LICENSE, COMMERCIALIZATION AND SUPPLY AGREEMENT FOR LUBIPROSTONE FOR JAPAN

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SUCAMPO PHARMACEUTICALS, INC. | ABBOTT JAPAN CO LTD

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Title: LICENSE, COMMERCIALIZATION AND SUPPLY AGREEMENT FOR LUBIPROSTONE FOR JAPAN
Date: 3/16/2009
Industry: Biotechnology and Drugs Sector: Healthcare

LICENSE, COMMERCIALIZATION AND SUPPLY AGREEMENT FOR LUBIPROSTONE FOR JAPAN, Parties: sucampo pharmaceuticals inc. , abbott japan co ltd

[*] = Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

Exhibit 10.43

LICENSE, COMMERCIALIZATION AND SUPPLY AGREEMENT
FOR LUBIPROSTONE FOR JAPAN

by and between

ABBOTT JAPAN CO. LTD

and

SUCAMPO PHARMA, LTD.

Dated as of February 19, 2009

LICENSE, COMMERCIALIZATION AND SUPPLY AGREEMENT
FOR LUBIPROSTONE FOR JAPAN

This LICENSE, COMMERCIALIZATION, AND SUPPLY AGREEMENT FOR LUBIPROSTONE FOR JAPAN (“ Agreement ”) is entered into as of February 19, 2009, by and between Sucampo Pharma, Ltd., a corporation organized under the laws of Japan with principal offices at 2-2-2 Uchisaiwai-cho, Chiyoda-ku, Tokyo, 100-0011, Japan (“ Sucampo ”) and Abbott Japan Co. Ltd., a corporation organized under the laws of Japan with principal offices at 3-5-27 Mita, Minato-ku, Tokyo 108-6303, Japan (“ Abbott ”). Each of Abbott and Sucampo is sometimes referred to individually herein as a “ Party ” and collectively as the “ Parties ”.

BACKGROUND

WHEREAS, Sucampo Controls the Sucampo Patents Rights and the Sucampo Background Technology related to the Product and is in the process of Developing the Product in the Field in the Territory (as such terms are hereinafter defined);

WHEREAS, Abbott is a healthcare company with research, development and marketing activities throughout the world; and

WHEREAS, Abbott desires to obtain a non-exclusive license to Develop the Product in the Field in the Territory and an exclusive license to Commercialize the Product in the Field in the Territory (as such terms are hereinafter defined).

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto, intending to be legally bound, hereby agree as follows:

ARTICLE 1
DEFINITIONS

Whenever used in this Agreement with an initial capital letter, the terms defined in this ARTICLE 1 shall have the meanings specified below:

“ Abbott ” means Abbott Japan Co. Ltd., as identified in the preamble to this Agreement.

“ Abbott Indemnitee(s) ” has the meaning set forth in Section 14.2.

“ Additional Materials ” means all raw materials, resins, chemical intermediates, components, excipients, and other ingredients and packaging materials and supplies, including Product Labels and Inserts, needed to manufacture the Product for use in the Field, including costs for relevant in-bound freight.

“ Adverse Event ” means any untoward medical occurrence in a patient or clinical investigation subject administered a pharmaceutical product and which does not necessarily have to have a causal relationship with treatment. An adverse event can therefore be any unfavorable and unintended sign (including an abnormal laboratory finding, for example), symptom, or disease temporally associated with the use of a medicinal product, whether or not considered related to the medicinal product.

“ Affiliate ” means, with respect to either Party, any Person that, directly or through one or more Affiliates, controls, or is controlled by, or is under common control with, such Party. For purposes of this definition, “control” means (a) ownership of more than fifty percent (50%) of the shares of stock entitled to vote for the election of directors, in the case of a corporation, or more than fifty percent (50%) of the equity interests in the case of any other type of legal entity, (b) status as a general partner in any partnership, or (c) any other arrangement whereby a Person controls or has the right to control the Board of Directors or equivalent governing body of a corporation or other entity.

“ Agreement ” means this License, Commercialization and Supply Agreement for Lubiprostone for Japan, including all Exhibits hereto, as identified in the preamble, as may be amended from time to time in accordance with its terms.

“ Annual Net Sales ” means the cumulative Net Sales during any given Calendar Year.

“ Applicable Law ” means all federal, state, local, national and supra-national laws, statutes, rules and regulations, including any rules, regulations, or requirements of Regulatory Authorities, major national securities exchanges or major securities listing organizations, that may be in effect from time to time during the Term and applicable to a particular activity hereunder.

“ Audited Party ” has the meaning set forth in Section 8.7.

“ Auditing Party ” has the meaning set forth in Section 8.7.

“ Business Day ” means a day, other than a Saturday or Sunday, on which banking institutions in Tokyo, Japan are open for business.

“ Calendar Year ” means each successive period of twelve (12) consecutive calendar months commencing on January 1 and ending on December 31, except that the first Calendar Year of the Term shall commence on the Effective Date and end on December

31, 2009, and the last Calendar Year of the Term shall commence on January 1 of the Calendar Year in which the Term ends and end on the last day of the Term.

“ cGMP ” means the quality systems and current good manufacturing practices applicable to the manufacture, labeling, packaging, handling, storage, and transport of the Compound, the Additional Materials and the Product, as set forth in the Pharmaceutical Affairs Law of Japan (Law No. 145 of 1960, as amended), and its related Ordinances including the MHLW Ordinance No. 179, December 24, 2004, any update thereto and any other laws, regulations, policies, or guidelines applicable to the manufacture, labeling, packaging, handling, storage, and transport of pharmaceutical products in the Territory, and/or any applicable foreign equivalents thereof, and any updates of any of the foregoing.

“ CIC ” means chronic idiopathic constipation.

“ CIC Indication ” means the prophylactic or therapeutic use in the prevention and/or treatment of CIC.

“ Clinical Data ” means all data with respect to a product containing the Compound for use in the CIC Indication that is made, collected or otherwise generated anywhere in the world under or in connection with the Clinical Studies for a product containing the Compound for use in the CIC Indication (as opposed to Pre-Clinical Data or non-clinical data derived from laboratory studies, disease models and animal studies). Clinical Data includes, but is not limited to, validated clinical databases.

“ Clinical Study(ies) ” means Phase I Study, Phase II Study, Phase III Study, Phase IV Study conducted anywhere in the world, or such other tests or studies in humans conducted anywhere in the world, that are required by Applicable Law, or otherwise recommended by the Regulatory Authorities, to obtain or maintain Regulatory Approvals for the Product in the Field in the Territory, but excluding Post-Approval Marketing Studies.

“ CMC Data ” means the data contained in the chemistry, manufacturing and controls section of a submission for Regulatory Approval of the Product in the Field in the Territory.

“ Commercialization ” or “ Commercialize ” means any and all activities (whether before or after Regulatory Approval) directed to the commercialization of the Product in the Field in the Territory, including pre-launch and post-launch marketing, Promoting, distributing, offering to sell and selling the Product in the Field in the Territory. When used as a verb, “Commercializing” means to engage in Commercialization and “Commercialized” has a corresponding meaning.

“ Commercialization Plan ” means a written one (1) year plan prepared by Abbott for the Commercialization of the Product in the Field in the Territory, including, without

limitation, a budget for such activities, as such plan may be amended or updated from time to time in accordance with Section 7.1.

“ Commercially Reasonable Efforts ” means, with respect to activities of each Party contemplated by this Agreement, the level of effort commonly used in the research-based pharmaceutical industry to conduct development, promotion or commercialization activities for a product that is at a similar stage in its lifecycle and is of comparable market potential, profit potential and strategic value, taking into account relevant considerations, including issues of safety (including Adverse Events) and efficacy, product profile, the proprietary position, the then-current competitive environment for such product, the likely timing of the product’s entry into the market, the then-current market penetration, the return on investment potential of such product, the regulatory environment and status of the product, and other relevant scientific, technical and commercial factors, in each case in a manner consistent with the level of effort and expenditure contemplated for such activities by the Development Plan or the Commercialization Plan, as the case may be, and as measured by the facts and circumstances at the time such efforts are due.

