CERTAIN
CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED
WITH “***”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN
FILED SEPARATELY WITH THE SECRETARY OF THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIAL
TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT OF 1934.
DOCOSANOL DATA TRANSFER &
PATENT LICENSE AGREEMENT
THIS DOCOSANOL
DATA TRANSFER & PATENT LICENSE AGREEMENT is made and entered
into as of July 6, 2006 (“ Effective Date ”)
between Avanir Pharmaceuticals, a California corporation (“
Avanir ”) and Healthcare Brands International Limited
of 56 Queen Anne Street, London W1G 8LA (“ HBI
”).
Avanir is the
owner of certain data, know-how, trade secrets, confidential
information, inventions, technology, and patent rights and that
(i) pertain to Docosanol, (ii) relate to use of Docosanol
in the treatment of viral infections and inflammations of skin and
mucous membranes in humans, and other medicinal uses, and
(iii) include certain medicinal formulations and manufacturing
methods of products containing Docosanol.
The United States
Food and Drug Administration (“ FDA ”) has
approved Avanir’s New Drug Application in the United States
of America (“ USA ”) and Avanir received
approval of its Marketing Authorization Application (“
MAA ”) from the Swedish Medical Products Agency
(“ MPA ”) under a Mutual Recognition Process
(“MRP”) relating to products incorporating Docosanol
for topical, human use for the treatment of herpes
labialis.
HBI is interested
in obtaining access to certain of Avanir’s proprietary data
and know-how, and Avanir is willing to grant such access on the
terms and conditions of this Agreement.
HBI is interested
in obtaining from Avanir a license to Avanir’s patent rights
relating to the use of Docosanol and Avanir is willing to grant
such license and access on the terms and conditions of this
Agreement.
NOW, THEREFORE, in
consideration of the monetary consideration set forth in this
Agreement and of the terms, conditions and agreements contained in
this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which are acknowledged, Avanir and HBI
agree as follows:
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Words and
phrases used in this Agreement which are not otherwise defined will
be interpreted in accordance with the common usage for such term in
English in the USA. Technical terms unless otherwise defined will
be interpreted consistent with their common usage in the relevant
scientific field. Some terms are defined in this Agreement
parenthetically, and such terms will have the meanings apparent
from the context in which such terms are parenthetically defined.
When used in this Agreement, each of the following defined terms
will have the meanings set forth in this Section.
Section 1.01 “ Additional
Territories ” means Italy, Greece, Cyprus, Turkey,
Romania, Sweden, Denmark, Norway and/or Finland.
Section 1.02 “ Additional
Rights ” means Avanir’s Know-how and/or
Intellectual Property in so far as it relates to any of the
Additional Territories, including without limitation those rights
set out in Schedule 1.12.
Section 1.03 “ Affiliate(s)
” means, with respect to each party, any organization,
corporation, company, firm, or other entity that controls, is
controlled by, or is under common control with such party. In this
context “control” shall mean the ability to control the
management of a company, whether through ownership of voting
rights, contract, ability to control or appoint the board or
otherwise.
Section 1.04 “ Approval Date
” has the meaning specified in Section 5.01.
Section 1.05 “ Business Day
” means any day other than a Saturday, Sunday or any other
day which is a public holiday in England.
Section 1.06 “ Data ”
means any data, results, know-how, and information which Avanir
owns, controls or has a license (with a right to sublicense) and
relating to Docosanol or that is necessary or useful to the
manufacture, use or sale of Products, including, without
limitation, data or information incorporated either in
Avanir’s approved New Drug Application in the USA or the MAA,
chemical compositions of monomers, derivatives, designs, polymers,
solvents, catalysts, formulae, specifications, designs, chemical
and physical data, clinical data, information concerning
concentrations, combinations, indications, dosage strengths and
sizes or packaging, preparations, synthesis, processes,
formulations, administrations, applications, toxicity, operations,
regulatory affairs and marketing.
