LICENSE AGREEMENT

 

Exhibit 10.4

LICENSE AGREEMENT

THIS LICENSE AGREEMENT (the “Agreement” ) is entered into as of May 19, 2008 (the “Effective Date” ) by and between NOVADEL PHARMA, INC. ( “NovaDel” ), having an address at 25 Minneakoning Road, Flemington, NJ 08822, and BIOALLIANCE PHARMA SA , a French société anonyme ( “BioAlliance” ), having an address of 49, boulevard du Général Martial Valin, 1st Floor 75015 Paris, France.

RECITALS

WHEREAS, NovaDel develops pharmaceutical products with a focus on developing oral spray formulations of a broad range of marketed treatments for serious diseases, and NovaDel has developed expertise and acquired proprietary rights related to Licensed Product (as defined below);

WHEREAS, BioAlliance has expertise in licensing, developing, marketing and distributing certain pharmaceutical products, and wishes to develop and market the Licensed Product as further described herein; and

WHEREAS, NovaDel desires to grant a license to BioAlliance, and BioAlliance desires to accept a license, with regard to Licensed Product in the Territory 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

For the purposes of this Agreement, the following words and phrases shall have the following meanings, unless otherwise specifically provided herein:

1.1

“AAA” shall have the meaning set forth in Section 12.3.

1.2         “Affiliate” shall mean, with respect to any Entity, any other Entity that directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Entity. For purposes of this Section 1.2 only, “control” and, with correlative meanings, the terms “controlled by” and “under common control with” shall mean (a) the possession, directly or indirectly, of the power to direct the management or policies of an Entity, whether through the ownership of voting securities, by contract or otherwise, or (b) the

 

ownership, directly or indirectly, of more than fifty percent (50%) of the voting securities or other ownership interest of an Entity.

1.3

“Agreement” shall have the meaning set forth in the introductory paragraph.

 

1.4

“Applicable Royalty Rate” shall have the meaning as set forth in Section 5.3(a).

 

1.5

“BioAlliance” shall have the meaning set forth in the introductory paragraph.

 

1.6

“BioAlliance Indemnitee” shall have the meaning set forth in Section 11.1.

1.7         “Calendar Quarter” shall mean each respective period of three (3) consecutive months ending on March 31, June 30, September 30 and December 31.

1.8         “Calendar Year” shall mean each successive period of twelve (12) months commencing on January 1 and ending on December 31.

1.9

“CMC” shall have the meaning set forth in Section 4.2(d)(i).

 

1.10

“Commercialization Plan” shall have the meaning provided in Section 4.4.

1.11       “Commercially Reasonable Efforts” shall mean, with respect to the development or commercialization of Licensed Product, efforts and resources commonly used in the research-based pharmaceutical industry for a product of similar commercial potential at a similar stage in its lifecycle, taking into consideration its safety and efficacy, its cost to develop, the competitiveness of alternative products, its proprietary position, the likelihood of regulatory approval, its profitability, and all other relevant factors. Commercially Reasonable Efforts shall be determined on a market-by-market basis for each Licensed Product without regard to the particular circumstances of a party, including any other product opportunities of such party.

1.12       “CTD” shall have the meaning set forth in the International Conference on Harmonization of the Technical Requirements for Registration of Pharmaceuticals for Human Use (ICH) Guideline M4, Organization of the Common Technical Document, as revised on January 13, 2004, as such may be amended or updated from time to time.

1.13       “Competing Lingual Product” shall mean, with respect to a Licensed Product in a country of the Territory, a lingual spray, metered delivery pharmaceutical product containing ondansetron as the sole active ingredient that is sold by a Third Party that is not a licensee or sublicensee of BioAlliance or its Affiliates (or any of their licensees or sublicensees) under a Regulatory Approval granted to such Third Party in such country.

1.14       “Competing Product” shall mean any pharmaceutical product for oral spray administration that may be used as an anti-emetic drug.

1.15

“Confidential Information” shall have the meaning provided in Section 9.1.

1.16       “Control” shall mean, with respect to any Information, Patent or other intellectual property right, possession by a party of the ability, whether directly or indirectly, and

 

 

whether by ownership, license or otherwise (but without taking into account any rights granted by one party to the other party under the terms of this Agreement), to assign, or grant 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.

1.17       “Cost of Goods” means the cost of Licensed Product shipped in final therapeutic form. As used herein, the cost of Licensed Product means (a) in the case of products and services acquired from Third Parties, payments made to such Third Parties, and (b) in the case of manufacturing services performed by a party or its Affiliates, including manufacturing services in support of Third Party manufacturing, the actual unit costs of manufacture in bulk form or final manufacturing, as the case may be, plus the variances and other costs specifically provided for herein. Actual unit costs shall consist of direct material and direct labor costs plus manufacturing overhead directly attributable to Licensed Product at standard, all calculated in accordance with reasonable accounting methods, consistently applied, of a party or its Affiliates. Direct material costs shall include the costs incurred in purchasing materials, including sales and excise taxes imposed thereon and customs duty and charges levied by government authorities, and all costs of packaging components. Direct labor shall include the cost of employees engaged in direct manufacturing activities and direct or indirect quality control and quality assurance activities who are directly employed in Licensed Product manufacturing and packaging. Overhead attributable to Licensed Product shall include a reasonable allocation of indirect labor (not previously included in direct labor), a reasonable allocation of administrative costs, and a reasonable allocation of facilities costs. Such allocations shall be in accordance reasonable accounting methods, consistently applied, of the party performing the work.