“ Committee(s) ” has the meaning set forth in Section 3.1.1. Each of the JDC and the JCSC is sometimes referred to individually herein as a “ Committee ” and collectively as the “ Committees .”

“ Competing Product ” has the meaning set forth in Section 7.8.

“ Compound ” means lubiprostone (also known by the tradename AMITIZA®) as further described in Exhibit A, and its salts, metabolites, as well as any active pro-drugs, isomers, tautomers, hydrates and polymorphs.

“ Confidential Information ” means any and all proprietary information or material, whether oral, visual, in writing or in any other form, that, at any time since September 5, 2007 or after the Effective Date, has been or is provided, communicated or otherwise made known to the Receiving Party or any of its Affiliates by or on behalf of the Disclosing Party or any of its Affiliates pursuant to this Agreement or in connection with the transactions contemplated hereby or any discussions or negotiations with respect thereto, including pursuant to the Confidentiality Agreement.

“ Confidentiality Agreement ” means the Confidentiality Agreement by and between Abbott Laboratories, an Illinois corporation, and Sucampo Pharmaceuticals, Inc., a Delaware corporation, effective as of September 5, 2007, as amended.

“ Control ” or “ Controlled ” means, with respect to any Technology, Patent Right or Regulatory Filing, possession of the right, whether directly or indirectly, and whether by ownership, license or otherwise, to assign, or grant a license, sublicense, a right of reference or other right to or under, such Technology, Patent Right or Regulatory Filing, as

provided for herein, without violating the terms of any agreement or other arrangement with any Third Party.

“ Core Data Sheets ” means a document prepared by the Regulatory Approval holder containing, in addition to the Company Core Safety Information (CCSI), material relating to the CIC Indication, dosing, pharmacokinetics, and other information on the Product for use in the Field in the Territory based on scientific data that are positioned on appropriate prescribing information for safe and effective use of the Product in the Field in the Territory.

“ Corporate Names ” means (a) in the case of Abbott, the Trademark Abbott and the Abbott corporate logo or such other names and logos used generally by Abbott and its Affiliates in their business (and not relating to a specific product or technology) as Abbott may designate in writing from time to time, and (b) in the case of Sucampo, the Trademark Sucampo and the Sucampo corporate logo or such other names and logos used generally by Sucampo and its Affiliates in its business (and not relating to a specific product or technology) as the JCSC may designate in writing from time to time, in each case ((a) and (b)), together with any variations and derivatives thereof.

“ CTN ” means an application filed with a Regulatory Authority for authorization to commence human clinical trials of the Compound, including (a) Clinical Trial Notifications as defined in IYAKUSHINHATSU No. 908, August 1, 2000 or any update thereto or any successor application or procedure filed with the Minister of Labour, Health and Welfare of Japan, and (b) all supplements and amendments that may be filed with respect to the foregoing.

“ Data Exclusivity ” means any data or market exclusivity granted to the Product in the Field in the Territory by any Regulatory Authority as of the Effective Date or at any time during the Term. *

“ Development ” or “ Develop ” means, with respect to the Product in the Field in the Territory, all research, all pre-clinical and clinical activities conducted relating to the Product for the CIC Indication, including without limitation, test method development and stability testing, toxicology, animal studies, formulation, process development, manufacturing scale-up, quality assurance/quality control development for Clinical Studies, statistical analysis and report writing, and Clinical Studies, including clinical trial design, operations, data collection and analysis and report writing, publication planning and support, risk assessment mitigation strategies, health economics outcomes research planning and support, clinical laboratory work, disposal of drugs and regulatory activities in connection therewith, the transfer of information, materials, Product regulatory documentation and other technology with respect to the foregoing, the preparation of Regulatory Filings, and obtaining and/ or maintaining Regulatory Approvals for the Product in the Field in the Territory (including regulatory affairs activities and preparation of meetings with Regulatory Authorities in the Territory). When used as a verb,

“Developing” means to engage in Development and “Developed” has a corresponding meaning.

“ Development Plan ” means a written rolling four (4) year plan for the Development of the Product in the Field in the Territory, as such plan may be amended or updated from time to time in accordance with Section 4.1.2.

“ Disclosing Party ” means the Party disclosing Confidential Information; provided a Party owning certain property as provided hereunder shall be considered the Disclosing Party and the other Party shall be considered the Receiving Party regardless of which Party discloses such information.

“ Disputed Matter ” has the meaning set forth in Section 3.1.5.

“ Distributor ” means any Third Party appointed by Abbott, its Affiliates or Sublicensees to distribute and sell in the Field in the Territory Product purchased from Abbott, its Affiliates or Sublicensees (regardless of whether such Third Party has the right or obligation to provide packaging or labeling services with respect to such Product) that: (i) is not required to make royalty or other similar payment to Abbott, its Affiliates or Sublicensees with respect to any Sucampo Patent Rights or Sucampo Background Technology related to the Product in the Field in the Territory; and (ii) has no right to distribute and sell such Product under its own Trademark.

“ Drug Approval Application ” means an application submitted to a Regulatory Authority for Regulatory Approval for the Product in the Field in the Territory, and all supplements and amendments that may be filed with respect to the foregoing.

“ Effective Date ” means the date first set forth in the preamble to this Agreement.

“ Field ” means the use of the Product for all prophylactic and therapeutic uses in animals and humans, in any formulation, dosage form, strength or delivery mode for the CIC Indication.

“ First Commercial Sale ” means the first bona fide commercial sale of the Product for use in the Field by Abbott, its Affiliates or Sublicensees to a Third Party in the Territory after all required applicable Regulatory Approvals have been granted.

“ Five Year Cumulative Sales Target ” means [*] JPY (JPY [*]) in cumulative Net Sales of Product in the Field in the Territory within the first sixty (60) months following the First Commercial Sale of the first Product, based on the assumptions listed in Exhibit I. The Five Year Cumulative Sales Target shall be adjusted upward or downward, as the case may be, by the Parties in the event any of the facts differ from the assumptions listed in Exhibit I.

“ Floor Transfer Price ” has the meaning set forth in Section 8.3.2.

“ Force Majeure ” has the meaning set forth in Section 15.10.

“ GAAP ” means generally accepted accounting principles recognized in the United States.

“ Generic Product ” means, with respect to a Product, a pharmaceutical product, other than a product that is developed, marketed or sold by a Party or its Affiliates or a Third Party authorized or licensed by such Party to Develop or Commercialize the Product, that contains the Compound.

“ Indemnification Claim Notice ” has the meaning set forth in Section 14.2.3.

“ Initial Period ” means the period commencing on the date of the First Commercial Sale and ending seventy-two (72) months later.

“ Infringement ” has the meaning set forth in Section 11.5.1.

“ Infringement Notice ” has the meaning set forth in Section 11.5.1.

“ Invoice Price ” means (i) for as long as Abbott pays the Transfer Price for Product, [*] percent ([*]%) of the NHI Price, and (ii) for as long as Abbott pays the Floor Transfer Price for Product, [*] percent ([*]%) of the NHI Price.

“ JCSC ” has the meaning set forth in Section 3.1.1(a).

“ JDC ” has the meaning set forth in Section 3.1.1(b).

“ JPY ” means Japanese yen.

“ Latent Defect ” means Product not conforming to Sucampo’s warranty for Product set forth in Section 9.1.2 and pursuant to Exhibit B such that (i) the related non-conformance of Product is not readily discoverable based on Abbott’s, its Affiliates’ or Sublicensees’ normal incoming-goods inspections, as the case may be and (ii) the related non-conformance was not caused by Abbott or Abbott’s Affiliates, Sublicensees or Distributors after receipt of such Product.

“ Losses ” has the meaning set forth in Section 14.1.

“ Market Withdrawal ” means a “market withdrawal” as such term is defined in the Notification of YAKUSHOKUSHINSAHATSU No. 0324002, March 24, 2006 (as amended from time to time, or such successor Applicable Law as may take effect in the Territory) of the Product.

