third Party.
1.34 "DEVELOPMENT PROJECT" means any
activities hereunder by or on behalf of
AstraZeneca or
its Affiliates outside of the Research Collaboration with
the aim of
developing a Licensed Product.
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CONFIDENTIAL TREATMENT REQUESTED
1.35 "DEVELOPMENT REPORT" has the meaning
set forth in Section 8.4.
1.36 "DEVELOPMENT RESULTS" means any and
all Results not constituting
Collaboration
Results or AstraZeneca Improvements.
1.37 "DISCLOSING PARTY" has the meaning set
forth in Section 14.1.1.
1.38 "DISTRIBUTOR" has the meaning set
forth in Section 3.4.
1.39 "EFFECTIVE DATE" has the meaning set
forth in the preamble to this
Agreement.
1.40 "EUROPE" means the European Economic
Area as it may be constituted from
time to
time.
1.41 "EXPLOIT" means to make, have made,
import, use, sell, or offer for sale,
including to
research, develop, register, modify, enhance, improve,
Manufacture,
have Manufactured, hold/keep (whether for disposal or
otherwise),
formulate, optimise, have used, export, transport, distribute,
promote, market
or have sold or otherwise dispose or offer to dispose of, a
product or
process.
1.42 "EXPLOITATION" means the act of
Exploiting a product or process.
1.43 "FDA" means the United States Food and
Drug Administration and any
successor agency
thereto.
1.44 "FIRST COMMERCIAL SALE" means the
first sale for monetary value for use or
consumption by a
member of the general public of a Licensed Product in a
country in the
Territory after Health Registration Approval for the sale of
such Licensed
Product has been obtained in such country. For the avoidance
of doubt, sales
prior to ***, shall not be construed as a First Commercial
Sale.
1.45 "FORCE MAJEURE" has the meaning set
forth in Section 22.1.
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1.46 "FORCE MAJEURE PARTY" means a Party
prevented or delayed in its performance
under this
Agreement by an event of Force Majeure.
1.47 "FTE" means the equivalent of one (1)
researcher being at least a graduate
or a similarly
qualified employee of Avanir having the requisite skills to
fulfil Avanir's
obligations under this Agreement and devoting the
equivalent hours
of a full time employee. For purposes of this Agreement,
"full time"
shall mean *** hours per Calendar Year as determined in
accordance with
Avanir's regular project hour reporting system.
1.48 "FTE RATE" means the price of one (1)
FTE per single Calendar Year. The FTE
Rate shall be
*** U.S. Dollars ($***). The FTE Rate reflects the fully
burdened costs
for an FTE. AstraZeneca shall not be responsible for any
Avanir ***,
including *** costs, incurred in pursuit of the Research
Collaboration
and the consultation services rendered by Avanir under this
Agreement, above
and beyond the FTE Rate, or for ***.
1.49 "GRANT-BACK PATENTS" shall have the
meaning set forth in Section 21.7.3.
1.50 "HEALTH AUTHORITY" means any
applicable supra-national, federal, national,
regional, state,
provincial or local regulatory agency, department, bureau,
commission,
council or other government entity regulating or otherwise
exercising
authority with respect to the Exploitation of Licensed
Compounds
or Licensed
Products in the Territory.
1.51 "HEALTH REGISTRATION APPROVAL" means,
with respect to a country in the
Territory, any
and all approvals, licences, registrations or authorisations
of any Health
Authority necessary to commercially distribute, sell or
market a
Licensed Product in such country, including, where reasonably
required to
engage in such activities, (a) pricing or reimbursement
approval in such
country, (b) pre- and post-approval marketing
authorisations
(including any prerequisite Manufacturing approval or
authorisation
related thereto), (c) labelling approval and (d) technical,
medical and
scientific licences.
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1.52 "HIT" means any compound identified
under the Research Collaboration and
selected by the
RCMC or by AstraZeneca, as applicable, as a candidate for
Hit
Optimisation.
1.53 "HIT OPTIMISATION" means chemical
structure modification performed as part
of the Research
Collaboration or by or on behalf of AstraZeneca, as
applicable,
starting from a Hit and aiming at the identification of
compounds with
properties meeting the Lead criteria defined in the Research
Plan.
1.54 "IF" has the meaning set forth in
Section 6.3.2.
1.55 "IMPROVEMENTS" means any improvements,
adaptations, modifications or
upgrading, and
any IP Protection Rights related thereto.
1.56 "IND" means an investigational new
drug application filed with the FDA for
authorisation to
commence human clinical trials in the U.S., and its
equivalent in
other countries or regulatory jurisdictions in the Territory.
1.57 "INDEMNIFICATION CLAIM NOTICE" has the
meaning set forth in Section 17.3.
1.58 "INDEMNIFIED PARTY" means a Party
seeking to recover a Loss under Section
17.1 or
17.2.
1.59 "INDEMNIFYING PARTY" means a Party
from whom recovery of a Loss is sought
under Section
17.1 or 17.2.
1.60 "INDEMNITEE" has the meaning set forth
in Section 17.3.
1.61 "INDIRECT TAXES" means value added
taxes, sales taxes, consumption taxes
and other
similar taxes.
1.62 "INFORMATION" means all technical,
scientific and other know-how and
information,
trade secrets, knowledge, technology, means, methods,
processes,
practices, formulae, instructions, skills, techniques,
procedures,
experiences, ideas, technical assistance, designs, drawings,
assembly
procedures, computer programs, apparatuses, specifications,
data,
results and
other material, including: the process and results of
high-throughput
screening, gene expression, genomics, proteomics and other
drug discovery
and development technology; biological, chemical,
pharmacological,
toxicological,
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CONFIDENTIAL
TREATMENT REQUESTED
pharmaceutical,
physical and analytical, pre-clinical, clinical, safety,
manufacturing
and quality control data and information, including study
designs and
protocols; assays and biological methodology; Manufacturing and
quality control
procedures and data, including test procedures; and
synthesis,
purification and isolation techniques, (whether or not
confidential,
proprietary, patented or patentable) in written, electronic
or any other
form now known or hereafter developed, but excluding the
Regulatory
Documentation.
1.63 "INFRINGEMENT SUIT" has the meaning
set forth in Section 20.3.
1.64 "IP" has the meaning set forth in
Section 21.10.
1.65 "IP PROTECTION RIGHTS" means any and
all legal means of establishing rights
in and to ideas,
inventions, discoveries, know-how, data, databases,
documentation,
reports, materials, writings, designs, computer software,
processes,
principles, methods, techniques and other information,
including
Patents, trade
marks, service marks, trade names, registered designs,
design rights,
copyrights (including rights in computer software and
database rights)
and any rights or property similar to any of the foregoing
in any part of
the world, whether registered or not, together with the
right to apply
for the registration of any such rights.
1.66 "JOINT EXECUTIVE COMMITTEE" or "JEC"
means the joint committee established
by the Parties
pursuant to Article 6.2.1.
1.67 "JOINT PATENTS" means Patents with
respect to Collaboration Results.
1.68 "KEY PERSONNEL" has the meaning set
forth in Section 5.2.
1.69 "KNOWLEDGE" means a Party's and its
Affiliates' understanding in good faith
of the relevant
facts and information resulting from the reasonable conduct
of its business
affairs, but without the requirement of performing an
investigation
with respect to any such facts and information.
1.70 "LEAD COMPOUND" or "LEAD" means a
compound identified through Hit
Optimisation
under the Research Collaboration or by AstraZeneca, as
applicable, that
has been selected by the RCMC or AstraZeneca, whichever is
applicable, as a
candidate for Lead Optimisation.
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1.71 "LEAD OPTIMISATION" means chemical
structure modification performed under
the Research
Collaboration or by or on behalf of AstraZeneca, whichever is
applicable,
starting from a Lead Compound and aiming at the identification
of compounds
with properties meeting the relevant CD criteria established
by AstraZeneca
at its sole discretion.
1.72 "LICENSED COMPOUNDS" means the AVP
26452 Compound, Back-Up Compound(s) and
Collaboration
Compounds.
1.73 "LICENSED IMPROVEMENT" means, subject
to the limitations set forth in the
next succeeding
paragraph, any Improvement with respect to a Licensed
Compound or
Licensed Product or relating to the Exploitation thereof
Controlled by
Avanir or its Affiliates, not constituting a Development
Result, whether
or not patentable, that is conceived, reduced to practice,
developed or
discovered or otherwise made outside the Research
Collaboration
during the term of this Agreement by or on behalf of Avanir
or its
Affiliates or by the Parties or their respective Affiliates
jointly,
or their
respective employees and agents (whether alone or jointly with
others), or
otherwise Controlled by Avanir or its Affiliates at any time
prior to and at
the Effective Date or during any period in which
AstraZeneca owes
royalties to Avanir pursuant to Section 10.2, and which
AstraZeneca has
not rejected pursuant to Section 12.4.1.
