ADDENDUM TO LICENSE AND SUPPLY
AGREEMENT
THIS ADDENDUM
made on this 14 th day of August, 2008 (the “Effective
Date”) by and between Meiji Seika Kaisha, Ltd.
(“Licensor”) and Cornerstone BioPharma, Inc.
(“Licensee”) with respect to the License and Supply
Agreement dated October 12, 2006 regarding Cefditoren Pivoxil,
as amended by Amendment No. 1 dated July 27, 2007 (the
“License Agreement”).
WHEREAS, the
licensing arrangement contemplated by the License Agreement is
confined to the premise that Licensee will purchase the API from
Licensor to manufacture the Product for sale in the Territory;
and
WHEREAS, the
parties desire to expand the scope of the licensing arrangement
under the License Agreement so that Licensee may purchase certain
Product from Licensor and sell such Product in the Territory, and
also desire to make certain amendments to the License Agreement;
and
WHEREAS, the
parties have agreed to implement the aforesaid desire by way of
entering into this Addendum to the License Agreement.
NOW, THEREFORE,
it is agreed by the parties as follows:
1. Capitalized terms not defined herein
shall have the same meanings ascribed to them in the License
Agreement.
[***]
Confidential portions of the exhibit have been omitted and filed
separately with the Securities and Exchange Commission.
2. In
addition to the definitions set forth in Paragraph 1 above,
the following terms shall have the following meanings for the
purpose of this Addendum:
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(a)
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The
term “Licensor Supplying 200mg Product” shall mean the
Product in the form of 200mg tablet manufactured by
Licensor’s subsidiary in Spain, Tedec-Meiji Farma, S.A.
(“Tedec-Meiji”) and supplied by Licensor to
Licensee.
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(b)
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The
term “Licensor Supplying 400mg Product” shall mean the
Product in the form of 400mg tablet manufactured by Tedec-Meiji and
supplied by Licensor to Licensee.
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(c)
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The
term “200mg Product Specifications” shall mean the
specifications and analytical method relating to the Licensor
Supplying 200mg Product attached hereto as
Exhibit A.
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(d)
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The
term “400mg Product Specifications” shall mean the
specifications and analytical method relating to the Licensor
Supplying 400mg Product attached hereto as
Exhibit B.
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3. Paragraph 1 of Article 2 of
the License Agreement shall be amended to include, in addition to
the license currently granted therein, an exclusive license to
offer to sell, sell and have sold in the Territory the Licensor
Supplying 200mg Product and the Licensor Supplying 400mg Product
under the Patents, the Technical Information and the Product
Registrations.
4. Licensee shall not be required to pay
any additional License Fee for the additional license granted under
Paragraph 3 above.
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5. In
consideration for the additional license granted under
Paragraph 3 above, Licensee shall pay to Licensor a running
royalty of [***] percent ([***]%) of the Net Sales of the Licensor
Supplying 200mg Product and the Licensor Supplying 400mg Product
for a period of ten (10) years from the launch date of each of
those Products. For the avoidance of doubt, the royalties under
this Paragraph 5 are in lieu of any royalty payments that
would otherwise be due and payable in respect to the Licensor
Supplying 200mg Product and the Licensor Supplying 400mg Product
under Paragraph 2 of Article 5 of the License
Agreement.
6. Subject
to the terms and conditions of this Addendum, Licensor shall sell
the Licensor Supplying 200mg Product and/or the Licensor Supplying
400mg Product for use in the Territory exclusively to Licensee, and
Licensee shall purchase the Licensor Supplying 200mg Product and/or
the Licensor Supplying 400mg Product exclusively from Licensor
until expiration of a period of ten (10) years from the launch
date thereof, subject to Paragraph 7 of this
Addendum.
(a) The
supply prices of the Licensor Supplying 200mg Product and the
Licensor Supplying 400mg Product are inclusive of API used therein
and shall be as listed below and shall be subject to the adjustment
based on Licensee’s ex-factory price fluctuation and the
foreign exchange fluctuation set forth in (b) and
(c) below:
Licensor
Supplying 200mg Product
10 tablets/blister x 2 blisters per pack: [***]
Licensor Supplying 400mg Product
4 tablets/blister x 5 blisters per pack: [***]
4 tablets/blister x 7 blisters per pack: [***]
[***]
Confidential portions of the exhibit have been omitted and filed
separately with the Securities and Exchange Commission.
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tablets/blister x 1 blister per pack (“Sample Pack of
Licensor Supplying 400mg Product”): [***]
Terms of
delivery: C.I.P. Memphis, Tennessee, U.S.A. (DDN Obergfel, LLC
warehouse) or such other destination as may be agreed by Licensor
and Licensee (which agreement shall not be unreasonably withheld),
by air.