“ Net Sales ” means, for any period, the total amount billed or invoiced on sales of Product in the Field in the Territory by Abbott, its Affiliates or Sublicensees to independent, unrelated Third Parties such as wholesalers, Distributors or end-users in bona fide arm’s length transactions, less the following deductions (specifically excluding any royalty payments made by Abbott or its Affiliates or Sublicensees to Sucampo), in each case related specifically to the Product and actually allowed and taken by such Third Parties and not otherwise recovered by or reimbursed to Abbott, its Affiliates or Sublicensees:

(i) trade, cash and quantity discounts (other than price discounts granted at the time of invoicing and already included in the gross amount invoiced);

(ii) price reductions or rebates, retroactive or otherwise, imposed by, negotiated with or otherwise paid to governmental authorities;

(iii) taxes on sales (such as Japanese consumption tax (“ JCT ”), value added taxes, sales or use taxes), but not including taxes assessed against the income derived from such sales;

(iv) freight, insurance and other transportation charges to the extent added to the sale price and set forth separately as such in the total amount invoiced, as well as any fees for services provided by wholesalers and warehousing chains related to the distribution of the Product that are treated as sales allowances under GAAP, provided that such fees are consistent with those charged across Abbott’s product line;

(v) amounts repaid or credited by reason of rejections, defects, one percent (1%) return credits, recalls or returns or because of retroactive price reductions, including, but not limited to, rebates or wholesaler charge backs; and

(vi) the portion of management fees paid during the relevant time period to group purchasing organizations and/or pharmaceutical benefit managers relating specifically to the finished Product that are treated as sales allowances under GAAP, provided that such fees are consistent with those charged across Abbott’s product line.

Where any reduction in the invoice price or deduction therefrom is based on sales of a bundle of products in which the Product for use in the Field in the Territory is included, the reduction in price or deduction therefrom would be allocated as actually credited unless such Product receives a higher than pro rata share of any reduction or deduction that the bundled set of products receives. In such case, the reduction or deduction therefrom shall be allocated to such Product on a no greater than a pro rata basis based on the sales value (i.e., the unit average selling price multiplied by the number of units) of such Product

relative to the sales value contributed by the other products in the bundle with respect to such sale.

Subject to the above, Net Sales shall be calculated in accordance with Abbott’s standard internal policies and procedures, which must be in accordance with GAAP. If consideration in addition to or in lieu of money is received for the sale of the Product in the Field in the Territory on an arm’s-length transaction, the fair market value of such consideration must be included in the determination of Net Sales for such a sale. Net Sales shall not include (i) sales, transfers or dispositions between or among Abbott, its Affiliates or Sublicensees, (ii) sampling for preclinical, clinical or regulatory purposes conducted by or on behalf of Abbott, its Affiliates or Sublicensees in connection with the Product in the Field in the Territory, (iii) destruction of the Product and (iv) sales, transfers or dispositions for legitimate charitable purposes at no charge.

All Net Sales will be calculated in JPY.

If Abbott, its Affiliates or Sublicensees appoint Distributors for the Product in the Field in the Territory, Net Sales will include the Net Sales invoiced by Abbott, its Affiliates or Sublicensees to such Distributors, but it will not include any sales of the Product in the Field in the Territory made by any such Distributors.

“ NHI ” means the Japan National Health Insurance Plan.

“ NHI Price ” means the NHI-approved price for the Product in the Field in the Territory.

“ Other Indication(s) ” means any indication for use of the Compound in the Territory other than the CIC Indication. Other Indication(s) shall include, but not be limited to, indications for constipation-predominant irritable bowel syndrome and opioid-induced bowel dysfunction.

“ Party ” means each of Abbott or Sucampo individually; Abbott and Sucampo are collectively referred to herein as “Parties”, as identified in the preamble to this Agreement.

“ Patent Defect ” means Product not conforming to Sucampo’s warranty for Product set forth in Section 9.1.2 and pursuant to Exhibit B such that the related non-conformance of Product may be readily discovered based on Abbott’s, its Affiliates’ or Sublicensees’ normal incoming-goods inspections procedures, as the case may be.

“ Patent Rights ” means the rights and interests in and to all Japanese patents and patent applications, including provisional applications, divisional applications, continuation applications, continuation-in-part applications, converted provisional applications, continued prosecution applications, utility models, petty patents design patents, certificate of inventions, extensions or restorations, including adjustments,

revalidations, reissues, re-examinations, patent term extensions, supplementary protection certificates, any similar rights, including so-called pipeline protection rights, introduction patents, registration patents and patents of addition of any foregoing patents and patent applications.

“ Person ” means 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 other entity or organization, in any case whether for-profit or not-for profit, and including, without limiting the generality of any of the foregoing, a government or political subdivision, department or agency of a government.

“ Pharmacovigilance Agreement ” has the meaning set forth in Section 6.4.

“ Phase I Study ” means a human clinical trial of a product containing the Compound, the principal purpose of which is a preliminary determination of safety or pharmacokinetics in healthy individuals or patients or similar clinical study prescribed by the Regulatory Authorities, from time to time, pursuant to Applicable Law or otherwise.

“ Phase II Study ” means, collectively, a Phase IIa Study and a Phase IIb Study.

“ Phase IIa Study ” means a human clinical trial of a product containing the Compound, the principal purpose of which is a demonstration of proof of concept in the target patient population or a similar clinical study prescribed by the Regulatory Authorities, from time to time, pursuant to Applicable Law or otherwise.

“ Phase IIb Study ” means a human clinical trial of a product containing the Compound, the principal purpose of which is to find the dose range in the target patient population or a similar clinical study prescribed by the Regulatory Authorities, from time to time, pursuant to Applicable Law or otherwise.

“ Phase III Study ” means a human clinical trial of a product containing the Compound on a sufficient number of subjects that is designated to establish that such product is safe and efficacious for its intended use, and to determine warnings, precautions, and adverse reactions that are associated with such product in the dosage range to be prescribed, which trial is intended to support marketing of such product, including all tests, studies, or a similar clinical study prescribed by the Regulatory Authorities, from time to time, pursuant to Applicable Law or otherwise.

“ Phase IV Study ” means a human clinical trial of a product containing the Compound that is not included in the original Drug Approval Application submission for the Product for an indication, including studies conducted to fulfill commitments made as a condition of the Regulatory Approval of the Drug Approval Application or any subsequent

human clinical trials requested, required or recommended by the Regulatory Authority(ies) in the Territory as a condition of maintaining such Regulatory Approval.

“ Post-Approval Marketing Studies ” means a human clinical trial or other test or study with respect to the Product for use in the Field, which test or study is conducted on a voluntary basis by a Party (rather than under a mandate from a Regulatory Authority in order to obtain or maintain Regulatory Approval for the Product in the Field) after the Drug Approval Application for the Product in the Field in the Territory has been approved by the Regulatory Authority in the Territory. Any human clinical study that is intended to expand the label for the Product for use in the Field in the Territory shall be a Clinical Study. Subject to the foregoing, Post-Approval Marketing Studies may include clinical studies conducted in support of pricing or reimbursement for the Product in the Field in the Territory, epidemiological studies, modeling and pharmacoeconomic studies, post-marketing studies, investigator sponsored studies, and health economic studies.

“ Pre-Clinical Data ” means data derived from a study to test the Compound for use in the Field, including, but not limited to, laboratory studies, toxicology, safety pharmacology, disease models and animal models.

“ Pricing Approval ” means any and all pricing or reimbursement approvals, licenses, registrations, or authorizations of any Regulatory Authority necessary to Commercialize, Promote, distribute, sell or market the Product in the Field in the Territory.

“ Product ” means any product (including any form or dosage form of a pharmaceutical composition or preparation) in finished form labeled and packaged for (i) sale, (ii) distribution, (iii) samples, or (iv) use in Clinical Studies, comprising the Compound (whether as sole active ingredient or in combination with one or more other active ingredients) for use in the Field in the Territory, including all future formulations, dosage forms and delivery modes. The term “Product” or “the Product” as used herein may be used to reference one or more than one
Product(s).