An Improvement
mentioned in the foregoing paragraph conceived, reduced to
practice,
developed or discovered, otherwise made or otherwise Controlled
by or on behalf
solely of Avanir or its Affiliates shall be deemed a
Licensed Improvement
only to the extent it relates to the Licensed Patents
and to the
extent such Improvement conceived, reduced to practice,
developed or
discovered or otherwise made by or on behalf of Avanir or its
Affiliates, and
not with AstraZeneca or its Affiliates, has application
outside such
area it may be utilised by Avanir for any purpose other than
to (a) conduct
any activity with, for the benefit of, or sponsored by, any
Person, that has
as its goal or intent discovering,
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CONFIDENTIAL TREATMENT REQUESTED
identifying,
Exploiting or otherwise commercialising products within *** or
their associated
mechanisms, or (b) grant any licence or other rights to
any Person to
utilise any IP Protection Rights Controlled by Avanir or its
Affiliates
(including, for the avoidance of doubt, any Licensed Patents,
Licensed
Know-How, Joint Patents or Collaboration Results) for the
purpose
of discovering,
identifying, Exploiting or otherwise commercialising
products within
*** or their associated mechanisms.
1.74 "LICENSED KNOW-HOW" means the
Information set out and described in Schedule
2, which is in
the Control of Avanir or its Affiliates as of the Effective
Date, being
Information that is not generally known and is necessary or
useful for the
Exploitation of the Licensed Compounds or the Licensed
Products,
including any Information with respect to Licensed
Improvements,
as mentioned in
Section 12.4.1, but excluding any Information to the extent
covered or
claimed by the Licensed Patents.
1.75 "LICENSED PATENTS" means (a) all
patent applications and patents set forth
in Schedule 4
hereto, (b) any Patents with respect to such patent
applications or
patents, and (c) any Patents claiming or covering any
Licensed
Improvements.
1.76 "LICENSED PRODUCTS" means the Products
and the Combination Products.
1.77 "LOSSES" means any and all direct or
indirect liability, damage, loss or
expense,
including interest, penalties and lawyers' fees and
disbursements.
In calculating
Losses, the duty to mitigate on the part of the Party
suffering the
Loss shall be taken into account.
1.78 "MAJOR MARKET" means (a) ***, (b) ***,
or (c) ***.
1.79 "MANUFACTURE" and "MANUFACTURING"
means, with respect to a product or
compound, the
synthesis, manufacturing, processing, formulating, packaging,
labelling, holding and quality
control testing of such product or compound.
1.80 "NET SALES" means the gross invoiced
amount on sales of the Licensed
Products by
AstraZeneca and its Affiliates to Third Parties (including
Distributors)
after deduction of:
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(a) normal and
customary trade, quantity or prompt settlement
discounts (including chargebacks and allowances) actually
allowed;
(b) amounts *** or ***
by reason of *** determined by AstraZeneca or
its Affiliates in good faith and pursuant to standard industry
practice;
(c) *** and similar
payments made with respect to *** such as, by way
of illustration and not in limitation of the Parties' rights
hereunder, ***;
(d) ***; and
(e) any other similar
deductions that are actually credited to the
customer and are consistent with generally accepted accounting
principles, or in the case of non-United States sales, other
applicable accounting standards; and
(f) as an allowance
for ***, *** percent (***%) of the amount arrived
at after the application of the provisions of items (a) to (e)
above.
Net Sales shall
be calculated using AstraZeneca's internal, externally
audited, systems
used to report such sales, which reporting is done in
accordance with
International Accounting Standards (IAS) consistently
applied, as
adjusted for any of items (a) to (f) above not taken into
account in such
systems.
1.81 "NOTICE PERIOD" has the meaning set
forth in Section 21.5.
1.82 "OTHER INDICATION" means a medical
indication, other than (i) ***; or (ii)
***.
1.83 "PARTY" means either AstraZeneca or
Avanir and "Parties" means both
AstraZeneca and
Avanir.
1.84 "PATENTS" means (a) all national,
regional and international patents and
patent
applications, including provisional patent applications, (b)
all
patent
applications filed
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either from such
patents, patent applications or provisional applications
or from an
application claiming priority from either of these, including
divisionals,
continuations, continuations-in-part, provisionals, converted
provisionals,
and continued prosecution applications, (c) any and all
patents that
have issued or in the future issue from the foregoing patent
applications
((a) and (b)), including utility models, petty patents and
design patents
and certificates of invention, (d) any and all extensions or
restorations by
existing or future extension or restoration mechanisms,
including
revalidations, reissues, re-examinations and extensions
(including any
supplementary protection certificates and the like) of the
foregoing
patents or patent applications ((a), (b) and (c)), and (e) any
similar rights,
including so-called pipeline protection, or any
importation,
revalidation, confirmation or introduction patent or
registration
patent or patent of additions to any such foregoing patent
applications and
patents.
1.85 "PAYMENTS" has the meaning set forth
in Section 10.15.1.
1.86 "PERSON" means a sole proprietorship,
partnership, limited partnership,
limited
liability partnership, corporation, limited liability company,
business trust,
joint stock company, trust, unincorporated association,
joint venture or
other similar entity or organisation, including a
government or
political subdivision, department or agency of a government,
or an
individual.
1.87 "PHASE II CLINICAL TRIAL" means either
a) a clinical trial performed in
patients with
the primary objective of establishing proof of concept,
assessing safety
and tolerability or demonstration of a pharmacological
effect of a
Licensed Product, or b) a clinical study performed in patients
to assess
safety, tolerability and efficacy for the purpose of
identifying
suitable doses
for a Phase III Clinical Trial.
1.88 "PHASE III CLINICAL TRIAL" means a
large scale, multi-centre, human
clinical trial
(excluding dose ranging studies) to be conducted in a number
of patients
estimated to be sufficient to primarily establish efficacy of a
Licensed Product
in the claim of e.g. dyslipidemia or antiatherosclerosis
or any other
claimed major medical indication and at a standard suitable to
obtain a Health
Registration Approval in a Major Market.
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1.89 "PRODUCTS" means the AVP 26452
Product, Back-Up Products and Collaboration
Products.
1.90 "RCMC" has the meaning defined in
Section 6.1.1.
1.91 "RECEIVING PARTY" has the meaning set
forth in Section 14.1.1.
1.92 "REGULATORY DOCUMENTATION" means all
applications, registrations, licences,
authorisations
and approvals (including all Health Registration Approvals),
all
correspondence submitted to or received from Health Authorities
(including
minutes and official contact reports relating to any
communications
with any Health Authority) and all supporting documents and
all clinical
studies and tests, relating to any Licensed Compounds or
Licensed
Products, and all data contained in any of the foregoing,
including all
IND applications, Health Registration Approvals, regulatory
drug lists,
advertising and promotion documents, adverse event files and
complaint
files.
1.93 "RESEARCH COLLABORATION" means the
research collaboration outlined in the
Research Plan to
be carried out during the Collaboration Term; provided,
however, that with respect
to each individual Licensed Compound the
Research
Collaboration shall cease on the date of AstraZeneca's
selection
of such Licensed
Compound as a Candidate Drug. For the avoidance of doubt,
(i) any research
or development concerning the Licensed Compounds or the
Licensed
Products beyond the Research Collaboration will be part of the
Development
Project, and (ii) notwithstanding the fact that the Research
Collaboration
may have ceased with respect to one or more Licensed
Compounds the
Research Collaboration shall, unless terminated earlier in
accordance with
the terms and conditions of this Agreement, continue for
the duration of
the Collaboration Term.
1.94 "RESEARCH PLAN" means the research
plan attached hereto as Schedule 1
outlining the
Research Collaboration and each Party's undertakings and
obligations,
including the allocation of Key Personnel and other FTEs by
Avanir, in
relation thereto as may be amended from time to time in
accordance with
Section 6.1.2.
1.95 "RESULTS" means ideas, inventions,
discoveries, know-how, data,
documentation,
reports, materials, writings, designs, computer software,
processes,
principles, methods,
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techniques and
other information, recorded in any form, that are
discovered,
conceived, reduced to practice or otherwise generated through
work performed
under this Agreement by or on behalf of either Party or by
the Parties
jointly, and any IP Protection Rights pertaining to any of the
foregoing.
