SUBCONTRACT

 

Exhibit 4.52

Confidential treatment has been requested for certain portions of this exhibit. The copy filed herewith omits the information subject to the confidential treatment request. Omissions are designated as “ ***** “. A complete version of this exhibit has been filed separately with the Commission pursuant to an application for confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.

SUBCONTRACT

     This Subcontract is entered into this 30th day of September, 2004, between Acambis Inc., 38 Sidney Street, Cambridge, MA 02139 (hereinafter “Contractor”) and Baxter Healthcare SA, Hertistrassse 2, CH 8304 Wallisellen, Switzerland (hereinafter “Subcontractor). This Subcontract is issued under the Prime Contract shown in the heading above, as executed between the Contractor and the United States Government, through the Department of Health and Human Services. In consideration of the mutual promises, covenants and agreements set forth herein, the parties agree that the Subcontractor shall furnish and deliver to the Contractor all the supplies and perform all the services set forth in this Subcontract, for the consideration stated herein. The rights and obligations of the parties to this Subcontract shall be subject to and governed by this Subcontract and other documents attached hereto or referenced herein.

     This Subcontract sets forth the entire agreement of the parties and supersedes any and all prior agreements of the parties, whether oral or written, concerning the subject matter hereof. Neither party has relied upon any representations, oral or written, in entering into this Subcontract that are not incorporated herein.

     This Subcontract shall not be varied or changed in its terms or conditions by any oral agreement or representation, or otherwise, except by an instrument in writing of even or subsequent date thereto, properly executed.

     The Article and Paragraph titles used herein are for convenience only and shall in no way be construed as part of this Subcontract, or as an indication of the meaning of a particular section.

     This subcontract shall not be legally binding unless and until approved in writing by the US Government Contracting Officer.

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IN WITNESS WHEREOF, the parties hereto have executed this Subcontract to be effective as of the day and year first above written.

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Section A — Introduction

A.1 PURPOSE

The purpose of this subcontract is to continue advanced development and manufacture of an MVA vaccine to support commercial manufacturing.

A.2 SCOPE OF WORK

Subcontractor, as an independent organization and not as an agent of the Contractor, shall furnish all labor, materials, supplies, facilities, equipment, transportation and travel necessary, to ***** other Items set forth in Section B below, according to Section J, Attachment A.

Section B – Schedule of Subcontract Items/Prices

B.1 FIRM - FIXED PRICE ITEMS (EACH ITEM/SUB LINE ITEM IS AN OPTION AND SHALL NOT BE AWARDED UNLESS AND UNTIL THE CONTRACTOR ISSUES NOTICE OF OPTION EXERCISE — SEE H.25)

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Note: Items 0001AG, 0003AB, 0003AD, 0003AE, 0003AF, and 0003AG may be invoiced for partial deliveries at the unit price (if a Unit Price is stated above) or at a pro-rata amount of the Total Price for the lot (if a Unit Price is not stated), based upon the quantity of the Item delivered as the partial delivery.

Section C — Description/Specification/Work Statement

C.1

ITEMS 0001- 0005: See Section J, Attachment A for Statement of Work (SOW).

ITEM 0006 : See Section G, Provisions G-7 and G-8.

C.2 REPORTING REQUIREMENTS (Applicable to All Items)

The Subcontractor shall submit a Monthly Progress Report providing the information listed below. The Subcontractor shall submit one copy of the Monthly Progress Report electronically via e-mail. Monthly progress reports are due on the 7 ^th day of every month. Any attachments to the e-mail report shall be submitted in MS Windows readable files, such as Microsoft Word, Acrobat Reader PDF, MS PowerPoint, or MS Excel.

	1.		A summary of the results of work performed during the reported period.
	2.		Include pertinent data/graphs in sufficient detail to explain any significant results achieved and preliminary conclusions.

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	3.		Describe any problems encountered or expected to occur and described the proposed corrective action. Differences between planned and actual progress should be identified and explained, including any cost impacts arising from performance.
	4.		Listing of all in-process and Quality Control testing completed during the preceding month, showing start dates and expected end dates, and the results of such tests for vaccine, diluent, Master Virus Seed and/or Production Virus Seed.

**See Section J, Attachment A, for other data requirements**

Section D — Packaging and Marking

PACKAGING AND MARKING REQUIREMENTS (ITEMS 0001AG, 0003AF, 0003AG, and 0005AA)

	(a)		Packaging of vaccine for shipment shall conform to Subcontractor’s validated shipping and packaging protocol to ensure safe delivery by common carrier to place of destination named by Acambis *****. Each package shall be shipped by airway.
	(b)		Subcontractor shall mark all shipping containers as “Property of the U.S. Government” and shall show the Prime Contract, and Subcontract numbers and shall identify “Acambis Inc.” as the Prime Contractor .
	(c)		Shipping containers shall be marked and labeled as refrigerated or frozen materials, as required.