“ Product Labels and Inserts ” means (a) any display of written, printed or graphic matter upon the immediate container, outside container, wrapper or other packaging of the Product for use in the Field in the Territory or (b) any written, printed or graphic material on or within the package from which the Product for use in the Field in the Territory is to be dispensed.

“ Product Trademark ” means (i) the Trademark AMITIZA as well as derivatives thereof, (ii) the Trademarks listed on Exhibit C, (iii) in the event the Trademark AMITIZA or any other trademarks listed in Exhibit C have not been granted to Sucampo at least one (1) year prior to the date of the estimated launch of the Product in the Field in the Territory or the Regulatory Authorities in the Territory do not approve that the Product uses the Trademark AMITIZA or any other Trademarks listed in Exhibit C, then any other Trademarks relating to the Product for use in the Field in the Territory designated by JCSC

with Sucampo’s written consent, which shall not be unreasonably withheld, conditioned or denied and (iv) any current or future modifications or variances of the foregoing Trademarks, but excluding the Corporate Names.

“ Promote ” or “ Promotion ” means those activities normally undertaken by a pharmaceutical company’s sales force and marketing team to implement marketing plans and strategies aimed at encouraging the appropriate use of a particular prescription or other pharmaceutical product, including detailing. When used as a verb, “Promote” means to engage in such activities.

“ Promotional Materials ” means all written, printed or graphic material, other than Product Labels and Inserts, intended for use by representatives in Promoting the Product for use in the Field in the Territory, including visual aids, file cards, premium items, clinical study reports, reprints, drug information updates, and any other promotional support items.

“ Publication Policies ” has the meaning set forth in Section 10.3.2.

“ Quality Agreement ” means the agreement to be entered into between Abbott and Sucampo, under which the Parties shall address Product quality issues to assure the Product is manufactured and packaged according to all Applicable Laws in the Territory.

“ Quarterly Reconciliation ” has the meaning set forth in Section 8.3.4.

“ Recall ” means a “recall” as such term is defined in the Notification of YAKUSHOKUHATSU No. 0331021, March 31, 2005 (as amended from time to time, or such successor Applicable Law as may take effect in the Territory) of the Product for use in the Field.

“ Receiving Party ” means the Party receiving Confidential Information; provided that a Party owning certain property as provided hereunder shall be considered the Disclosing Party and the other Party shall be considered the Receiving Party regardless of which Party discloses such information.

“ Regulatory Approval ” means any and all approvals, licenses (including product and establishment licenses), registrations, or authorizations of any Regulatory Authority necessary to Develop, manufacture, Commercialize, Promote, distribute, transport, store, use, sell or market the Product for use in the Field in the Territory, including all CTNs, Drug Approval Applications and the manufacturing license and marketing registration required under the Drug Approval and Licensing Procedures in Japan 2008, or any update thereto, and Pricing Approvals, or pre- and Post-Approval Marketing Studies, labeling approvals, technical, medical and scientific licenses.

“ Regulatory Authority ” means any national, supra-national, regional, federal, state, provincial or local regulatory agency, department, bureau, commission, council or other governmental entity (including, without limitation, the Minister of Health, Labour and Welfare of Japan, the National Health Insurance Plan, and any prefecture having jurisdiction over the manufacture of the Product in the Field in the Territory) regulating or otherwise exercising authority over the distribution, manufacture, use, storage, transport, clinical testing or sale of the Product.

“ Regulatory Filings ” means, with respect to the Product in the Field in the Territory, all applications, registrations, licenses, authorizations and approvals (including all Regulatory Approvals), all correspondence submitted to or received from the Regulatory Authorities (including minutes and official contract reports relating to any communications with any Regulatory Authority) and all supporting documents and all Pre-Clinical Data, Clinical Data and CMC Data (including all Clinical Studies and Post-Approval Marketing Studies, and all data contained in any of the foregoing, including all CTNs, Drug Approval Applications, Adverse Event files and complaint files.

“ Remaining Period ” means the period commencing on the day immediately following the last day of the Initial Period and ending on the last day of the Term.

“ Rolling Forecast ” has the meaning set forth in Section 9.1.5(a).

“ SKU(s) ” means Stock Keeping Unit(s) and are the smallest unit of measure to identify manufacturing and distribution of the Product.

“ Specifications ” means the processes, methods, formulae, analyses, instructions, standards, know-how, testing and control procedures, information and specifications relating to the manufacture of the Product in the Field in the Territory as reflected in the relevant formulae edition and Regulatory Approvals.

“ Sublicensee ” means any Person (other than an Abbott Affiliate) to whom Abbott sublicenses any rights as permitted by Section 2.1.2.

“ Sucampo ” means Sucampo Pharma, Ltd., as identified in the preamble to this Agreement.

“ Sucampo Background Technology ” means any Technology Controlled by Sucampo or its Affiliates, as of the Effective Date or at any time during the Term, that is useful or necessary for Developing, Promoting or Commercializing the Product in the Field in the Territory.

“ Sucampo Indemnitee(s) ” has the meaning set forth in Section 14.1.

“ Sucampo Patent Rights ” means any Patent Rights that are Controlled by Sucampo or its Affiliates, as of the Effective Date or at any time during the Term, including patents applied for and issued after the Effective Date, and that would otherwise be infringed, absent a license, by the Development, Promotion or Commercialization of the Product in the Field in the Territory. Sucampo Patent Rights include the patents and patent applications set forth in Exhibit D, which may be amended from time-to-time by Sucampo to add additional patents and patent applications.

“ Technology ” means, collectively, proprietary information, know-how and data, technical or non-technical, trade secrets, materials (including tangible chemical, biological or other physical materials) or inventions, discoveries, improvements, processes, methods of use, methods of manufacturing and analysis, compositions of matter, or designs, whether or not patentable.

“ Term ” has the meaning set forth in Section 12.1.

“ Territory ” means Japan.

“ Third Party ” means any Person other than Abbott and Sucampo and their respective Affiliates or Sublicensees.

“ Third Party Claim(s) ” has the meaning set forth in Section 14.1.

“ Third Party Royalties ” means all fees, milestones, royalties and other payments payable to a Third Party in consideration for intellectual property rights necessary or useful for the Development, manufacturing, Commercialization or Promotion of a Compound or a Product.

“ Trademark ” means (a) any trademark, trade dress, brand mark, service mark, brand name, logo or business symbol, Internet domain name and e-mail address, whether or not registered, or any application, renewal, extension or modification thereto, and (b) all goodwill associated therewith.

“ Transfer Price ” has the meaning set forth in Section 8.3.1.

ARTICLE 2
LICENSE GRANTS; EXCLUSIVITY

2.1 Development and Commercialization Licenses

2.1.1 Sucampo Grants . Subject to the terms and conditions of this Agreement, during the Term, Sucampo hereby grants to Abbott and its Affiliates, and

Abbott hereby accepts, on behalf of itself and its Affiliates, under the Sucampo Patent Rights, the Sucampo Background Technology and the Data Exclusivity:

(a) a non-exclusive right and license, with the right to grant sublicenses to multiple tiers of Sublicensees subject to Section 2.1.2, to Develop, to the extent expressly agreed to by the Parties in the JDC, the Product anywhere in the world in support of obtaining Regulatory Approval for the Product in the Field in the Territory;

(b) an exclusive, even as to Sucampo and its Affiliates (except as otherwise provided in ARTICLE 7 with respect to Promotion of the Product in the Field in the Territory by Sucampo and its Affiliates), right and license, with the right to grant sublicenses to multiple tiers of Sublicensees subject to Section 2.1.2, to Promote and Commercialize the Product in the Field in the Territory; and

(c) an exclusive, except as to Sucampo and its Affiliates, license and right of reference under the Regulatory Filings, with the right to grant sublicenses and further rights of reference to multiple tiers of Sublicensees subject to Section 2.1.2, to use and reference in Regulatory Filings in the Territory any data Controlled by Sucampo or its Affiliates necessary to support Regulatory Filings for Regulatory Approval of the Product in the Field in the Territory, including, but not limited to, all Pre-Clinical Data, Clinical Data and CMC Data regarding the Product Controlled by Sucampo or its Affiliates generated at any time inside or outside the Territory, without any additional compensation from Abbott to Sucampo.