1.18

“Development Plan” shall have the meaning set forth in Section 4.1(b).

 

1.19

“Diligence Obligation” shall have the meaning set forth in Section 4.6.

 

1.20

“Effective Date” shall have the meaning set forth in the introductory paragraph.

1.21       “EMEA” shall mean the European Medicines Agency, or any successor agency or agencies thereto, having the administrative authority to regulate the marketing of human pharmaceutical products or biological therapeutic products, delivery systems and devices in the Territory.

1.22       “Entity” shall mean any individual, sole proprietorship, corporation, limited liability company, association, joint venture, partnership, limited partnership, limited liability partnership, trust, university, business, government or political subdivision thereof, including an agency, or any other organization that possesses independent legal standing.

1.23

“Executives” shall have the meaning provided in Section 12.2.

1.24       “Exploit” shall mean the making, having made, importation, use, sale, offering for sale of a product or process, including, without limitation, the research, development, registration, modification, improvement, manufacture, storage, optimization, import, export, transport, distribution, promotion, marketing, sale or other disposition of a product. The term “Exploitation” shall have a corresponding meaning.

 

 

1.25       “FDA” shall mean the United States Food and Drug Administration, or any successor agency or agencies thereto, responsible for the evaluation and approval of pharmaceutical products or biological therapeutic products, delivery systems and devices in the United States.

1.26       “First Commercial Sale” shall mean, with respect to Licensed Product, the first sale for end use or consumption of such Licensed Product in a country after the governing health regulatory authority of such country has granted Regulatory Approval.

1.27

“Global Product Committee” shall have the meaning set forth in Section 2.7.

1.28       “Improvement” shall mean any modification, variation or revision to an apparatus, method, formulation, process, product or technology, or any discovery, technology, process, method or formulation related to an apparatus, method, process, product or technology, whether or not patented or patentable, including any enhancement in the manufacture or steps or processes thereof, ingredients, preparation, presentation, formulation, means of delivery, packaging or dosage of an apparatus, method, process, product or technology, any discovery or development of any new or expanded indications for an apparatus, method, process, product or technology, or any discovery or development that improves the stability, safety or efficacy of an apparatus, method, product or technology.

1.29       “Indemnification Claim Notice” shall have the meaning set forth in Section 11.3(a).

1.30

“Indemnified Party” shall have the meaning set forth in Section 11.3(a).

1.31       “Information” shall mean all technical, scientific and other know-how and information, trade secrets, knowledge, technology, means, methods, processes, practices, formulas, instructions, skills, techniques, procedures, experiences, ideas, technical assistance, designs, drawings, assembly procedures, computer programs, algorithms, apparatuses, compositions of matter, cells, cell lines, assays, animal models, physical, biological or chemical material, specifications, data, results and other material, including pre-clinical and clinical trial results, manufacturing procedures and test procedures and techniques, (whether or not confidential, proprietary, patented or patentable) in written, electronic or any other form now known or hereafter developed, and all Improvements to any of the foregoing, and other discoveries, developments, inventions, and other intellectual property (whether or not confidential, proprietary, patented or patentable).

1.32       “Licensed Product” shall mean any dosage of pharmaceutical composition or preparation that contains, as the sole active ingredient, ondansetron, delivered by means of the NovaDel Process for any human uses.

1.33

“Losses” shall have the meaning set forth in Section 11.1.

1.34       “MAA” shall mean a Marketing Authorization Application, and any and all supplements, requesting permission to place a drug on the market and filed with the EMEA or any regulatory agency either (i) under the centralized or decentralized European system, in each case for Licensed Product, (ii) under the Mutual Recognition system, in each case for Licensed

 

 

Product or (iii) with any other national government regulatory approval agency that does not use the Mutual Recognition system relating to the Licensed Product.

1.35       “Major Market Country” shall mean France, Germany, Spain, Italy or the United Kingdom, alone or in combination.

1.36       “Net Sales” shall mean the gross amounts invoiced by BioAlliance or its Affiliates or Sublicensees for sales of Licensed Product in the Territory, less the following deductions to the extent included in the gross invoiced sales price for Licensed Product or otherwise directly paid, allowed, accrued, or incurred by BioAlliance or its Affiliates or Sublicensees with respect to the sale of such Licensed Product (if not previously deducted from the amount invoiced): (i) *** actually given; (ii) *** upon *** (except where any such *** ); (iii) *** on *** of such Licensed Product; (iv) *** pursuant to *** ; (v) *** ; (vi) *** (if actually borne by BioAlliance or its Affiliates without reimbursement from any Third Party); and (vii) *** (other than *** ) directly related to *** .

For purposes of determining Net Sales, the Licensed Product shall be *** and *** , *** . For purposes of calculating Net Sales, *** shall be excluded from the computation of Net Sales, but *** shall be included in the computation of Net Sales.

 

1.37

“NovaDel” shall have the meaning set forth in the introductory paragraph.

1.38       “NovaDel Development Expenses” shall have the meaning set forth in Section 5.4(a).