Section 1.07 “ Docosanol
” means docosanol *** and any other *** ***.
Section 1.08 “ European Rights
” means all of Avanir’s Know-how and Intellectual
Property in so far as it relates to the Territory, including
without limitation those rights set out in
Schedule 1.13 .
Section 1.09 “ First
Commercial Sale ” means, in the Territory the
first commercial sale, where sale means ***, whichever comes first,
of a Product by HBI, its Affiliates or sublicensees to any person
or entity other than HBI, its Affiliates or sublicensees following
Territory Registration.
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Section 1.10 “ Improvements
” means any and all improvements, developments, alterations
or modifications to the Product made or developed by Avanir or HBI
from time to time, solely to the extent that the composition,
manufacture or use of any such item would be dominated by the
Licensed Patents at the time when discovered or made or would
require use of Know-how.
Section 1.11 “ Intellectual
Property ” means all patents and patent applications
(including the Licensed Patents), registered and unregistered
designs, design rights, copyright works or other intellectual
property rights from time to time owned by Avanir in relation to
the creation, manufacture, Registration, marketing, promotion,
distribution and/or sale of the Products and/or Docosanol,
including any Improvements.
Section 1.12 “ Know-how
” means all of the Data, drawings, designs, specifications,
processes, knowledge, correspondence, technical information and
expertise from time to time owned or controlled by Avanir in
relation to the creation, manufacture, Registration, marketing,
promotion, distribution and/or sale of the Products and/or
Docosanol and its packaging, including any Improvements.
Section 1.13 “ Licensed
Patents ” means all (i) patents and patent
applications in the Territory which generally or specifically claim
a Product, a process for manufacturing or formulating a Product, an
intermediate contained in a Product, or use of a Product and which
are owned or controlled by Avanir, including without limitation
those listed in Schedule 1.13 and those owned by Avanir
under Section 3.06; (ii) any divisionals, continuations,
refilings, and extensions of any of the foregoing patents and
patent applications; and (iii) all substitutions, reissues,
renewals, reexaminations, patents of addition, and inventors’
certificates thereof, patent term extensions, supplementary
protection certificates and exclusivity extensions of the foregoing
patents.
Section 1.14 “ Product(s)
” means any finished or semi-finished product that contains
Docosanol (either as the sole ingredient or in combination with any
other ingredient, substance or compound, regardless of whether any
other such ingredient, substance or compound is claimed as or
considered to be an “active ingredient” or not) in any
and all concentrations, formulations, preparations,
administrations, combinations or dosage strengths and sizes
thereof, together with all expansions and Improvements thereon, the
manufacturing, use or sale of which would, but for the licenses
granted hereunder, infringe any Licensed Patent or employ any
Know-how.
Section 1.15 “ Registration
” means satisfaction of registration (including any duplicate
marketing authorizations) or notification requirements and receipt
of approvals, licenses, registrations or authorizations of any
appropriate regulatory agency, department, bureau or other
government entity, necessary for the commercialization of the
Product, including any manufacture, use, storage, import, transport
or sale of Products or the equivalent from the appropriate
governmental agency in any relevant country of the Territory or
Additional Territory.
Section 1.16 “ Territory
” means Russia, the Ukraine and the nations of the European
Union as of the Effective Date, but not any of the following
countries: Italy, Greece, Cyprus, Turkey, Romania, Sweden, Denmark,
Norway or Finland; provided, however, that if HBI has been granted
a license pursuant to Section 2.07 in respect of any
Additional Territory, such Additional Territory shall become part
of the Territory and references to Territory shall thereafter be
construed accordingly. Other countries may be added to the
Territory by the parties from time to time upon
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the mutual
execution of an amendment to this Agreement adding such countries
and upon the payment of mutually agreed consideration
therefor.
Section 1.17 “ Third Party
” or “ Third Parties ” means any person,
organization, corporation, company, firm, or other entity that is
not a party hereto or an Affiliate of either party.