Section E — Inspection and Acceptance

     The following FAR clauses are incorporated herein by reference. References to the “Government” shall be deemed to refer to the “Contractor.” References to the “Contractor” shall be deemed to refer to the “Subcontractors.” To the extent that FAR clauses incorporated herein may conflict with the clauses set forth below in full text, the clauses in full text shall govern.

E.1 Inspection and Acceptance

	(a)		Inspection and acceptance of the articles, services, and documentation called for herein shall be accomplished by the Contractual Officer, or his duly authorized representative (who for the purposes of this Subcontract shall be the Program Officer). Acambis Quality Assurance (Q/A) will inspect the deliverable items as set out in Section J, Attachment A, for conformance with subcontract requirements at Baxter’s premises with the exception of vaccine samples to be furnished to Acambis for Product Identity Testing and executed batch records and related documentation, which shall be submitted to Acambis at its place of business in the United States.
	(b)		The Contractor may designate one or more representatives to perform on-site inspection(s) of the physical plant(s) on a full or part time basis. Plant inspection, at a minimum will include Master Batch Records, document control procedures, facilities, personnel training records, equipment process procedures, and Quality Assurance Program reviews.
	(c)		The Contractual Officer (or his duly authorized representative) shall have the right to inspect articles, services, and documentation delivered and tendered for acceptance. Contractor shall make its best effort to inspect and accept delivered items within thirty (30) work days from the date on which the Subcontractor notifies the Contractor that the tendered items have been fully performed (including Subcontractor submission of executed batch records and samples of filled vials for Product Identity Testing by the Contractor) and are available for inspection, after

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			which time, the tendered items shall be either 1) accepted or 2) rejected. In the absence of a rejection within forty (40) work days, the fully performed, tendered item(s) or services shall be deemed accepted. In the case of a rejection, the Contractor shall in due course provide the Subcontractor with a detailed description of the nonconformance(s) and, where applicable, evidence such as photographs of the discrepancies.
	(d)		Subcontractor agrees to provide and maintain quality control systems acceptable to Contractor and to provide access to Subcontractors’ facilities at all reasonable times for surveillance by Contractor and authorized representatives of the Government .
	(e)		Contractor shall have the right to audit Subcontractors’ facilities to determine compliance with (i) cGMP and (ii) applicable federal, state, and local laws, regulations and rules regarding facilities. Such audits shall be scheduled at mutually agreeable times upon two (2) business days written notice to Subcontractors and shall not occur more than one (1) time per calendar year *****. In connection with performing such audits, each party shall bear its own expenses and the Contractor shall comply with all reasonable rules and regulations promulgated by Subcontractors. All information disclosed or reviewed in such inspections shall be deemed to be the property of the Subcontractor and Subcontractor’s Confidential Information and Propriety Information.
	(f)		All notices, forms, approvals, certificates, acceptances and other communications identified above may be transmitted by facsimile or electronic mail with e-signature.

E.2 RESEARCH RECORDS, INSPECTION AND CONSULTATION

	(a)		The Subcontractor agrees to maintain books, records, and supporting documentation in such detail as will properly reflect all work done and results achieved in the performance of this contract, and agrees to retain and preserve the same, together with all research notes, charts, graphs, comments, computations, analysis, and other graphic or written data (collectively, “documentation”) generated in connection with performance hereunder and agrees to permit the Contractual Officer or his authorized representatives to examine and review the same at all reasonable times during said period. Contractor shall have the right to copy such documentation at Subcontractor’s facility and to retain such copies for Contractor’s records to the extent reasonably necessary for regulatory compliance and pharmacovigilence. Additionally, Subcontractor shall not destroy or dispose of such documents; but shall furnish the originals and existing copies of such documentation to Acambis, Inc upon contract completion.
	(b)		The Contractual Officer or any of his authorized representatives shall have the right to inspect the work of the Subcontractor and its subcontractors, if any, and the facilities, floor plans, equipment validation, and any other information, including laboratories or other premises where the work is being performed. The Subcontractor shall provide and shall require its subcontractors to provide all reasonable facilities and assistance for the safety and convenience of such representatives in the performance of their duties. Personnel engaged in the performance of the contract shall be available at all reasonable times for consultation with such representatives. All inspections and review shall be performed in such a manner as will not unduly delay or interfere with the work.
	(c)		Additionally, the Subcontractor shall inform the Contractor, in writing, of any deviations, complaints, and adverse events, as well as the results of all tests and investigations regarding or possibly impacting the safety or efficacy of the evaluated product.

E.3 *****

	(a)		*****
	(b)		*****

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(c)

 

F.1 DELIVERABLE (S) SCHEDULE

Periods of Performance: Specified completion dates are based upon the date(s) on which the Contactor has exercised the option(s) for the various items specified in Section B of the Subcontract Schedule (Dates After Receipt of Order (ARO). Time required for Contractor inspection and acceptance under Provision E.2 of delivered items shall not be counted toward the period of performance by the Subcontractor.