1.39

“NovaDel Indemnitee” shall have the meaning set forth in Section 11.2.

1.40       “NovaDel Know-How” shall mean all Information Controlled by NovaDel or an Affiliate of NovaDel as of the Effective Date or, from time to time, during the Term that is necessary to Exploit the Licensed Product in the Territory or to use the NovaDel Process to Exploit Licensed Product in the Territory, but excluding any Information to the extent claimed by any NovaDel Patents.

1.41       “NovaDel Patents” shall mean the Patents that NovaDel or any of its Affiliates Controls on the Effective Date or during the Term that are necessary to Exploit Licensed Product in the Territory or to use the NovaDel Process to Exploit Licensed Product in the Territory. The NovaDel Patents as of the Effective Date are set forth on Schedule 1.41 .

1.42       “NovaDel Process” shall mean NovaDel’s proprietary lingual spray technology for the delivery of pharmaceutical compounds through the mucosal membrane of the mouth in humans using an aerosol or pump spray device and any Improvements thereto that are or come under the Control of NovaDel or any of its Affiliates during the Term.

1.43       “NovaDel Technology” shall mean the NovaDel Patents and NovaDel Know-How.

1.44

“Patent Challenge” shall have the meaning set forth in Section 10.2(c).

 

 

1.45       “Patents” shall mean all issued patents and pending unpublished and published patent applications (which, for purposes of this Agreement, include certificates of invention, applications for certificates of invention and priority rights) in any country or region, including all provisional applications, substitutions, continuations, continuations-in-part, continued prosecution applications including requests for continued examination, divisional applications and renewals, and all letters patent or certificates of invention granted thereon, and all reissues, reexaminations, extensions, term restorations, renewals, substitutions, confirmations, registrations, revalidations, revisions and additions of or to any of the foregoing, and all counterparts of any of the foregoing.

1.46       “Regulatory Approval” shall mean any approvals, including pricing and reimbursement approvals, where applicable, of a Regulatory Authority that are necessary for the manufacture, use, storage, import, transport, marketing, distribution and/or sale of a pharmaceutical product in any applicable jurisdiction.

1.47       “Regulatory Authority” shall mean any applicable supra-national, federal, national, regional, state, provincial or local regulatory agencies, departments, bureaus, commissions, councils or other government entities regulating or otherwise exercising authority in the applicable jurisdiction.

1.48       “Regulatory Documentation” shall mean all applications, registrations, licenses, authorizations and approvals (including all Regulatory Approvals), all correspondence submitted to or received from Regulatory Authorities (including minutes and official contact reports relating to any communications with any Regulatory Authority), all supporting documents and all clinical studies and tests, relating to Licensed Product, including, where applicable, in CTD format, and all data contained in any of the foregoing, including all regulatory drug lists, advertising and promotion documents, adverse event files and complaint files.

1.49       “Royalty Term” shall mean, on a Licensed Product-by-Licensed Product and country-by-country basis in the Territory, the longer of (a) ten (10) years after the First Commercial Sale of such Licensed Product in such country and (b) the date of expiration or invalidation of the last Valid Claim covering such Licensed Product in such country.

1.50

“Steering Committee” shall have the meaning set forth in Section 2.1.

1.51       “Sublicensee” shall mean an Affiliate or Third Party to whom BioAlliance has transferred its rights granted under this Agreement to use, sell, offer for sale or import Licensed Products in accordance with this Agreement.

1.52

“Term” shall have the meaning provided in Section 10.1.

1.53       “Territory” shall mean the countries comprising Europe that are listed on Schedule 1.53 .

1.54       “Third Party” shall mean any entity other than BioAlliance or NovaDel or an Affiliate of BioAlliance or NovaDel.

1.55

“Third Party Claim” shall have the meaning set forth in Section 11.3(b).

 

 

1.56

“Total Cap” shall have the meaning set forth in Section 5.4(b).

1.57       “Trademark” shall mean the trademark developed under this Agreement and under which the Licensed Product is sold in the Territory.

1.58       “Transfer Price” means the Cost of Goods for Licensed Product shipped in final therapeutic form, plus a reasonable mark-up for NovaDel’s services in connection with the manufacture and supply of Licensed Product, subject to the limitations in Section 4.5.

1.59       “Valid Claim” shall mean, with respect to a particular country, a claim of an issued and unexpired patent within the NovaDel Patents in such country, which patent claims the composition, formulation or use of the Licensed Product and that (a) has not been revoked or held unenforceable or invalid by a decision of a court or governmental agency of competent jurisdiction from which no appeal can be taken, or no appeal has been taken, within the time allowed for appeal, or otherwise has been dedicated to the public and (b) has not been abandoned, disclaimed, canceled, denied or admitted to be invalid or unenforceable through reissue or disclaimer or otherwise in such country.

2.	GOVERNANCE

2.1         Establishment of Steering Committee. Within five (5) business days after the Effective Date, the parties will establish a steering committee (the “Steering Committee” ) for the purpose of coordinating and facilitating communications regarding the development and commercialization of Licensed Product in the Territory. The Steering Committee will consist of an equal number of designees of each of BioAlliance and NovaDel. Each of the Steering Committee members shall have appropriate expertise for participation in the Steering Committee. The initial Steering Committee members shall be designated by each party promptly following the Effective Date. Each party shall have the right at any time and from time to time to designate a replacement, on a permanent or temporary basis, for any or all of its previously-designated members of the Steering Committee upon written notice to the other party. Upon initial formation of the Steering Committee and thereafter at the beginning of each Calendar Year during the Term, each party shall appoint one of its designees to serve as a Co-Chair of the Steering Committee. NovaDel and BioAlliance each may, on advance written notice to the other party, invite non-member representatives of such party to attend meetings of the Steering Committee.

