Exhibit 10.23
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LICENSE AGREEMENT
This License Agreement
(the “Agreement” ) is entered into as of
July 2, 2007 (the “Effective Date” )
by and between BioAlliance Pharma SA , a
French société anonyme (
“BioAlliance” ), having an address of 59,
boulevard du Général Martial Valin, 4 th Floor 75015
Paris, France, and Par
Pharmaceutical, Inc. ( “PAR”
), having an address at 300 Tice Blvd, Woodcliff Lake, NJ 07677,
USA.
Recitals
Whereas, BioAlliance is a
specialty pharmaceutical company focused on the development of
innovative therapeutics targeting drug resistance in cancer, HIV,
and severe opportunistic infections, has developed expertise and
acquired proprietary rights related to Product (as defined below),
which Product received marketing authorization in France in
October 2006 for treatment of oropharyngeal candidiasis in
immunocompromised patients, and is seeking an experienced strategic
partner for commercialization of Product in the Territory (as
defined below);
Whereas, PAR develops,
manufactures and markets generic drugs and innovative branded
pharmaceuticals for specialty markets, has received approval for
and introduced Megace ® ES, the
company’s first branded pharmaceutical product, and intends
to expand its branded products portfolio; and
Whereas, BioAlliance
desires to grant a license to PAR with regard to Product, and PAR
desires to accept such license on the terms and conditions set
forth herein.
Agreement
Now, Therefore, in
consideration of the foregoing premises and the mutual covenants
contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1. Definitions
1.1 “Affiliate”
shall mean any entity controlled by, controlling, or under common
control with a party hereto. Solely for purposes of the foregoing
definition, the term “control” (including, with
correlative meaning, the terms “controlling”,
“controlled by”, and “under common control
with”) as used with respect to any party, shall mean the
possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such party, whether
through ownership of interests representing the equity, voting
securities or general partnership interest or by contract, or
otherwise. Without limiting the foregoing, the term Affiliate shall
include any entity where more than 50% of the voting stock or
profit interest of which entity is owned or controlled, directly or
indirectly, by a party, and any entity which owns or controls,
directly or indirectly, more than 50% of the voting stock or profit
interest of a party.
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1.2 “AG Product”
shall mean non-branded, generic Product marketed and sold by PAR or
a sublicensee of PAR in the Territory and “Branded
Product” shall mean all Product other than AG
Product.
1.3 “API” shall
mean the active pharmaceutical ingredient miconazole.
1.4 “BioAlliance
Know-How” shall mean Information that BioAlliance or any
of its Affiliates Controls that is useful or necessary for the use,
sale, marketing, offer for sale, export or import of Product,
including, without limitation, any replication or any part of such
Information.
1.5 “BioAlliance
Patents” shall mean the Patents that BioAlliance or any
of its Affiliates Controls that are useful or necessary for the
manufacture, use, sale, offer for sale or import of Product in the
Territory, including those Patents set forth on
Exhibit A .
1.6 “BioAlliance
Technology” shall mean the BioAlliance Patents and
BioAlliance Know-How.
1.7 “Calendar
Quarter” shall mean each respective period of three
consecutive months ending on March 31, June 30,
September 30 and December 31.
1.8 “Commercialization
Plan” shall have the meaning provided in
Section 3.1(f).
1.9 “Competing
Product” shall mean any pharmaceutical product for oral
mucosal administration that may be used to treat oropharyngeal
candidiasis.
1.10 “Confidential
Information” shall have the meaning provided in
Section 8.1.
1.11 “Control”
shall mean, with respect to any Information, Patent or other
intellectual property right, or Regulatory Approval, possession by
a party of the ability (whether by ownership, license or otherwise)
to grant access, rights, title, possession, a license or a
sublicense to such Information, Patent or other intellectual
property right without violating the terms of any agreement or
other arrangement with any Third Party.
1.12 “Executives”
shall have the meaning provided in Section 11.2.
1.13 “FDA” shall
mean the United States Food and Drug Administration, or any
successor agency or agencies thereto having the administrative
authority to regulate the marketing of human pharmaceutical
products in the United States.
1.14 “First Commercial
Sale” shall mean the first sale for end use or
consumption of the Product in the Territory after the FDA has
granted Regulatory Approval. Sales for clinical studies,
compassionate use, named patient programs, sales under a treatment
IND, test marketing, any nonregistrational studies, or any similar
instance where Product is supplied with or without charge shall not
constitute a First Commercial Sale.