CLIN 0001

      CLIN 0001AA (Milestone 1) - Product Development Plan (PDP)- *****

      CLIN 0001AB (Milestone 17) - Deliver PDP Update and Quality Systems Plan (QSP) Update - *****

      CLIN 0001AC (Milestone 2) - Deliver Quality Systems Plan (QSP)- *****

      CLIN 0001AD (Milestone 5) - Regulatory Support Plan- *****

      CLIN 0001AE (Milestone 16) - Updated Regulatory Support Plan- *****

      CLIN 0001AF (Milestone 6 ) - Summary Report - *****

      CLIN 0001AG (Milestone 7) - Complete Process Validation and Produce/Deliver ***** doses MVA vaccine- *****

      CLIN 0001AH (Milestone 1) - Small Scale Lyophilization Study - *****

CLIN 0002

      CLIN 0002AA (Milestone 8) - Develop plan to Maintain, Test, and Replenish MVA vaccine stockpile- *****

CLIN 0003

      CLIN 0003AA (Milestone 9) - Large Scale Production Plan (50 million doses)- *****

      CLIN 0003AB (Milestone 12) - Manufacture Purified Bulk vaccine 2.5 million doses - *****

      CLIN 0003AC (Milestone 12) - Deliver 500,000 additional dose-equivalent purified bulk vaccine if 500,000 doses from Milestone 7 not produced from conformance lots that successfully established consistency of manufacture - *****

      CLIN 0003AD (Milestone 13) - Formulate, fill and finish, and label ***** doses MVA            vaccine - *****

      CLIN 0003AE (Milestone 13) (Option) - Formulate, fill and finish, and label ***** doses- *****

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      CLIN 0003AF (Milestone 14) - Package/Ship ***** dose vials MVA -*****

      CLIN 0003AG (Milestone 14) - Package/Ship additional ***** vials MVA-*****

CLIN 0004

      CLIN 0004AA (Milestone 18) - Stability Study Program – From option exercise until *****

CLIN 0005

      CLIN 0005AA (Milestone 18 ) - Replenish Government stockpile, as ordered — Ordered vaccine shall be delivered within a reasonable time ARO, as mutually agreed between the parties.

CLIN 0006 - Perform necessary travel to accomplish SOW from Subcontract Award through Completion

** For Option Exercise Clause, see Special Contract Provision H.25.

Section G — Subcontract Administration Data

G.1 INVOICE/VOUCHER SUBMISSION

Invoices (Fixed-Price)

(1)

Subcontractor shall submit an original and three (3) copies of Subcontract invoices to:

Acambis Inc.
Accounts Payable
38 Sidney Street
Cambridge, MA 02139

(2)

Subcontractor agrees to include (at a minimum) the following information on each invoice:

 

	i.		Subcontractor’s Name & Address;
	ii.		Subcontractor’s Tax Identification Number (TIN);
	iii.		Prime Contract, Subcontract, and Purchase Order Numbers (and
	iv.		Invoice Number;
	v.		Invoice Date;
	vi.		Subcontract ITEM Number (See Section B);
	vii.		Quantity;
	viii.		Unit Price;
	ix.		Total Amount of Invoice;
	x.		Name, title and telephone number of person to be notified in the event of a defective invoice;
	xi.		Payment Address, if different from the information in (2) i. above;
	xii.		Electronic Funds Transfer Information (EFT)
	xiii.		For Other Direct Costs (Item 0005), an itemized listing of expenses for which reimbursement is sought, supported by receipts for each item of expense exceeding $75.00 .

 

(3)

Any invoice not containing the above information/documentation may be considered defective and returned to the Subcontractor without payment within five (5) business days.

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G.2 CONTRACTOR’S OBLIGATION TO PAY

Subcontractor may submit an invoice for payment upon Subcontractor shipment of any end item(s) accepted by the Contractor. Contractor agrees to make payment by wire within thirty (30) days following receipt of a properly submitted invoice from the Subcontractor. Payment shall be deemed to have been “made” on the date that the electronic transfer of funds has been authorized. Late payments (other than as to amounts for which Contractor liability to Subcontractors is in dispute under Paragraph H. 19 DISPUTES or Paragraph H. 21 CLAIMS INVOLVING THE GOVERNMENT) shall accrue simple interest (at the then prime rate as published by the Federal Reserve Board) from thirty (30) days after receipt of a proper invoice from the Subcontractor until the date of payment.

G.3 PROGRAM/PROJECT OFFICER(S)

I. For the Contractor:

	(a)		Performance of the work hereunder shall be subject to the technical directions of the designated Program Officer for this Subcontract.
	(b)		The Program Officer is not authorized to change any of the terms or conditions of the Subcontract. In the event that the Subcontractor believes that implementation of any of the direction issued by the Program Officer constitute a change to the Subcontract requirements or to otherwise warrant an adjustment to Subcontract price, Subcontractor shall promptly notify the Program Officer and the Contractual Officer in writing.
	(c)		Contractor may from time to time change the person designated as the Program Officer for this Subcontract by delivering a written notice of such change to Subcontractors.
	(d)		The designated Program Officer for this project is:
			Cynthia K. Lee, PhD Principal Investigator ***** ***** ***** ***** *****

