Exhibit 10.50
Portions of this exhibit marked [*] are
requested to be treated confidentially.
CO-PROMOTION
AGREEMENT
This CO-PROMOTION AGREEMENT
(this “Agreement”), dated March 2, 2005, is entered
into by and between SALIX PHARMACEUTICALS, INC. , a
California corporation (“Salix”) and ALTANA PHARMA
US , INC. , a Delaware corporation
(“Altana”).
WHEREAS, Salix owns, develops, markets and manufactures
rifaximin, an antibiotic marketed and sold under the name
“Xifaxan ™ ” (the “Product”), the initial
indication for which is the treatment of patients, twelve (12)
years of age and older, with travelers’ diarrhea caused by
non-invasive strains of Escherichia coli ;
WHEREAS, Altana has significant experience in the
marketing and promotion of prescription pharmaceutical products;
and
WHEREAS, each of Salix and Altana wish to collaborate
with the other on the terms and conditions set forth herein to
optimize the sales of the Product in the Territory (as hereinafter
defined).
NOW, THEREFORE,
in consideration of the mutual
covenants contained in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereto, intending to be legally
bound, agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION;
TERM
1.1. Definitions.
For purposes of this Agreement, the
following terms shall have the meanings assigned below:
“Act”
means the Federal Food, Drug and
Cosmetic Act, as amended from time to time, and the rules,
regulations, guidelines and requirements of the FDA (as hereinafter
defined) as may be in effect from time to time.
“Adverse
Event” means the
development of an undesirable medical condition or the
deterioration of a pre-existing medical condition following or
during exposure to the Product, whether or not considered causally
related to the Product, the exacerbation of any pre-existing
condition occurring during the use of the Product, or any other
adverse experience or adverse drug experience described in the
FDA’s Investigational New Drug safety reporting and NDA (as
hereinafter defined) postmarketing reporting regulations, 21 C.F.R.
312.32 and 314.80, respectively, as they may be amended from time
to time. For purposes of this Agreement, “undesirable medical
condition” shall include symptoms (e.g. nausea, chest pain),
signs (e.g. tachycardia, enlarged liver) or the abnormal results of
an investigation (e.g. laboratory findings, electrocardiogram),
including unfavorable side effects, toxicity, injury, overdose,
sensitivity reactions or failure of the Product to exhibit its
expected pharmacological/biologic effect.
1
“Affiliate” means, with respect to either Party (as
hereinafter defined) to this Agreement, any Person (as hereinafter
defined) that Controls (as hereinafter defined), is Controlled by
or is under common Control with such Party.
“Altana”
means Altana Pharma US Inc., a
Delaware corporation, a wholly owned subsidiary of Altana Pharma
AG, a German company.
“Altana Target
Physicians” means
physicians and other practitioners licensed to prescribe
pharmaceutical products, other than those physicians and other
practitioners that are Salix Target Physicians.
“Applicable
Laws” means all
federal, state and local laws, and the rules, regulations,
guidance, guidelines and requirements of Governmental Authorities
(as hereinafter defined) in effect from time to time, including,
without limitation, those relating to the manufacture, marketing,
promotion, distribution, (including storage, handling and
transportation) and sale of the Product in the Territory (as
hereinafter defined), including the Act, the PDMA (as hereinafter
defined ), the FDA Guidance for Industry – Supported
Scientific and Educational Activities, “fraud and
abuse,” anti-kickback, consumer protection and false claims
statutes and regulations.
“Business
Day” means any day
other than a Saturday or a Sunday or other day on which commercial
banks are authorized or required to be closed in the State of
Delaware.
“Cause”
has the meaning set forth in
Section 7.1 of this Agreement.
“Change of
Control” means a
transaction (or series of transactions) that results in: (a) a
merger, consolidation or reorganization of a Party (each of which
is referred to as a “Merger”) whereby the holders of
record of all capital stock of a Party outstanding immediately
prior to the Merger, shall, immediately after such Merger, hold,
directly or indirectly, less than fifty percent (50%) of the
outstanding capital stock, voting or management control of the
surviving or acquiring entity; (b) any other purchase or
acquisition of more than fifty percent (50%) of the outstanding
capital stock, voting or management control of Altana; or (c) a
sale or exchange of all, or substantially all, of the assets of a
Party.
