Exhibit 10.2
AMENDMENT No. 5 TO
LICENSE & OPTION AGREEMENT
THIS AMENDMENT No. 5 TO THE
LICENSE & OPTION AGREEMENT (“Amendment
No. 5”) is made and entered into this February 3,
2006 (the “Amendment No. 5 Effective Date”) by and
between Oscient Pharmaceuticals Corporation
(“OSCIENT”), a Massachusetts corporation, having a
principal place of business at 1000 Winter Street, Suite 2200,
Waltham, MA 02451, and LG Life Sciences, LTD
(“LGLS”), a corporation organized under the laws of the
Republic of Korea, having a principal place of business at LG Twin
Tower, 20 yoido-dong, Youngdungpo-gu, Seoul, 150-721, Republic of
Korea. LGLS and OSCIENT may be referred to herein individually as a
“Party” and collectively as the
“Parties”.
W I T N E S S E T H
WHEREAS, LGLS and Genesoft
Pharmaceuticals, Inc. (“Genesoft”) entered into a
certain License and Option Agreement dated October 22, 2002
and amended said License and Option Agreement by Amendment
No. 1 dated November 21, 2002, Amendment No. 2 dated
December 6, 2002, Amendment No. 3 dated October 16,
2003 and Amendment No. 4 dated March 31, 2005 (as
amended, the “License”);
WHEREAS, Genesoft merged into
Genesoft Pharmaceuticals, LLC (then Guardian Holdings, LLC
(“Guardian”)) on February 6, 2004 and the benefits
of and obligations under the License were assigned to Guardian, and
then, Guardian assigned all of its right, title and interest in, to
and under the License to OSCIENT;
WHEREAS, the Parties desire to amend
the License to, among other things, amend the supply price paid by
Oscient and to amend the royalty rate with respect to Product sales
in Mexico and Canada; and
WHEREAS, the terms used herein with
capital initial letters and not otherwise defined shall have the
same meanings as set forth in License.
NOW THEREFORE, in consideration of
the premises, and other good and valuable consideration, the
sufficiency of which is hereby acknowledged, the Parties agree as
follows:
1. A new Section 4.3(d) shall
be inserted as follows:
4.3 Co-Promotion.
(d) (i) Upon OSCIENT entering
into a strategic relationship with a Third Party which grants such
Third Party a sublicense to commercialize Product (a
“Partnership”) in Mexico within ***** days from the
Amendment No. 5 Effective Date, LGLS’ option under
subsection 4.3(a) above with respect to Mexico shall terminate and
no longer be exercisable; provided that , the Parties agree
that such *****-day period may be extended by mutual agreement of
the Parties.
(ii) Upon OSCIENT entering into a
Partnership in Canada within ***** days from the Amendment
No. 5 Effective Date, LGLS’ option under subsection
4.3(a) above with respect to Canada shall terminate and no longer
be exercisable; provided that , the Parties agree that such
*****-day period may be extended by mutual agreement of the
Parties.
* Confidential information has been omitted and
filed separately with the Securities and Exchange Commission
pursuant to a confidential treatment request.
2. Section 5.1(a) (ii) shall be
deleted in its entirety and replaced with the following:
5.1 General.
(a) (ii) Following the
expiration or termination of the Initial Period and until the
expiration or termination of the License (the “Remaining
Period”), LGLS shall supply to OSCIENT, and OSCIENT shall
exclusively purchase from LGLS, all of OSCIENT’s requirements
of API in bulk form according to the API Specifications;
provided that , notwithstanding anything herein to the
contrary, Oscient’s obligation to exclusively purchase bulk
API from LGLS for Final Product or API to be supplied in Mexico or
Canada shall expire on the last to expire of the LGLS Patents and
GLAXO Patents claiming or covering such Product in Mexico or
Canada, as the case may be; provided that , OSCIENT agrees
that it shall exclusively purchase from LGLS all requirements of
API in bulk for Mexico and/or Canada, as the case may be, so long
as OSCIENT continues to supply API or Final Product in Mexico or
Canada pursuant to a Partnership.
3. Section 5.2 (iii) shall
be deleted in its entirety and replaced with the
following:
5.2 Supply Price.
(iii) The supply price for API
provided by LGLS to OSCIENT during the Remaining Period, shall be
equal to ***** percent of LGLS’s Fully Burdened Cost of
Manufacture for API supplied thereunder, which shall in no event
***** $***** per kg ***** $***** per kg. In addition, if total
purchases by OSCIENT plus any other purchasers of bulk API is
greater than ***** kg in any calendar year, the $***** supply price
shall be reduced by $***** per kg for each additional ***** kg of
API purchased in excess of ***** kg in such calendar year by
OSCIENT plus any other purchasers; provided however, that in
the event OSCIENT purchases more than ***** kg of API in any
calendar year (the first such calendar year, the “Threshold
Year”), OSCIENT shall pay LGLS $***** per kg for all API
purchased during such calendar year. Within thirty (30) days
after the end of the Threshold Year, LGLS shall reimburse OSCIENT
the difference between (a) the actual amount paid by OSCIENT
for API purchased during such year and (b) $***** per kg times
the number of kg purchased for such year. After the Threshold Year,
OSCIENT shall continue to pay $***** per kg unless OSCIENT
purchases less than ***** kg of API during any calendar year. In
the event OSCIENT purchases less than ***** kg of API during such
calendar year, OSCIENT shall pay LGLS the difference between
(x) $***** times the number of kg purchased and (y) the
amount paid to LGLS for API purchased during such calendar year
(i.e. $***** times the number of kg purchased) within thirty
(30) days after the end of such calendar year. In the event
that there is an interruption in LGLS’s supply of API for any
reason, which continues uncured for more than ***** days, then
OSCIENT shall have the right to procure an alternative source of
supply for the duration of the interruption (“Second Source
Supplier”). Notwithstanding the foregoing, OSCIENT shall only
have the right to procure a Second Source Supplier in the event
that the interruption arises with respect to a supply order
quantity, which is less than or equal to ***** percent of the
quantity anticipated by OSCIENT in the most recently updated
forecast, immediately preceding the submission of the supply order.
LGLS shall have the opportunity to resume its supply of API upon
the elimination or resolution of the events causing the
interruption; provided that , however, LGLS shall not resume
its role as the exclusive supplier until OSCIENT is able to
negotiate a termination of its purchase obligations with the Second
Source Supplier; and provided further that OSCIENT shall use
commercially reasonable efforts to enter into an agreement with a
Second Source Supplier that allows for such termination of
OSCIENT’s purchase obligations within ***** months of notice
to the Second Source Supplier ( provided that , Oscient
shall not enter into an agreement with a Second