II. For the Subcontractor:

	(a)		Correspondence for technical performance of the work hereunder shall be addressed to the Subcontractor’s designated Project Officer.
	(b)		The Project Officer is not authorized to change any of the terms or conditions of the Subcontract.
	(c)		The designated Project Officer for this project is:

Andreas Wustinger
Senior Project Manager
*****
*****
*****
*****
*****

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G.4 CONTRACTUAL OFFICER

	(a)		The Contractual Officer is the only individual who can legally commit the contractor to the expenditure of funds. No other person other than the Contractual Officer can make any changes to the terms, conditions, general provisions, or other stipulations of this subcontract. Such changes may only be made by mutual agreement of the parties through their duly authorized representatives, in writing. If any such change causes an increase or decrease in the cost of, or the time required for work under this Subcontract, whether or not changed, the Subcontract price and delivery schedule shall be subject to equitable adjustment.
	(b)		No information, other than that which may be contained in an authorized modification to this Subcontract, duly issued by the Contractual Officer, which may be received from any person employed by the Contractor, or otherwise, shall be considered grounds for deviation from any stipulation of this Subcontract.
	(c)		Contractor may from time to time change the person designated as the Contractual Officer for this Subcontract by delivering a written notice of such change to Subcontractor. Except for changes mutually agreed to by the parties under subparagraph (a) above, the Subcontractor must assert its right to an equitable adjustment for any changes under this clause within 30 days from actual or constructive notice or knowledge of the event that gave rise to the equitable adjustment sought. However, if the Contractual Officer decides that the facts justify it, the Contracting Officer may receive and act upon a proposal for equitable adjustment submitted before final payment.
	(d)		The designated Contractual Officer for this Subcontract is:

Roger J. McAvoy
Vice President, *****
*****
*****
*****
*****
*****
*****

(e)

Contractor designates the following individual and agrees to make such individual available to Subcontractor for receipt of subcontract administration matters:

NAME: Mark S. Stay
ADDRESS: *****

                    *****
                    *****

TELEPHONE: *****
FAX: *****
E-MAIL: *****

G. 5 AUTHORIZED REPRESENTATIVE OF SUBCONTRACTOR

	(a)		The Authorized Representative of Subcontractor is the only individual who can legally commit the Subcontractor. No person other than the Authorized Representative of Subcontractor can agree to any changes to the terms, conditions, general provisions, or other stipulations of this Subcontract.
	(b)		No information, which may be received from any person employed by Subcontractor other than from the Subcontractor’s Authorized Representative, shall be considered grounds for deviation from any stipulation of this Subcontract.
	(c)		Subcontractor may from time to time change the person designated as the Authorized Representative for this Subcontract by delivering a written notice of such change to Contractor.
	(d)		The Authorized Representative of the Subcontractor for this Subcontract is:

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Kim C. Bush
President Vaccines, *****
*****
*****
*****
*****
*****

G.6 SUBCONTRACT COMMUNICATIONS/CORRESPONDENCE

Subcontractor shall identify all correspondence, reports, and other data pertinent to this Subcontract by imprinting thereon the Subcontract number from Page 1 of the Subcontract.

G.7 REIMBURSEMENT OF OTHER DIRECT COSTS (CLIN 0006 only)

(a) Contractor shall reimburse the Subcontractor its allowable costs incurred and properly allocable to this contract, in accordance with the clause entitled Allowable Cost and Payment (See Section I). Costs that may be allowable include the following:

(1)

Travel costs plus per diem or actual subsistence for personnel while in an actual travel status in direct performance of the work and services required under this contract. These costs will be in accordance with the Subcontractor’s policy and subject to the following:

 

	(i)		Air travel shall be by the most direct route using “air coach” or “air tourist” (less than first class) unless use of air coach or air tourist is clearly unreasonable or impractical (e.g., not available for reasons other than avoidable delay in making reservations, would require circuitous routing or entail additional expense offsetting the savings on fare, or would not make necessary connections).
	(ii)		Rail travel shall be by the most direct route, first class with lower berth or nearest equivalent.
	(iii)		Costs incurred for lodging, meals, and incidental expenses shall be considered reasonable and allowable to the extent that they do not exceed on a daily basis the per diem rates set forth in the Federal Travel Regulation (FTR).
	(iv)		Travel via privately owned automobile shall be reimbursed at not more than the current General Services Administration (GSA) FTR established mileage rate.
	(v)		All allowable travel costs under this paragraph will be invoiced and reimbursed in US dollars. Conversion to US dollars from foreign currency will be as of the date the cost was incurred. Receipts in excess of $75.00 must be provided with the invoice.