2.2         Responsibilities . The Steering Committee shall have the following responsibilities and decision-making authority and perform the following functions relating to Licensed Product pursuant to this Agreement:

(a)        Discuss, facilitate and coordinate the exchange of information between the parties;

(b)        Discuss and review: (i) Licensed Product development strategies for the Territory; and (ii) the preparation and implementation of the Development Plans including the status of material activities and budgets under such plans and any material amendment to the Development Plans;

 

 

(c)        Discuss and review: (i) commercialization strategies for the Territory; and (ii) the preparation and implementation of the Commercialization Plans for Licensed Product including the progress of material activities under such Commercialization Plan and any material amendments to any Commercialization Plan;

(d)        Discuss and review regulatory strategies and submissions, Licensed Product labeling strategies and related activities for the Territory;

(e)

Discuss and review Licensed Product supply strategies; and

(f)          Have such other responsibilities as may be mutually agreed in writing by the parties from time to time.

2.3         Meetings. The Steering Committee shall meet at least four (4) times during every Calendar Year of which at least two (2) times during every Calendar Year shall be in person, and more frequently as the parties deem appropriate, at such places and times as determined by the members. The two (2) Co-Chairs shall cooperate to send a notice and agenda for each meeting of the Steering Committee to all members of the Steering Committee reasonably in advance of each meeting. The members of the Steering Committee also may convene or be polled or consulted from time to time by means of telephone conference, video conference, electronic mail or correspondence and the like, as deemed necessary or appropriate by the Co-Chairs. The party hosting any Steering Committee meeting shall appoint one (1) person (who need not be a member of the Steering Committee) to attend the meeting and record the minutes of the meeting in writing. Such minutes shall be circulated to the members of the Steering Committee promptly following the meeting for review and comment. The Steering Committee may determine such other procedures with respect to Steering Committee meetings as it determines appropriate.

2.4

Decision-Making of the Steering Committee .

(a)        The Steering Committee may make decisions with respect to such matters set forth in Section 2.2(a). Except as specified in Sections 2.4(b) and 2.4(c), all decisions of the Steering Committee shall be made by unanimous vote, with BioAlliance and NovaDel each having, collectively, among its respective members, one vote in all decisions.

(b)        With respect to any issue, if the Steering Committee cannot reach consensus within ten (10) business days after the matter has been brought to the Steering Committee’s attention, then such issue shall be referred to the Executives of each party for resolution. If the Executives cannot resolve the issue within ten (10) business days after the matter has been brought to their attention, such matter shall be resolved in accordance with Section 2.4(c) for those items set forth in Section 2.4(c) and for all other matters in accordance with the dispute resolution procedures set forth in Section 12.

(c)

Notwithstanding anything contained herein to the contrary:

(i)         subject to BioAlliance’s consideration in good faith of the views of NovaDel, BioAlliance shall have final decision-making authority on all development (subject to the limitations set forth in Sections 4.1(c), 4.2(a) and 5.4 to the extent of NovaDel’s involvement

 

 

in specified development matters), regulatory and commercialization matters (other than manufacturing or supply matters) with respect to Licensed Product in the Territory; and

(ii)        subject to NovaDel’s consideration in good faith of the views of BioAlliance, NovaDel shall have final decision-making authority on all matters with respect to manufacture and supply of Licensed Product (provided that such authority shall not extend to modifying the pricing or other terms regarding the manufacture and supply of Licensed Product set forth in this Agreement or in any manufacture and supply agreement between the parties, except by mutual written agreement of the parties).

2.5         Expenses. Each party shall be responsible for all travel and related costs and expenses for its members and approved invitees to attend meetings of, and otherwise participate on, the Steering Committee.

2.6         Limitations on Authority of Steering Committee. Each party to this Agreement shall retain the rights, powers, and discretion granted to it under this Agreement, and no such rights, powers, or discretion shall be delegated to or vested in the Steering Committee unless such delegation or vesting of rights is expressly provided for in this Agreement or the parties expressly so agree in writing. The Steering Committee shall not have the power to amend or modify this Agreement, which may only be amended or modified as provided in Section 13.2.

2.7         Global Product Committee . The parties shall use commercially reasonable efforts to establish a global Product committee (the “Global Product Committee” ) for the purpose of coordinating and facilitating communications regarding global brand strategy of Licensed Product throughout the world. The Global Product Committee shall not have decision-making authority. The Global Product Committee will consist of an equal number of designees of each of BioAlliance, NovaDel and the third parties to whom NovaDel has licensed rights to Licensed Product outside of the Territory.

3.

LICENSE

3.1         License Grant. Subject to the terms and conditions of this Agreement, during the Term, NovaDel hereby grants to BioAlliance an exclusive (even as to NovaDel, subject to Section 3.2 and Section 3.5(c)), royalty-bearing license, with the right to sublicense the rights hereunder (as provided in Section 3.3), under the NovaDel Technology, to develop, register, use, promote, market, distribute, sell, offer for sale, have sold, import and export Licensed Product in the Territory.