“Competing
Product” means any
pharmaceutical product or compound (whether alone or in combination
with any other product or compound), including any non-prescription
product, other than the Product, whose primary indication is the
same as the Product.
“ Confidential
Information” means all confidential materials, data or
other information, including any proprietary information (whether
or not patentable, or protectable as a trade secret), regarding the
technology, products, business or objectives of a Party or its
Affiliates that is disclosed to the other Party pursuant to this
Agreement other than information that:
(a) is obtained by the receiving
Party from a non-Party person that did not disclose the information
in violation of a non-disclosure obligation; or
(b) is in the public domain not as a
result of action by the receiving Party or its
Affiliates;
2
The obligations of confidentiality shall not
apply to the extent of a disclosure of Confidential Information
required by law or court order; provided , however ,
that, in the event of any such required disclosure, to the extent
permissible, the receiving Party shall give the disclosing Party
prompt notice thereof in order that the disclosing Party may
attempt to quash, limit or otherwise prevent or limit disclosure,
the receiving Party shall cooperate with the disclosing Party with
respect to any such attempt as reasonably requested by the
receiving Party.
“Contract
Year” means the
period beginning on the Co-Promotion Date (as hereinafter defined)
and ending on [*], and each successive twelve (12) month period
thereafter, provided, that, the final Contract Year may be a
shorter period ending on the expiration or termination of the
Co-Promotion Period pursuant to this Agreement.
“Contract Year
Quarter” means the
period beginning on the Co-Promotion Date and ending on [*], and
each successive three (3) month period thereafter, provided that
(a) the initial Contract Year Quarter may be a shorter period
should the Co-Promotion Date occur prior to [*] (in which case the
initial Contract Year Quarter would end on [*]), and (b) the final
Contract Year Quarter may be a shorter period ending on the
expiration or termination of the Co-Promotion Period pursuant to
this Agreement.
“Control”
shall mean (a) to possess, directly
or indirectly, the power to direct the management or policies of a
Person, whether through ownership of voting securities or by
contract relating to voting rights or corporate governance, or (b)
to own, directly or indirectly, fifty percent (50%) or more of the
outstanding voting securities or other ownership interest of such
Person; provided that where local law restricts maximum ownership
to a level less than the level in (b), control is established by
direct or indirect ownership of the maximum permitted ownership
percentage.
“Co-Promotion
Date” means the
date upon which Altana begins Promotion of the Product.
“Co-Promotion
Fee” has the
meaning set forth in Section 5.1 of this Agreement.
“Co-Promotion
Period” means the
period (a) commencing on the Effective Date (as hereinafter
defined), and (b) concluding on [*], unless earlier terminated
pursuant to Section 7.1 hereof.
“Damages”
means any and all losses,
liabilities, claims, damages, judgments, penalties, costs and
expenses, including, without limitation, reasonable
attorneys’ fees and expenses.
“Detail”
means any in-person sales
presentation of the Product made by Representatives (as hereinafter
defined) of Altana to Altana Target Physicians (as hereinafter
defined), describing it in a fair and balanced manner consistent
with the requirements of this Agreement and Applicable Law and in a
manner that is customary in the industry for the purpose of
promoting a prescription pharmaceutical product. Details shall be
deemed to include only full presentations of the first or second
position in a sales presentation and shall not be deemed
to
[*] Confidential treatment requested; certain
information omitted and filed separately with the SEC.
3
include tertiary or other details that are not
in the first or second position, “reminder” details or
e-details, in each case as such terms are generally understood in
the pharmaceutical industry, or any presentations made at
conventions or similar gatherings. When used as a verb,
“Detail” shall mean to engage in a Detail.
“Detail Call
Threshold” has the
meaning set forth in Section 2.1(b) of this Agreement.
“Effective
Date” means the
date upon which both Parties have signed this Agreement.