Article II. DATA TRANSFER
& PATENT LICENSE
Section 2.01 Data Transfer. In
consideration for the fee paid by HBI and in order to support
HBI’s direct pursuit of applications for Registrations for
marketing approval of Products in the Territory, Avanir
(A) hereby grants HBI the right to access and reference the
Data, (B) will execute such letters of authorization or consents as
reasonably requested by HBI in connection with the foregoing,
(C) will make available the Data which is the entire contents
of the approved Swedish MAA regulatory submission for 10% docosanol
cream in the treatment of herpes labialis, and pre-clinical data
relating to any Product, including, without limitation, copies of
all existing clinical data, documents, papers, protocols, results
and analyses and all correspondence relating to the Swedish
approval, and (D) will transfer, or cause to be transferred,
to HBI all regulatory licenses for Products in the Territory
existing as of the Effective Date. This Data represents a
significant investment on the part of Avanir, and is considered
proprietary to Avanir. HBI, therefore, agrees to retain control
over this Data and not to transfer Data to Third Parties other than
to regulatory authorities in the Territory or to regulatory
consultants of HBI who are obligated in writing to maintain its
confidentiality without advance written approval of
Avanir.
Section 2.02 Patent License Grant .
Subject to all the terms, payments and limitations of this
Agreement, Avanir hereby grants to HBI an exclusive license under
the European Rights to make, have made, use, have used, offer to
sell, sell, have sold through distributors and import Products in
the Territory, and to subcontract such rights as reasonably
required to exercise the rights granted hereunder and to grant
sub-licenses of such rights upon approval by Avanir, not to be
unreasonably withheld or delayed, and subject to the terms set
forth in Schedule 2 .
For clarity, as
a consequence of the exclusive license granted herein, Avanir will
not carry on or procure any Third Party to carry on any activities
within the scope of such license. Accordingly, Avanir shall not
seek customers in the Territory and will not maintain a
distribution depot in the Territory for sales of Product to
customers in the Territory. Notwithstanding the foregoing, Avanir
shall be entitled to manufacture Product in the Territory for the
sole purpose of exporting Product outside the Territory provided
that Avanir shall not sell or supply Product to any Third Party in
the event Avanir believes or has reasonable cause to believe that
such Third Party intends to sell such Product into the Territory.
HBI shall not seek customers outside the Territory and will not
maintain a distribution depot outside the Territory for sales of
Product to customers outside the Territory. Notwithstanding the
foregoing, HBI shall be entitled to manufacture Product outside the
Territory for the sole purpose of exporting Product into the
Territory provided that HBI shall not sell or supply Product to any
Third Party in the event that HBI believes or has reasonable cause
to believe that such Third Party intends to sell such Product
outside the Territory.
Section 2.03 Duty to Supplement the
Data . Subject to any contractual prohibitions by which Avanir
is bound as of the Effective Date, in the event that Avanir
receives any supplemental Data or other Know-how or copies of
correspondence with regulatory authorities outside the Territory
from any other licensees or any other source that relates to the
Products, Avanir will promptly
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provide such
updates of Data and/or Know-how to HBI. Upon request of HBI, Avanir
shall request permission from other licensees of Products to share
any such information which Avanir receives with HBI, solely for use
by HBI under the terms of this Agreement. Avanir will also make
available, upon request, content from the US NDA 20-941 to HBI for
use in seeking and supporting Product Registrations in the
Territory. HBI shall be permitted to reference such US NDA and any
other regulatory filings made by Avanir or its licensees in the
Additional Territories to the extent reasonably necessary to obtain
Registrations in the Territory.
Section 2.04 Data Transfer Fees . In
consideration for the transfer of the Data as a know-how and data
transfer fee, HBI will pay to Avanir, (a) the sum of
£750,000 within ten (10) business days of the execution of
this Agreement and (b) the sum of £750,000 within
30 days of receipt of each of the first two grants in the
Territory by the appropriate regulatory authorities of the
regulatory approvals necessary to commence sales, including
Registration and pricing approvals if required, in each case with
respect to approvals which are received after the Effective
Date.