3.2         License Grant to NovaDel. Subject to the terms and conditions of this Agreement, BioAlliance hereby grants to NovaDel a limited, royalty-free, non-exclusive right and license in the Territory in and to the NovaDel Technology to the extent necessary to perform its development activities under Section 4.1(c) and only during the period that NovaDel is performing such activities.

3.3         Sublicenses. BioAlliance shall have the right to grant sublicenses under the grants in Section 3.1 to Affiliates and/or Third Parties pursuant to a separate written agreement, subject to the following requirements and conditions:

 

 

(a)        BioAlliance must obtain NovaDel’s prior written consent in respect of each such sublicense to a Third Party that Controls a lingual spray technology or who is developing or commercializing a Competing Product.

(b)        Except to the extent the parties otherwise agree pursuant to the terms of a particular sublicense granted under this Section 3.3 any sublicense agreement must be fully consistent with the terms and conditions of this Agreement, and provide that Sublicensee will indemnify NovaDel and its Affiliates with respect to the Exploitation of Licensed Product by such Sublicensee to the extent provided in Section 11.2(e).

(c)        Within five (5) days after execution or receipt thereof, as applicable, BioAlliance shall provide NovaDel with a full and complete copy of each sublicense agreement granted hereunder (provided that BioAlliance may redact financial information contained therein that is not necessary to disclose to ensure compliance with this Section 3.3) and shall deliver copies of all reports (including relating to royalties and other payments) relating to Licensed Product received by BioAlliance from such Sublicensees, which sublicense agreements and reports shall be treated by NovaDel as Confidential Information of BioAlliance.

(d)        Termination of this Agreement by NovaDel pursuant to Section 10.2(a) with respect to BioAlliance shall not terminate any sublicense granted by BioAlliance pursuant to this Section 3.3 with respect to a Sublicensee, and such sublicense shall become a direct license from NovaDel to such Sublicensee; provided that (i) such Sublicensee is not in breach of any provision of this Agreement or the applicable sublicense agreement, (ii) such Sublicensee shall perform all obligations of BioAlliance under this Agreement to the extent of the rights granted to such Sublicensee under its sublicense agreement with BioAlliance (e.g., only for a given territory within the Territory), (iii) NovaDel shall have all rights with respect to any and all Sublicensees as it had hereunder with respect to BioAlliance prior to termination of this Agreement with respect to BioAlliance to the extent of the rights granted to such Sublicensee under its sublicense agreement with BioAlliance (e.g., only for a given territory within the Territory), except that in no event shall any Sublicensee shall have any responsibility or liability for any action or omission of BioAlliance under this Agreement, and (iv) BioAlliance shall include in any sublicense a provision in which said Sublicensee acknowledges its obligations to NovaDel hereunder and the rights of NovaDel to terminate such sublicense agreement for a breach of such sublicense agreement by such Sublicensee. The failure of BioAlliance to include in a sublicense the provisions referenced in clause (iv) shall render the affected sublicense void.

3.4         Disclosure of NovaDel Know-How and Improvements. Promptly after the Effective Date, NovaDel shall at its cost and expense, use good faith reasonable efforts to disclose to BioAlliance in writing or via mutually acceptable electronic media, copies or reproductions of all NovaDel Know-How, not previously disclosed to BioAlliance, reasonably necessary in order to enable BioAlliance to exploit its rights granted under this Section 3. In addition, during the Term, NovaDel shall disclose to BioAlliance in writing, or via mutually acceptable electronic media, on an ongoing basis, copies or reproductions of all NovaDel Know-How not previously disclosed to BioAlliance that is reasonably necessary in order to enable BioAlliance to exploit its rights granted under this Section 3 and all Improvements to the NovaDel Process, Licensed Product or NovaDel Technology that are conceived, discovered, developed or otherwise made by or on behalf of NovaDel (or its Affiliates, licensees or

 

 

sublicensees). Such NovaDel Know-How and all Improvements to the NovaDel Process, Licensed Product or NovaDel Technology that are conceived, discovered, developed or otherwise made by or on behalf of either party (or its Affiliates, licensees or sublicensees) shall be deemed to be within the scope of the licenses granted herein without payment of any additional compensation.

3.5         Retained Rights; No Implied Licenses. NovaDel hereby expressly reserves the right to practice, and to grant licenses under, the NovaDel Technology for any and all purposes except as expressly set forth under Section 3.1. BioAlliance shall have no rights, express or implied, with respect to the NovaDel Technology, except as expressly set forth in Section 3.1, and BioAlliance covenants to NovaDel that none of BioAlliance, its Affiliates or Sublicensees shall use the NovaDel Technology, directly or indirectly, for any purpose other than as expressly permitted by this Agreement. Without limiting the foregoing, but subject to Section 3.6, NovaDel retains, without any duty of accounting or otherwise to BioAlliance or a Sublicensee (a) the right to enter into collaborations or other agreements with, and to grant licenses and other rights under the NovaDel Technology to Third Parties to Exploit products other than Licensed Product and to use the NovaDel Process in connection therewith, (b) the right to independently Exploit products other than Licensed Product and to use the NovaDel Process in connection therewith, (c) the irrevocable, non-exclusive, royalty-free right to use the NovaDel Technology (including the NovaDel Process) with respect to ondansetron, for its own internal, non-commercial research and development activities, (d) all rights in the NovaDel Technology for all territories other than the Territory and (e) all rights in the NovaDel Technology for any dosage of pharmaceutical composition or preparation that contains ondansetron delivered by means of the NovaDel Process for non-human uses in all territories, including the Territory. All such rights or licenses are or shall be granted only as expressly provided in the terms of this Agreement.