2.1.2 Right to Sublicense . Subject to and in accordance with the terms and conditions of this Agreement, Abbott and its Affiliates shall have the right to grant sublicenses or further rights of reference under the licenses and rights of reference granted by Sucampo under Section 2.1.1 to any Person (each, a “ Sublicensee ”) provided that (a) Abbott or its Affiliates enter into a written sublicense agreement with each such Sublicensee that is consistent in all material terms with this Agreement, (b) Abbott and its Affiliates shall not be relieved of its obligations pursuant to this Agreement as a result of such sublicense, except to the extent they are satisfactorily performed by the Sublicensee, (c) the Sublicensee shall expressly agree in writing to be bound by the terms of this Agreement, to the extent applicable, and (d) Sucampo shall have the right to approve any such Sublicensee, such approval not to be unreasonably withheld, conditioned or delayed. If Sucampo fails to respond to Abbott or one of its Affiliates’ request for approval within fifteen (15) Business Days, then it shall be deemed to have consented to the sublicense.

2.1.3 License to Product Trademarks . Subject to and in accordance with the terms and conditions of this Agreement, during the Term (except to the extent extended pursuant to Section 11.4), Sucampo, on behalf of itself or its Affiliates, hereby grants to Abbott and its Affiliates, and Abbott hereby accepts, an exclusive, except as to Sucampo and its Affiliates, royalty-free license, with the right to sublicense to multiple tiers of Sublicensees, to use the Product Trademarks in the Territory in connection with the performance by Abbott of its Development and Commercialization obligations with

respect to the Product in the Territory. In furtherance of the foregoing license, Sucampo hereby covenants and agrees that, during the Term, without Abbott’s prior written consent, Sucampo shall not use, and shall cause its Affiliates and sublicensees not to use the Product Trademarks or any other Trademarks confusingly similar to the Product Trademarks in connection with the Other Indications in the Territory.

2.1.4 Covenant Not to Sue. In the event the using, offering for sale or selling by Abbott, its Affiliates or Sublicensees of Product in the Field, would infringe in the Territory, during the Term, a claim of an issued patent which is Controlled by Sucampo or its Affiliates and which issued patent is not covered by the grant in Section 2.1.1, Sucampo hereby covenants not to sue Abbott, its Affiliates, Sublicensees or Distributors under such patent solely for Abbott, its Affiliates, Sublicensees or Distributors to develop, use, sell, offer for sale or import Product in the Territory, to the extent that Sucampo has the authority to grant such a covenant not to sue as to any such patent(s). Notwithstanding any other provisions of this Agreement, if Sucampo’s authority to grant, or cause its Affiliates to grant, such a covenant not to sue on any such issued patents is subject to any Third Party restrictions and: (a) if a Third Party Royalty would be owed to a Third Party for any grant of rights to such issued patent that would otherwise be covered under this Section, and (b) Sucampo or its Affiliates have the ability to grant a sublicense to such issued patent then: (i) Sucampo or its Affiliates shall not grant Abbott a covenant not to sue such issued patent and (ii) at Abbott’s option, Sucampo and Abbott shall enter into a sublicense for such issued patent and (iii) Sucampo shall be responsible for all payments and other obligations to such Third Party that are required under the sublicense for such issued patent.

2.1.5 Development of Intellectual Property . In the event that a Party or its Affiliates develop any intellectual property covering the Product, such Party or its Affiliates shall own such intellectual property, shall be free to use such intellectual property without regard to, or accounting to, the other Party except as otherwise provided herein, and the other Party and its Affiliates shall have a royalty-free, perpetual license to use such intellectual property solely with respect to the Product for use in the Field in the Territory. Publication or presentation of a manuscript related to intellectual property developed under this Section 2.1.5 shall be governed by Section 3.1.3(b)(viii) and Section 10.3.2. In the case that Abbott, Sucampo or their respective Affiliates develop any intellectual property covering the Product, Abbott or Sucampo, as applicable, for itself and its Affiliates, shall notify the other Party of its intent to use such intellectual property.

2.1.6 Joint Development . In the event that the Parties jointly develop any intellectual property covering the Product, the Parties shall jointly own such jointly developed intellectual property and each Party shall be free to use such jointly developed intellectual property without regard to, or accounting to, the other Party, except as otherwise provided herein. Both Parties shall cooperate with each other in any filings or assignments necessary to give effect to this Section 2.1.6 or to seek protection for the jointly developed intellectual property. Each Party shall submit any proposed manuscript for publication, presentation or securing Patent Rights related to the jointly developed

intellectual property to the JDC at least sixty (60) days before submission, and each Party shall have the right to review and comment on the manuscript. Upon a Party’s request, the publication of a manuscript or the presentation will be delayed up to sixty (60) additional days to enable the non-requesting Party to either secure adequate intellectual property protection that would be affected by the publication or presentation or amend any existing manuscript.

2.1.7 Product Diversion . To the extent permitted by Applicable Law, Sucampo shall not, and shall cause its Affiliates and sublicensees not to, knowingly or intentionally sell the Product in the Field into the Territory and should Sucampo become aware of any such Product diversion, it shall use Commercially Reasonable Efforts to stop the diversion. To the extent permitted by Applicable Law, Abbott or its Affiliates shall include in agreements with Sublicensees that sell Product in the Field covenants from such Sublicensees to not knowingly or intentionally sell, the Product outside of the Territory or outside the Field. Should Abbott become aware of any such Product diversion, it shall use Commercially Reasonable Efforts to stop the diversion.

ARTICLE 3
ADMINISTRATION OF THE COLLABORATION

3.1 Committees

3.1.1 Committees’ Establishment . Within thirty (30) days of the Effective Date, Sucampo and Abbott shall establish the following committees (the “ Committees ”):

(a) a Joint Commercialization and Steering Committee (“ JCSC ”) with responsibility for overseeing Commercialization-related activities with respect to the Product in the Field in the Territory, and managing the collaboration and resolving any conflicts and overseeing the JDC.

(b) a Joint Development Committee (“ JDC ”) with responsibility for overseeing Development-related activities with respect to the Product in the Field in the Territory, including, without limitation, the regulatory approach and filing strategy designed to generate the successful submission and approval of the Product in the Field in the Territory.

Within sixty (60) days of the establishment of the foregoing Committees, the Committees shall meet to prepare such procedures and mechanisms as may be reasonably necessary for their operation to assure the most efficient conduct of each Party’s obligations under this Agreement.

3.1.2 JCSC

(a) Membership . Sucampo and Abbott shall each designate three (3) of its employees or consultants or its Affiliates’ employees or consultants to serve as members of the JCSC (or such other equal number of representatives as the Parties may agree). The initial members of the JCSC are set forth on Exhibit E. Each representative of the JCSC shall have the requisite experience and seniority to make decisions on behalf of the Parties with respect to issues falling within the jurisdiction of the JCSC. The chairperson shall serve for a term of one (1) year, beginning on the Effective Date or an anniversary thereof, as the case may be. The right to name the chairperson of the JCSC shall alternate between the Parties. The initial chairperson shall be selected by Abbott and is set forth on Exhibit E. Each Party shall have the right at any time to substitute individuals, on a permanent or temporary basis, for any of its previously designated representatives to the JCSC by giving written notice to the other Party; provided such substitute meets the criteria defined herein. Neither Party shall have the right to remove a sitting member of the other Party.

(b) Responsibilities. The JCSC shall have the responsibilities set forth in Section 3.1.1(a), including to:

(i) Review the Commercialization Plan, including any material updates, amendments, modifications, and waivers of provisions thereof;

(ii) Review and evaluate progress under the Commercialization Plan;

(iii) Discuss strategies for Commercialization of the Product in the Field in the Territory;

(iv) Review the activities and monitor the progress of the JDC;

(v) Resolve any issues, including, but not limited to, Disputed Matters referred to the JCSC by the JDC; and

(vi) Perform such other functions as the Parties may mutually agree in writing, except where in conflict with any provision of this Agreement.