Section 2.05 Taxes . HBI will pay
and bear the expense of local, state and/or federal government
license, sales and use, property and ad valorem taxes and
any custom duties, fees or charges which may be imposed or assessed
on it with respect to manufacture or sales of Products in the
Territory under this Agreement.
Section 2.06 Deferred Compensation .
In accordance with Schedule 2 and in further
consideration for the licenses granted pursuant to
Section 2.02 , for (a) sales or sublicenses of
Product rights, (b) sales of HBI and (c) initial public
offerings, Licensee will pay Avanir non-refundable amounts as
calculated on Schedule 2 . For clarity, no royalties
shall be due on sales of Products hereunder.
Section 2.07 “ Additional
Territories License” . Avanir grants HBI a right of first
offer to obtain a license under the terms set out in
Section 2.02 of the relevant Additional Rights in respect of
each of the Additional Territories. This shall mean that before
making any offer to any Third Party of, or making direct use by
Avanir following expiration, termination or renegotiation of any
existing license agreement relating to, any of the Additional
Rights (or any interest in any of them), directly or indirectly,
Avanir shall first notify HBI in writing of the of its offer of
such Additional Rights and shall give HBI *** Business Days in which to decide whether it
wishes to acquire the rights which are the subject of such written
offer. If HBI wishes to acquire such Additional Rights, HBI and
Avanir shall then negotiate terms to extend the licenses hereunder
to include such rights in good faith for a period of no more than
60 days from the end of the first *** Business Day period. If
such terms are agreed within such period, and Avanir has as of such
date obtained by reversion from an existing licensee, rights to any
Registrations relevant to the Product in such part of the
Additional Territory as has become part of the Territory pursuant
to this Section 2.07, Avanir shall transfer such rights to HBI
upon the execution of the amendment adding such Additional
Territory. If HBI and Avanir are not able to agree on such terms
within such additional 60 day period then Avanir may
thereafter offer such Additional Rights to any Third Party on
financial terms which are substantially equivalent to the terms
that were last offered to HBI.
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Article III. INTELLECTUAL
PROPERTY
Section 3.01 Patent Prosecution and
Maintenance .
(a)
Discretionary Duty to Prosecute and Maintain : Avanir shall,
at Avanir’s expense, use all commercially reasonable efforts
to prosecute or cause to be prosecuted or continue to prosecute to
allowance or final rejection in the Territory the patent
applications included in the Licensed Patents. Avanir shall, at
Avanir’s expense use all commercially reasonable efforts to
maintain any issued patents described within the Licensed Patents.
Avanir shall promptly provide HBI with copies of all correspondence
with patent offices relevant to the foregoing efforts. If, subject
to Avanir’s obligation to use all commercially reasonable
efforts as provided herein, Avanir fails to so file, prosecute,
cause to be prosecuted, or maintain the Licensed Patents, HBI may
elect to do so.
(b)
HBI’s Right to Consult : Avanir shall furnish HBI with
copies of all correspondence relating to the Licensed Patents to
and from patent offices in the Territory and shall provide HBI a
reasonable time to offer its comments thereon, provided that
in the event that delay would jeopardize any potential patent
right, Avanir shall use all commercially reasonable efforts to
proceed without awaiting HBI’s comments on any patent
application or correspondence. HBI shall have the right to consult
with Avanir regarding the content of the patent applications
included in the Licensed Patents in the Territory and to comment on
any prosecution thereof. Avanir shall consider all such comments
offered by HBI in good faith, it being agreed, however, that all
final decisions respecting conduct of the prosecution of said
patent applications shall rest solely in the discretion of Avanir.
Any legal fees or expenses incurred by HBI under this
Section 3.01 shall be the sole responsibility of
HBI.