“Event of
Insolvency” with
respect to either Party shall be deemed to have occurred if such
Party: (a) voluntarily files a petition in or for bankruptcy,
reorganization or an arrangement with creditors; (b) makes a
general assignment for the benefit of creditors; (c) is adjudged
bankrupt; (d) is unable or is unwilling to pay its debts as they
become due; (e) has a trustee, receiver or other custodian
appointed on its behalf; (f) has total liabilities which exceed its
total assets; or (g) is the subject of any other case or proceeding
under any bankruptcy or insolvency law, or any dissolution or
liquidation proceeding is commenced against it, which case or
proceeding is not dismissed within sixty (60) days of
filing.
“FDA”
means the United States Department
of Health and Human Services, Food and Drug
Administration.
“Field
Alert” has the
meaning set forth in Section 2.14(b) of this Agreement.
“ First Contract Year
Samples ” has the meaning set forth in Section 3.1 of
this Agreement.
“Force
Majeure” has the
meaning set forth in Section 12.17 of the Agreement.
“FSS”
means the list of prices published
by the United States General Services Administration at which the
Product is to be sold to eligible federal government agencies
pursuant to 48 C.F.R. 538 et. seq., as in effect from time to
time.
“ GAAP ” means
generally accepted accounting principles in the United
States.
“Governmental
Authorities” has
the meaning set forth in Section 2.2 of this Agreement.
“GPO”
means group purchasing
organization.
“ Gross Profit ”
means [*].
“Gross
Sales” means gross
sales revenue as determined according to GAAP.
“Improvements”
has the meaning set forth in Section
9.3(d) of this Agreement.
[*] Confidential treatment requested; certain
information omitted and filed separately with the SEC.
4
“ Indemnified Party
” has the meaning set forth in Section 11.2 of this
Agreement.
“Indemnifying
Party” has the
meaning set forth in Section 11.2 of this Agreement.
“Marketing
Plan” has the
meaning set forth in Section 2.7 of this Agreement.
“NDA”
means New Drug
Application.
“NDC”
means NDCHealth Corporation
headquartered in Atlanta, Georgia.
“Operating
Committee” has the
meaning set forth in Section 4.1 of this Agreement.
“Party”
means either Salix or
Altana.
“PDMA”
shall mean the Prescription Drug
Marketing Act of 1987, as amended, and the rules and regulations
and guidelines promulgated thereunder as in effect from time to
time.
“Person”
means, as applicable, an individual,
sole proprietorship, partnership, limited partnership, limited
liability partnership, corporation, limited liability company,
business trust, joint stock company, trust, incorporated
association, joint venture or similar entity or organization,
including a government or political subdivision, department or
agency of a government.
“PIRs”
means Product Labels and Inserts
(as hereinafter defined) and Promotional Materials (as hereinafter
defined) collectively.
“Principal
Contact” has the
meaning set forth in Section 2.6 of this Agreement.
“Product”
means rifaximin, an antibiotic
marketed and sold under the name “Xifaxan.”
“Product
Copyrights” shall
mean all copyrightable subject matter included in the Product
Labels and Inserts, the Promotional Materials, and the Product
training programs and materials developed and produced in
accordance with this Agreement.
“Product Label and
Insert” means (a)
all labels and other written, printed or graphic matter affixed to
any container, packaging or wrapper utilized with the Product, or
(b) any written material physically accompanying the Product,
including Product package inserts.
“ Product Medical
Inquiries ” has the meaning set forth in Section 2.15 of
this Agreement.
“Product
Profit” has the
meaning set forth in Section 5.1(a) of this Agreement.
“Product
Trademarks” means
the (a) Trademark “Xifaxan ™ ” and the registrations thereof, (b) any
other Trademarks relating to the Product and the registrations
thereof, (c) any pending or future Trademark registration
applications relating to the Products,
5
(d) any unregistered Trademark rights relating
to the Product as may exist through use prior to or as of the date
hereof, (e) any current or future modifications or variants of any
of the foregoing Trademarks, and (f) any future Trademarks adopted
by Salix for use in connection with the Product, in each case
excluding the Salix Trademark.