G.8 LIMITATION OF COST (CLIN 0006 only)

	(a)		It is estimated that the cost to the Contractor for the performance of CLIN 0006 of this Contract will not exceed the estimated cost set forth in the Subcontract Schedule. Subcontractor agrees to use reasonable efforts to perform the work specified in the Schedule within such estimated cost.
	(b)		If at any time the Subcontractor has reason to believe that the costs that it expects to incur subject to reimbursement under Item 0006 within the next succeeding thirty (30) days,

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	(c)		when added to all Other Direct Costs previously incurred and subject to reimbursement under Item 0006, will exceed seventy-five percent (75%) of the total estimated cost for Item 0006 as shown in the Subcontract Schedule, the Subcontractor shall notify the Contractual Officer in writing to that effect. The notice shall state the estimated amount of additional funds required to continue performance for the duration of the Subcontract period of performance for “Other Direct Costs” required.
	(d)		Except as required by other provisions of this contract specifically citing and stating that they are an exception to this provision, the Contractor shall not be obligated to reimburse the Subcontractor for Other Direct Costs incurred in excess of the Estimated Cost for Item 0006 as set forth in the Subcontract Schedule and the Subcontractor shall not be obligated to incur Other Direct Costs in excess of the Estimated Cost for Item 0006, unless, and until, the Contractual Officer has notified the Subcontractor in writing that the Estimated Cost for Item 0006 has been increased and the amount of such increase. No notice, communication, or representation in any other form, or from any person other than the Contractual Officer, shall be deemed to be an increase to the Estimated Cost of Item 0006. When and if the Estimated Cost for Item 0006 in the Subcontract Schedule is increased by the Contractual Officer, the Subcontractor shall be entitled to reimbursement of any Other Direct Costs incurred, whether incurred before or after the date on which the Contractual Officer notified the Subcontractor that the Estimated Cost of Item 0006 has been increased, to the extent that such costs are allowable Other Direct Costs properly allocable to this subcontract. If the Contractual Officer issues a termination or other notice, the Contractual Officer may increase the Estimated Cost for Item 0006 and direct that the increase be used solely for the purpose of Other Direct Costs associated with termination activities.
	(e)		Change orders issued pursuant to the Changes clause shall not be considered an authorization to the Subcontractor to exceed the Estimated Cost for Item 0006 in the absence of a statement in the change order, or other contractual modification, increasing the Estimated Cost of Item 0006 set forth in the Subcontract Schedule.

G.9 Performance-Based Payments

     The Contractor shall make payment for completed item(s) when such items have been delivered and accepted, as specified by Subcontract Provision G.2 and B1. The following item(s), however, involve substantial efforts/costs to be incurred by the Subcontractor before the item is completed and delivered under the terms of the Subcontract. For the Item(s) specified below, performance-based payments shall be made to the Subcontractor in accordance with the Performance - Based Payments clause of this Subcontract. Such performance-based payments may be invoiced upon successful completion of the specified milestone.

Section H — Special Subcontract Requirements

H.1 KEY PERSONNEL

The key personnel cited below are considered essential to the work being performed under the Subcontract. If these individuals leave the Subcontractor’s employ or are reassigned to other programs, Subcontractor shall notify the Contractual Officer reasonably in advance and shall submit justification (including proposed substitutions) in sufficient detail to permit evaluation of the impact on the program. The Subcontractor shall not divert or replace such individuals without the written consent of the Contractual Officer, which shall not be unreasonably withheld.

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H.2 PROHIBITION ON THE USE OF APPROPRIATED FUNDS FOR LOBBYING ACTIVITIES

Subcontractor is hereby notified of the restrictions on the use of DHHS’s funding for lobbying of federal, state and local legislative bodies.

Section 1352 of Title 31, United Stated Code among other things, prohibits a recipient (and their subcontractors) of a federal contract, grant, loan, or cooperative agreement from using appropriated funds (other than profits from a federal contract) to pay any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with any of the following covered federal actions; the awarding of any federal contract; the making of any federal grant; the making of any federal loan; the entering into of any cooperative agreement; or the modification of any federal contract, grant, loan, or cooperative agreement. For additional information of prohibitions against lobbying activities, see FAR Subpart 3.8 and FAR Clause 52.203-12.

In addition, the current DHHS Appropriations Act provides that no part of any appropriation contained in this Act shall be used, other than for normal and recognized executive-legislative relationships, for publicity or propaganda purposes, for the preparation, distribution, or use of any kit, pamphlet, booklet, publication, radio, television, or video presentation designed to support, or defeat legislation pending before the Congress, or any state or local legislature except in presentation to the Congress, or any state or local legislative body itself.

The current DHHS Appropriations Act also provides that no part of any appropriation contained in this Act shall be used to pay the salary or expenses of any contract or grant recipient, or agent acting for such recipient, related to any activity designed to influence legislation or appropriations pending before the Congress, or any state or local legislature.

H.3 INSTITUTIONAL RESPONSIBILITY REGARDING CONFLICTING INTERESTS OF INVESTIGATORS

Subcontractor shall:

(a) Maintain an appropriate written, enforced policy on conflict of interest that complies with 42 CFR Part 50 Subpart F and/or 45 CFR Part 94 as appropriate and inform each investigator of the Subcontractor’s (Institution’s) policy, the Investigator’s reporting responsibilities, and the applicable regulations. If the Institution carries out the NIH funded research through subgrantees, subcontractors or collaborators, the Institution must take reasonable steps to ensure that Investigators working for such entities comply with the regulations, either by requiring those investigators to comply with the Institution’s policy or by requiring the entities to provide assurances to the Institution that will enable the Institution to comply with the regulations.