(c)
Abandonment of Prosecution : Avanir shall notify HBI in the
event Avanir decides at any time, subject to Avanir’s
obligation to use all commercially reasonable efforts as provided
herein, to abandon or discontinue prosecution of any one or more of
the patent applications included in the Licensed Patents in the
Territory, including any decisions to discontinue pursuit of
applications which have been finally rejected. Such notification
will be given as early as possible which in no event will be less
than ***
days prior to the date on which said
application(s) will become abandoned. HBI shall have the option,
exercisable upon written notification to Avanir, to assume full
responsibility, at its discretion and expense, for the prosecution
of the affected patent application(s). Under no circumstances shall
any such expense paid by HBI be refundable to HBI by Avanir. Under
no circumstance shall any such assumption of responsibility on the
part of HBI affect ownership of any such patent application or any
patent issuing thereon.
(d)
Abandonment of Opposition Contest : Should a priority or
opposition contest develop in any patent office or other forum
within the Territory relating to a patent or patent application
within the Licensed Patents which Avanir does not believe it would
be commercially reasonable to defend, then HBI shall be given ***
days notice in which to elect to continue prosecuting and defending
such patent or patent applications at HBI’s own expense.
Otherwise, HBI shall pursue and bear the cost of any such contest
and shall have control of such contest. Avanir shall provide HBI
with all cooperation and available documents required by HBI to
prosecute any such priority
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or opposition
contest not pursued by HBI, including cooperation of any licensor
or consultants of Avanir, at HBI’s expense. Avanir shall have
the right to participate in any such contest, or designate its own
counsel to so participate, at Avanir’s own expense,
throughout each step of such priority or opposition contest. Under
no circumstance shall any such expenses or fees paid by HBI be
refundable to HBI by Avanir. Under no circumstances shall any such
election on the part of HBI affect ownership of any such patent or
patent application, including any patent issuing
thereon.
(e)
Patent Term Extension : In the event that applicable law in
any country in the Territory provides for the extension of the term
of any patent included among Licensed Patents, Avanir shall, upon
request of HBI, apply for and use all commercially reasonable
efforts to obtain such an extension or, should the law require HBI
to so apply, Avanir hereby gives permission to HBI to do so. HBI
and Avanir agree to cooperate with one another in obtaining such
extension. Avanir agrees to cooperate with HBI in the exercise of
the authorization granted herein and will execute such documents
and take such additional action as HBI may reasonably request in
connection therewith.
Section 3.02 Enforcement of Patent
Rights Against Third Parties . If either party becomes aware of
any product or activity of any Third Party that involves
infringement or violation of any of Avanir’s proprietary
rights licensed to HBI hereunder, then such party will promptly
notify the other party in writing of such infringement or
violation. Subject to Section 3.03, Avanir may in its sole
discretion take or not take whatever action it believes is
appropriate in connection with, and will have the right to initiate
an infringement or other appropriate suit against, any Third Party
who is suspected of infringing or misappropriating any Licensed
Patents, invention or technology included in any Products or the
Data in the Territory. If Avanir elects to take action, HBI will
fully cooperate therewith at Avanir’s expense. If Avanir
initiates and prosecutes any such action under this section, all
legal expenses (including court costs and attorneys’ fees)
will be for Avanir’s account. All amounts awarded by way of
judgment, settlement or compromise and any such damages, royalties,
settlement fees or other consideration received by Avanir will be
shared by the parties in proportion to the damages that each has
suffered in relation to such infringement. Avanir will have the
sole and exclusive right to select counsel for any such suit but
shall consult with HBI in that regard. If necessary, HBI may be
joined as a party to the suit and will cooperate fully with respect
to such suit and will offer such assistance to Avanir as Avanir
reasonably requests in connection therewith at no charge except for
reimbursement of reasonable out-of-pocket expenses (including
attorneys’ fees) incurred in rendering such
assistance.