3.1.3 JDC

(a) Membership. Sucampo and Abbott shall each designate three (3) of its employees or consultants or its Affiliates’ employees or consultants to serve as members of the JDC (or such other equal number of representatives as the Parties may agree). Each Party shall designate to be a member of the JDC at least one (1) representative from its regulatory department and one (1) representative from its clinical development department. The initial members of the JDC are set forth on Exhibit E. Each representative of the JDC shall have the requisite experience and seniority to make

decisions on behalf of the Parties with respect to issues falling within the jurisdiction of the JDC. The chairperson shall serve for a term of one (1) year beginning on the Effective Date or an anniversary thereof, as the case may be. The right to name the chairperson of the JDC shall alternate between the Parties. The initial chairperson shall be selected by Sucampo and is set forth in Exhibit E. Each Party shall have the right at any time to substitute individuals, on a permanent or temporary basis, for any of its previously designated representatives to the JDC by giving written notice to the other Party; provided such substitute meets the criteria defined herein. Neither Party shall have the right to remove a sitting member of the other Party.

(b) Responsibilities . The JDC shall have the responsibilities set forth in Section 3.1.1(b), including to:

(i) Review the Development Plan, including all material updates, amendments, modifications, and waivers of provisions thereof;

(ii) Review and evaluate progress under the Development Plan;

(iii) Review the statistical analysis plans and protocols for all pre-clinical and Clinical Studies prepared in support of obtaining or maintaining Regulatory Approvals for the Product in the Field in the Territory;

(iv) Unless otherwise agreed by the Parties, review all proposed initial submissions to Regulatory Authorities anywhere in the world;

(v) Unless otherwise agreed by the Parties, review the submission of all draft and final Product Labels and Inserts for the Product in the Field in the Territory and any material changes thereto;

(vi) Monitor the progress of all Clinical Studies and other Development activities in the Field anywhere in the world;

(vii) Assess the potential impact of Clinical Studies conducted anywhere in the world on Product Labels and Inserts for the Product in the Field in the Territory;

(viii) Review all proposed publications or presentations related to the Product pursuant to Clinical Studies that is based on (a) data developed by Sucampo and its Affiliates or any Third Party, or (b) any jointly developed intellectual property under Section 2.1.5 within sixty (60) days of such request being made, except as otherwise provided herein; and

(ix) Perform such other Development functions as the Parties may mutually agree in writing, except where in conflict with any provision of this Agreement.

3.1.4 Committee Meetings . Each Committee shall establish a schedule of times for regular meetings and shall meet at least once per calendar quarter. Meetings may be held in person, by telephone or videoconference, provided that at least one meeting per Calendar Year shall be held in person. Such in-person meeting shall alternate between the respective offices of Abbott and Sucampo or such other locations mutually agreed upon by the Committees. The chairperson of each Committee shall prepare and circulate to each Committee member an agenda for each Committee meeting reasonably in advance of each meeting. At each Committee meeting, the presence of at least one (1) member designated by each Party shall constitute a quorum. The Committees shall keep minutes of their meetings that record all decisions and all actions recommended or taken in reasonable detail. The chairperson of each Committee shall circulate a draft of the minutes no later than five (5) Business Days after each meeting and each member of the Committee shall have the opportunity to comment on the draft minutes. The minutes shall be approved, disapproved or revised as necessary within thirty (30) days of each meeting; provided, however, that if the Parties cannot agree as to the content of the minutes, such minutes will be finalized to reflect such disagreement. The chairperson of each Committee shall circulate final minutes of each meeting to each Committee member.

3.1.5 Decision-Making . Except as otherwise provided herein, decisions of each Committee shall be made by consensus. Each Committee shall use reasonable efforts to reach agreement on any and all matters for which it is responsible. In the event that, despite such reasonable efforts, agreement on a particular matter cannot be reached by a Committee within fifteen (15) Business Days after the Committee first meets to consider such matter (each such matter, a “ Disputed Matter ”), then the following procedure shall apply:

(a) JDC Disputed Matters . Disputed Matters arising from the JDC shall be referred for resolution to the JCSC. The JCSC shall initiate discussions in good faith to resolve each Disputed Matter within ten (10) Business Days of receipt of the notice of such Disputed Matter. In the event that the JCSC does not reach agreement on such Disputed Matter within fifteen (15) Business Days from the date of initiation of such discussions, such Disputed Matter shall be referred to senior management for resolution in accordance with Section 3.1.5(c).

(b) JCSC Disputed Matters . Disputed Matters first arising in the JCSC shall be referred to senior management for resolution in accordance with Section 3.1.5(c).

(c) Management Negotiations . In the event that the JCSC cannot resolve a Disputed Matter, either Party may, by written notice to the other, refer such Disputed Matter to the Parties’ respective senior management for good faith

negotiations. In the event that, despite good faith efforts, resolution of such Disputed Matter cannot be reached by senior management of the Parties within fifteen (15) Business Days of its referral:

(i) with respect to any Disputed Matter that relates to the Commercialization of the Product in the Field in the Territory, Abbott shall have final decision-making authority; and

(ii) with respect to any Disputed Matter that relates to Development of the Product, the final decision-making authority shall rest with Sucampo, unless the Disputed Matter relates to the conduct of Post-Approval Marketing Studies by Abbott under Section 4.3.1, in which case Abbott shall have final decision-making authority.

3.2 Limitations on Authority . Each Party shall retain the rights, powers, and discretion granted to it under this Agreement, and no such rights, powers, or discretion shall be delegated to or vested in a Committee unless such delegation or vesting of rights is expressly provided for in this Agreement, or the Parties expressly so agree in writing. Neither Committee shall have the authority to make any determination that a Party is in breach of this Agreement, or that a Party has engaged or not engaged in acts related to breach. Neither Committee shall have the power to amend, modify or waive compliance with this Agreement, which may only be amended or modified, or compliance with which may only be waived, as provided in Section 15.5.

3.3 Interactions Between a Committee and Internal Teams . The Parties recognize that each Party possesses an internal structure (including various committees, teams and review boards) that will be involved in administering such Party’s activities under this Agreement. Nothing contained in this Article shall prevent a Party from making routine day-to-day decisions relating to the conduct of those activities for which it has a performance or other obligation hereunder, provided that such decisions are consistent with the then-current Commercialization Plan or Development Plan, as applicable, and the terms and conditions of this Agreement.

3.4 Expenses . Each Party shall be responsible for all travel and related costs and expenses for its members and other representatives to attend meetings of, and otherwise participate on, a Committee.

3.5 Purpose of the Committees . The Parties acknowledge and agree that the Committees are strictly for the purposes of decision-making and governance of the Agreement.

3.6 Communication . With regard to the Parties’ entire relationship, the Parties shall cooperate and provide support in connection with each other’s reasonable requests and shall promptly respond to each other’s communications.

ARTICLE 4
DEVELOPMENT

4.1 Development Plan

4.1.1 Initial Plan . The Development of the Product for use in the Field in the Territory shall be governed by a comprehensive, multi-year plan detailing (i) the Development program (including pharmacokinetics studies) to be conducted by Sucampo on an activity-by-activity basis, and (ii) the regulatory strategy for obtaining Regulatory Approval for the Product in the Field in the Territory, which Development program is designed to generate all the Clinical Data and regulatory information required to obtain the Regulatory Approval required for Abbott to be able to Commercialize the Product in the Field in the Territory (the “ Development Plan ”). Within thirty (30) days following the Effective Date, Sucampo shall prepare and provide to the JDC a proposed Development Plan for its review in accordance with the provisions of ARTICLE 3.

4.1.2 Amendments . Commencing in the first full Calendar Year after the Effective Date and continuing for so long as Development activities are being performed by or on behalf of Sucampo, Sucampo shall prepare and submit no later than January 31 ^st of each Calendar Year for review by the JDC appropriate amendments and updates to the Development Plan.

4.2 Responsibilities . Sucampo shall be solely responsible for conducting all Development activities set forth in the Development Plan.

