Exhibit 10.29
[ ]
= Certain confidential information contained in this document,
marked by brackets, has been omitted and filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the
Securities Exchange Act of 1934, as amended.
CONFIDENTIAL PROVISIONS
MARKED
EXHIBIT 10.29
(CONFIDENTIAL)
PATENT LICENSE AGREEMENT
between
PROTEIN DESIGN LABS, INC.
and
ELAN INTERNATIONAL SERVICES
LTD.
This Agreement
(“Agreement”), effective as of April 24, 1998
(“Effective Date”), is made by and between Protein
Design Labs, Inc., a Delaware corporation having offices at 2375
Garcia Avenue, Mountain View, CA 94043 (hereinafter
“PDL”) and Elan International Services Ltd., a Bermuda
corporation and wholly-owned subsidiary of Elan Corporation plc,
having offices at 102 St. James Court, Flatts, Smiths FL04, Bermuda
(hereinafter “ELAN”).
RECITALS
A. ELAN desires to license certain
patents owned or controlled by PDL related to humanized antibodies
directed against the alpha subunit of the VLA-4
integrin.
B. The ELAN antibody
directed against the alpha subunit of the VLA-4 integrin, currently
designated as Antegrin ® , is in a Phase II U.S. clinical
trial for treatment of acute flares associated with multiple
sclerosis.
C. PDL is willing to license to ELAN
such patent rights under the terms and conditions of this
Agreement.
AGREEMENT
NOW THEREFORE, in consideration of
the mutual covenants herein contained and intending to be legally
bound, the parties agree as follows:
1. DEFINITIONS
All references to Exhibits, Articles
and Sections shall be references to Exhibits, Articles and Sections
of this Agreement. In addition, except as otherwise expressly
provided herein, the following terms in this Agreement shall have
the following meanings:
1.01
“Affiliate” shall mean, with respect to a party hereto, any
corporate or other entity which, directly or indirectly, controls,
is controlled by, or is under common control with such party where
“control” means the ownership of not less than 50% of
the voting shares of a
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corporation, or decision-making authority as to
an unincorporated entity; provided that such entity shall be an
Affiliate only so long as such control exists.
1.02 “Combination
Product(s)” shall
mean any product containing both a pharmaceutically active agent or
ingredient which constitutes a Licensed Product and one or more
other pharmaceutically active agents or ingredients which do not
constitute Licensed Products.
1.03
“Licensed Product(s)” shall mean human therapeutic
products of ELAN or ELAN’s sublicensees that include an
Antibody developed by ELAN binding to the alpha subunit of the
VLA-4 integrin whose development, manufacture, import, use or sale
would, but for a license under this Agreement, infringe a Valid
Claim. “Antibody” as used herein shall include, without
limitation, monospecific and bispecific antibodies; less than
full-length antibody forms such as Fv, Fab, and F(ab’)
2
; single-chain
antibodies; and antibody conjugates bound to a toxin, label or
other moiety.
1.04 “Net
Sales” shall mean
the aggregate gross revenues, whether in cash or in kind, derived
by or payable from or on account of the sale of Licensed Products
by ELAN, its Affiliates and its sublicensees to an independent
third party not an Affiliate or sublicensee of either ELAN or
ELAN’s sublicensee, less amounts actually incurred or
provided for (a) credits, allowances, discounts or rebates, if
any, granted on account of price adjustments, recalls, rejection or
return of items previously sold, (b) excise and sales taxes,
duties or other taxes imposed on and paid with respect to such
sales (excluding income or franchise taxes of any kind) and
(c) outer packing, freight and freight insurance costs. If
ELAN or any of its Affiliates or sublicensees receive any
consideration (whether in cash or otherwise) in lieu of all or part
of any royalties otherwise payable for any Licensed Product sold or
otherwise transferred to an independent third party not an
Affiliate of the seller or transferor, the fair market value of
such consideration on the date of such transfer as known to ELAN,
or as reasonably estimated by ELAN if unknown, shall be included in
the definition of Net Sales. For purposes of the foregoing
sentence, consideration paid to Elan from its Affiliates or
sublicensees in the form of fees, milestones, collaboration
payments or supply payments shall not be deemed consideration in
lieu of royalties (i.e., not part of Net Sales) hereunder if such
consideration is not intended to and does not result in a
reduction, credit, allowance, rebate or other offset against
payment of any royalties otherwise payable for any Licensed Product
sold or otherwise transferred to an independent third
party.