Section 3.03 Enforcement of Patent
Rights Against Third Parties by HBI . If Avanir declines to (or
does not agree to) enforce or initiate an infringement or other
appropriate suit against an infringing Third Party in the Territory
within ***
Business Days of HBI informing it of
a claim, or, notwithstanding Section 3.02, to the extent such
infringement relates to the Territory, HBI will have the right to
sue in respect of any such infringement in the Territory and shall
be entitled to all amounts awarded by way of judgment, settlement
or compromise, provided, however, that Avanir will be entitled to a
*** percent (***%) share of any damages or payments (other than for
reimbursement of costs or expenses, including attorneys’
fees) received by HBI from such Third Party(s). If HBI elects to
take such action, Avanir will fully cooperate therewith at
HBI’s expense
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and will not
itself take any conflicting action under Section 3.02
(though it may take action in respect of countries which are not
within the Territory). HBI may in any event seek injunctive relief
in appropriate cases without notice to or consent from
Avanir.
The parties
shall keep one another informed of the status of and of their
respective activities regarding any litigation or settlement
thereof concerning Product pursuant to this Section 3.03 or
Section 3.02, provided, however, that no settlement or consent
judgment or other voluntary final disposition of any suit defended
or action brought by a party pursuant to this Article 3
may be entered into without the consent of the other party if such
settlement would require the other party to be subject to an
injunction or to make a monetary payment or would otherwise
adversely affect the other party’s rights under this
Agreement or the validity, scope or enforceability of the Licensed
Patents.
Section 3.04 Confidential
Information . Each party to this Agreement acknowledges that in
order for Avanir and HBI to carry out their respective obligations
under this Agreement, it may be necessary for Avanir and HBI to
disclose to each other certain non-public and valuable business
information (“ Confidential Information ”),
which shall include without limitation information exchanged or
provided under Sections 2.01, 2.03 and 4.02 hereof. Each party
to this Agreement agrees: (a) not to reveal or make available
any Confidential Information of the other to any Third Party,
(except (i) to agents engaged to obtain Registrations in the
Territory who have entered into confidentiality agreements in a
form acceptable to Avanir or (ii) as such disclosure may be
specifically approved in writing by the party against whom such
disclosure is sought and except as such disclosure may be required
by the receiving party’s compliance with legal requirements
and in any such case such party will promptly notify the other
party of any such legally required disclosure) and to ensure that
it will treat such Confidential Information of the other party in
the same manner as it treats its own Confidential Information, such
treatment to be at least the degree that a reasonable person would
perform under similar circumstances; (b) to ensure that
Affiliates, sublicensees, employees, agents, associates or other
persons to whom such disclosure may be made or who may otherwise
have access to such Confidential Information of the other have,
directly or indirectly, agreed in writing to safeguard and maintain
such Confidential Information of the other and not to disclose or
use such Confidential Information of the other except as expressly
provided herein; (c) to ensure that Confidential Information
of the other is not used for the receiving party’s benefit
except as such benefits are expressly contemplated in this
Agreement; (d) to prohibit the Confidential Information of the
other from being duplicated in any manner; except as is reasonably
necessary to perform the tasks and obligations contemplated under
this Agreement; and (e) to prohibit the Confidential
Information of the other from being published in any form without
the express written consent from the disclosing party. The
obligations of this Section with respect to Confidential
Information of the other Party will continue during the term of
this Agreement and for 10 years thereafter. For clarity, this
Section 3.04 shall not be deemed to prevent HBI from
subcontracting or sublicensing under Section 2.02 or
either Party from making any permitted assignment under Section
7.03 .
Section 3.05 Trademarks . HBI will
have no right to use the Avanir trade name or any Avanir trademark.
HBI will solely own any trademark or trademarks selected by HBI for
use in connection with the sale of the Products in the Territory,
together with any registrations or pending registration
applications or intent to use filings therefor, and HBI will be
solely responsible for use and regi
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