(b) Designate an Institutional official(s) to solicit and review financial disclosure statements from each Investigator who is planning to participate in NIH-funded research.

(c) Require that by the time an application/proposal is submitted to the NIH, each investigator who is planning to participate in the NIH-funded research has submitted to the designated official(s) a listing of his/her known Significant Financial Interests (and those of his/her spouse and dependent children): (i) that would reasonably appear to be affected by the research for which the NIH funding is sought; and (ii) in entities whose financial interests would reasonably appear to be affected by the research. All financial disclosures must be updated during the period of the award, either on an annual basis or as new reportable Significant Financial Interests are obtained.

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(d) Provide guidelines consistent with the regulations for the designated official(s) to identify conflicting interests and take such actions as necessary to ensure that such conflicting interests will be managed, reduced, or eliminated.

(e) Maintain records, identifiable to each award, of all financial disclosures and all actions taken by the institution with respect to each conflicting interest for: (1) in the case of grants, at least three years from the date of submission of the final expenditures report or, where applicable, from other dates specified in 45 CFR Part 74.53(b) and (2) in the case of contracts, 3 years after final payment or, where applicable, for the other time period specified in 48 CFR Part 4 Subpart 4.7, Contract Records Retention.

(f) Establish adequate enforcement mechanisms and provide for sanctions where appropriate.

(g) Certify, in each application/proposal for funding to which the regulations applies, that:

      1) there is in effect at the Institution a written and enforced administrative process to identify and manage, reduce or eliminate conflicting interests with respect to all research projects for which funding is sought from the NIH;

      2) prior to the Institution’s expenditure of any funds under the award, the Institution will report to the Contractor (awarding component) the existence of a conflicting interest (but not the nature of the interest or other details) found by the Institution and assure that the interest has been managed, reduced or eliminated in accord with the regulations; and for any interest that the Institution identifies as conflicting subsequent to the expenditure of funds after award, the report will be made and the conflicting interest managed, reduced, or eliminated, at least on a temporary basis within sixty days of that identification;

      3) the Institution agrees to make information available, upon request, to the awarding component regarding all conflicting interests identified by the Institution and how those interested have been managed, reduced, or eliminated to protect the research from bias; and 4) the Institution will otherwise comply with the regulations.

H.4 INSTITUTIONAL MANAGEMENT OF CONFLICTING INTERESTS

(a) The designated official(s) must: (1) review all financial disclosures; and (2) determine whether conflict of interest exists, and if so, determine what actions should be taken by the Institution to manage, reduce or eliminate such conflict of interest. A conflict of interest exists when the designated official(s) reasonably determines that a Significant Financial Interest could directly and significantly affect the design, conduct, or reporting of the NIH-funded research.

(b) Examples of conditions or restrictions that might be imposed to manage actual or potential conflicts of interests include, but are not limited to:

(i) public disclosure of significant financial interests;

(ii) monitoring of research by independent reviewers;

(iii) modification of the research plan;

(iv) disqualification of the Investigator(s) from participation in all or a portion of the research funded by the    awarding component;

(v) divestiture of significant financial interests; or,

(vi) severance of relationships that create actual or potential conflicts of interests.

(c) An Institution may require the management of other conflicting financial interests in addition to those described in paragraph (a) of this section, as the Institution deems appropriate.

H.5 REPRESENTATIONS, CERTIFICATIONS AND OTHER STATEMENTS OF OFFERORS

The Representations, Certifications and Other Statements of Offerors submitted by Subcontractor, Section J, Attachment B, are hereby incorporated by reference, with the same force and effect as if they were given in full text.

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H.6 LABORATORY LICENSE REQUIREMENTS

The Subcontractor shall comply with all applicable FDA requirements and the requirements of Section 353 of the Public Health Service Act (Clinical Laboratory Improvement Act as amended) to the extent applicable to subcontract performance. This requirement shall also be included in any lower-tier subcontract awarded by the Subcontractor

H.7 MANUFACTURING STANDARDS

	(a)		The current Good Manufacturing Practices (cGMP) regulations (21 CFR Parts 210-211) will be the standard to be applied for manufacturing under this Subcontract.
	(b)		If at any time during the life of the Subcontract, Subcontractor fails to comply with cGMP in the manufacturing of the vaccine and such failure results in a material adverse effect on the safety, purity or potency of this vaccine (a material failure) as identified by the Center for Biologics Evaluation and Research of the FDA, the Subcontractor shall have thirty (30) calendar days from the time such material failure is identified within which to cure such material failure. If the Subcontractor fails to take such action within the thirty (30) calendar day period, the Subcontract may be terminated.

H.8 DISSEMINATION OF INFORMATION

Information related to this Subcontract or to data obtained or generated under this Subcontract may be released or publicized only after coordination with the Contractual Officer, provided, however, that the Subcontractor may, notwithstanding anything in this clause, disclose such information to third parties, under appropriate confidentiality restrictions, as may be necessary or useful in connection with the manufacturing or storage of MVA vaccine hereunder.