1.05 “PDL Patent
Rights” means the
patent applications or patents (as well as any foreign counterparts
thereto filed by PDL before or during the term of this Agreement)
identified on Exhibit A , including any
additions, continuations, continuations-in-part or divisions
thereof or any substitute applications therefor; any patents issued
with respect to such patent applications, any reissues, extensions
or patent term extensions of any such patents, and any confirmation
patents or registration patents or patents of addition based on any
such patents.
1.06 “Valid
Claim” means
(a) any claim in any issued patent included in the PDL Patent
Rights which would be infringed but for the license granted under
Section 2.01, and which claim has not been disclaimed or held
unenforceable or invalid by a governmental agency or court of
competent jurisdiction by a decision beyond right of review; and
(b) any pending claim under
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PDL Patent Rights which, if granted, would be
infringed but for the license granted under Section 2.01, and
which pending claim would be a Valid Claim if the pending claim
were treated as granted.
2. LICENSE
2.01 License Grant
. Subject to the terms and
conditions of this Agreement, PDL hereby grants and ELAN hereby
accepts a worldwide nonexclusive license under the PDL Patent
Rights, including the right to grant sublicenses in accordance with
Section 2.02, to make, have made, use and sell Licensed
Products.
2.02 Limitation on Sublicenses;
Notification . ELAN shall
have the right to grant sublicenses of its rights with respect to
the Licensed Product under Section 2.01 to its Affiliates,
including for purposes of this Agreement, Axogen Limited
(“Axogen”), and such Affiliates shall have the right to
grant further sublicenses with respect to Licensed Products in
accordance with the terms of this Agreement. ELAN and its
Affiliates shall only grant sublicenses hereunder in connection
with the assignment or license by ELAN and its Affiliates of the
Licensed Product to that sublicensee. ELAN shall provide a written
summary to PDL within forty-five (45) days following the end
of each calendar quarter during the term of this Agreement
specifying the name of each sublicensee, territory and scope of the
rights sublicensed hereunder during that quarter. Notwithstanding
the assignment or grant of a sublicense by ELAN or its Affiliates
hereunder, ELAN shall remain obligated to pay all royalties due to
PDL with respect to the sale of Licensed Products by its assignee
or sublicensee. In addition, the grant or any sublicenses under
Section 2.01 shall be on terms and conditions which are
subject to and subordinate to the terms of this Agreement and ELAN
shall remain fully responsible to PDL for the performance of any
and all such terms by its sublicensees.
2.03 No Other License
Rights . ELAN expressly
acknowledges and agrees that, except for the license expressly
granted under Section 2.01, no rights to any other PDL
patents, patent applications, know-how or licenses are included in
this Agreement and that any royalties or payments that may be due
to third parties in order for ELAN to make, have made, use or sell
Licensed Products shall be the sole responsibility of
ELAN.
2.04 Certain
Understandings.
(a)
[ ]
(b) Fee Payment
. ELAN acknowledges that the
payments under Section 3.01 are based on good faith market
projections provided by ELAN to PDL and ELAN represents that the
projections as provided to PDL are the same as those used by ELAN
internally at this time for initial marketing and development
decisions of the Licensed Product.
3. PAYMENTS, ROYALTIES,
REPORTS
3.01 Payments
. In consideration for the license
granted by PDL under Article 2 of this Agreement, ELAN shall
pay to PDL the following amounts:
(a) Signing and Licensing
Fee . ELAN shall pay to
PDL a nonrefundable signing and licensing fee within ten (10)
days of the Effective Date in the sum of
[ ].