“Promotion” and “Promotional Activities”
means those activities normally undertaken by a pharmaceutical
company’s sales force to implement marketing plans and
strategies aimed at encouraging the FDA approved use of a
prescription pharmaceutical product including Detailing. When used
as a verb, “Promote” or “Promoting” means
engagement in such activities.
“Promotional
Materials” has the
meaning set forth in Section 2.9(a) of this Agreement.
“Representative”
means a pharmaceutical sales
representative or any other Person employed or engaged by Altana
that is involved in the Promotion or Detailing of the
Product.
[*]
“Salix”
means Salix Pharmaceuticals, Inc.,
a California corporation.
“Salix Target
Physicians” means
physicians and other practitioners licensed to prescribe
pharmaceutical products that are included in Salix’s current
call file list as of the Effective Date, plus any physicians and
other practitioners not in Salix’s current call file list
that are categorized as gastroenterologists or hepatologists as
defined by NDC. Salix’s current list of Salix Target
Physicians is attached hereto in CD-ROM format as Appendix D.
During the Co-Promotion Period, Salix may add physicians and other
practitioners to the list of Salix Target Physicians once per
calendar quarter with written approval from Altana, not to be
unreasonably withheld.
“Salix
Trademark” shall
mean any Trademark that includes the name “Salix” or
one or more of the logos identified in Appendix A, or any other
Trademark under which Salix and/or its Affiliates market and sell
products in the Territory.
“ Sample ” means
a standard sample unit of Product as determined, and as may be
changed from time to time by Salix, in its sole and absolute
discretion, subject to the provisions of Section
3.1(a)(iii).
“ Second Contract Year
Samples ” has the meaning set forth in Section 3.1 of
this Agreement.
“ Territory”
means the United States of America and its territories and
possessions.
“Trademark” shall mean any trademark, trade dress, brand
mark, trade name, brand name, corporate name, logo or business
symbol.
[*] Confidential treatment requested; certain
information omitted and filed separately with the SEC.
6
“Unit of
Product” means a
tablet, capsule or other individual dosage of Product.
1.2. Construction.
Except where the context requires
otherwise, whenever used the singular includes the plural, the
plural includes the singular, the use of any gender is applicable
to all genders and the word “or” has the inclusive
meaning represented by the phrase “and/or.” Whenever
this Agreement refers to a number of days, unless otherwise
specified, such number refers to calendar days. The headings of
this Agreement are for convenience of reference only and do not
define, describe, extend or limit the scope or intent of this
Agreement or the scope or intent of any provision contained in this
Agreement. The term “including” or
“includes” as used in this Agreement means including or
includes “without limiting” or “without
limitation.” The wording of this Agreement shall be deemed to
be the wording mutually chosen by the Parties and no rule of strict
construction shall be applied against any Party.
1.3 Term. This Agreement shall commence on the Effective
Date and shall continue in full force and effect until [*], unless
earlier terminated pursuant to Section 7.1 hereof.
ARTICLE II
CO-PROMOTION
2.1 Grant of Co-Promotion Rights;
Minimum Number of Details.
(a) Subject to the terms and
conditions of this Agreement, including, without limitation, the
retained rights of Salix set forth in the immediately subsequent
sentence, Salix grants to Altana, during the Co-Promotion Period,
the exclusive right to Promote and Detail the Product to Altana
Target Physicians practicing within the Territory. The grant set
forth in this Section 2.1 does not include the right to Promote and
Detail the Product or receive a Co-Promotion Fee with respect to
Salix Target Physicians, health care institutions, including
hospitals, governmental entities, managed care organizations or any
Person other than an Altana Target Physician, all of which is
expressly reserved to Salix. Furthermore, Altana shall not during
the Term present a Detail to any Salix Target Physician.
(b) During each Contract Year
Quarter occurring during the Co-Promotion Period, Altana shall
cause its Representatives to conduct not less than [*] Detail calls
on Altana Target Physicians (the “Detail Call
Threshold”). [*] shall bear the cost and expense of all such
Detail calls on Altana Target Physicians.
(c) Salix shall, upon delivery of
reasonable advance notice to Altana sales management, have the
right to have its sales and marketing personnel accompany Altana
Representatives during their presentation of Detail calls
(“Ride-Alongs”). Salix personnel shall have the right
to participate in Ride-Alongs as often as is commercially and
regulatorily reasonable under the circumstances then in
effect.