1.96 "***" has the meaning defined in
Section 11.1.1.
1.97 "***" has the meaning defined in
Section 11.1.3.
1.98 "SUBLICENSEE" has the meaning set out
in Section 3.3.
1.99 "SUCCESSFUL PROOF OF CONCEPT" means
agreement of the Parties in writing
that there
exists evidence of an effect (whether a clinical outcome or
other bio
marker) indicating a high chance of achieving a result of a
Phase
III Clinical
Trial in an indication in which the Licensed Product concerned
could be
expected to generate peak Annual Net Sales of at least *** U.S.
Dollars ($***),
or initiation of the next step of clinical assessment by
AstraZeneca
after having discovered such effect.
1.100 "SURROGATE MARKER" means a marker
accepted by the Health Authority in a
Major Market as
a substitute for showing a reduction of the risk of ***.
1.101 "TERRITORY" means all countries in
the world, except for those countries
in which this
Agreement is terminated pursuant to Sections 21.3, 21.4 or
21.5.
1.102 "THIRD PARTY" means any Person not
including the Parties, the Parties'
respective
Affiliates or Sublicensees.
1.103 "THIRD PARTY CLAIM" has the meaning
set forth in Section 17.1.
1.104 "TRADEMARK" means any word, name,
symbol, colour, designation or device or
any combination
thereof, including any trademark, trade dress, brand mark,
trade name,
brand name, logo or business symbol used by AstraZeneca in
connection with
the Licensed Compounds or Licensed Products.
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1.105 "TRIGGERING EVENT" has the meaning
set forth in Section 20.1.
1.106 "UNITED STATES" or "U.S." means the
United States of America, including
its territories,
possessions and Puerto Rico.
1.107 "VALID CLAIM" shall mean, with
respect to a Licensed Product in a
particular
country, any claim of a Licensed Patent, a Joint Patent or an
AstraZeneca
Patent that claims (i) the Licensed Compound included in such
Licensed Product
as a composition of matter; (ii) the formulation of such
Licensed Product
or (iii) a method related to, or a use of, the Licensed
Compound or
Licensed Product; provided such claims were filed
contemporaneously with, or after, the claims described in clause
(i) above;
and provided,
further, that a claim described in either clause (ii) or
clause (iii)
above could be reasonably considered to be the reason that
generic
competition (as defined in Section 10.5.1 (a)) has not occurred,
as
determined on a
country-by-country basis, and either:
(a) with respect to a
granted and unexpired Licensed Patent, Joint
Patent or AstraZeneca Patent in such country, (i) has not been
held permanently revoked, unenforceable or invalid by a
decision
of a court or other governmental agency of competent
jurisdiction, which decision is unappealable or unappealed
within
the time allowed for appeal, and (ii) has not been abandoned,
disclaimed, denied or admitted to be invalid or unenforceable
through reissue or disclaimer or otherwise; or
(b) with respect to a
pending Licensed Patent, Joint Patent or
AstraZeneca Patent application, was filed and is being
prosecuted
in good faith and has not been abandoned or finally disallowed
without the possibility of appeal or re-filing of the
application, provided that such claim has not been pending for
more than *** years.
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2 CONSTRUCTION
Except where the
context requires otherwise, whenever used the singular
includes the
plural, the plural includes the singular, the use of any
gender is
applicable to all genders and the word "or" has the inclusive
meaning
represented by the phrase "and/or". Whenever this Agreement
refers
to a number of
days, unless otherwise specified, such number refers to
calendar days.
The headings of this Agreement are for convenience of
reference only
and do not define, describe, extend or limit the scope or
intent of this
Agreement or the scope or intent of any provision contained
in this
Agreement. The term "including" or "includes" as used in this
Agreement means
including, without limiting the generality of any
description
preceding such term. The wording of this Agreement shall be
deemed to be the
wording mutually chosen by the Parties and no rule of
strict
construction shall be applied against any Party.
3 GRANT OF RIGHTS
3.1 Licence Grants to AstraZeneca.
Subject to the terms and conditions of this
Agreement,
Avanir hereby grants to AstraZeneca an exclusive (including
with
regard to Avanir
and its Affiliates), subject to a retained right thereto
for the sole
purpose of Avanir carrying out its obligations under the
Research
Collaboration, right and licence in the Territory, with the
right
to grant
sublicenses pursuant to Section 3.3, under Avanir's and its
Affiliates'
rights, titles, and interests in and to the Licensed Patents,
the Licensed
Know-How, the Collaboration Results, the Joint Patents and the
Licensed
Improvements to (i) Exploit the Licensed Compounds and the
Licensed
Products for all purposes and (ii) use and otherwise Exploit
the
Licensed
Know-How and the Collaboration Results in connection with the
purposes set
forth in clause (i) immediately preceding.
3.2 Licence Grants to Avanir.
AstraZeneca hereby grants to Avanir a
non-exclusive
right and licence, without the right to grant sublicenses,
under
AstraZeneca's rights, titles, and interests in and to the
AstraZeneca
Background
Technologies, the AstraZeneca Improvements, the AstraZeneca
Patents, the
Joint Patents and the Collaboration Results that are disclosed
or otherwise
provided by AstraZeneca to, or discovered by, Avanir during
the
Collaboration Term (a) solely to the extent required by Avanir
to
perform the
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Research
Collaboration during the Collaboration Term, and (b) to use and
otherwise
Exploit such AstraZeneca Background Technologies and
AstraZeneca
Improvements as necessary or
useful to exercise Avanir's rights under the
grant under
(a).
3.3 Sublicenses. AstraZeneca shall,
subject to Section 10.4, have the right to
grant
sublicenses, through multiple tiers of sublicensees, under the
licences granted in Section
3.1, to its Affiliates and to any other Persons
in the Territory
or in any country of the Territory. Where AstraZeneca
grants a
sublicense to a Person that is not an Affiliate of AstraZeneca,
and such Person
is not a Distributor, such Person shall be a "SUBLICENSEE"
for purposes of
this Agreement. AstraZeneca shall ensure that all Persons
to which it
grants sublicenses will comply with all terms and conditions of
this Agreement
and AstraZeneca shall remain liable for any breach of this
Agreement by a
Sublicensee. AstraZeneca shall provide notice of the
granting of any
sublicence hereunder promptly following the making of such
grant. Such
notice shall identify the Sublicensee, the territory of the
sublicence and a
copy of those provisions of the sublicense that relate to
performance of
this Agreement.
3.4 Distributorships. AstraZeneca
shall have the right, in its sole discretion,
to appoint its
Affiliates, and AstraZeneca and its Affiliates shall have
the right, in
their sole discretion, to appoint any other Persons, in the
Territory or in
any country of the Territory, to distribute, market and
sell the
Licensed Products (with or without packaging rights), in
circumstances
where the Person purchases its requirements of Licensed
Products from
AstraZeneca or its Affiliates but does not otherwise make any
royalty or other
payment to AstraZeneca with respect to its IP Protection
Rights. Where
AstraZeneca or its Affiliates appoints such a Person that is
not an Affiliate
of AstraZeneca, that Person shall be a "DISTRIBUTOR" for
purposes of this
Agreement. The term "packaging rights" in this Section 3.4
shall mean the
right for the Distributor to package Licensed Products
supplied in
unpackaged bulk form into individual ready-for-sale packs.
3.5 Co-Promotion Rights. For the
avoidance of doubt, AstraZeneca and its
Affiliates shall
have the right, in their sole discretion, to co-promote
the Licensed
Products with any
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other Person, or
to appoint one or more Third Parties to promote the
Licensed
Products without AstraZeneca carrying out any promotion in all
or
any part of the
Territory.
