EXHIBIT 10.57
NOTE: Portions of this Exhibit
are the subject of a Confidential Treatment Request by the
Registrant to the Securities and Exchange Commission (the
“Commission”). Such portions have been redacted and are
marked with a “[***]” in place of the redacted
language. The redacted information has been filed separately with
the Commission.
DEVELOPMENT
AGREEMENT
This Development Agreement
(“Agreement”) is entered into as of this
of December 2005 by and between
PRINCETON BIOMEDITECH CORPORATION, a New Jersey Corporation
(“PBM”), having its principal place of business at 4242
U.S. Route 1, Monmouth Junction, New Jersey 08852, and NANOGEN,
INC., a Delaware Corporation (“NANOGEN”), having its
principal place of business at 10398 Pacific Center Court, San
Diego, California 92121.
RECITALS
A. PBM and SYN-X Pharma, Inc., an
Ontario Corporation (SYNX), having its principal place of business
at 1 Marmac Drive, Toronto, Ontario M9W 1E7, Canada, have
previously entered into a DEVELOPMENT AND MANUFACTURING AGREEMENT
as of October 9, 2001 (“PBM/SYNX Agreement”)
directed to the development, manufacturing and marketing of certain
point of care diagnostic products.
B. SYNX is now a wholly owned
subsidiary of NANOGEN.
C. SYNX has assigned its
intellectual property relating to the PBM/SYNX agreement to NANOGEN
and assigned to NANOGEN its interest in the Cross License Agreement
included in the Roche Agreements.
D. PBM and SYNX have terminated the
PBM/SYNX Agreement as of the Effective Date of this
Agreement.
E. NANOGEN now wishes to continue
the development with PBM of certain point of care diagnostic
products contemplated to have been developed under the PBM/SYNX
Agreement.
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NOW, THEREFORE , in
consideration of the foregoing premises, which are incorporated
into and made a part of this Agreement, and of the mutual covenants
which are set forth herein, PBM and NANOGEN hereby agree as
follows:
ARTICLE 1
DEFINITIONS
Unless the context requires
otherwise, the following terms, when used in this Agreement, shall
have the respective meanings specified in this Article 1, such
meanings to be equally applicable to the singular and plural forms
of the defined terms:
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1.1
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“Affiliate” shall mean any person or
entity which directly or indirectly through one or more
intermediaries, controls, is controlled by, or is under common
control with, a Party. As used in this definition of
“Affiliate”, control means, with respect to an entity,
the legal or beneficial ownership of 50% or more of the voting or
equity interests of the entity or the power or right to direct the
management and affairs of the entity.
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1.2
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“cGMP” shall mean current good
manufacturing practices related to diagnostic pharmaceutical
products under applicable laws, rules and regulations in all
relevant jurisdictions, including without limitation the guidelines
of good manufacturing practices determined by the FDA and the
equivalent European regulatory body.
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1.3
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“Collaboration Agreements” shall
mean this Agreement and the Manufacturing and Distribution
Agreement by and between PBM and NANOGEN of even date
herewith.
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1.4
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“ Development Product” shall mean a Product
or New Assay that is jointly developed by the Parties under this
Agreement.
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1.5
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“ Development Product Specifications” shall
mean the specifications for a specific Development Product
determined as provided in Section 2.2 a).
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1.6
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“ FDA” shall mean the United States Food and
Drug Administration, or any successor entity thereto.
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1.7
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“ FD & C Act” shall mean the United
States Federal Food, Drug & Cosmetic Act, as
amended.
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1.8
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“NANOGEN
Reagent” shall mean natural or recombinant antigen controls
and/or antibodies, which can be polyclonal or monoclonal, to
NT-proBNP, selected by NANOGEN and accepted by PBM or, if
applicable, previously selected by SYNX under the PBM/SYNX
Agreement, for use by PBM in the development and manufacture of the
Development Products.
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1.9
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“NANOGEN
Reagent Specifications” shall mean the specifications for a
NANOGEN Reagent as provided in Section 2.1 e).
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1.10
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“New
Assay” shall mean a human in vitro diagnostic assay for an
analyte (i) which the Parties undertake to develop under this
Agreement and (ii) the performance criteria and specifications
of which assay meet or exceed specifications and criteria
therefore, to which both parties agree in writing and set forth in
Exhibit C.
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1.11
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“New
Product” shall mean a Product that is not read upon by a
claim in a PBM Patent.
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1.12
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“Party” shall mean either PBM or
NANOGEN and ‘Parties” shall mean PBM and
NANOGEN.
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1.13
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“PBM
Patent” shall mean an issued patent in any country of the
world owned or licensed to and by PBM which is listed on, or which
issues from a patent application listed on Exhibit A hereto,
including any reissue patent, reexamined patent, and patents
issuing on continuation, continuation-in-part and divisional
applications of any listed patent application and foreign
equivalents of any of the listed patents and patent
applications.
