EXHIBIT 10.3
Portions of this Exhibit were
omitted and filed separately with the Secretary of the Commission
pursuant to an application for confidential treatment filed with
the Commission pursuant to Rule 24b-2 under the Securities Exchange
Act of 1934. Such omissions are designated as ***.
TECHNOLOGY TRANSFER
AGREEMENT
LICENSING AGREEMENT
BETWEEN
SHIJIAZHUANG PHARMACEUTICAL GROUP
CORPORATION
AND
UNIGENE LABORATORIES
INC.
Party A: Shijiazhuang Pharmaceutical Group
Corporation
Party B: Unigene
Laboratories Inc.
Party A and Party B have
agreed to establish a joint venture (JV) to engage in the
production and marketing of bulk recombinant Salmon
Calcitonin(sCT), bulk recombinant Parathyroid Hormone (PTH), and
certain other finished products and to engage in
research & development activities related to biotechnology
products. The initial total investment is US$15 million. The
said technologies for the above two kinds of products contributed
to the JV by Party B shall be valued as 30% of the
$15 million capital investment, i.e. $4.5 million. The
registered capital is US$7 million. Party A contributes
US$3.85 million for an equity share of 55%, and Party B
contributes US$3.15 million which includes its proprietary
technologies for the production of calcitonin and PTH and certain
of their finished products for a value of US$2.1 million and
US$1,050,000 cash for 45% equity share of the registered capital.
JV desires a license under certain proprietary and manufacturing
technologies of Party B in order to facilitate the production
and marketing of the aforementioned products and to engage in the
development activities, and Party B is willing to grant such a
license to JV on the following terms and conditions.
Chapter I Terms and
Conditions
|
|
1.1
|
Party B
shall deliver to JV such proprietary technologies represented by
the supporting patents and know-how owned or controlled by it and
reasonably necessary for the manufacturing of recombinant sCT and
recombinant PTH, and shall during the term of this agreement,
deliver such other proprietary technologies owned or controlled by
Party B as may be reasonably necessary to manufacture such other
final products as JV may identify, or provide research and
development services, Proprietary technologies may include the
stability data, quality specifications, various physical and
chemical data, analytical and test methods, compositions and
formulations, are attached as appendix 1 of this
agreement.
|
|
|
1.2
|
The physical
and chemical data, quality specifications, test methods, place of
origin and suppliers for the raw and auxiliary materials are
attached as appendix 2 of this agreement.
|
|
|
1.3
|
The operational
index and methods for all steps and processes in the production of
such products and materials are attached as appendix 3 of this
agreement.
|
|
|
1.4
|
The production
process flow chart and technical designs and associated indices are
attached as appendix 4 of this agreement.
|
|
|
1.5
|
Requirements
for equipment and designs in accordance with ICH and/or FDA
guidelines and standards are attached as appendix 5 of this
agreement.
|
|
|
1.6
|
Requirements
for the construction of a manufacturing facility are attached as
appendix 6 of this agreement.
|
2
|
|
1.7
|
Storage
requirements for raw and auxiliary materials as well as finished
products are attached as appendix 7 of this
agreement.
|
|
|
1.8
|
Documents to
assist in JV’s successful mastery of the technology through
training and other effective measures offered by Party B are
attached as appendix 8 of this agreement.
|
|
|
1.9
|
The technical
services offered by competent experts dispatched to JV from
Party B are attached as appendix 9 of this
agreement.
|
|
|
1.10
|
Party B
shall offer advice with regards to the technical designs and
facility issues.
|
|
|
1.11
|
When technical
problems arise, Party B shall provide prompt assistance.
Details are attached as appendix 10 of this
agreement.
|
|
|
1.12
|
To establish a
Peptide Product Research Platform in the form of Biotech Research
Institute (the Institute) in accordance with the Agreement Between
Shijiazhuang Pharmaceutical Group Company Ltd. and Unigene
Laboratories, Inc. dated April 23, 2008. This platform shall select
and develop other biotech products that hold visible market
potential as agreed by both parties based the technologies provided
by Party B. The said Platform technologies include:
recombinant peptide production technologies; oral delivery system
for solid peptide formulations; nasal delivery system for peptide
products. Details are attached as appendix 11 of this
agreement. The Institute shall make efforts to seek external
financial and technological support. The terms and conditions for
future technological input from Party B shall be agreed on through
separate discussions.
|
Chapter II
Definitions
|
|
2.1
|
“Technologies” are as set forth in
Chapter 1 and the applicable appendices.
|
|
|
2.2
|
“Product(s)” refers to bulk
recombinant salmon calcitonin, bulk recombinant PTH and such final
products as may be determined by JV (which may include, for
calcitonin products, injectable, nasal and oral formulations; and
for PTH products, injectable and nasal formulations).
|
|
|
2.3
|
“Technical Data” refers to all
technical data necessary for the manufacturing of the
Product(s).