1.15 “Generic
Product” means a pharmaceutical product that is
(i) a Therapeutic Equivalent of the Branded Product or
(ii) approved by the FDA pursuant to a Suitability
Petition
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in
connection with a filing referencing the Branded Product under
Section 505 (j)(2)(c) of the Federal Food, Drug, and Cosmetic
Act and FDA regulation 21 C.F.R. § 314.93.
1.16 “Governmental
Authority” means any court, tribunal, arbitrator, agency,
legislative body, commission, official or other instrumentality of
(a) any government of any country, (b) a federal, state,
province, county, city or other political subdivision thereof or
(c) any supranational body, including the FDA.
1.17 “IND” shall
mean an Investigational New Drug Application filed with FDA related
to the Product.
1.18
“Information” shall mean all tangible and
intangible, proprietary or non-proprietary, (a) techniques,
clinical study protocols, formulations, technology, practices,
trade secrets, inventions (whether patentable or not), methods,
knowledge, know-how, skill, ideas, discoveries, experience, test
data and results (including pharmacological, toxicological and
clinical test data and results), analytical and quality control
data, results or descriptions, software and algorithms and
(b) compositions of matter, cells, cell lines, assays, animal
models and physical, biological or chemical material.
1.19 “Losses”
shall have the meaning provided in Section 10.1.
1.20 “NDA” shall
mean a New Drug Application with the FDA for commercial sale or use
of the Product as a drug for human use within the Territory,
including any supplements or any amendments thereto.
1.21 “Net Sales”
shall mean ***.
1.22 “Patents”
shall mean US patents and US patent applications, including, any
divisionals, counterparts, reissues, reexaminations, additions,
extensions, supplementary protection certificates and renewals
thereof, and all patents issuing or claiming priority there from in
the US.
1.23 “Product”
shall mean the pharmaceutical product containing the API as an
active pharmaceutical ingredient for administration to the oral
mucosa, that is being developed by BioAlliance as of the Effective
Date to treat or prevent oropharyngeal candidiasis and is the
subject of the current IND Controlled by BioAlliance as of the
Effective Date (including as the Product may be modified as
development proceeds), in each case, all formulations,
presentations, line extensions and modes of administration
thereof.
1.24 “Product
Field” shall mean the oral mucosal administration through
local tablet delivery in the buccal cavity of an anti-fungal agent
that may be used (a) to treat or prevent oropharyngeal
candidiasis or (b) for the treatment or prevention of an
ailment, condition or disease in humans.
1.25 “Regulatory
Approval” shall mean all approvals (including, where
applicable, pricing and reimbursement approval and schedule
classifications), product and/or establishment licenses,
registrations or authorizations of any Governmental Authority,
necessary for the commercialization, use, storage, import, export,
transport, offer for sale, or sale of a
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pharmaceutical product for human use in a regulatory jurisdiction
within the Territory, including any applicable IND or NDA.
1.26 “Reasonable
Efforts” shall mean, with regard to a party, those
efforts consistent with the exercise of customary scientific and
business practices that are consistent with the efforts and
resources such party uses for other products owned by it or to
which it has exclusive rights, for development and
commercialization activities conducted with respect to other
products of similar potential and market size and at a similar
stage in their life cycle, taking into account the competitiveness
of the marketplace, the regulatory structure involved, the
profitability of the Product and other relevant factors, including,
technical, legal, scientific, medical, sales performance, marketing
factors and/or any regulatory, intellectual property or product
liability disputes or issues.
1.27 “Royalty
Term” shall mean the period of time commencing on the
First Commercial Sale and ending upon the later of (a) ten
(10) years after the date of First Commercial Sale, and
(b) the expiration of the last to expire Valid Claim in the
Territory within the BioAlliance Patents that claims the
composition of the Product or use in the Product Field.
1.28 “Supply
Agreement” shall have the meaning provided in
Section 3.2.
1.29 “Term”,
“Initial Term” and “Second Term”
shall have the meanings provided in Section 9.1.
1.30 “Territory”
shall mean United States of America, including its territories,
possessions, protectorates and the Commonwealth of Puerto Rico and
any installation, territory, location or jurisdiction under the
control of the U.S. government.