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(b) Development
Milestone . Within
ten (10) days of its determination to proceed with further
development of the Licensed Product following completion of the
U.S. Phase II clinical study in multiple sclerosis designated as
“AN100226-202” (the “Milestone Trial”),
ELAN shall pay to PDL a nonrefundable milestone payment in the sum
of either
(a) [ ]
if paid on or prior to December 31, 1998, or
(b) [ ]
if paid after December 31, 1998. In any event, ELAN shall
notify PDL in writing of its determination to proceed with or to
terminate further development of the Licensed Product not later
than thirty (30) days following the earlier of (a) its
review of the preliminary results from the Milestone Trial, or
(b) its public announcement or presentation of the results
from the Milestone Trial.
3.02 Royalties to PDL
. Subject to reduction for any
offset as provided in Section 3.05, in further consideration
of the rights and licenses granted under Article 2, ELAN shall
pay to PDL a royalty of
[ ]
of the Net Sales of all Licensed Products sold by ELAN or its
Affiliates or sublicensees in each country until the last date on
which there is a Valid Claim that, but for the licenses granted to
ELAN under this Agreement, would be infringed by the making, using,
having made or sale of that Licensed Product in such country or by
the manufacture of Licensed Product in the country of
manufacture.
3.03 Sales Among
Affiliates . Sales
between and among ELAN and its Affiliates of Licensed Products
which are subsequently resold or to be resold by such Affiliates
shall not be subject to royalty, but in such cases royalties shall
accrue and be calculated on any subsequent sale of such Licensed
Products to a non-Affiliate.
3.04 Combination
Products . Net Sales in a
particular country, in the case of Combination Products for which
the pharmaceutically active agent or ingredient constituting a
Licensed Product and each of the other pharmaceutically active
agents or ingredients not constituting Licensed Products have
established market prices in that country when sold separately,
shall be determined by multiplying the Net Sales for each such
Combination Product by a fraction, the numerator of which shall be
the established market price for the Licensed Product(s) contained
in the Combination Product and the denominator of which shall be
the sum of the established market prices for the Licensed
Product(s) plus the established market prices for the other
pharmaceutically active agents or ingredients contained in the
Combination Product. When such separate market prices are not
established in that country, then the parties shall negotiate in
good faith to determine a fair and equitable method of calculating
Net Sales in that country for the Combination Product in
question.
3.05 Annual
Maintenance Fee . In further consideration of
the licenses granted under Article 2, not later than
thirty (30) days following the third (3
rd
) anniversary
of the Effective Date and not later than each anniversary
thereafter, ELAN shall pay PDL a nonrefundable annual maintenance
fee in the amount of
[ ].
An amount up to fifty percent (50%) of the annual maintenance
fee paid by ELAN hereunder beginning in the year in which a
Biologics License Application (“BLA”) is filed with the
U.S. Food and Drug Administration (or any successor thereto) with
respect to a Licensed Product shall be creditable against royalties
payable to PDL pursuant to Section 3.02; provided that in no
event shall any portion of the annual maintenance fees paid prior
to the year in which a BLA is filed with respect to the Licensed
Product be creditable against royalties hereunder.
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3.06 Currency
Conversion . All amounts
payable to PDL under this Agreement shall be payable in U.S.
Dollars by wire transfer to a bank account designated by PDL. In
the case of royalties on Net Sales, all amounts payable shall first
be calculated in the currency of sale and then converted into U.S.
Dollars using the average of the daily exchange rates for such
currency quoted by Citibank, N.A. for each of the last
five (5) banking days of each calendar quarter.
3.07 Royalty
Reports.
(a) Current Reports
. ELAN agrees to make written
reports and royalty payments to PDL within forty-five (45)
days after the close of each calendar quarter during the term of
this Agreement, beginning with the calendar quarter in which the
date of first sale following regulatory approval occurs. These
reports shall show for the calendar quarter in question Net Sales
by ELAN, its Affiliates and sublicensees of the Licens