2.2 Continued Development;
Governmental Authorities. Salix shall have the sole right to (a) test and
develop the Product, and (b) except as otherwise set forth in the
last sentence of this Section 2.2, contact and communicate with
applicable governmental and regulatory authorities (collectively,
“Governmental Authorities”) regarding the Product.
Salix shall (i) use commercially reasonable efforts to continue
development of the Product and related regulatory
[*] Confidential treatment requested; certain
information omitted and filed separately with the SEC.
7
activities within the Territory, and (ii) keep
Altana informed of the regulatory status of the Product and all
developments related thereto. Notwithstanding the foregoing, Altana
shall have the right to contact FDA directly with respect to
matters directly relating to (A) Altana and the performance of its
obligations under this Agreement, or (B) Altana Target Physicians,
provided that Altana (1) notifies Salix in writing in advance of
any such contact, such notice to describe the subject and nature of
Altana’s proposed FDA contact and Altana’s anticipated
position, if any, (2) consults with Salix prior to such contact,
and (3) if requested by Salix, permits Salix to participate in such
contact.
2.3 Contract Sales
Organizations. Altana
shall not use any contract sales organizations or other third
parties other than [*] to satisfy any or all of its obligations
under this Agreement.
2.4
Representatives.
(a) At all times during the
Co-Promotion Period, Altana shall have no fewer than two hundred
fifty (250) active territories with Representatives to Promote and
Detail the Product to Altana Target Physicians within the
Territory.
(b) Each Representative of Altana
shall have satisfactorily completed the sales training program
described in Section 2.10 hereof, and be fully knowledgeable about
the Product, including its Product Label and Insert and the use of
the Promotional Materials. In addition, not less than ninety-five
percent (95%) of Altana’s Representatives shall have
graduated from an accredited four (4) year college and fifty
percent (50%) of Altana’s Representatives must have been
promoting pharmaceutical products in the Territory for at least
eighteen (18) months prior to the time that such Representative
commences Promoting the Product.
(c) As soon as is reasonably
practicable following the execution of this Agreement, Altana shall
adopt and implement a commercially reasonable sales incentive plan
covering those of its Representatives that Promote and Detail the
Product to Target Physicians. Such plan and its implementation
shall comply with all Applicable Laws.
(d) Salix shall procure NDC
physician level prescribing data for Altana for a twelve (12) month
period starting March 1, 2005, at [*] cost and expense up to
$[*].
2.5. Managed Care.
Salix shall be solely responsible
for all aspects of managed care in connection with the Product,
including, without limitation: (a) contract strategy, (b)
contracting, (c) contract administration and claims processing, (d)
contract compliance, monitoring and auditing, (e) account
management, including P&T committee presentations, and (f)
government reporting, government program, rebate processing, FSS
calculations and pricing schedules. Salix shall communicate with
Altana sales management on a quarterly basis regarding such managed
care activities.
2.6. Principal
Contact. Each Party shall
designate a principal contact (“Principal Contact”) to
deal with all day to day issues that arise during the Co-Promotion
Period and relate
[*] Confidential treatment requested; certain
information omitted and filed separately with the SEC.
8
to this Agreement and the Promotion and
Detailing of the Product to Altana Target Physicians. The Principal
Contacts shall coordinate and cooperate with each other and shall
bring all unresolved issues to the Operating Committee for
resolution. Either Party may remove and replace its designated
Principal Contact upon written notice to the other
Party.
2.7. Marketing Plan.
(a) The Parties, working jointly
through the Operating Committee, shall develop a marketing plan for
the Product (the “Marketing Plan”).
(b) Altana shall not be prohibited
from undertaking Promotional Activities with respect to the Product
that are in excess of those for which Altana is responsible under
the then current Marketing Plan, provided that such excess
Promotional Activities (i) are consistent with the then current
Marketing Plan, (ii) are in compliance with Applicable Laws and
industry guidance, including, without limitation, the Accreditation
Council for Continuing Medical Education Standards for Support of
Continuing Medical Education, the American Medical Association
Guidelines on Gifts to Physicians from Industry, the Pharmaceutical
Research and Manufacturers of America Code on Interactions with
Healthcare Professionals, and (iii) are undertaken and performed at
the sole cost and expense of [*].