3.6 Commercially Viable Use of
Avanir's Sales Force. In anticipation of the
Health
Registration Approval of the initial Licensed Product in the
United
States,
AstraZeneca and Avanir shall meet and confer to establish the
terms
and conditions,
beyond those set forth herein, upon which AstraZeneca will,
should
AstraZeneca determine in its then current sales and marketing plan
a
need to have the
Licensed Product concerned promoted among *** in second or
third-line
promotional activities, use Avanir's sales force to support
AstraZeneca's
sales efforts in the United States in respect of such initial
Licensed Product
by way of second or third line promotional activities in
the segment of
***. Such right of Avanir shall always be subject to the
provisos that
(i) each member of Avanir's sales force intended to support
AstraZeneca as
described hereunder meets the then applicable AstraZeneca
standard quality
criteria for sales representatives; (ii) such Avanir
personnel shall
be deployed only pursuant to the relevant sales and
marketing plan
by AstraZeneca for the initial Licensed Product; (iii)
AstraZeneca's
obligation to compensate Avanir for such services be limited
to ***; and (iv)
that such detail calls by Avanir shall not in any given
calendar quarter
exceed *** percent (***%) of the aggregate detail calls
with specialists
by AstraZeneca's or its Affiliates' sales forces for the
initial Licensed
Product in such calendar quarter. Notwithstanding the
foregoing to the
contrary, in the event that AstraZeneca decides to
outsource sales
or promotional activities pertaining to the Licensed
Product in the
neuro-specialist field in the U.S. beyond the activities of
Avanir pursuant
to this Section 3.6, AstraZeneca shall meet and confer with
Avanir on such
subject for the purpose of providing Avanir an opportunity
to seek such
business if it so desires.
3.7 No Conflicts.
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3.7.1 Within the
scope of the Research Collaboration, and to the extent
Applicable Law permits Avanir to conduct research and
development
activities with respect to Licensed Compounds or Licensed
Products
notwithstanding the exclusive licence grants to AstraZeneca
under
Section 3.1, Avanir agrees that neither it nor its Affiliates
will
publish or present any material or file any Patent applications
with
respect to such activities without the consent of AstraZeneca.
3.7.2 Subject to
Avanir's rights and obligations under the Research
Collaboration, and during the Collaboration Term and for ***
years
after its termination or expiration, or, if this Agreement is
terminated by AstraZeneca pursuant to Section 21.5, for a period
of
*** year after such termination, Avanir covenants that it and
its
majority-owned subsidiaries (and its other Affiliates which are
Affiliates both as of the Effective Date and during the periods
referred to above) shall not, and that it shall use its best
reasonable efforts to cause its Affiliates other than those
mentioned
above not to, (a) conduct any activity with, for the benefit of,
or
sponsored by, any Person, that has as its goal or intent
discovering,
identifying, Exploiting or otherwise commercialising *** or
their
associated mechanisms, or (b) grant any licence or other rights to
any
Person to utilise any IP Protection Rights Controlled by Avanir or
its
majority-owned subsidiaries (or its other Affiliates which are
Affiliates both as of the Effective Date and during the period
referred to above), or by such Affiliates of Avanir other than
those
referred to above to the extent Avanir has the ability to prevent
such
grant provided always that Avanir uses its best reasonable efforts
in
this regard, (including, for the avoidance of doubt, any
Licensed
Patents, Licensed Know-How, Joint Patents or Collaboration
Results)
for the express
purpose of discovering, identifying, Exploiting or
otherwise commercialising *** or their associated mechanisms.
Avanir
agrees that it will not create Affiliates after the Effective Date
for
the
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purpose of obviating compliance with this Section 3.7.2. The
Parties
acknowledge that all restrictions contained in this Section 3.7.2
are
reasonable, valid and necessary for the adequate protection of
the
Licensed Product business and because of the disclosure of
Confidential Information by AstraZeneca, and that AstraZeneca
would
not have entered into this Agreement without the protection
afforded
it by this Section 3.7.2.
3.8 Exclusivity Term. AstraZeneca's
exclusive position granted by Section 3.1
shall expire
with respect to each separate Licensed Product, on a
country-by-country basis, on the date when AstraZeneca's obligation
to pay
royalties with
respect to such Licensed Product pursuant to Section 10.2 or
Section 10.4, as
applicable, expires. Upon expiration of the royalty term
set forth in
Section 10.8 with respect to a Licensed Product in a country,
AstraZeneca's
licence with respect to such Licensed Product in such country
shall become
non-exclusive, fully paid-up, perpetual and irrevocable and
the Net Sales of
such Licensed Product in such country shall be excluded
from the royalty
calculations in Sections 10.2 (including the thresholds
and ceilings) or
10.4, as applicable. AstraZeneca and its Affiliates and
Sublicensees
following such expiration shall be allowed to continue
Exploiting such
Licensed Product and using all Licensed Know-How and
Collaboration
Results in connection therewith on a non-exclusive basis in
such country
with no further consideration to Avanir.
3.9 Regulatory Documentation. The
Parties acknowledge that Avanir will prepare
in conjunction
with AstraZeneca and submit the first IND application
concerning the
AVP 26452 Compound in accordance with the IND filing plan
attached hereto
as Schedule 3. Furthermore, in the event that in response
to the
submission of the IND, the Regulatory Authority poses questions
to
Avanir or
otherwise requires additional data, Avanir and AstraZeneca
shall
cooperate to
meet and confer as required to formulate an action plan in
response to such
request. It is acknowledged that AstraZeneca may ask
Avanir to manage the
single and multiple ascending dose studies associated
with the IND
filing and
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Avanir agrees
(at AstraZeneca's request) to make up to *** FTEs available
to manage such
studies. AstraZeneca shall reimburse Avanir for the work of
such FTEs at the
FTE rate. AstraZeneca may from time to time during the
term of this
Agreement reasonably request Avanir to make, at AstraZeneca's
cost,
applications for an IND in addition to that mentioned above in
this
Section 3.9 or
other regulatory approvals whether in Avanir's or in
AstraZeneca's or
any of its Affiliates' name and Avanir undertakes to
comply with any
such reasonable request. Without exception, AstraZeneca
will, as between
AstraZeneca and Avanir, be the owner of any Regulatory
Documentation
relating to any such applications for an IND or regulatory
approvals as
mentioned in this Section 3.9 (including IND applications and
approvals).
Notwithstanding
what is stated above in this Section 3.9 should the first
IND Application
either (a) not have been submitted by ***, or (b) not have
become effective
within *** of submission, AstraZeneca shall have the
right, in its
sole discretion, upon written notice to Avanir either to
require Avanir
to transfer such IND Application to it or to instruct Avanir
in the conduct
of remedial measures to allow such IND Application to be
submitted and to
become effective, as the case may be. Upon transfer of
such IND
Application, AstraZeneca shall be responsible for preparing and
submitting such
IND Application.
4 CONFIRMATORY PATENT
LICENCES
Avanir shall if
requested to do so by AstraZeneca promptly enter into
confirmatory
licence agreements in the form or substantially the form set
out in Schedule
5 for purposes of recording the licences granted under this
Agreement with
such Patent Offices in the Territory as AstraZeneca
considers
appropriate. Until the execution of any such confirmatory
licences, so far
as may be legally possible, Avanir and AstraZeneca shall
have the same
rights in respect of the Licensed Patents and the Joint
Patens and be
under
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the same
obligations to each other in all respects as if the said
confirmatory
licences had been executed.
5 THE RESEARCH
COLLABORATION
5.1 Conduct of Research Collaboration.
During the Collaboration Term and under
the direction
and supervision of the RCMC, each Party shall (a) perform or
cause to be
performed its obligations under the Research Plan in good
scientific
manner and in compliance in all material aspects with all
Applicable Law,
including, unless otherwise set forth in the Research Plan,
good laboratory
practices and good clinical practices, and (b) allocate the
time, effort,
equipment and skilled personnel to complete such activities
as set forth in
the Research Plan. Following the Effective Date, the
Parties shall
promptly commence the Research Collaboration. Avanir
undertakes
insofar as it relates to animal care in the activities to be
carried out by
it hereunder to comply with the AAALAC standards and shall
use its best
reasonable efforts to comply with the AstraZeneca
International
Policy on Animal Care and Use to the extent stricter than the
AAALAC
standards.
5.2 Facilities and Key Personnel.
Avanir shall provide facilities, equipment
and manpower
that are reasonably necessary to carry out the work undertaken
by Avanir under
the Research Collaboration at Avanir's facilities at 11388
Sorrento Valley
Road, Suite 200, in San Diego, California, USA, and, after
AstraZeneca's
prior written approval, at such other facilities which Avanir
may come to
occupy of an appropriate standard for performing research in
accordance with
Good Laboratory Practice and otherwise in accordance with
the Research
Plan. Subject to Section 5.3, the foregoing undertaking shall
not be construed
to prevent Avanir from relying upon subcontractors for the
performance of
activities under the Research Plan which are, or would be,
of a type
typically performed by subcontractors. The principal scientist
designated by
Avanir (the "AVANIR PRINCIPAL SCIENTIST") shall be
responsible for
all Research Collaboration activities undertaken by Avanir
and shall
supervise the work of all personnel engaged by Avanir in the
Research
Collaboration. The Avanir Principal Scientist shall serve as
the
primary contact
for AstraZeneca on all matters related to the Research
Collaboration.