3.6         Exclusivity. NovaDel agrees that during the Term it will not (a) enable or contract with any Third Party (including, without limitation, its licensees and sublicensees) to develop, import, market, sell or distribute Licensed Product in the Territory or itself develop or supply Licensed Product for sale in the Territory, except as contemplated by this Agreement, or (b) enable or contract with any Third Party (including, without limitation, its licensees and sublicensees) 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. BioAlliance agrees that during the Term it will not, and will not enable or contract with any Third Party (including, without limitation, its licensees and Sublicensees) to develop, manufacture, import, market, sell or distribute any Competing Product in the Territory.

4.	DEVELOPMENT, REGULATORY AND COMMERCIALIZATION MATTERS

 

4.1

Development.

(a)         Development Activities . Subject to the other provisions of this Section 4.1 and Section 4.2, BioAlliance, its Affiliates or Sublicensees shall be solely responsible, using Commercially Reasonable Efforts, for development of Licensed Product in the Territory.

(b)

Development Plans .

 

 

(i)         Within sixty (60) days after the Effective Date, BioAlliance will provide to the Steering Committee for review and comment a development plan describing its strategy and principal activities in seeking Regulatory Approval of Licensed Product in the Territory in accordance with the terms of this Agreement (as updated from time to time, the “ Development Plan ”).

(ii)        BioAlliance shall periodically (and at least once per Calendar Year) prepare an updated Development Plan, as applicable taking into account completion, commencement or cessation of or changes to development not contemplated by the then-current Development Plan and shall submit such proposed Development Plan to the Steering Committee for review and comment.

(c)         Development Activities by NovaDel . Without limiting the foregoing, upon (i) BioAlliance’s written request in connection with a particular development activity with respect to Licensed Product in the Territory, and (ii) the written agreement of the parties, NovaDel will undertake the development activity pursuant to the Development Plan, and shall provide to BioAlliance such requested work product for such development activity; provided that NovaDel Development Expenses related to such development shall be reimbursed by BioAlliance pursuant to Section 5.4 or in such other manner and amount as may be agreed by the parties in writing. Notwithstanding the foregoing, NovaDel shall only undertake development activity pursuant to the Development Plan upon mutual agreement of the parties and shall not be subject to BioAlliance’s casting vote pursuant to Section 2.4(c)(i). For purposes of clarification, the development activities referred to in this Section 4.1(c) shall not include, and this Section 4.1(c) shall not otherwise apply to or affect, NovaDel’s obligation to provide Regulatory Documentation pursuant to Section 4.2(c) or NovaDel’s obligations to manufacture and supply Licensed Product pursuant to this Agreement or any manufacture and supply agreement between the parties.

(d)         Reports. BioAlliance shall, every six (6) months, provide to the Steering Committee a written progress report, which shall describe the development activities with respect to Licensed Product in the Territory during such time period, and provide such other information as may be reasonably requested by the Steering Committee with respect to such development activities.

(e)         Regulatory Records. NovaDel and BioAlliance each shall maintain, or cause to be maintained, records of its respective development activities with respect to Licensed Product 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 development activities, and which shall be retained by such party for at least five (5) years after the termination of this Agreement, or for such longer period as may be required by applicable law. Each party shall have the right, during normal business hours and upon reasonable notice, to inspect and copy any such records; provided, however, that neither party shall have the right to conduct more than one such inspection in any twelve (12)-month period.

 

 

4.2

Regulatory Matters in the Territory.

(a)         Regulatory Activities. BioAlliance and, as applicable, its Affiliates and Sublicensees, at its sole cost and expense, subject to Section 4.2(d), shall be responsible, using Commercially Reasonable Efforts, for obtaining and maintaining Regulatory Approval for Licensed Product in the Territory, including the filing of all annual and other reports or filings required by the EMEA or any other Regulatory Authority in the Territory and shall use Commercially Reasonable Efforts to conduct any clinical trials required by the EMEA or any other Regulatory Authority in the Territory to gain or maintain Regulatory Approval for the Licensed Product or otherwise as a condition to Regulatory Approval of Licensed Product in the Territory. BioAlliance or its Affiliates shall hold, in their name, all Regulatory Approvals for Licensed Product in the Territory. BioAlliance and, as applicable, its Affiliates shall use Commercially Reasonable Efforts to conduct any further development activities required in connection with seeking Regulatory Approval for Licensed Product in the Territory; provided that in connection with further development necessary to support the registration in the Major Market Countries of the first Regulatory Approval for the first Licensed Product, *** shall be entitled to*** in accordance with *** of *** and/or a *** each as may be *** or otherwise *** to be *** to *** as are *** and *** such agreement not to be *** and such *** shall not be subject to***

(b)         Correspondence with Regulatory Authorities . Unless otherwise agreed in writing by the parties, BioAlliance, subject to Section 4.2(d), shall be responsible, using Commercially Reasonable Efforts, for preparing and filing MAAs and seeking and maintaining Regulatory Approvals for Licensed Products in the Territory in accordance with the Development Plan, including preparing all reports necessary as part of a MAA. BioAlliance shall provide NovaDel with drafts of any material documents or correspondence to be submitted to any Regulatory Authority in the Territory that pertains to Licensed Product, including MAAs. BioAlliance will consult in advance with NovaDel with respect to any substantive or material filings to be made by BioAlliance in accordance with the terms of this Section 4.2(b), including MAAs, and shall consider in good faith any comments NovaDel may have with respect to any such filings.