1.31 “Therapeutic
Equivalent” shall have the meaning given to it by the FDA
in the current edition of the “Approved Drug Product with
Therapeutic Equivalence Evaluations” (the “Orange
Book”), as may be amended from time to time during the
Term.
1.32 “Third
Party” shall mean any entity other than BioAlliance or
PAR or an Affiliate of BioAlliance or PAR.
1.33 “Trademark”
shall mean the trademark under which the Product may be sold in the
Territory, including as set forth in Exhibit B
, as may be amended from time to time.
1.34 “Valid
Claim” shall mean (a) an unexpired claim of an
issued patent within the BioAlliance Patents which has not been
found to be unpatentable, invalid or unenforceable by a court or
other authority in the subject country, from which decision no
appeal is taken or can be taken; or (b) a claim of a pending
application within the BioAlliance Patents, which together with its
direct progeny (continuations only) have not been pending
collectively for more than five (5) years.
2. License
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2.1 License Grant. Subject to
the terms and conditions of this Agreement, during the Term,
BioAlliance hereby grants to PAR and its Affiliates an exclusive
(even as to BioAlliance), royalty-bearing license, with no right to
sublicense (except with the right to sublicense the AG Product) or
transfer any rights hereunder except as permitted under
Section 12.5, under the BioAlliance Technology, and any
Regulatory Approvals for Product in the Product Field held by
BioAlliance, to promote, market, use, sell, offer for sale, have
sold and import (and develop as set forth in Section 3.1(b))
Product in the Product Field in the Territory. The above
notwithstanding, PAR shall have the right to grant sublicenses
under such license to market, sell, offer for sale, and have sold
AG Product only beginning (a) on the date on which a Third
Party sells or offers for sale a Generic Product or (b) if
applicable, upon (or as part of) settlement of a litigation under
Section 6.2; provided that PAR has obtained the consent of
BioAlliance to such settlement to the extent required under
Section 6.2. PAR will at all times remain responsible to
BioAlliance for all of its obligations under this Agreement and
shall be responsible for the acts or omissions of its Affiliates
and Sublicensees in exercising rights granted hereunder. Each
sublicense granted by PAR shall be consistent with the terms of
this Agreement, and PAR shall furnish BioAlliance a copy of each
such sublicense it grants.
2.2 Trademark License.
2.2.1 License to Trademark. Subject to the terms and
conditions of this Agreement, during the Term, BioAlliance hereby
grants to PAR an exclusive (even as to BioAlliance),
royalty-bearing license, with no right to sublicense or transfer
any rights hereunder except as permitted under Section 12.5,
under the Trademark to promote, market, use, sell, offer for sale,
have sold and import Branded Product in the Product Field in the
Territory.
2.2.2 Quality Control. Except to the extent required by
applicable law or any applicable Regulatory Approval, the nature
and quality of Product advertised or sold by PAR on which the
Trademark appear shall conform to quality standards and Product
specifications for packaging and quality control of Product
reflected in Regulatory Approvals. In all packaging, labeling,
advertising, promotional and other material of PAR or its
Affiliates referencing the Trademark, PAR and its Affiliates shall
not: (a) vary the spelling, add or delete hyphens, abbreviate,
make one word two, or use a possessive or plural form of the
Trademark; (b) modify the design, add or delete any elements
or words, change any colors or proportion of the Trademark; or
(c) use the Trademark in a manner which disparages BioAlliance
or any of its products or services, in each case except to the
extent required by applicable law or any applicable Regulatory
Approval; provided that PAR will review and discuss any such
changes required by applicable law or any Regulatory Approval
before making them. At the request of BioAlliance, PAR will provide
from time to time copies of packaging, labeling, advertising,
promotional and other material of PAR or its Affiliates referencing
the Trademark to allow BioAlliance to confirm compliance with the
foregoing.
2.2.3 Ownership Rights, as Between Parties. BioAlliance
shall own and shall retain the ownership of the entire right, title
and interest in and to the Trademark. PAR acknowledges, as between
the parties, the exclusive rights, title and interest of
BioAlliance in and to the Trademark and will not do or cause to be
done any act or thing contesting or, in any way, impairing any part
of said right, title and interest for the Term and after its
expiration. PAR will not make any representations or take any
actions, which may be taken to indicate that it has
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any
right title or interest in or to the ownership or use of the
Trademark except under the terms of this Agreement and acknowledges
that nothing contained in this Agreement shall give PAR any right,
title or interest in or to the Trademark except the license rights
granted under Section 2.2(a). For the purpose of clarity,
PAR’s performance of its obligations and activities in
accordance this Agreement, including the use of the Trademark on a
PAR label, PAR’s enforcement of any intellectual property
rights or its marketing, promotion or sale of Product using the
Trademark, shall not be deemed a violation of this provision.