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The Avanir
Principal Scientist and other scientific and technical
personnel
of Avanir considered by
AstraZeneca to be of key importance for the conduct
of the Research
Collaboration (the "KEY PERSONNEL") are listed on Schedule
6 hereto. Avanir
shall not substitute persons for the Key Personnel or
materially
reduce the time commitment of any Key Personnel to the Research
Collaboration
without the prior written approval of AstraZeneca, which
approval with
respect to the Key Personnel shall not be unreasonably
withheld or
notice whether approval is granted unreasonably delayed. In the
event that any
Key Personnel are no longer employed by Avanir or are
otherwise
incapable of performing their obligations under this Agreement
(e.g., become
disabled), the Parties shall meet and discuss in good faith
how best to
proceed provided, however, that in case the Principal Scientist
terminates his
employment with Avanir or leaves the employment for any
other reason
(including death) during the *** Collaboration Year, Avanir
shall have a
reasonable opportunity to find a replacement of comparable
experience and
stature satisfactory to AstraZeneca; provided, however, if
Avanir is unable
to hire a reasonably satisfactory replacement within ***
days of the date
the Principal Scientist terminates or leaves his
employment,
AstraZeneca shall have the right to terminate the Research
Collaboration by
providing *** days' written notice thereby ending the
Collaboration
Term. Upon such termination AstraZeneca shall be under no
obligation to
provide Avanir with any further compensation pursuant to
Article 9 and
the provisions of Section 21.6 (y) shall apply.
5.3 Subcontracting. Avanir shall be
solely responsible for successfully
completing its
activities set forth in the Research Plan. Avanir shall
conduct and
carry out the activities provided for under the Research
Collaboration
primarily through its employees at the site identified under
Section 5.2.
Avanir, prior to engaging a subcontractor to carry out any
significant
portion of such activities shall seek the consent of
AstraZeneca
which shall not be unreasonably withheld or notice whether
consent is
provided unreasonably
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delayed. Any subcontract
shall be subject to the applicable terms and
conditions of
this Agreement, including Articles 14 and Section 16.1, and,
upon
AstraZeneca's request, Avanir shall require each such subcontractor
to
enter into an
undertaking, pursuant to which the terms and conditions of
this Agreement
shall apply directly between such subcontractor and
AstraZeneca,
prior to disclosing to such subcontractor any of AstraZeneca's
Confidential
Information; provided, however, that Avanir shall remain
ultimately
responsible for the performance of its obligations under this
Agreement. Any
fees or costs due any such subcontractor shall be at the
sole expense of
Avanir.
5.4 Collaboration Materials and
Information Transfer.
5.4.1 Avanir
shall, and shall cause its majority-owned subsidiaries and its
other Affiliates (which are its Affiliates both as of the
Effective
Date and at all relevant times thereafter) and use its best
reasonable
efforts to cause its Affiliates other than those referred to
above,
without additional compensation and at Avanir's sole expense,
provide
to AstraZeneca copies of any Licensed Know-How which could be
reasonably considered material to the Research Collaboration,
not
previously provided to AstraZeneca, promptly after the Effective
Date.
Upon AstraZeneca's request to Avanir, Avanir shall promptly provide
to
AstraZeneca any copies of additional Licensed Know-How and
originals
of Licensed Know-How in those cases where AstraZeneca has a need
for
the same in connection with the filing and prosecution of
patents.
5.4.2 During the
Research Collaboration each Party shall, and shall cause
its majority-owned subsidiaries and its other Affiliates (which
are
its Affiliates both as of the Effective Date and at all relevant
times
thereafter) and use its best reasonable efforts to cause its
Affiliates other than those mentioned above, in accordance with
the
criteria and mechanisms established by the RCMC, disclose and
make
available to the other Party, in whatever form such Party may
reasonably request all Collaboration Results promptly upon the
earlier
of the conception or reduction to practice, discovery, development
or
making of such Collaboration Results.
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5.4.3 Each Party
shall, and shall cause its majority-owned subsidiaries and
its other Affiliates (which are its Affiliates both as of the
Effective Date and at all relevant times thereafter) and use its
best
reasonable efforts to cause its Affiliates other than those
referred
to above, in accordance with the criteria and mechanisms
established
by the RCMC, disclose and make available to the other Party, in
whatever form such Party may reasonably request all
Collaboration
Material promptly upon the Effective Date or upon the earlier of
the
conception or reduction to practice, discovery, development or
making
of such Collaboration
Material; provided, however, that,
notwithstanding the foregoing, AstraZeneca shall only be required
to
provide or disclose to Avanir such Collaboration Materials and
other
information as it determines, in its sole discretion, is
reasonably
necessary for Avanir to perform its activities under the
Research
Collaboration and AstraZeneca retains the right, in its
reasonable
discretion, to withdraw any such Collaboration Material
information
from the Research Collaboration upon written notice to Avanir.
5.5 Cooperation. Each Party shall
cooperate with any and all reasonable
requests for
assistance from the other Party with respect to the activities
under the
Research Collaboration, including by making its employees,
consultants and
other scientific staff available upon reasonable notice
during normal
business hours at their respective places of employment to
consult with
such other Party on issues arising in connection with the
Research
Collaboration.
5.6 Regulatory Records. Avanir and
AstraZeneca each shall maintain, or cause to
be maintained,
records of its respective activities under the Research
Collaboration in
sufficient detail and in good scientific manner
appropriate for
patent and regulatory purposes, which shall be complete and
accurate and
shall fully and properly reflect all work done and results
achieved in the
performance of its respective activities under the Research
Collaboration,
and which shall be retained by such Party for at least five
(5) years after
the termination of the Research Collaboration, or for such
longer period as
may be required by Applicable Law; provided always that
before
destroying any such
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record upon
expiration of such period Avanir shall offer AstraZeneca in
writing to
transfer such record to AstraZeneca and shall, should
AstraZeneca
declare that it wishes to have such record transferred,
transfer it to
AstraZeneca, at AstraZeneca's cost, without unreasonable
delay.
AstraZeneca shall preserve such records for the benefit of, and
transfer to,
Avanir in anticipation of a termination of this Agreement that
could result in
the transfer of such documents to Avanir. Each Party shall
have the right,
during normal business hours and upon reasonable notice, to
inspect and copy
any such records contemplated by this Section 5.6.
6 MANAGEMENT OF THE
RESEARCH COLLABORATION
6.1 Research Collaboration Management
Committee.
6.1.1
Responsibilities of RCMC. The Research Collaboration Management
Committee (the "RCMC") established by the Parties oversees the
initiation, planning and performance of the activities under
the
Research Collaboration. In particular, the responsibilities of
the
RCMC shall include: (a) for the period following the first
Collaboration Year, consider and propose to the JEC the number of
FTEs
at Avanir to be funded under the Collaboration Term by AstraZeneca
as
set forth in Section 9.1; (b) establishing reporting criteria
and
mechanisms for making Collaboration Results available to the
other
Party; (c) establishing criteria and mechanisms for disclosing
and
making available to the other Party Collaboration Materials;
(d)
establishing prioritisation criteria for specific components under
the
Research Collaboration, including setting proposed dates for
experimental initiation and completion of each stage of the
Research
Collaboration; (e) determining within fifteen (15) days of the
completion of each stage of the Research Collaboration pertaining
to a
specific Licensed Compound whether the completion thereof has
been
successful and deciding whether or not to continue the Research
Collaboration into the next stage (i.e., making "stop/go
decisions");
(f) monitoring workflow, including experimental sample
transfer,
sample analysis and data quality control, data analysis and
summarisation, software installation (access), training and
maintenance; (g) monitoring of sample throughput, and
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overall Research Collaboration progress; (h) to the extent
permitted
by the Research Plan, assigning tasks and responsibilities taking
into
account each Party's respective specific capabilities and expertise
in
order to avoid duplication and enhance efficiency and synergies;
(i)
monitoring timely execution of the Research Collaboration,
including
compliance with budgets and timelines; and (j) reviewing and
approving
any amendments to the Research Plan, which to the extent they
place
additional responsibilities on Avanir shall require the express
written consent of Avanir.