|
|
|
2.4
|
“Specifications” refers to the
specifications set forth in the appendices, and shall include any
specifications adopted and formulated by JV or Party B in
connection with the manufacturing, research or development
activities under this agreement.
|
|
|
2.5
|
“Term” is specified in
11.3.
|
Chapter III License; Delivery of
Technology
|
|
3.1
|
Part B hereby grants to JV,
during the Term, a license to use the Technologies, Specifications
and Technical Data in the manufacture of Products in the
People’s
|
3
Republic of China
(“PRC”). The license shall be exclusive for the PRC,
non-sublicensable and non-transferable. In the event that the JV
desires to acquire rights for territories other than the PRC,
unanimous agreement is required from the Board of Directors of the
JV. During the Term, Party B agrees not to grant to any third
party the right to use the Technologies, Specifications or
Technical Data in connection with the manufacture of Products in
the PRC, or in connection with such other manufacturing, research
and development activities of JV in the PRC, but Party B expressly
reserves the right, for itself and through its licensees, to
practice and use the Technologies, Specifications and Technical
Data, elsewhere worldwide outside PRC, in the manufacture of
products other than Products, or in manufacturing, research and
development activities unrelated to the activities of JV. For the
avoidance of doubt, JV obtains no right, title or interest in or to
the Technologies, Specifications or Technical Data other than the
license granted hereunder.
|
|
3.2
|
Party B
should provide JV the Technical Data provided for in
Chapter I.
|
|
|
3.3
|
Party B
should make available to JV the Technical Data stipulated in
appendix 1,2,3,4,5,6,7,11 and JV shall confirm
receipt.
|
|
|
3.4
|
Party B
should complete the obligations cited in appendix 8 and 9
before JV initiates production.
|
|
|
3.5
|
Party B
shall assist JV in constructing facilities that meet ICH guidelines
and FDA requirements.
|
|
|
3.6
|
The time of
training shall commence *** before JV begins production of
Products. Technical service from Party B shall continue under
the terms of appendix 9 until JV is able to *** produce *** of
Products.
|
Chapter IV Improvement and
Modification of the Technologies
|
|
4.1
|
In the event JV
desires to modify or change the Specifications in order to satisfy
specific requirements of Chinese designing standard, materials,
process equipment and other conditions, it shall first obtain the
written approval of ***.
|
|
|
4.2
|
In the event
*** creates any improvements to the Technologies, Specifications or
Technical Data reasonably necessary to the activities of JV, it
shall deliver such improvements to JV ***. In the event JV creates
any improvements to the Technologies, Specifications or Technical
Data, it shall deliver such improvements to ***.
|
|
|
4.3
|
Any such
improvements or modifications to the Technologies, Specifications
or Technical Data developed by either party and/or the JV during
the term of this agreement, shall be owned exclusively by Party B.
Any new products and/or intellectual properties developed by the JV
independent of *** Technologies shall be owned and controlled by
***.
|
4
Chapter V Quality Inspection and
Test
|
|
5.1
|
To ensure the
reliability of the Technologies, JV and Party B shall jointly
inspect the performance of the Technologies in production. If
necessary, tests may also be performed or repeated at the plant of
Party B. JV can send representatives to verify the tests at the
plant of Party B. JV shall be responsible for the expenses of the
repeated test and travel expenses for the people of JV, Party B
shall be responsible for the expenses of the trip for the people of
Party B. JV shall be responsible for translation.
|
|
|
5.2
|
The technical
condition of the tested Products shall conform to the standard set
forth by Party B in the contract. After inspection, JV and Party B
shall jointly sign a “Performance Certification” to
signify the passage of inspection. The certificates are signed in 4
copies and each party keeps 2.
|
|
|
5.3
|
Under the
circumstances that the technical condition of the Products are
unable to meet the standards set forth in the appendices, both
parties shall hold amiable discussion, and work together to analyze
the cause and take measures to eliminate defects and get ready for
a second test inspection.
|
|
|
5.4
|
If the failure
of the *** is due to the performance or failure of performance of
***, all expenses for the *** shall be borne by ***. If the failure
of the *** is due to the performance or failure of performance of
***, *** shall bear all the expenses incurred for the
***.
|
|
|
5.5
|
Should the ***
fail, *** shall compensate the direct losses of *** if it is due to
the ***. This is not limited to *** responsibility for the
production of Products and performance of a *** in accordance with
Section 5.4.
|
|
|
5.6
|
Should the test
fail the ***, both parties shall discuss the issue of contract
performance, and shall provide such technical assistance as the
parties may deem reasonably necessary, and shall implement such
procedures, improvements or modifications to the Technologies,
Specifications and Technical Data as the parties may mutually deem
necessary to produce ***. If the test fails ***, either party may
opt to terminate its participation for the project under test, with
no effect on other existing rights and obligations of each
party.
|
Chapter VI Representations and
Warranties
|