4.3 Development Activities

4.3.1 Sucampo Responsibilities . Sucampo shall use Commercially Reasonable Efforts to Develop the Product in the Field in the Territory, including the activities in the Development Plan and in this Section 4.3.1. Sucampo shall be solely responsible for funding and completing all Clinical Studies required to obtain and maintain Regulatory Approval in the Territory in the Field. Sucampo shall be responsible for all the other Development activities contemplated by the Development Plan and shall bear all Development costs required for registration for the CIC Indication of the Product in the Territory. If the Ministry of Health, Labor and Welfare (MHLW), the Pharmaceuticals and Medical Devices Agency (PMDA) or any other Regulatory Authority in the Territory requires or recommends any Phase IV Clinical Studies as a condition to obtaining the Regulatory Approval for the Product in the Field in the Territory or maintaining such Regulatory Approval, Sucampo shall fund, conduct and direct all such Phase IV Clinical Studies.

4.3.2 Other Post-Approval Marketing Studies . Abbott shall fund, conduct and direct any Post-Approval Marketing Studies determined by the JCSC provided that such Post-Approval Marketing Studies shall not negatively impact Sucampo’s marketing of the Product outside of the Territory.

4.3.3 Other Development Activities . In the event the JDC identifies an opportunity to expand and optimize the Compound in the Field in the Territory such as expanding the label for the Product for use in the Field in the Territory, Sucampo shall be responsible for the related Development costs (including any Clinical Studies required to expand the label of the Product for use in the Field in the Territory) of pursing any such opportunities for the first six (6) years following Regulatory Approval. Thereafter, in the event JDC identifies an opportunity to expand and optimize the Compound in the Field in the Territory and the Parties decide to pursue such opportunity, the Parties shall then agree on an allocation of the Development costs and activities between Sucampo and Abbott.

4.4 Conduct of Development

4.4.1 Compliance . Sucampo shall perform its obligations under the Development Plan and all other Development activities required for registration for the CIC Indication of the Product in the Territory in good scientific manner and in material compliance with Applicable Law.

4.4.2 Cooperation . The Parties shall reasonably cooperate through the JDC in the performance of the Development Plan.

4.4.3 Phase III Study Results . Sucampo shall provide Abbott with a copy of the Phase III Study report within ten (10) Business Days after such Phase III Study report has been completed. Within thirty (30) days after Abbott’s receipt of such Phase III Study report and any reasonable documentation in support of such Phase III Study report, that Abbott may request, Abbott shall notify in writing Sucampo whether or not the Phase III Study results are acceptable to Abbott and until Sucampo has received such notification, Sucampo shall restrain from filing the Drug Approval Application. In the event the Phase III Study results do not have a favorable outcome for both Parties, both Parties shall discuss in good faith the results. If the outcome of the discussion is not acceptable to Abbott, Abbott shall have the right to terminate this Agreement and the provisions of Section 12.3 shall apply.

4.5 Records . Sucampo shall maintain records of its Development activities under the Development Plan in sufficient detail, in good scientific manner and otherwise in a manner that reflects all work done and results achieved in the performance of the Development Plan. Sucampo shall retain such records for at least five (5) years after the expiration or termination of this Agreement, or for such longer period as may be required by Applicable Law or agreed to in writing by the Parties. Subject to ARTICLE 10, Sucampo shall provide Abbott, upon reasonable request, a copy of such records to the extent reasonably required for the performance of the requesting Party’s obligations and exercise of its rights under this Agreement. Each Party agrees to maintain a policy that requires its employees and consultants to record and maintain Technology developed during the Development Plan in accordance with generally accepted practice in the industry.

ARTICLE 5
DEVELOPMENT AND COMMERCIALIZATION OF OTHER INDICATIONS

5.1 Reporting . From time to time during the Term, Sucampo and its Affiliates may seek to develop Other Indication(s). Sucampo shall provide Abbott with notice of such Other Indication(s) within [*] ([*]) Business Days after the [*]. The notice shall include such information with regard to such Other Indication(s) as Sucampo and its Affiliates reasonably determines is necessary to permit Abbott and its Affiliates to evaluate the Other Indication(s) and its/their potential marketability for purposes of determining whether to exercise the option described in Section 5.2. Sucampo shall promptly provide any additional information requested by Abbott.

5.2 Abbott Right of First Refusal for Other Indications . Abbott shall have [*] ([*]) days from the date of the notice referred to in Section 5.1 to provide a written response as to whether it wishes to participate in negotiations with Sucampo with respect to such Other Indication(s) opportunity, provided that Abbott agrees that, if it determines not to participate in such negotiations prior to the end of such period, it shall in good faith provide written notice to Sucampo promptly upon such determination. If Abbott’s response indicating whether or not it wishes to participate in negotiations with respect to such Other Indication(s) opportunity is not delivered to Sucampo within the [*] ([*]) day response period, Abbott shall no longer have the right to exercise such Other Indication(s) opportunity. If Abbott indicates in its response delivered within such [*] ([*]) day period that it wishes to participate in negotiations with Sucampo with respect to such Other Indication(s) opportunity, the Parties shall then negotiate in good faith for a period of [*] ([*]) days after Abbott’s receipt of such notice. If basic terms and conditions of such license agreement have not been agreed upon by the Parties within the foregoing period, Sucampo shall be entitled to negotiate with Third Parties for the development and commercialization of such Other Indication(s) from any Third Party. If Sucampo receives a bona fide offer to develop and/or commercialize any such Other Indication(s) from any Third Party, Sucampo shall present the material terms of such offer to Abbott in writing. Abbott shall have [*] ([*]) days after receipt of the offer to meet the offer’s material terms on consideration and if Abbott does so, Abbott shall then have the right to develop and commercialize the Product for such Other Indication(s). Sucampo hereby covenants and agrees that in the event Sucampo grants a license to develop and/or commercialize Other Indication(s) in the Territory to a Third Party, Sucampo shall coordinate and consult with Abbott and such Third Party with respect to all regulatory matters related to the Other Indication(s) in the Territory.

ARTICLE 6
REGULATORY

6.1 Regulatory Filings; Regulatory Approvals

6.1.1 Ownership . Unless prohibited by Applicable Law, Sucampo shall own all Regulatory Filings.

6.1.2 Regulatory Strategy; Preparation of Regulatory Filings; Communications .

(a) Development of Regulatory Strategy . The Parties shall reasonably cooperate and consult with each other, through the JDC, in good faith, to develop strategies for all Regulatory Filings in the Field in the Territory for the Compounds and the Product, and from time to time update the Development Plan as appropriate to reflect such developed strategies.

(b) Preparation of Regulatory Filings; Review of Regulatory Filings . Sucampo shall be responsible for, and possess all rights with respect to: (i) implementing the regulatory strategy for Clinical Studies (other than Post-Approval Marketing Studies) (including interactions with Regulatory Authorities); (ii) preparing and submitting all Regulatory Filings in the Territory in the Field (provided that the Parties shall reasonably cooperate with each other regarding such preparation and submission); and (iii) other public disclosure and confidentiality provisions in this Agreement notwithstanding, obtaining, referencing and using all Regulatory Filings, Pre-clinical Data, Clinical Data and CMC Data for the Product (including but not limited to countries outside the Territory) for use in the Territory in connection with the Regulatory Filings, without any additional compensation from Abbott to Sucampo. At Abbott’s request, Sucampo shall provide Abbott with (a) copies of such Regulatory Filings in the Territory in the Field, Pre-clinical Data, Clinical Data and CMC Data within thirty (30) days, and (b) with other related information as soon as practicable.

(c) Communications; Regulatory Meetings . After the Regulatory Authorities in the Territory have approved the Drug Approval Application, Abbott shall cooperate, at Abbott’s expense, with Sucampo’s reasonable requests relating to, and provide support in responding to, communications from Regulatory Authorities in the Territory related to the Product in the Field, including providing comments on Sucampo’s submissions’ and responses within ten (10) Business Days from the time of receipt or sooner if required by such Regulatory Authorities.