(c)         Regulatory Documentation. NovaDel shall promptly disclose to BioAlliance all Regulatory Documentation and any data included or referenced therein generated or made available by NovaDel or any of its Affiliates or licensees or sublicensees. NovaDel’s agreement with Par Pharmaceutical, Inc. requires PAR to promptly disclose to NovaDel all regulatory documentation and all other information in the possession or control of PAR that relate to the exploitation of the Licensed Product and NovaDel and its licensees shall have a perpetual, royalty-free, irrevocable, worldwide right to use and reference any such Par regulatory documentation and any data included or referenced therein for all purposes. To the extent Par does not promptly disclose such documentation and information to NovaDel, NovaDel shall use Commercially Reasonable Efforts to enforce its rights under its agreement with Par to receive such documentation and information. BioAlliance and its Sublicensees shall have the royalty-free right to reference and use all Regulatory Documentation and any data included or referenced therein for the purposes of development, regulatory and commercialization activities with respect to Licensed Product in the Territory. NovaDel shall provide to BioAlliance or cause its

 

 

Affiliates, licensees and sublicensees to provide to BioAlliance letters of authorization to use such Information in accordance with this Agreement.

(d)         Regulatory Approvals. Except as the parties otherwise agree in writing, all Regulatory Documentation pursuant to or in connection with the Regulatory Approvals for Licensed Product in the Territory required under the Development Plan shall be made in the name of BioAlliance; provided, however, that:

(i)         NovaDel will be the primary contact for Chemistry, Manufacturing and Control ( “CMC” ) matters in all MAAs and other applications for Regulatory Approval for Licensed Product in the Territory and will comply with the then current edition of the European Pharmacopoeia for specifications of raw materials and finished Licensed Product.

(ii)        BioAlliance agrees to utilize, to the extent possible based upon the format used in Regulatory Documentation provided by NovaDel under Section 4.2(c), the CTD format for its MAAs in order to facilitate use and reference to such MAAs any subsequent submissions filed by NovaDel or its licensees for Licensed Product outside of the Territory.

(iii)       BioAlliance agrees to keep the Regulatory Documentation and data included or referenced therein provided by NovaDel pursuant to Section 4.2(c) included within its MAAs for Licensed Product, except for those sections in the Summary Basis of Approval and available through the Freedom of Information Act, confidential in accordance with Section 9 and subject to the rights granted under Section 4.2(c).

(iv)       NovaDel and its Affiliates and licensees shall have a perpetual, royalty-free, irrevocable, worldwide right to use and reference the Regulatory Documentation Controlled by BioAlliance or its Affiliates or Sublicensees and any data included or referenced therein for the purposes of development, regulatory and commercialization activities (A) with respect to Licensed Product, outside the Territory and (B) with respect to products (other than Licensed Product) inside and outside the Territory. NovaDel agrees to keep the Regulatory Documentation and data included or referenced therein provided by BioAlliance pursuant to this 4.2(d)(iv) included within its applications for marketing approval for Licensed Product outside the Territory, except for those sections in the Summary Basis of Approval and available through the Freedom of Information Act, confidential in accordance with Section 9 and subject to the rights granted in this Section 4.2(d)(iv).

4.3         Pharmacovigilance. Each party will cooperate (at its sole cost and expense), and will cause its Affiliates, licensees and sublicensees to cooperate, in implementing a pharmacovigilance mutual alert process to comply with all applicable legal obligations of Regulatory Authorities.

4.4         Commercialization Activities in the Territory. Following receipt of Regulatory Approval of Licensed Product by Regulatory Authorities in the Territory, BioAlliance and, as applicable, its Affiliates and Sublicensees shall, at its sole cost and expense, use Commercially Reasonable Efforts to commercialize Licensed Product in the Territory. Without limiting the foregoing, BioAlliance, itself or through its Affiliate or Sublicensee, shall, at its sole cost and expense, commercialize Licensed Product in the Territory in accordance with a

 