2.2.4 Registration of the Trademark. While PAR is marketing
Product using the Trademark, BioAlliance shall, at its own cost and
expense, file in the Territory and endeavor in good faith to obtain
the registration of the Trademark in the Territory, and when
registered, thereafter maintain the applicable Trademark in the
Territory at its own expense.
2.2.5 Goodwill. Any accretion of goodwill derived by PAR to
the extent attributed to the Trademark shall accrue to BioAlliance
and BioAlliance may call for a confirmatory assignment
thereof.
2.2.6 Registered User. Where required, BioAlliance shall
make applications to the applicable regulatory authority for the
registration of PAR as a registered user of the Trademark in
respect of each registration of the Trademark and PAR shall
cooperate with BioAlliance in making such applications. PAR shall
take reasonable actions requested by BioAlliance at
BioAlliance’s expense which may be necessary or desirable for
registering and maintaining registration of PAR as a registered
user.
2.2.7 Reasonable Assistance. PAR shall reasonably cooperate,
upon request, with BioAlliance or its authorized representative to
provide information as to its use of the Trademark which
BioAlliance may require and will render any assistance reasonably
required by BioAlliance in securing and maintaining the
registration(s) of the Trademark in the Territory.
2.2.8 Product Trademark Changes. In the event the FDA or
other applicable Governmental Authority does not allow the Product
to be sold, marketed or promoted under the Loramyc ® name, the
Product shall be sold under a trade name chosen by PAR in
consultation with BioAlliance. The parties shall ***. The trademark
for the new Product name shall be owned by BioAlliance and for
purposes of clarity shall be the Trademark under this
Agreement.
2.3 Retained Rights; No Implied
Licenses. BioAlliance hereby expressly reserves the right to
practice, and to grant licenses under, the BioAlliance Technology
and the Trademark for any and all purposes other than the specific
purposes for which PAR has been granted an exclusive license under
this Agreement. No right or license under any Patents or
Information, any Regulatory Approval or the Trademark is or shall
be granted by BioAlliance by implication. All such rights or
licenses are or shall be granted only as expressly provided in the
terms of this Agreement. PAR will not practice any BioAlliance
Patents or Confidential Information of BioAlliance, or use the
Trademark, except as expressly permitted under this
Agreement.
2.4 Exclusivity. BioAlliance
agrees that during the Term it will not (a) enable or contract
with any Third Party to develop, import, market, sell or distribute
the Product in the Territory or itself develop or supply the
Product for sale in the Territory, except for the
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development and supply of the Product pursuant to this Agreement,
(b) enable or contract with any Third Party to develop,
manufacture, import, market, sell or distribute any Competing
Product in the Territory or itself develop or supply any Competing
Product for sale in the Territory; or (c) enable or contract
with any Third Party for the use of the Trademark in the Territory
or itself use the Trademark in connection with any product in the
Territory other than the Product pursuant to this Agreement. PAR
agrees that during the Term it will not, and will not enable or
contract with any Third Party to develop, manufacture, import,
market, sell or distribute any Competing Product in the
Territory.
3. Regulatory and
Supply Matters
3.1 Regulatory.
3.1.1 Approval Activities. BioAlliance shall use Reasonable
Efforts to gain Regulatory Approval for the Product for the
treatment and prevention of oropharyngeal candidiasis and shall
maintain during the Term any and all Regulatory Approvals for the
Product in the Territory for the treatment and prevention of
oropharyngeal candidiasis, including the filing of all annual and
other reports or filings required by the FDA or any other
Governmental Authority and shall use Reasonable Efforts to conduct
any clinical trials (including any not contemplated as of the
Effective Date or requiring a reformulation of the Product)
required by the FDA to gain or maintain Regulatory Approval for the
Product or otherwise as a condition to Regulatory Approval of the
Product in the Territory for the treatment and prevention of
oropharyngeal candidiasis. The parties agree that they will
separately discuss any activities regarding pediatric exclusivity
for the Product in the Territory. BioAlliance shall hold all
Regulatory Approvals for the Product.