(b) Not
less than fifteen (15) days before the first date of each and
every six (6) month period after the first year from the
launch date of the Licensor Supplying 200mg Product and the
Licensor Supplying 400mg Product, Licensee shall provide Licensor
with an updated Licensee’s ex-factory prices of those
Products. Effective on the first date of each and every such six
(6) month period, the supply prices of subsequent purchases of
the Licensor Supplying 200mg Product and the Licensor Supplying
400mg Product except for the Sample pack of Licensor Supplying
400mg Product shall be revised to be the greater of (i) the
prices for the Licensor Supplying 200mg Product and the Licensor
Supplying 400mg Product listed in (a) above or (ii) the
supply prices of the Licensor Supplying 200mg Product and the
Licensor Supplying 400mg Product calculated in accordance with the
following formula, subject to the adjustment based on the foreign
exchange fluctuation set forth in (c) below:
Future Supply
Price of the Licensor Supplying 200mg Product = {{[0.5] x [(the
updated Licensee’s ex-factory price of the Licensor Supplying
200mg Product divided by the previous Licensee’s ex-factory
price of the Licensor Supplying 200mg Product) – (1)]} + 1} x
{current supply price of the Licensor Supplying 200mg
Product}
[***]
Confidential portions of the exhibit have been omitted and filed
separately with the Securities and Exchange Commission.
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Future Supply
Price of the Licensor Supplying 400mg Product = {{[0.5] x [(the
updated Licensee’s ex-factory price of the Licensor Supplying
400mg Product divided by the previous Licensee’s ex-factory
price of the Licensor Supplying 400mg Product) – (1)]} + 1} x
{current supply price of the Licensor Supplying 400mg
Product}
The supply
price of the Sample Pack of Licensor Supplying 400mg Product shall
be only subject to the adjustment based on the foreign exchange
fluctuation set forth in (c) below.
(c) In the
event that the exchange rate of the Japanese Yen to the US$ as of
the date on which any firm written order for the Licensor Supplying
200mg Product or the Licensor Supplying 400mg Product is placed by
Licensee (the “Exchange Rate”) fluctuates more than
[***] above or below the exchange rate of Japanese Yen [***]=US$1,
then the supply price of the Licensor Supplying 200mg Product or
the Licensor Supplying 400mg Product in respect of such order shall
be adjusted in accordance with the following formula:
Supply Price of
the Licensor Supplying 200mg Product Adjusted by Exchange
Rate={[(current supply price of the Licensor Supplying 200mg
Product x Japanese Yen [***]/US$) + (current supply price of the
Licensor Supplying 200mg Product x the Exchange Rate)] divided by
2} divided by the Exchange Rate
[***]
Confidential portions of the exhibit have been omitted and filed
separately with the Securities and Exchange Commission.
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Supply Price of
the Licensor Supplying 400mg Product Adjusted by Exchange
Rate={[(current supply price of the Licensor Supplying 400mg
Product x Japanese Yen [***]/US$) + (current supply price of the
Licensor Supplying 400mg Product x the Exchange Rate)] divided by
2} divided by the Exchange Rate.
(d) In the
event that the transactions of the Licensor Supplying 200mg Product
or the Licensor Supplying 400mg Product are not commercially
reasonable for Licensor and/or Licensee because they cannot
generate a reasonable gross profit using the supply price of the
Licensor Supplying 200mg Product or the Licensor Supplying 400mg
Product which is generated from the calculation method described in
above (b) and/or (c) and Licensor and/or Licensee believe
in good faith that they are unable to continue the transactions of
the Licensor Supplying 200mg Product or the Licensor Supplying
400mg Product for the said reason(s), Licensor and Licensee shall
discuss in good faith measures to be taken to cope with such
situation.
(e) The
payment terms for the Licensor Supplying 200mg Product and the
Licensor Supplying 400mg Product for one-year period from the
Effective Date shall be T.T. remittance to the bank designated by
Licensor within thirty (30) days after B/L date, provided that
such payment terms are not applicable to the portion of the
quantity greater than 1,500,000 tablets of the Licensor Supplying
400mg Product (equivalent to 3,000,000 tablets of the Licensor
Supplying 200mg Product) per shipment or if any preceding order
remains unsettled and, in such event, the payment terms for the
said portion of any order or for any order shipped while any
preceding order remains
[***]
Confidential portions of the exhibit have been omitted and filed
separately with the Securities and Exchange Commission.
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unsettled shall
be advance payment by T.T. remittance to the bank designated by
Licensor. With respect to the payment terms for those Products
after the above one-year period, Licensor and Licensee shall
discuss in good faith to continue the same payment terms or revise
the payment terms.
(f) Licensee shall place a firm order for
the Licensor Supplying 200mg Product and/or the Licensor Supplying
400mg Product at least four (4) months prior to a desired
shipping date. Licensor shall use commercially reasonable efforts
to ship the Licensor Supplying 200mg Product and/or the Licensor
Supplying 400mg Product within five (5) days of the desired
shipping date and in amounts not less than ninety five percent
(95%) of the amount ordered. By the first day of each month,
Licensee shall submit to Licensor a non-binding six (6) months
rolling purchasing forecast of the Licensor Supplying 200mg Product
and the Licensor Supplying 400mg Product which shall be
the
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