 

commercialization plan for Licensed Product, which plan shall be prepared by BioAlliance in consultation and cooperation with NovaDel no later than one (1) year prior to the expected date of First Commercial Sale of Licensed Product in the Territory, as amended in accordance with this Section 4.4 (the “Commercialization Plan” ). BioAlliance or, if applicable, its Affiliate or Sublicensee may amend the Commercialization Plan in the ordinary course of its business. With respect to the initial Commercialization Plan or amendment thereto, BioAlliance shall submit such Commercialization Plan or amendment, as applicable, to the Steering Committee and shall consider in good faith any comments the Steering Committee may have with respect thereto, except that any amendment to the Commercialization Plan (other than an amendment required by the applicable Regulatory Authority in the Territory) that is reasonably likely to have a material adverse affect on the commercial value of Licensed Product in the Territory, shall require NovaDel’s prior written approval, which shall not be unreasonably withheld. Notwithstanding the foregoing, BioAlliance shall have final decision-making authority over all pricing decisions with respect to Licensed Product in the Territory and pricing matters described in the Commercialization Plan, which decisions shall not be subject to approval by NovaDel. BioAlliance or, if applicable, its Affiliate or Sublicensee shall have responsibility for all customary advertising, marketing, promotion, distribution, selling and other commercialization activities including developing and implementing strategies and tactics related to such activities for Licensed Product in the Territory. BioAlliance or, if applicable, its Affiliate or Sublicensee shall provide, using Commercially Reasonable Efforts, and at BioAlliance’s sole cost and expense, customary distribution services, including among other things, storage, order taking, shipping, billing, accounts receivable, returns and/or allowances, for Licensed Product in the Territory. BioAlliance or, if applicable, its Affiliate or Sublicensee shall be responsible, using Commercially Reasonable Efforts, for customary pre-launch market development, launch and post-launch marketing, sales, and distribution of Licensed Product in the Territory including, among other things, (i) marketing, (ii) sales personnel, (iii) order taking, product storage and distribution, (iv) commercially relevant regulatory activities, price and reimbursement negotiations, and (v) managing local medical affairs and drug safety issues. BioAlliance or, if applicable, its Affiliate or Sublicensee shall, at all times during the Term after receipt of Regulatory Approval of Licensed Product in the Territory, use Commercially Reasonable Efforts to provide, without limitation, appropriate promotional campaigns and materials and qualified commercial personnel with respect to Licensed Product in the Territory.

4.5         Manufacture and Supply. NovaDel or its Affiliates shall be solely responsible for the manufacture and supply to BioAlliance and its Sublicensees of Licensed Product, both for clinical development and following receipt of Regulatory Approval of Licensed Product, in the Territory during the Royalty Term; provided that NovaDel and its Affiliates may contract with a Third Party to perform such manufacturing and supply services. After the Royalty Term, NovaDel or its Affiliates shall continue to be the primary source for the manufacture and supply to BioAlliance and its Sublicensees of Licensed Product in the Territory (and may contract with a Third Party to perform such manufacturing and supply services) so long as the Transfer Price is commercially reasonable given the market conditions and is competitive with the transfer price for Licensed Product that BioAlliance or its Sublicensees may obtain from any Third Party manufacturer. Upon the Effective Date, the parties shall enter into a supply agreement relating to supply to BioAlliance of its requirements of Licensed Product for its development and commercialization activities for the Territory. The supply agreement shall address the standard terms of supply and relevant other terms, including, without limitation, terms relating to

 

 

specifications, forecasting, delivery, product warranties, acceptance and rejection, and regulatory matters. The supply agreement shall provide for supply of Licensed Product from NovaDel to BioAlliance at Cost of Goods for any Licensed Product required for development activities under Section 4.1 (including, without limitation, for development activities performed by NovaDel under Section 4.1(c)) and at the Transfer Price for all other Licensed Product; provided, however, if the *** in any *** exceeds*** of Net Sales for Licensed Product for such *** then the *** shall be *** in connection with the *** for such *** that, if the *** for such *** of *** for Licensed Product for such *** then*** shall *** of the amount by which *** of *** for such *** and*** of *** for such *** For example, if *** are*** and *** is *** for a given *** payable by *** for such *** would*** and would *** which is *** or*** plus*** of the amount by which *** of *** or ***

4.6         Diligence Obligations. Without limiting obligation to use Commercially Reasonable Efforts in accordance with its activities under Sections 4.1, 4.2 and 4.4, BioAlliance shall have the following specific diligence obligations (each, a “Diligence Obligation” ):

(a)        Within the later of (i) one hundred eighty (180) days after receipt from NovaDel of the complete Regulatory Documentation dossier for Licensed Product in appropriate format (including the Regulatory Documentation dossier from its sublicensee in the United States), or (ii) in the event BioAlliance, in its sole discretion, believes an efficacy study is required with respect to Licensed Product, one hundred eighty (180) days after receipt of final report for such efficacy study, BioAlliance or, if applicable, its Affiliate or Sublicensee shall file an MAA in a country of the Territory;

(b)        Within ninety (90) days after filing the first MAA in a country in the Territory, BioAlliance or, if applicable, its Affiliate or Sublicensee shall file an MAA in each Major Market Country; and

(c)        Within ninety (90) days after receipt of all Regulatory Approvals from the Regulatory Authority for Licensed Product in each Major Market Country, BioAlliance directly or through a Sublicensee shall consummate the First Commercial Sale of Licensed Product in such Major Market Country.

If, for any reason, BioAlliance or, if applicable, its Affiliate or Sublicensee has not achieved a Diligence Obligation set forth in (a), (b) or (c) above within the specified time frame but provides to NovaDel documentary evidence showing diligent efforts to achieve such Diligence Obligation, the time period for achievement of the applicable Diligence Obligation will be extended once by ninety (90) days.

5.	FEES AND PAYMENT