3.1.2 Post-Approval Activities. PAR shall reasonably
cooperate with BioAlliance regarding any necessary regulatory
activities required or requested by any Governmental Authority in
the Territory after Regulatory Approval of Product. A
pharmacovigilance mutual alert process will be implemented in order
to comply with all legal obligations. PAR shall have the option,
but not the obligation, to conduct any post Regulatory Approval
activities, investigations or clinical studies it deems necessary
or advantageous for the commercialization of the Product in the
Product Field in the Territory, and BioAlliance shall reasonably
cooperate with PAR with such activities, at PAR’s request and
expense.
3.1.3 BioAlliance Development and Regulatory Activities.
BioAlliance shall retain the right to conduct development of, make
all regulatory filings for and commercialize Product outside the
Territory. including as follows: (1) BioAlliance shall provide
PAR with the opportunity to review and comment on all material
submissions to the FDA related to the Product; (2) BioAlliance
shall notify PAR, and allow to the extent practicable,
representatives PAR to attend all formal meetings, including
telephonic meetings, with the FDA relating to Regulatory Approval
of the Product; and (3) BioAlliance shall keep PAR informed of
the progress of the prosecution of the NDA for the Product,
including providing BioAlliance with good faith projections of the
approximate time at which approval of the NDA may be
expected.
3.1.4 Cooperation. The parties shall cooperate in good faith
with respect to the submission, prosecution and maintenance of the
Regulatory Approvals for the Product with the
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FDA or
other applicable Governmental Authority and BioAlliance shall keep
PAR informed with respect to all matters related to the Regulatory
Approvals for the Product. BioAlliance will provide PAR with copies
of all communications and submissions to and from the FDA related
to the Product no later than forty-eight (48) hours after
their receipt by BioAlliance and promptly as possible, but in any
case, no less than ten (10) business days before they are
scheduled to be sent to the FDA. BioAlliance shall use Reasonable
Efforts to include PAR in any meetings or teleconferences with the
FDA related to the Product. BioAlliance will not respond
substantively to any FDA communication or otherwise make any
submissions to the FDA without first giving PAR a reasonable
opportunity to review and comment. BioAlliance agrees to review and
consider in good faith any comments received by PAR related to
communications or submissions to and from the FDA related to the
Product and any comments or suggestions from PAR otherwise related
to any of the Regulatory Approvals for the Product. In the event
PAR raises any objection to any such FDA submission, including the
proposed label or any formulation changes, due to intellectual
property or product liability concern, the parties will confer for
a thirty (30) day period and work in good faith to resolve
such issues in a mutually satisfactory manner.
3.1.5 PAR Label. The parties agree that the label for the
Product in the Territory shall be a PAR label in accordance with
PAR’s customary practices and the parties shall use
Reasonable Efforts to cooperate in gaining Regulatory Approval to
sell the Products in the Territory under the PAR label.
3.1.6 PAR Commercialization Activities. PAR shall use
Reasonable Efforts to commercialize Product for its approved
indication in the Territory following Regulatory Approval of the
Product. Without limiting the foregoing, PAR shall commercialize
Product in the Product Field in the Territory in accordance with a
commercialization plan for Product, which plan shall be prepared by
PAR and delivered to BioAlliance no later than one (1) year
prior to the expected date of First Commercial Sale, as amended in
accordance with this Section 3.1(f) (the
“Commercialization Plan” ). PAR may amend
the Commercialization Plan at any time during the Term. PAR shall
promptly provide any proposed amendment to the Commercialization
Plan to BioAlliance. BioAlliance may provide comments and
suggestions with respect to the original Commercialization Plan and
any proposed amendments and changes to the Commercialization Plan,
which PAR will in good faith review and consider and discuss with
BioAlliance, provided, however, PAR shall have final
decision-making authority over the Commercialization Plan. In
addition, PAR will keep BioAlliance informed on a calendar
quarterly basis of the commercialization activities of PAR with
regard to Product in the Product Field in the Territory.
3.2 Supply Agreement.
BioAlliance shall supply Product to PAR for the Territory in
accordance with the agreement for the supply of Product by
BioAlliance to PAR for the Territory, being entered into
simultaneously with this Agreement and attached hereto as
Exhibit C (the “ Supply
Agreement ”).
4. Fees and
Payments
4.1 Upfront Fees. PAR shall
pay to BioAlliance a non-refundable, non-creditable upfront fee of
$15 Million (Fifteen Million Dollars) within five (5) days of
the Effective Date.