(c) Altana shall train its sales
force to market the Product pursuant to the then current Marketing
Plan and consistent with approved Product labeling pursuant to and
in accordance with a training program described in Section 2.10
hereof.
(d) Salix shall inform
Altana’s Principal Contact of catalog price increases or
decreases for the Product in the Territory in sufficient time so
that such information is provided to Altana and Salix
Representatives at approximately the same time.
2.8. Product
Management. Salix shall
have sole and exclusive responsibility for the distribution, sale,
invoicing and collection of payment and accounts receivable for and
with respect to the Product. All orders for the Product shall be
subject to acceptance by Salix, which acceptance shall not be
unreasonably withheld. Salix shall have the sole and exclusive
discretion to make pricing and discounting decisions regarding the
Product.
2.9. Promotional
Materials.
(a) All electronic and physical
advertising, promotional, educational, training and communication
materials for marketing, advertising and Promotion of the Product
to third parties including, without limitation, to Altana Target
Physicians and to Altana’s sales force (“Promotional
Materials”) shall be developed and produced by Salix. Such
Promotional Materials may include, without limitation, detail aids,
file cards, premium items, reprints, and any other promotional
support items. Salix shall ensure that all Promotional Materials
are in strict compliance with all Applicable Laws.
(b) Altana shall, and shall cause
its Representatives to (i) only use Promotional Materials provided
by Salix in connection with the Promotion of the Product,
(ii)
[*] Confidential treatment requested; certain
information omitted and filed separately with the SEC.
9
ensure that all statements and claims related to
the Product, including as to efficacy and safety, are only made in
strict compliance with the PIRs, and all Applicable Laws, including
the Act, (iii) ensure that all comments about the Product, Product
competitors, other products and Salix are truthful, accurate and in
strict compliance with Applicable Laws, and (iv) not change the
Promotional Materials in any respect without the express written
consent of Salix, not to be unreasonably withheld.
(c) Salix shall provide Altana with
Promotional Materials produced by Salix at [*] cost and expense in
quantities reasonably sufficient to allow Altana to promote sales
of the Product in accordance with the Marketing Plan then in
effect. Salix shall, at Altana’s request, provide to Altana
Promotional Materials that are consistent with the then current
Marketing Plan and that are of a quality equivalent to those
provided to Salix Representatives. Without limitation of the
foregoing, Salix shall provide to Altana, for use during and with
respect to each Contract Year occurring during the Co-Promotion
Period, a total of up to [*] pieces of Promotional Materials. The
initial shipment of such Promotional Materials shall be [*] percent
[*] of the [*] pieces [(*] pieces) and shall be shipped to the
Altana warehouse by March 9, 2005, by Salix and at [*] expense. The
balance of the Promotional Materials distributed after such initial
shipment shall be determined by the Operating Committee and shall
be shipped in bulk to the same Altana warehouse or other single
location specified in advance by Altana at [*] cost and expense. If
the Operating Committee determines that Altana needs additional
Promotional Materials (in excess of [*] pieces), [*] the cost to
purchase such additional Promotional Materials from Salix for an
amount equal to [*]. The shipment of such additional Promotional
Materials shall be the same as described above.
(d) Altana shall, and shall cause
its Representatives to immediately cease the use of any Promotional
Materials when instructed to do so by Salix. Upon such
instructions, all Promotional Materials in the possession or
control of Altana or its sales representatives shall be promptly
returned to Salix. However, Salix shall replace the returned
Promotional Materials with comparable pieces of similar quality and
number. Further, upon expiration or earlier termination of the
Co-Promotion Period, Altana shall promptly return all Promotional
Materials in the possession or control of Altana or its
Representatives.
(e) Each Party shall make, and shall
permit its Representatives to make, only such statements and claims
regarding the Product, including as to efficacy and safety, as are
consistent with the PIRs. Without limitation to the foregoing, each
Party shall not, and shall not cause or permit its Representatives
to make any untrue or misleading statements or comments about the
Product, and/or take any action that jeopardizes, or could
reasonably be expected to jeopardize the goodwill or reputation of
the other Party or its products.