6.1.2 Research
Plan. The Parties acknowledge and agree that the Research
Plan attached hereto as of the Effective Date sets forth the goals
and
objectives of the Research Collaboration and the broad terms of
the
Parties' respective undertakings to achieve those goals and
objectives, and the funding of FTEs provided for under Section
9.1
represents AstraZeneca's total financial obligation for all
services
to be rendered and expenses to be incurred by or on behalf of
Avanir
as necessary to achieve the goals and objectives of the
Research
Collaboration. The Parties further acknowledge and agree that
the
Research Plan will be amended by the RCMC from time to time during
the
Collaboration Term for each stage of the Research Collaboration
to
identify and define the specific undertakings of the Parties
required
to implement the Research Collaboration.
6.1.3 Formation
of RCMC. The RCMC shall consist of six (6) members with the
requisite experience and seniority to enable them to make decisions
on
behalf of the Parties with respect to the initiation, planning
and
performance of the activities of the Research Collaboration,
with
equal numbers appointed by the respective Party, which shall
include
the Avanir Principal Scientist and the AstraZeneca Principal
Scientist
acting as Co-Chairs. Each Party shall have the right to replace
its
respective RCMC representatives upon written notice to the
other
Party, provided that any such substitute representative shall
have
substantially the equivalent experience and seniority as the
representative that such person replaces. Each Party shall be
entitled
to bring for an agenda item at a
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meeting of the RCMC such minimum numbers of advisors, consultants
and
other visitors which such Party considers in good faith necessary
or
useful to such Party to protect its interest regarding the business
to
be dealt with under such agenda item. If such visitors are not
employees of a Party, their attendance at the RCMC meeting shall
be
further conditioned upon agreement with the inviting Party over
confidentiality and non-use obligations no less burdensome than
set
forth herein.
6.1.4 Disputes.
The RCMC shall endeavour to reach consensus on all matters
brought before it with each Party having a single vote,
irrespective
of the number of representatives actually in attendance at a
meeting;
provided, however, that in the event the RCMC is unable to resolve
an
outstanding matter before it, such matter shall be resolved by
the
JEC.
Should the RCMC not be able to reach consensus on what proposal
to
bring to the JEC concerning such matter referred to under
Section
6.1.1 (a), each Party may bring its respective proposal to the
JEC
which shall then consider the proposals and make a decision in
accordance with Section 6.2.4. The matter shall be deemed brought
to
the attention of the JEC when the first Party's proposal has
been
submitted to the JEC.
6.1.5 Meetings.
The RCMC shall meet at least quarterly and more frequently
when required. Regular quarterly meetings shall be scheduled on
a
recurring schedule to be established by the RCMC (e.g. the
first
Tuesday of January, April, July and October at 9:30 a.m. at the
place
of meeting, if held in person), or at such other mutually
agreeable
times no less than three (3) months in advance, except for the
initial
meeting of the RCMC, which shall be at a mutually agreeable time
and
place. Any such regular meeting falling on a holiday when
commercial
banks are closed in any of Great Britain, Sweden or the United
States
shall be postponed until the next succeeding day when commercial
banks
are open for business in all three jurisdictions. The meetings
shall
be held by means of teleconference or videoconference or, when held
in
person, at AstraZeneca AB's facilities in Molndal, Sweden, or at
other
locations *** mutually
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agreed upon by the Parties. Subject to what is stated in
Section
6.1.6, a quorum of the RCMC shall exist whenever there is present
at a
meeting each of the Co-Chairs or their respective designees. In
addition, the RCMC may act without a formal meeting by a
written
memorandum signed by the Co-Chairs of the RCMC. Whenever any action
by
the RCMC is required hereunder during a time period in which the
RCMC
is not scheduled to meet, either Co-Chair shall have the right to
call
a special meeting or the Co-Chairs may cause the RCMC to take
the
action without a meeting in the applicable time period. Any
such
additional meetings shall be held at places and on dates selected
by
the Co-Chairs.
6.1.6 Quorum.
Notwithstanding what is stated in Section 6.1.5, the Co-Chair
of AstraZeneca may call for a meeting to be held on a business
day
when commercial banks are open for business in Great Britain,
Sweden
and the United States by notifying Avanir no later than thirty
(30)
days in advance of a meeting of the RCMC of the exact date, time
and
location for the meeting. Provided that (i) such notice has
been
timely issued and that the meeting is held on the date, time and
place
so indicated, or (ii) that Avanir confirms that it has been
properly
notified about the meeting, quorum shall be considered constituted
at
that meeting unless all members of one Party fail to attend the
meeting because of illness, where no substitution could be
reasonably
arranged, breakdown in general communications, travel
difficulties
beyond the reasonable control of such Party, or by other
similar
reasons. No meeting shall be called for a day on which the
commercial
banks are closed in any of Great Britain, Sweden or the United
States.
For the purpose of agreeing that Avanir has been properly notified
of
the meeting in the case under (ii), attendance to a meeting
without
express objection thereto shall be sufficient.
6.1.7 Expenses.
Avanir and AstraZeneca each shall bear all expenses of its
RCMC members related to such members' participation on the RCMC
and
attendance at RCMC meetings.
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6.1.8 Minutes.
The RCMC shall keep accurate minutes of its deliberations,
which minutes shall record all proposed decisions and all
actions
recommended or taken, all proposals to the JEC on the number of
FTEs
at Avanir to be funded by AstraZeneca in a subsequent
Collaboration
Year in accordance with Section 9.1, Research Collaboration
progress
reports provided to the RCMC pursuant to Section 7.1 and
Collaboration
Results generated of interest in the Research Collaboration.
Furthermore, all CDs and pre-CDs selected by AstraZeneca during
the
Collaboration Term shall be recorded in the minutes of the
RCMC.
Drafts of minutes shall be delivered to the Co-Chairs of the
RCMC
within twenty (20) days after the respective meeting. The Parties,
on
an alternating basis, shall prepare and circulate the draft
minutes.
Draft minutes shall be edited by the Co-Chairs and shall be issued
in
final form only with the approval and agreement of the Co-Chairs,
such
issuance not subject to final determination by the JEC in the event
of
a dispute.
6.2 Joint Executive Committee.
6.2.1 Formation
of the JEC. The Parties shall establish a Joint Executive
Committee (the "JEC") to resolve any outstanding matter before
the
RCMC that the RCMC is unable to resolve. The JEC shall consist of
four
(4) members with equal numbers appointed by each Party with the
requisite experience and seniority to enable them to resolve
any
matter brought before them and make any necessary decisions on
behalf
of the Parties with respect to any such matter. Furthermore, the
JEC
shall include a Co-Chair to be designated by each Party. Each
Party
shall have the right to replace its respective JEC
representatives
upon written notice to the other Party, provided that any such
substitute representative shall have substantially the
equivalent
experience and seniority as the representative that such person
replaces.
6.2.2 Meetings.
The JEC shall meet within fifteen (15) days from when a
matter in dispute is first brought to the attention of the JEC by
the
RCMC and when otherwise required for the purpose of the
Research
Collaboration. The meetings
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shall be held by means of teleconference or videoconference or,
when
held in person, at AstraZeneca AB's facilities in Molndal, Sweden,
or
at other locations *** mutually agreed upon by the Parties. Subject
to
what is stated in Section 6.2.3, a quorum of the JEC shall
exist
whenever there is present at a meeting each of the Co-Chairs or
their
respective designees. The JEC shall endeavour to reach consensus
on
all matters brought before it with each Party having a single
vote,
irrespective of
the number of representatives actually in attendance
at a meeting. Avanir and AstraZeneca each shall bear all expenses
of
its JEC members related to such members' participation on the JEC
and
attendance at JEC meetings.
6.2.3 Quorum.
Notwithstanding what is stated in Section 6.2.2, the Co-Chair
of AstraZeneca may call for a meeting by notifying Avanir no
later
than thirty (30) days in advance of a meeting of the JEC of the
exact
date, time
and location for the meeting. Provided that (i) such notice
has been timely issued and that the meeting is held on the date,
time
and place so indicated, or (ii) that Avanir confirms that it has
been
properly notified about the meeting, quorum shall be considered
constituted at that meeting unless all members of one Party fail
to
attend the meeting because of illness, where no substitution could
be
reasonably arranged, breakdown in general communications,
travel
difficulties beyond the reasonable control of such Party, or by
other
similar reasons. No meeting shall be called for a day on which
the
commercial banks are closed in any of Great Britain, Sweden or
the
United States. For the purpose of agreeing that Avanir has been
properly notified of the meeting in the case under (ii), attendance
to
a meeting without express objection thereto shall be
sufficient.