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4.2 Additional Payments to
BioAlliance.
4.2.1 Payment upon Regulatory Approval in the United States.
PAR shall pay to BioAlliance a non-refundable, non-creditable
payment of $20 Million (Twenty Million Dollars) within ten
(10) days after written notice by BioAlliance to PAR of
Regulatory Approval of Product in the Territory.
4.2.2 Payment upon Sales Performance. PAR shall pay to
BioAlliance a non-refundable, non-creditable payment of $*** (***
Dollars) within forty-five (45) days the first time that ***
and another $*** (*** Dollars) the first time that ***.
4.3 BioAlliance
Royalties.
4.3.1 PAR shall pay to BioAlliance the royalties on Net
Sales of Branded Product in the Territory during the Initial Term
as follows, with the royalty rate determined based upon total of
all Net Sales during the Initial Term:
***
4.3.2 PAR shall pay to BioAlliance as a royalty *** percent
(***%) of Net Sales of AG Product in the Territory during the Term
and ***% of Net Sales of Branded Product in the Territory during
the Second Term. For clarity, the royalty payments under
Section 4.3(a) shall not apply to AG Product or to Branded
Product sold during the Second Term.
4.3.3 ***. The payments specified in this Section 4.3
shall be payable during the Term in the Territory. ***.
5. Payment;
Records; Audits
5.1 Payment; Reports. All
payments due under this Agreement shall be paid within sixty (60)
days of the end of each Calendar Quarter, unless otherwise
specifically provided herein. Each payment shall be accompanied by
a report of Net Sales of Product by PAR in sufficient detail to
permit confirmation of the accuracy of the payment made, including,
the number of Products sold, the gross sales and Net Sales of such
Products, the royalties payable, and the method used to calculate
the royalties. PAR shall keep complete and accurate records
pertaining to the sale or other disposition of Products in
sufficient detail to permit BioAlliance to confirm the accuracy of
all payments due hereunder.
5.2 Manner and Place of
Payment. All payments hereunder shall be payable in US Dollars.
All payments owed under this Agreement shall be made by wire
transfer in immediately available funds to a bank and account
designated in writing by BioAlliance.
5.3 Income Tax Withholding.
PAR will pay any and all taxes levied on account of any payments
made to it under this Agreement. If any taxes are required to be
withheld by PAR, PAR will (a) deduct such taxes from the payment
made to BioAlliance, (b) timely pay the taxes to the proper
taxing authority, and (c) provide BioAlliance with available
evidence of payment of the taxes.
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5.4 Audits. During the Term
and for a period of three (3) years thereafter, PAR shall keep
complete and accurate records pertaining to the sale or other
disposition of Products upon which royalties are due under
Section 4.3, in sufficient detail to permit BioAlliance to
confirm the accuracy of all payments due hereunder. Once a calendar
year during the Term, and for a period of three (3) years
thereafter, BioAlliance shall have the right to cause an
independent, certified public accountant reasonably acceptable to
PAR to audit such records to confirm Net Sales, royalty payments
and other payments for a period covering not more than the
preceding three years; provided, however, that such auditor shall
enter into a confidentiality agreement with PAR and will not
disclose PAR’s Confidential Information to BioAlliance,
except and only to the extent such disclosure is necessary to
verify the amount of payments due under this Agreement, and such
certified public accountant is not paid on a commission or
contingency fee basis. Such audits may be exercised during normal
business hours upon reasonable prior written notice. Prompt
adjustments shall be made by the parties to reflect the results of
such audit. BioAlliance shall bear the full cost of such audit
unless such audit discloses an underpayment by PAR of more than
five percent (5%) of the amount of royalty payments or other
payments due to BioAlliance under this Agreement, in which case,
PAR shall bear the full cost of such audit and shall promptly remit
the amount of any underpayment.
5.5 Late Payments. In the
event that any payment due under this Agreement is not made when
due, the payment shall accrue interest from the date due at the
rate of one percent (1%) above the U.S. Prime Rate (as set forth in
the Wall Street Journal, Eastern Edition); provided, however, that
in no event shall such rate exceed the maximum legal annual
interest rate. The payment of such interest shall not limit
BioAlliance from exercising any other rights it may have as a
consequence of the lateness of any payment.