2.10. Training; Sales
Meetings.
(a) Salix shall train Altana’s
sales managers and trainers to assist Altana in the fulfillment of
its obligations under the Co-Promotion Agreement. Such training
provided by Salix shall comply with all Applicable Laws. In
connection therewith, Salix shall provide such trainers and
speakers as Salix and Altana may deem reasonably necessary. Such
trainers and speakers shall be provided by [*]. Altana shall have
the right to review and comment on training materials from medical,
legal and regulatory perspectives. Following the completion of
initial
[*] Confidential treatment requested; certain
information omitted and filed separately with the SEC.
10
training, [*] shall be responsible for ongoing
training of any and all Altana Representatives. [*] shall bear the
cost and expense of the ongoing training of Altana Representatives.
Salix shall, in addition to the aforementioned training of
Altana’s sales managers and trainers, designate and make
available one (1) individual to respond to inquiries from Altana
sales managers and trainers. Salix shall provide Altana with such
training materials as Salix deems appropriate for use in training
Altana’s Representatives and in such quantities as Altana
shall reasonably require and request. Any such training materials
required for training of Altana’s Representatives prior to
the Co-Promotion Date, as determined by the Operating Committee,
shall be produced and shipped directly to the Altana
Representatives by Salix at [*] cost and expense. Any training
materials required after the Co-Promotion Date shall be shipped in
bulk to a warehouse or other single location specified in advance
by Altana at [*] cost and expense. Altana shall hold in person
training meetings for each Representative of Altana prior to his or
her commencement of Promotion of the Product pursuant to this
Agreement. Altana shall be responsible for and shall ensure that
each Representative is properly and thoroughly trained with respect
to all matters identified during the training of Altana sales
managers and trainers. With regard to Product-specific training of
its Representatives, Altana shall only use those Product training
programs and materials provided by Salix, as modified by
Altana’s medical, legal and regulatory reviewers, with
Salix’s consent, not to be unreasonably withheld. An Altana
Representative shall not be deemed to be fully trained and may not
Promote or Detail Product unless and until such Representative has
taken the Salix Product test included in the aforementioned
training materials and answered not less than [*] percent [(*]%) of
the questions correctly. Upon request from Salix, Altana shall
provide evidence and/or certification that such test results have
been achieved.
(b) Altana shall permit
representatives of Salix to attend the portions of training, sales
and other meetings of Altana with its Representatives in which
Promotion and strategies relating to the Product are discussed. At
Altana’s “launch” meeting for the Product, Salix,
at [*] cost and expense, shall provide one or more marketing, sales
or medical faculty speakers.
2.11. Supply of
Product. Salix shall use
reasonable efforts to supply the Product during the Co-Promotion
Period in sufficient quantities to satisfy the levels of Product
sales forecasted in the then current Marketing Plan. Salix shall
maintain reasonable inventory levels of the Product in order to
ensure their ability to fulfill this obligation. Salix shall have
the sole responsibility and right to fill orders with respect to
the Product. Altana shall not solicit orders for the Product but,
if for any reason, Altana shall receive an order for the Product,
Altana shall promptly forward to Salix any such orders. All orders
for Product shall be subject to acceptance by Salix, in its sole
discretion, which acceptance shall not be unreasonably withheld.
Salix may cancel any order for Product at any time after acceptance
without incurring any liability to Altana. Salix shall be solely
responsible for responding to requests from Target Physicians for
individual patients who need the Product but are unable to afford
it. Any such request shall be forwarded by Altana to Salix for
processing. Salix shall have the sole right and responsibility for
establishing and modifying the terms and conditions of the sale of
the Product, including (a) the price at which the Product will be
sold, (b) whether the Product will be subject to trade or quantity
discounts, (c) whether any discount will be provided for payments
on accounts receivable, (d) whether the Product will be subject to
rebates, returns and allowances or retroactive price reductions,
(e) the channels of distribution of the Product, and (f) whether
credit
[*] Confidential treatment requested; certain
information omitted and filed separately with the SEC.