6.2.4
Decision-making. Any final decision mutually agreed to by the
JEC
shall be in writing and shall be conclusive and binding on the
Parties. If such resolution regarding the initiation, planning
or
performance of the activities of the Research
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Collaboration as described in Section 6.1.1 is unattainable by the
JEC
within *** days from the date the matter in dispute is first
brought
to the attention of the JEC, the dispute shall be resolved in
accordance with ***; provided, however, that, subject to
Section
6.1.2, if the matter in dispute would result in additional
expense
being incurred by Avanir for activities not contemplated in the
Research Plan, then AstraZeneca shall reimburse Avanir for such
additional expense.
6.2.5 Minutes.
The JEC shall keep accurate minutes of its deliberations,
which minutes shall record all proposed decisions and all
actions
recommended or taken. Drafts of minutes shall be delivered to
the
Co-Chairs of the JEC within twenty (20) days after the
respective
meeting. The Parties, on an alternating basis, shall prepare
and
circulate the draft minutes. Draft minutes shall be edited by
the
Co-Chairs and shall be issued in final form only with the approval
and
agreement of the Co-Chairs.
6.3 Upon Expiration or Termination of
the Collaboration Term. Upon expiration
or termination
of the Collaboration Term the following shall apply:
6.3.1
Dissolution of the RCMC and the JEC. The RCMC and the JEC shall
be
dissolved and Avanir shall provide AstraZeneca with
consultation
services, including reviewing and contributing to proposed
publications concerning the Licensed Compounds or Licensed
Products,
as AstraZeneca may reasonably request for the Development
Project,
including by making Avanir's employees, consultants and other
scientific staff available upon reasonable notice during normal
business hours at their respective places of employment to
consult
with AstraZeneca on issues arising during the Development Project,
or
in connection with Exploitation of Licensed Compounds, Products
or
Results. AstraZeneca shall reimburse Avanir for out-of-pocket
costs
incurred in connection with such consultation services and should
the
time devoted by Avanir to such services
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exceed *** FTE days in any Calendar Year, AstraZeneca shall
compensate
Avanir for any additional agreed upon FTE days. Prior to
performing
services in excess of the *** day allotment, Avanir shall
notify
AstraZeneca in writing that the said allotment has been utilised.
For
purposes of this Section 6.3.1, the daily FTE rate shall be
determined
by dividing the FTE Rate by ***.
6.3.2 The
Parties shall establish an Information Forum (the "IF"),
consisting of between four (4) and eight (8) members with equal
numbers appointed by the respective Party for the purpose of
AstraZeneca gaining from the experience and expertise of Avanir
and
for keeping Avanir updated on AstraZeneca's activities in the
Development Project. The IF shall meet on dates mutually agreed by
the
Parties once a year at a location suitable to both parties or
by
teleconference, videoconference or by other jointly suitable
means.
Avanir and AstraZeneca each shall bear all expenses of its IF
members
related to such members' participation on the IF and attendance at
IF
meetings.
6.3.3 Avanir shall
cease any and all use of the Licensed Know How, the
Collaboration Results, the AstraZeneca Background Technologies,
the
AstraZeneca Improvements and any other AstraZeneca Confidential
Information.
6.3.4 Avanir
shall deliver or return, as applicable, all data, files,
records and other materials in its possession or control containing
or
comprising all AstraZeneca Background Technologies, AstraZeneca
Improvements and AstraZeneca's Confidential Information (except
one
copy of AstraZeneca's Confidential Information which may be
retained
by Avanir solely for archival purposes).
6.3.5 Avanir's
obligation under Sections 6.3.1 through 6.3.4 shall, in
addition to, and without limiting, what is stated therein, apply
to
each separate Licensed Compound which AstraZeneca has selected as
a
Candidate Drug in which
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situation such obligations shall refer to such individual
Licensed
Compound or Licensed Improvement thereon, provided, however, that
the
RCMC and the JEC shall not be dissolved, and the IF not be
established, until the expiration or termination of the
Collaboration
Term.
6.3.6
Information Updates Regarding the AVP 26452 Compound and Other
Compounds. At each quarterly meeting of the RCMC during the
Collaboration Term, AstraZeneca shall provide Avanir an update
on
AstraZeneca's activities and progress regarding the AVP 26452
Compound
and any other Licensed Compounds that has been selected as a CD
by
AstraZeneca. Such updates shall cover general information on
AstraZeneca's development activities in the preceding quarter and
a
summary of the activities planned in the next twelve (12) months.
For
the avoidance of doubt, after the termination or expiration of
the
Collaboration Term, the AVP 26452 Compound and such other
Licensed
Compounds that have been selected as a CD by AstraZeneca shall
be
included in the regular information updates process for the
Development Program as set forth in Sections 6.3.2 and 8.4.
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6.4 Transfer upon Termination of the
Collaboration Term.
Upon expiration
or termination of the Collaboration Term the following
shall apply:
6.4.1 Avanir
shall, and shall cause its majority-owned subsidiaries and its
other Affiliates (which are its Affiliates both as of the
Effective
Date and at all relevant times thereafter) and use its best
reasonable
efforts to cause its Affiliates other than those referred to above
to,
without additional compensation, disclose and make available to
AstraZeneca, to the extent not done so already, in whatever
form
AstraZeneca may reasonably request, Regulatory Documentation,
copies
of Licensed Know-How, Collaboration Results and any other
Information
claimed or covered by any Licensed Patent or Joint Patent or
otherwise
relating, directly or indirectly, to any Licensed Compound,
Licensed
Product or Licensed Improvement, and thereafter and throughout
the
term of the Agreement immediately upon the earlier of the
development,
making, conception or reduction to practice of each such
Regulatory
Documentation, Licensed Know-How or other Information.
6.4.2 Avanir's
obligation under Section 6.4.1 and under Section 6.4.4
shall, in addition to, and without limiting, what is stated
therein,
apply to each separate Licensed Compound which AstraZeneca has
selected as a Candidate Drug in which situation such obligations
shall
refer to such Regulatory Documentation, Licensed Know-How,
Collaboration Results and Information relating directly or
indirectly
to that particular Licensed Compound or Licensed Improvement
thereon.
6.4.3 Avanir
warrants that it will perform a reasonably diligent search for
Licensed Know-How and Regulatory Documentation relevant to the
safety,
efficacy and Exploitation of Licensed Compounds and Licensed
Products
in existence as of the termination or expiration of the
Collaboration
Term and that all such located Licensed Know-How and Regulatory
Documentation will be disclosed to AstraZeneca upon termination
or
expiration of the Collaboration Term.
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6.4.4 Avanir, at
its ***, will provide AstraZeneca with all reasonable
assistance required in order to transfer the Licensed Know-How
to
AstraZeneca in a timely manner following termination or expiration
of
the Collaboration Term. Without prejudice to the generality of
the
foregoing, if visits of Avanir's representatives to
AstraZeneca's
facilities are reasonably requested by AstraZeneca for purposes
of
transferring the
Licensed Know-How to AstraZeneca or for purposes of
AstraZeneca acquiring expertise on the practical application of
the
Licensed Know-How or assisting on issues arising during such
Exploitation, Avanir will send appropriate representatives to
AstraZeneca's facilities, provided that AstraZeneca shall
reimburse
Avanir for its reasonable and verifiable expenses of travel and
accommodations for such representatives and such persons'
working
hours actually devoted to such transfer or assistance at the FTE
Rate.
7 REPORTS
7.1 Research Collaboration Progress
Reports. No later than five (5) business
days prior to
each quarterly RCMC meeting, the Parties shall provide the
RCMC with a
detailed written progress report in English containing
specifications
and other information on all Collaboration Results generated
by such party
under the Research Collaboration and not previously reported
to the RCMC. The
RCMC may provide further instructions on the timing and
content of these
reports.
7.2 Copyrights. Copyrights to reports
provided for hereunder are part of the
Collaboration
Results. Neither Party shall, without the prior written
approval of the
other Party, attribute to the other Party any abstract or
interpretation
of any such report for sales or promotion purposes.
Notwithstanding
the foregoing, each Party shall be entitled to make such
number of copies
of Collaboration Results as is reasonably required to
perform its
obligations under this Agreement and for archival purposes.