H.9 CONFIDENTIALITY OF PROPRIETARY INFORMATION AND INTELLECTUAL PROPERTY RIGHTS

*****

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H. 10 MANUFACTURING SITE

The manufacturing site for vaccine under this Subcontract shall be at the address shown below. Alternate sites may be used upon receipt of written approval from the Contractual Officer.

*****

H. 11 GOVERNMENT PROPERTY/CONTRACTOR FURNISHED PROPERTY

Subcontractor shall be responsible for the control and accountable record keeping for all Government Property in its possession under this subcontract in accordance with FAR Subpart 45.5. Similar controls and record keeping procedures shall be used for any Contractor-furnished property as well.

The Subcontract Program Officer (or her duly authorized representative) shall be the Contractor’s Property Administrator for any Government or Contractor-furnished property under this Subcontract. The Subcontractor agrees to furnish information regarding any Government property (or any Contractor-furnished property) under this Subcontract to the respective Property Administrator, an authorized representative, or a duly designated successor(s). Any inquiry from or information proposed to be furnished to the Government Property Administrator shall be promptly reported to Contractor’s Property Administrator before furnishing information to the Government representative.

The following Government property shall be furnished to the Subcontractor “as is” under this Subcontract. Such items shall be marked as U.S. Government Property, with Subcontract No. MVA-2004-00001(BXTR), the Prime Contract No. (TBD), (Acambis Inc, Prime Contractor) (if not already so marked when received) and shall be managed and administered while in Subcontractor’s possession in accordance with the Government Property (Fixed Price Contracts) (Dec 1989) clause, FAR 52.245-2:

*****

*****

The following Acambis property shall be furnished to the Subcontractor “as is” for use in performance of the Subcontract:

*****

*****

Any residual Acambis-furnished property (and related documentation provided by Acambis) shall be returned to the Contractor upon subcontract completion, at Contractor expense.

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H.12 LIMITATION OF LIABILITY

*****

H.13 ASSIGNMENT OF CLAIMS

Assignment of this Subcontract, or any interest therein, or any payment due or to become due thereunder, without the prior written consent of Contractor, which shall not be unreasonably withheld, shall be void. Should Contractor approve any assignment thereof, in no event shall any copy of any part or all of this Subcontract which is marked “Top Secret”, “Secret,” “Confidential”, or “Proprietary Information” be furnished to any assignee of any claim arising under this Subcontract, or to any person not entitled to receive the same, without prior written consent of Contractor.

H.14 VALIDITY OF INDIVIDUAL PROVISION

The invalidity, in whole or in part, of any provision of this Subcontract shall not void or otherwise affect the validity of any other provision.

H. 15 WAIVER OF BREACH

No waiver of a breach of any provision of this Subcontract shall constitute a waiver of any other breach of such provision, nor shall waiver of breach of any provision of this contract constitute a waiver of breach of any other provision of this contract. Failure of any party to enforce at any time, or from time to time, any provision of this Subcontract shall not be construed as a waiver thereof. The remedies herein shall be cumulative and additional to any other remedies in law and in equity.

H. 16 COMPLIANCE WITH LAWS

Each party agrees to comply with all applicable U.S. federal, state and municipal laws and ordinances and all rules and regulations thereunder. *****

H.17 INDEPENDENT CONTRACTOR

It is understood and agreed that Subcontractor is an independent contractor in all its operations and activities hereunder; that the employees furnished by Subcontractor to perform work hereunder shall be deemed to be Subcontractor’s employees exclusively, without any relationship to Contractor with respect to their employment; that said employees shall be paid by Subcontractor for all services in this connection, and that Subcontractor shall be responsible for all obligations and reports covering Social Security, unemployment insurance, workers’ compensation, income tax, and other reports and deductions required by state, U.S. federal, or foreign law.

H.18 SOLICITATION OF EMPLOYEES

Each of the parties agrees that, during the term of this Subcontract and for a period of one (1) year thereafter, it will not directly solicit or recruit the employees of the other party associated with the performance of this Subcontract. Nothing herein shall preclude any employee of any party from pursuing and securing employment opportunities with another party on such employee’s own initiation.

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H.19 DISPUTES

Any dispute arising under or related to the performance of this Subcontract, including the breach, termination, or validity thereof, that is not resolved by good faith negotiations shall, upon the written request of either party, be submitted to non-binding arbitration to be conducted in accordance with the rules of the CPR Institute for Dispute Resolution for Non-Administered Arbitration by a sole arbitrator who is a member of the National Health Lawyers Association or another mutually agreeable individual. Such arbitrator shall set a schedule for determination of such dispute that is reasonable under the circumstances. Such arbitrator shall determine the dispute in accordance with the substantive rules of law (but not the rules of procedure) as required by Paragraph H.21 below. The arbitration shall take place in Delaware. The arbitration will be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16, and, where applicable, the Patent Arbitration Act, 35 U.S.C. § 294. Each party shall bear its own costs of such arbitration and shall equally share the common costs of the arbitration.