11
is to be granted or refused in connection with
any sale of Product. In the event that Salix fails to supply the
Product as required pursuant to this Agreement for any reason other
than a Force Majeure, which such failure results in lost sales for
Altana, the Parties shall meet and attempt to negotiate a mutually
agreeable and commercially reasonable solution. If the Parties
cannot reach such an agreement within a reasonable period of time,
the issue will be dealt with as contemplated under Section 4.4 of
this Agreement.
2.12. Product Recall and
Withdrawal. Salix shall
have the sole responsibility and right with respect to any recall
or withdrawal of Product, and shall bear all costs and expenses
relating thereto. At Salix’s request, where the Product has
been recalled or withdrawn from the market, Altana shall, as soon
as reasonably practical and in accordance with Applicable Law,
assist Salix in obtaining the return of any Product not in the
direct possession or control of Salix by notifying physicians who
have received the Samples from Altana Representatives and by
returning to Salix Samples still in the possession of Altana or the
Altana Representatives, and Salix shall reimburse Altana for any
reasonable documented costs and expenses incurred by Altana in
taking such actions.
2.13. Product Return.
Salix shall have the sole
responsibility and right to accept any returned Product. Altana
shall not solicit the return of any Product and shall not receive
or accept any returned Product. In the event that any such Product
is inadvertently returned to Altana, Altana shall promptly ship
such Product to Salix, along with any documentation or explanation
Altana receives regarding the reason for the return, at
Salix’s cost and expense.
2.14. Adverse Experience
Reporting; Field Reports; Quality Complaints.
(a) Altana shall, and shall cause
each of its Representatives to, provide notice to Salix within two
(2) calendar days of the time it, he or she becomes aware of an
Adverse Event associated with use of a Product (whether or not the
reported effect is (a) described in the full prescribing
information or the published literature with respect to such
Product or (b) determined to be attributable to such Product), or
any information in or coming into its, his or her possession or
control concerning such Adverse Event by contacting the Medical
Call Center for Salix or by completing the adverse event report
form provided by Salix and submitting such form to Salix or its
designated safety contractor. The contact information for the
Medical Call Center for Salix and Salix’s designated safety
contractor are as set forth in Appendix E, as may be updated from
time to time by Salix with prior written notice to
Altana.
(b) Altana shall, and shall cause
each of its Representatives to, notify Salix within two (2)
calendar days of the time it, he or she becomes aware of any
information that might necessitate the filing by Salix of a field
alert report, as required under 21 C.F.R. § 314.81(b)(1) (a
“Field Alert”), as such regulation may be amended from
time to time, by contacting the Associate Director, Quality, or the
Medical Call Center of Salix. The contact information for the
Medical Call Center for Salix and Salix’s Associate Director,
Quality are as set forth in Appendix E, as may be updated from time
to time by Salix with prior written notice to Altana.
(c) Altana shall, and shall cause
each of its Representatives to notify Salix within two (2) business
days of the time it, he or she becomes aware of any Product quality
complaint associated with the use of the Product by contacting the
Associate Director, Quality, or the Medical Call Center of Salix.
The contact information for the Medical Call Center for Salix and
Salix’s Associate Director, Quality are as set forth in
Appendix E, as may be updated from time to time by Salix with prior
written notice to Altana.
12
(d) Salix shall provide adverse drug
experience information regarding the Product to Altana to the
extent such information is provided by Salix to its sales
representatives. Salix shall also notify Altana immediately of any
formal communication received by Salix from the FDA regarding any
threatened or pending action which may affect the safety or
efficacy claims of the Product or the continued marketing and
Promotion of the Product.
(e) Altana shall immediately notify
Salix of any information Altana receives regarding any threatened
or pending action by any Governmental Authority that may affect the
safety or efficacy claims of the Product or the continued marketing
and Promotion of the Product. Upon receipt of any such information,
Salix may consult with Altana in an effort to arrive at a mutually
acceptable procedure for taking appropriate action; provided,
however, that nothing in this Agreement shall restrict
Salix’s ability to make a timely report of