(d) Occurrences or Information Arising out of Sucampo Manufacturing Activities . During the Term, Sucampo will advise Abbott, without undue delay following, and in any event within a period not to exceed seven (7) Business Days of, any occurrences or information arising out of Sucampo’s manufacturing activities that have or could reasonably be expected to have adverse regulatory compliance and/or reporting consequences concerning the Product in the Field in the Territory, including actual or threatened Regulatory Authorization withdrawals or labeling changes in the Field in the Territory.

(e) Regulatory Authority Inspections . During the Term, Sucampo will be responsible for handling and responding to any Regulatory Authority inspections with respect to Sucampo’s manufacture of the Product. Sucampo will provide to Abbott any information reasonably requested by Abbott and all significant information requested by any Regulatory Authority in the Territory concerning any governmental inspection related to the Product, and will allow Regulatory Authorities in the Territory to conduct reasonable inspections upon the request of such Regulatory Authority.

(f) Violations or Deficiencies Relating to the Product . In the event Sucampo is inspected by any Regulatory Authority in the Territory, Sucampo will notify Abbott without undue delay, and in any event within a period not to exceed seven (7) Business Days, of any written alleged violations or deficiencies relating to the Product, and any proposed corrective actions to be taken. Sucampo will as expeditiously as practicable take any such corrective action required to comply with the provisions of this Agreement and Applicable Law. Prior to submission of any written response submitted to any applicable Regulatory Authority in the Territory, to the extent reasonably practicable, Abbott may review and comment on any portion of the response regarding written alleged violations or deficiencies relating to the Product; provided that Sucampo shall have final say regarding and the content of any submission to a such Regulatory Authority.

(g) NHI Price Decisions . For the initial approval of the NHI Price of the Product, Abbott shall have sole approval authority as between the Parties, provided that the initial price proposed by the NHI is equal to or above [*] JPY (JPY [*]) per capsule. In the event the initial NHI Price is below [*] JPY (JPY [*]) per capsule or becomes below [*] JPY (JPY [*]) per capsule by revision of NHI price and not commercially viable for Sucampo or Abbott, then the Parties shall meet and hold good faith discussions to determine an appropriate NHI Price strategy or alternative commercial terms for the Agreement.

6.2 Product Labels and Inserts; Core Data Sheets . Sucampo shall own and be responsible for the manufacturing of all Product Labels and Inserts and Core Data Sheets for the Product in the Field in the Territory. Abbott shall provide the artwork for the Product Labels and Inserts, subject to Sucampo’s written consent, which shall not be unreasonably withheld, conditioned or denied.

6.3 Pharmacovigilance Administration . For so long as Sucampo holds the Regulatory Approvals for the Product in the Field in the Territory, Sucampo shall be solely responsible and shall bear all costs of pharmacovigilance administration of Product in the Territory in accordance with the Development Plan and the Pharmacovigilance Agreement, including without limitation, any post-marketing Clinical Studies obligations (PMS) and any obligations to submit periodic safety updated reports (PSUR) to the Regulatory Authorities in the Territory. Sucampo shall ensure that it, its Affiliates, or its licensees provide Abbott with all information and data required to allow Abbott to comply with its regulatory obligations.

6.4 Adverse Event Reports . Sucampo shall be responsible for investigating Adverse Events and other required safety information associated with the use of the Product in the Field in the Territory. Sucampo shall be responsible for the collection, review, assessment, tracking and filing of information related to Adverse Events, and Sucampo will cooperate and provide or cause Third Parties, as appropriate, to provide such information to Abbott with respect thereto. Within ninety (90) days after the Effective Date, the Parties shall enter into an agreement to initiate a process for the exchange of Adverse Event safety data in a mutually agreed format, including, but not limited to, post-marketing spontaneous reports received by a Party or its Affiliates, sublicensees or Distributors in order to monitor the safety of the Product, and to meet reporting requirements with any applicable Regulatory Authority (“ Pharmacovigilance Agreement ”).

6.5 Recalls and Market Withdrawals

6.5.1 Notification . Each Party shall make every reasonable effort to notify the other Party promptly (but in no event later than forty-eight (48) hours) upon its determination that any event, incident or circumstance has occurred that may result in the need for a Recall or Market Withdrawal of the Product in the Territory, and include in such notice the reasoning behind such determination and any supporting facts.

6.5.2 Initiation . Both Parties shall jointly determine whether to voluntarily implement any Recall and upon what terms and conditions the Product shall be subject to a Recall in the Territory. Both Parties shall jointly determine whether to voluntarily implement a Market Withdrawal in the Territory and upon what terms and conditions the Product shall be subject to a Market Withdrawal or otherwise temporarily or on a limited basis withdrawn from sale in the Territory. In the event Sucampo and Abbott are unable to agree whether or not to voluntary implement a Recall or Market Withdrawal of the Product in the Territory, notwithstanding anything herein to the contrary, Sucampo shall make the final determination but Abbott shall have the right to immediately terminate this Agreement if it disagrees with Sucampo’s determination. If a Recall is mandated by a Regulatory Authority, Sucampo shall initiate such a Recall to be in compliance with Applicable Law. In the event of any voluntary Recall, Market Withdrawal or other withdrawal of the Product in the Territory, Abbott shall provide, and cause its Affiliates and Sublicensees to provide as necessary, any and all assistance and support reasonably required by Applicable Law, or reasonably requested by Sucampo.

6.5.3 Responsibility . In the event of a Recall or Market Withdrawal of the Product or any lot(s) thereof, Sucampo shall bear all costs and expenses of such Recall or Market Withdrawal, including expenses and other costs or obligations of Third Parties, the cost and expense of notifying customers and the costs and expenses associated with the Market Withdrawal or Recall of the Product and the cost and expenses of destroying the Product recalled from the market, if necessary, unless such Recall or Market Withdrawal was caused by the Commercialization of the Product by Abbott in the Field in the

Territory, in which case Abbott shall pay for all costs and expenses of such Market Withdrawal to the extent the Recall or Market Withdrawal was caused by Abbott.

6.6 Complaints . Each Party shall refer to the other Party complaints that it receives concerning the Product in the Territory within forty-eight (48) hours of its receipt of the same; provided that all complaints concerning suspected or actual Product tampering, contamination or mix-up (e.g. wrong ingredients) shall be delivered within twenty-four (24) hours of receipt of the same. Although Sucampo shall be responsible for investigating complaints and taking corrective action as necessary, Abbott shall provide all reasonable efforts and collaboration with Sucampo in the resolution of complaints. Abbott shall train its employees on the proper handling and resolution of complaints concerning the Product.

ARTICLE 7
PROMOTION OF PRODUCTS

7.1 Commercialization Plan

7.1.1 Initial Plan and Updates . Approximately six (6) months prior to the estimated date for the filing of the Drug Approval Application, Abbott shall prepare and submit to the JCSC the initial Commercialization Plan, which will include the number of full time representative equivalents to be deployed. The Commercialization Plan shall be revised annually by Abbott and submitted to the JCSC on or before November 30 of each year.

7.1.2 Contents of Plan . The Commercialization Plan shall, among other things, specify Abbott’s responsibilities for Promotion and Commercialization, including the estimated number of FTEs to be used to Promote the Product in the Field in the Territory and the estimated levels of Annual Net Sales in the Territory in the next Calendar Year.

7.2 Responsibility . Subject to the terms and conditions of this Agreement, Abbott shall be responsible for all aspects of Commercializing the Product in the Field in the Territory in accordance with the Commercialization Plan, including, but not limited to, the utilization of Third Parties (including Distributors) to Commercialize the Product.

7.3 Sales Efforts by Abbott . Abbott shall use Commercially Reasonable Efforts (a) to Commercialize the Product in the Territory throughout the Term, and (b) to accomplish the objectives set forth in the Commercialization Plan.

7.4 Sales Target . In the event Abbott fails to achieve, in the aggregate, the Five Year Cumulative Sales Target during the first sixty (60) months after the First Commercial Sale of the first Product, then Abbott shall have the option to pay to Sucampo

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