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1.14
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“PBM
Reagents” shall mean all reagents other than NANOGEN Reagents
used in Development Products.
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1.15
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“Product” shall mean a human in
vitro diagnostic assay for NT-proBNP alone (i) for use restricted
to Point of Care market segments, whereby Point of Care means
analysis conducted in an instrument or in a system which is
designed for a throughput of less than [***] specimens per hour;
and (ii) the performance criteria of which assay meets or exceeds
the Standard Criteria and Specifications in Exhibit B attached
hereto.
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1.16
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“Reader” shall mean a reasonably
priced quantitative reader for use with Development Products to
determine the amount of a target analyte present in a patient
sample.
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1.17
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“ Regulatory Approval” shall mean, with
respect to any country or jurisdiction, all governmental and
regulatory registrations and approvals (including, but not limited
to, approvals of all Product and Quantitative Reader labeling and
packaging) required for the marketing, distribution and sale of
Products and the Quantitative Reader in such country or
jurisdiction.
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1.18
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“Roche
Agreements” shall mean collectively that certain Settlement
Agreement among SYN-X Pharma, Inc. et al and Roche
Diagnostics GmbH et al having an effective date of
July 17, 2003 and that certain Cross License Agreement between
SYN-X Pharma, Inc. and Roche Diagnostics GmbH having an effective
date of July 17, 2003.
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ARTICLE 2
PRODUCT
DEVELOPMENT
The Parties will continue to
undertake under this Agreement the development of a certain
Development Product that was being developed under the PBM/SYNX
Agreement, more specifically a Development Product for the
quantitative determination of NT-proBNP
*** Confidential portions omitted
and filed separately with the Commission.
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under a license granted NANOGEN in the Roche
Agreements and which incorporates proprietary technology of PBM.
The Parties acknowledge that the PBM-SynX agreement predates the
Roche Agreements and under the PBM Syn-X agreement, PBM had the
exclusive right to develop and manufacture the Development Product;
and subsequently that NANOGEN’s rights to develop, have PBM
participate in the development and manufacture of, and market the
Development Product and to grant distribution rights therefor are
subject to the Roche Agreements. Nanogen assumes full
responsibility to assure that PBM’s rights, as defined
elsewhere in this agreement, for exclusive development and
manufacturing is not unreasonably compromised under the separate
Roche Agreements. The Parties also intend to cooperate in the
development of the Reader. Responsibilities and obligations of the
Parties with respect to the development of Development Products and
the Reader are set forth herein below in this Article 2.
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2.1
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NANOGEN
Development Obligations and Responsibilities
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a)
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NANOGEN will
use commercially reasonable efforts to develop and produce NANOGEN
Reagents which meet specifications and in quantities reasonably
sufficient for use by PBM in PBM’s development activities for
Development Products and for the production of Development Products
for use in clinical trials and other studies required for
Regulatory Approval and for any other developmental purpose to
which the Parties mutually agree. Notwithstanding anything to the
contrary in this Agreement, NANOGEN will not be obliged to provide
NANOGEN Reagents to PBM for use in any Development Product that
(i) does not fall within the “SYN-X Licensed
Field” as that term is defined in the Roche Agreements,
(ii) is not intended to meet or exceed requirements of the
Standard Performance Criteria and Specifications in Exhibit B
hereto and (iii) is not manufactured for or licensed to
NANOGEN and/or SYN.X. NANOGEN shall also provide PBM with internal
controls for use in the development of Development
Products.
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b)
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NANOGEN will
take such measures as it deems necessary and appropriate in the
exercise of its sole discretion with respect to obtaining and
maintaining patent protection for Development Products and NANOGEN
Reagents.
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c)
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NANOGEN will
take such measures as it deems appropriate in its sole discretion
to develop scientific interest in the Development Products and
NANOGEN Reagents, through obtaining publication of research and
other and other articles in scientific journals and trade
publications, giving papers and other similar measures. PBM will
assist Nanogen with test product supply for such a study and two
parties shall work together in selection study sites and providing
study protocols if needed.
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d)
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NANOGEN will
conduct, or contract with SYNX or third parties to conduct, all
such clinical trials and other testing of Development Products and
NANOGEN Reagents as is reasonably required in order to obtain
Regulatory Approval for the marketing and sale of Development
Products from the governmental or other authority in any
jurisdiction in which the Parties desire that Development Products
be marketed and sold. The data will be provided to PBM for review
and comment. The Parties will use their best efforts, in
consultation with each other to obtain Regulatory Approval for the
marketing and sale of Development Products in the United States and
other jurisdictions determined by NANOGEN or reasonably requested
by PBM after consultation with NANOGEN. The Regulatory Approval for
a Development Product which is an assay for NT-proBNP shall be
owned by NANOGEN.