5.6 Accounting. The parties
acknowledge that any expenses or costs deducted from Net Sales
under this Agreement may be based upon accruals, which accruals
will be compliant with Generally Accepted Accounting Principles
(“GAAP”), consistently applied; provided that when the
actual results become known relative to any accrued amount, any
difference between the actual results and the accrual is reported
and accounted for in the next payment due hereunder. To the extent
that the difference between such accruals and the actual results
has led to an underpayment, PAR shall pay BioAlliance the amount of
such underpayment on the next date payment is due to BioAlliance
hereunder. To the extent that the difference between such accruals
and the actual results has led to an overpayment to BioAlliance,
PAR may set-off such overpayments against subsequent payments to be
made to BioAlliance; additionally, if any overpayments remain upon
the expiration or termination of this Agreement, BioAlliance shall
refund such overpayments to PAR within thirty (30) days of
receiving an invoice for such overpayment together with applicable
supporting documentation.
6. Intellectual
Property
6.1 Patent Prosecution and
Maintenance.
6.1.1 Invention Disclosure . BioAlliance agrees to disclose
in writing to PAR any BioAlliance Technology it conceives of during
the Term which may be relevant to the use, sale, manufacture,
marketing, offer for sale, export or import of Product, to the
prosecution (including decisions of whether to prosecute) of a
Patent to protect the Product market, or to
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SECURITIES AND EXCHANGE COMMISSION
ASTERISKS DENOTE SUCH OMISSION
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enforce
such intellectual property against third party infringers (
“Product Inventions” ), together with any
such related Information in BioAlliance’s Control as
reasonably requested by PAR. BioAlliance shall make such
disclosures promptly after such Product Inventions are conceived,
and in any event no less frequently than every Calendar Quarter (to
the extent there are Product Inventions to disclose during the
applicable Calendar Quarter).
6.1.2 BioAlliance Patents. BioAlliance shall be responsible,
in its discretion, for the preparation, filing, prosecution and
maintenance of the BioAlliance Patents. The cost of such
preparation, filing, prosecution and maintenance of the BioAlliance
Patents shall be borne by BioAlliance (or such Third Party
licensor). BioAlliance shall keep PAR informed of progress with
regard to the preparation, filing, prosecution and maintenance of
BioAlliance Patents in the Territory, including providing PAR with
a copy of any and all correspondence between BioAlliance and the
U.S. Patent Office and providing PAR with sufficient time to review
and comment on such communications (excluding any non-substantive
correspondence or communications). BioAlliance shall consider in
good faith the requests and suggestions of PAR with respect to
strategies for prosecution and maintenance of BioAlliance Patents
in the Territory and revisions to correspondence with the U.S.
Patent Office.
6.1.3 Cooperation of the Parties. Each party agrees to
cooperate fully in the preparation, filing, prosecution and
maintenance of any BioAlliance Patents under this Agreement and in
the obtaining and maintenance of any patent extensions,
supplementary protection certificates and the like with respect to
any BioAlliance Patent claiming the composition or use of a Product
being commercialized pursuant to this Agreement.
6.1.4 If BioAlliance elects (i) to abandon the
prosecution or maintenance of any BioAlliance Patent, or
(ii) elects not to file a patent application in the Territory
for any Product Invention, then BioAlliance shall promptly notify
PAR in writing at least sixty (60) days before the abandonment
or applicable filing deadline and PAR shall have the right to cause
BioAlliance, at PAR’s expense, to file, prosecute, continue
prosecution and/or maintenance, as applicable, of such BioAlliance
Patent. Anything to the contrary notwithstanding, subject to the
mutual agreement of PAR, BioAlliance shall not be required to file,
nor shall PAR have the following right to file, a patent
application in the Territory for any Product Invention that
BioAlliance has determined to maintain as a trade secret in good
faith; provided however, that if such Product Invention pertains to
manufacturing and the parties, after consultation in good faith
regarding the effects on the Product market, disagree as to whether
to maintain such manufacturing Product Invention as a trade secret
or to pursue patent protection for such Product Invention, the
dispute resolution procedure under Section 11.2 shall apply,
except that BioAlliance’s Chief Executive Officer shall have
final say on such matter. In the event of the forgoing, PAR shall
be entitled, at its discretion and expense, upon written election
to BioAlliance, to file, prosecute and/or maintain such BioAlliance
Patents, in BioAlliance’s name. Additionally, if comp
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