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8 DEVELOPMENT
PROJECT
8.1 Diligence Obligations. AstraZeneca
undertakes to:
8.1.1 use
Commercially Reasonable Efforts at its own cost and expense to
develop a Licensed Product and to conduct all development necessary
to
obtain Health Registration Approvals for a Licensed Product for use
in
humans (including the indication for ***) in each of the Major
Markets
and throughout the Territory; and
8.1.2 use
Commercially Reasonable Efforts to commercialise a Licensed
Product for use in humans (including the indication for ***) in
each
of the
Major Markets and throughout the Territory; provided, however,
that such obligations are expressly conditioned upon Avanir and
its
Affiliates performing their respective obligations hereunder,
including the completion of the activities under the Research
Collaboration and the information disclosure requirements pursuant
to
Section 5.4, and such obligations of AstraZeneca shall be delayed
or
suspended as long as any such condition exists; and provided
further,
for the avoidance of doubt, that AstraZeneca shall not be obligated
to
obtain Health Registration Approval for, or commercialise, more
than
one Licensed Product in any Major Market and throughout the
Territory.
In the event that AstraZeneca decides to discontinue the
development
or commercialisation of a Licensed Product in favour of another
Licensed Product, its obligations under this Section 8.1.2.
shall
cease with respect to such initial Licensed Product in favour of
such
other Licensed Product. AstraZeneca shall perform its obligation
under
this Section 8.1.2. in good scientific manner and in compliance in
all
material respects with all Applicable Law.
8.1.3 Should the
use by AstraZeneca of its Commercially Reasonable Efforts
have as a consequence that AstraZeneca would be obligated to carry
out
some or all of the
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activities provided for in Section 8.1.1 or 8.1.2 in a country
in
which such activities would not, in AstraZeneca's reasonable
judgement, make commercial sense then AstraZeneca shall,
notwithstanding what is stated in Sections 8.1.1 and 8.1.2 and
following consultation with Avanir, be allowed to refrain from
carrying out such activity(ies) in such country, other than a
Major
Market, ***.
8.1.4 Upon
satisfaction of its obligations under Sections 8.1.1 and 8.1.2,
AstraZeneca shall be deemed to have satisfied all diligence
obligations owed to Avanir hereunder, with respect to the
Exploitation
of the Licensed Compounds, Licensed Products or Collaboration
Results,
and shall have no other obligation, express or implied, to Exploit
the
Licensed Compounds, Licensed Products or Collaboration Results.
8.2 Breach of Diligence
Obligations.
8.2.1
Notification and Meeting. If at any time Avanir has a
reasonable
basis to believe that AstraZeneca is in breach of its material
obligations under Section 8.1, then Avanir shall so notify
AstraZeneca, specifying the basis for its belief, and the
Parties
shall meet within thirty (30) days after such notice to discuss
in
good faith Avanir's concerns and AstraZeneca's development and
commercialisation plans with respect to the Licensed Compound
and
Licensed Product.
8.2.2 Right of
Termination. If, after such good faith discussions mentioned
in Section 8.2.1, (a) AstraZeneca is in breach of its
obligations
under Section 8.1, and (b) AstraZeneca does not take reasonable
steps
designed to rectify such breach within ninety (90) days of
meeting
with Avanir pursuant to Section 8.2.1 (or, if such failure cannot
be
rectified within such ninety (90)-day period, if AstraZeneca does
not
commence actions to rectify such breach within such period and
thereafter
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diligently pursues such actions), Avanir may exercise its right
of
termination provided under Section 21.5.
8.3 Services in Relation to the AVP
26452 Compound. Avanir shall provide
AstraZeneca with
consultation services, including reviewing and
contributing to
proposed publications concerning the AVP 26452 Compound, as
AstraZeneca may
reasonably request for the Development Project, including
by making
Avanir's employees, consultants and other scientific staff
available to
consult with AstraZeneca on issues arising during the
pre-clinical or
clinical development of the AVP 26452 Compound, or in
connection with
Exploitation of the AVP 26452 Compound or the AVP 26452
Product. For
this purpose AstraZeneca may use during the Collaboration Term
the FTEs at
Avanir funded by AstraZeneca in accordance with Section 9.1 and
thus no
additional funding shall be provided by AstraZeneca to Avanir
to
obtain the
consultation services provided for in this Section 8.3; unless
the delivery of
such services rises to a level that makes it impracticable
for Avanir to
fulfil its responsibilities under the Research Plan. After
termination or
expiration of the Collaboration Term, the payment shall
follow the
reimbursement scheme set forth in Section 6.3.1. The failure of
Avanir to fulfil
its obligations to provide consultation services shall not
give rise to a
right in AstraZeneca to terminate this Agreement. For the
avoidance of
doubt, Avanir shall provide the services described in Section
3.9.
8.4 Reporting. Following termination
or expiration of the Research
Collaboration
AstraZeneca shall provide Avanir in reasonable connection to
the meetings in
the IF with an annual report on the development (the
"DEVELOPMENT
REPORT") of Licensed Products in the Territory in order to
keep Avanir
informed of its progress. Such report shall cover, in relation
to Licensed
Compounds and Licensed Products, general information on
AstraZeneca's
development activities in the previous *** months, a summary
of the
activities planned in the next *** months, and a timetable of
planned and
actual
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CONFIDENTIAL TREATMENT REQUESTED
submissions for
Health Registration Approvals. If and when a Health
Registration
Approval is obtained in any country of the Territory,
AstraZeneca
shall promptly inform Avanir thereof.
8.5 Licensed Improvements. For
purposes of the obligations in Sections 8.1, 8.2
and 8.3, a
Licensed Product shall include any Licensed Improvement.
9 RESEARCH FUNDING
9.1 Funding.
9.1.1 Each Party
shall assume responsibility for its own costs and expenses
for the Research Collaboration with the sole exception that
AstraZeneca shall provide funding to Avanir (i) during the
first
Collaboration Year for *** FTEs; and (ii) for at least *** and no
more
than *** FTEs per each Collaboration Year thereafter during the
Collaboration Term at the FTE Rate. Such AstraZeneca's
obligation
shall be contingent upon Avanir making the corresponding number
of
FTEs available for the Research Collaboration. In addition to
being
available for the Research Collaboration such FTE's funded by
AstraZeneca in accordance herewith, shall also be available for
such
consulting services provided for under Section 8.3.
9.1.2 The JEC
shall no later than *** prior to the expiration of a certain
Collaboration Year decide in writing the number of FTEs to be
funded
by AstraZeneca during the immediately subsequent Collaboration
Year;
provided
that the number of FTEs to be funded by AstraZeneca shall be
no less than *** FTEs in any given year during the Collaboration
Term.
9.1.3 Subject to
mutual agreement between the Parties, which agreement each
Party may enter into at its sole discretion, AstraZeneca may
provide
funding for FTEs
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for a certain period of time, to be decided by the Parties, beyond
the
third Collaboration Year.
9.2 Invoices. Thirty (30) days prior
to the commencement of each Calendar
Quarter, Avanir
shall invoice AstraZeneca for amounts due to Avanir from
AstraZeneca
pursuant to Section 9.1 based on the FTE Rate for the ensuing
Calendar
Quarter. Each invoice shall be sent to the AstraZeneca
Principal
Scientist and
shall be accompanied by a forecast of the number and purpose
of the FTEs to
be provided by Avanir in the Research Collaboration during
such ensuing
Calendar Quarter and a report from Avanir's time reporting
system on FTE
effort spent in relation to the Research Collaboration during
the immediately
preceding Calendar Quarter, if any. AstraZeneca hereby
acknowledges
that Avanir does not maintain a timesheet system and that the
requirements of
this Agreement do not require Avanir to implement any such
system. The
Parties confirm, however, that such documentation mentioned in
Section 9.3.1
shall be required for the purpose of reporting FTEs devoted
to the Research Collaboration as
set forth in this Section 9.2. No later
than thirty (30)
days after the end of each Collaboration Year Avanir shall
send a report
relating to the FTEs provided by Avanir to the Research
Collaboration
during such Collaboration Year. Without prejudice to any
other remedy
available to AstraZeneca, any amount paid by AstraZeneca for
which Avanir has
not provided the corresponding number of FTEs during such
Collaboration
Year may be deducted by AstraZeneca from subsequent payments
to be made by
AstraZeneca to Avanir for FTE funding hereunder and, if
necessary to
recover the amount, from milestone payments and royalty
payments.
Each invoice
shall be payable to Avanir within thirty (30) days after
receipt by
AstraZeneca of a correct invoice with supporting documentation.
Payment shall be
made to such bank account as Avanir shall have notified
AstraZeneca in
writing.
9.3 Records Retention; Audit.
9.3.1 Avanir
shall keep or cause to be kept accurate records or books of
account in accordance with applicable generally accepted
accounting
principles that, in reasonable detail, fairly reflect the
reimbursable
FTEs. Such books and records shall include attendance rec