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e)
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NANOGEN, in
consultation with PBM, shall be responsible for the development of
manufacturing and other specifications to be met by each batch of a
NANOGEN Reagent to be supplied by NANOGEN to PBM for the
development and commercial production of Development
Products.
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f)
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NANOGEN will
fund [***]% of the development cost of the Reader, up to a maximum
of $[***] (U.S.), less any amounts already paid for development of
the Reader by SYNX following the receipt by NANOGEN from PBM of an
invoice for its share of the costs and a summary schedule detailing
such development costs. Development costs of the Reader are to
include materials, actual engineering salaries marked up at
PBM’s standard overhead rates, and travel related to
development of the Reader. NANOGEN shall have the right to audit
PBM’s costs incurred for development of the Reader, which
audit must be requested within 30 days of receipt of the summary
schedule detailing the direct development costs. The audit will be
conducted at PBM’s facility in Monmouth Junction, New Jersey
on a date and at a time proposed by NANOGEN and reasonably
acceptable to PBM. For purposes of the audit, detailed costs on the
summary schedule shall be supported by invoices, labor schedules,
time cards of non-exempt employees and like documentation. If the
result of the audit is not acceptable to NANOGEN, the Parties shall
each appoint a person who will negotiate in good faith to resolve
issues raised by NANOGEN. At the request of PBM, the designated
individuals shall meet in person at least one day in Monmouth
Junction. If after 30 days of the initiation of the negotiations,
the Parties have not reached an agreement on the issues raised by
NANOGEN, the Parties shall select an independent certified
accountant reasonably acceptable to both and submit the issue with
a written explanation of its position on the amount of direct costs
incurred by PBM to the independent accountant. NANOGEN
shall
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*** Confidential portions omitted
and filed separately with the Commission.
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pay the cost of the independent
audit and the Parties will be bound by the decision of the
independent accountant. NANOGEN’s payment of its share of the
costs will be due the later of (i) 30 days from the receipt of
the invoice or (ii) completion of the audit if NANOGEN
requests such audit.
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g)
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NANOGEN will
fund [***]% of the actual development cost for and actual cost of
equipment that will print a test identification, lot number, and/or
patient identification on the cartridge used in the Development
Product, up to a maximum of US $[***], within thirty (30) days
following the receipt by NANOGEN from PBM of an invoice for its
share of the costs and a summary schedule detailing such
development and equipment costs. Development costs of the equipment
are to include materials, actual engineering salaries marked up at
PBM’s standard overhead rates, and travel related to
development of the equipment. The equipment cost shall be the cost
of procuring and setting up the equipment and the ancillary
materials needed to produce and apply the labels to the cartridge.
NANOGEN shall have the right to audit PBM’s development and
equipment costs incurred for development of the equipment, which
audit must be requested within 30 days of receipt of the summary
schedule detailing the costs.
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h)
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NANOGEN, in
addition to the obligations and responsibilities set forth above in
this Section 2.1, will provide such other assistance to PBM as
reasonably required to support PBM in the discharge of its
obligations and responsibilities to develop Development Products as
provided in Section 2.2. All activities conducted by NANOGEN
under this Section 2.1 shall be at NANOGEN’s sole cost
and expense.
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2.2
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PBM
Development Obligations and Responsibilities
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a)
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PBM will
cooperate with NANOGEN in determining the specifications for
NANOGEN Reagents to be included in Development Products and PBM
will be responsible, in consultation with NANOGEN, for determining
the specifications for PBM Reagents and Development Products
(Development Product Specifications) in order to incorporate into
the Development Products proprietary technology of PBM. PBM will
also be responsible for determining the specifications for the
Reader.
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b)
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PBM will
conduct such research and development as is reasonably required to
optimize NANOGEN Reagents for commercial use and to develop and
produce PBM Reagents and Development Products, in each case
utilizing NANOGEN Reagents supplied by NANOGEN.
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*** Confidential portions omitted
and filed separately with the Commission.
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c)
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PBM will supply
NANOGEN with sufficient quantities of developmental stage
Development Products as is reasonably necessary for NANOGEN to
carry out its responsibilities and obligations set forth in
Section 2.1.
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d)
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Each of the
Parties will cooperate in sharing information including clinical,
and validation data with the other Party to facilitate the
preparation of applications for Regulatory Approval of Development
Products.
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e)
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PBM will use
commercially reasonable best efforts to promptly complete, on its
own or using a subcontractor, the development of a Reader and to
obtain Regulatory Approval for the Reader meeting specifications
reasonably acceptable to NANOGEN in the United States and other
jurisdictions reasonably requested by NANOGEN. The Regulatory
Approvals for the Reader shall be owned by PBM.
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f)
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PBM shall
provide NANOGEN a report not later than January 15 and
July 15 of each year summarizing the status of the development
of Development Products during the prior six month period and the
report shall include the expected date of the first sale of a
Development Product in each of the United States, Japan and Germany
in order for NANOGEN to comply with provisions of Section 6.3
of the Cross License Agreement of the Roche Agreements.
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g)
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Not later than
the receipt of the first Regulatory Approval for a Development
Product, PBM and NANOGEN together shall compile a written summary
of the protocols of all tests used to demonstrate that that
Development Product meets the Standard Performance Criteria and
Specifications set forth in the Roche Agreements and test data
accumulated under those protocols that would prove that the
Development Product meets the Standard Performance Criteria and
Specifications as required under Section 6.3 of the Cross License
Agreement of the Roche Agreements.
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h)
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PBM, in
addition to the obligations and responsibilities set forth above in
this Section 2.2, will provide such other assistance to
NANOGEN as reasonably required to support NANOGEN in carrying out
its responsibilities and obligations under Section 2.1. All
activities carried out by PBM under this Section 2.2 shall be
at PBM’s sole cost and expense.
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ARTICLE 3
NEW PRODUCTS AND OTHER
PRODUCTS
NANOGEN shall have the right to
develop and commercialize New Products without obligation to PBM
except as otherwise specifically provided herein or elsewhere in
the Collaboration Agreements; provided, however, that NANOGEN shall
not use the same trademark for New Products, other than the trade
name NANOGEN or the tradename of an Affiliate, that it adopts for
Development Products. If NANOGEN develops a New Product alone or in
collaboration with a third party in which it retains the right to
manufacture the New Product, it will negotiate in good faith with
PBM for a period of not less than 90 days concerning the
nonexclusive manufacture of the New Product by PBM for NANOGEN upon
commercially reasonable terms. NANOGEN’S right to develop and
commercialize New Products as provided in this Section 3.1 is
not expressly or by implication a grant of a license or other
rights under a PBM Patent to develop or commercialize New
Products.
In the event NANOGEN undertakes to
develop other products for the detection of biological markers
that, as of the date of this agreement, it owns, or for which it
has a license with the right to grant a sublicense, for congestive
heart failure, stroke or traumatic brain injury, PBM shall have the
option to obtain a nonexclusive license or sublicense, but not the
obligation, to develop, make, have made, use and sell products for
the detection of those markers in a point-of-care assay for
congestive heart failure, stroke and traumatic brain injury and to
purchase antigens and antibodies for such products from NANOGEN at
commercially reasonable terms and price. NANOGEN shall have no
obligation to support PBM’s development of such other
products other than to supply the antigen and antibody reagents.
The Parties shall negotiate in good faith concerning the
compensation to be paid NANOGEN on sales of such other products by
PBM which may be in the form of a royalty or if the Parties agree
on a co-development approach, an arrangement similar as provided in
Section 4.2 of the Manufacturing and Distribution Agreement between
the Parties of even date herewith, or on any other basis to which
the Parties agree. If the Parties are unable to agree upon the form
of compensation for NANOGEN after negotiation for a period of not
less than 90 days, PBM, at its option, shall pay NANOGEN [***]%
royalty plus an amount equal to the amount of royalty that NANOGEN
is obligated to pay any third party. Any such other product
developed by PBM shall not use the same trademark as, or
confusingly similar to the trademarks used by NANOGEN for
Development Products or New Products. As used in this Section 3.2,
the term “point-of-care assay” means an assay designed
principally for use in a doctor’s office or clinic lacking a
central laboratory, or directly in a hospital’s emergency
room and not in its central laboratory and that is not sold for use
in a reference laboratory or for use on an instrument
with
*** Confidential portions omitted
and filed separately with the Commission.
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random access capability or on an
instrument with the ability to analyze multiple patient samples.
However, this does not inhibit PBM from selling the Development
Product to the central or reference laboratory. NANOGEN will have
no indemnity obligation to PBM arising from its supply of NANOGEN
Reagents to PBM for the development and/or marketing of other
products and makes no warranties of any kind with respect to such
antibody NANOGEN Reagents.
ARTICLE 4
OWNERSHIP OF INTELLECTUAL
PROPERTY;
LICENSES;
CONFIDENTIALITY
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4.1
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Intellectual Property
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a) Nothing in this Agreement shall
be deemed to give PBM any rights in, right to use or license in any
of NANOGEN’s existing or future intellectual property,
including without limitation, patents, confidential information,
technology, production methods and procedures, know-how and the
like (collectively “Intellectual Property”), except as
explicitly provided herein, .NANOGEN Intellectual Property does
include any rights granted SYNX under the Roche
Agreements.
b) Nothing in this Agreement shall
be deemed to give NANOGEN any rights in, right to use or license in
any of PBM’s existing or future