In the event that non-binding arbitration fails to resolve a dispute, any legal proceedings between the Contractor and the Subcontractor shall be brought and jurisdiction and venue shall be proper only in the United States District Court for the District of Delaware, or if jurisdiction is lacking, the Courts of the State of Delaware.

Pending final resolution of any dispute, as evidenced by a written agreement of the parties, or in the event of legal proceedings, as evidenced by final judgment by a court of competent jurisdiction, the parties shall proceed diligently with the performance of their respective responsibilities under this Subcontract, except to the extent that Contractor may have terminated the Subcontract.

Any reference to disputes procedures in FAR clauses incorporated into this Subcontract by reference shall be deemed to refer to this provision.

H.20 GOVERNING LAW

The validity, construction, scope and performance of this Subcontract, including any attachments and modifications hereto, and all disputes related thereto, shall be governed by the laws of the State of Delaware, without regard to its “Choice of Law” provisions; except that with respect to any provisions “flowed-down” from the Prime Contract or based upon FAR clauses, such provisions shall be interpreted and governed by the body of federal government procurement law interpreting such provisions.

H.21 CLAIMS INVOLVING THE GOVERNMENT

(a)

Government Claims Against Contractor and Contractor Claims Against the Government - To the extent that the Contractor may present any request for equitable adjustment, request for schedule extension, settlement proposal, or other matter to the Government that may become a “claim” under the Contract Disputes Act of 1978 (41 U.S.C. 604)(hereinafter referred to as the Contract Disputes Act); or, to the extent that the Government may assert any claim against the Contractor, the Parties agree:

 

	(1)		To the extent that such matters involve the performance of this Subcontract, Subcontractors shall fully cooperate with the Contractor, provide supporting documentation, witnesses, statements, and otherwise participate in negotiations with or litigation against the Government, to the extent reasonably requested by the Contractor.
	(2)		That the Subcontractor shall not be bound by any settlement the Contractor may make with the Government or other compromise with respect to any matter within the coverage of paragraph (a)(1) above unless the Subcontractor agrees to such settlement or compromise in writing.
	(3)		That, if the Government issues a final decision of the Contracting Officer under the terms of the Prime Contract with respect to any claim described in paragraph (a) above, and the Contractor elects not to file an appeal from such final decision under the Disputes provisions of the Prime Contract, within sixty (60) days of Contractor receipt of such final decision; the Contractor may authorize the Subcontractor to appeal such final decision, in the name of and with the consent of the Contractor, at the Subcontractor’s expense. In the event that the Subcontractor elects to appeal any such final decision, the Contractor

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(4)

shall cooperate with the Subcontractor in the same manner provided in subparagraph (1) above with respect to Subcontractor cooperation with the Contractor.

 

(b)

Subcontractor Claims Against the Government - To the extent that the costs of Subcontract performance have been increased or the schedule or manner of Subcontract performance has been adversely affected by actions or inactions of the Government, and the Subcontractor request consent to pursue a claim against the Government, the Parties agree as follows:

 

			If the subject matter of the Subcontractor claim is not within the coverage of a matter governed by paragraph (a) above, Subcontractor shall submit to the Contractor a fully supported claim with respect to such matter no later than final payment under this Subcontract.
			If the Parties are unable to resolve the Subcontractor’ claim within ninety (90) days of Subcontractor’s submission to the Contractor, the Contractor may either: (A) Present a request for equitable adjustment or other relief, as appropriate, to the Government, which submission shall embody the Subcontractor’s claim and shall be governed by paragraph (a) above, or (B) may authorize the Subcontractor to assert such claim against the Government on behalf of the Contractor, to negotiate a settlement thereof, and to prosecute any appeal from any final decision of the Government Contracting Officer with respect to such claim, in the name of and with the consent of the Contractor.

 

(c)		If the Contractor authorizes the Subcontractor to assert any claim against the Government in the name of the Contractor, or to prosecute an appeal from the final decision of the Government Contracting Officer, in the name of and with the consent of the Contractor, if the claim is subject to certification by the Contractor under the Contract Disputes Act, Subcontractor shall submit with their claim, when submitted to the Contractor under paragraph (b)(1), a certification that: (i) the claim is made in good faith, (ii) the supporting data are accurate and complete to the best of the Subcontractors’ knowledge and belief, and (iii) the amount requested accurately reflects the Subcontract adjustment for which Subcontractors believe the Government through the Contractor is liable; furthermore, such certification shall be executed by a person duly authorized to certify the claim and bind Subcontractor, and Subcontractor shall indemnify and hold Contractor harmless from damages, judgments, costs (including reasonable attorneys’ fees), and other liabilities arising from any breach of such certification or any violation of section 5 of the Contract Disputes Act of 1978 (41 U.S.C. § 604) or any violation of common law or statutory prohibitions against misrepresentations, fraud or false statements.
(d)		Contractor shall include interest in the amount of any Subcontract price adjustment to which the Subcontractors are found entitled on any Subcontractor claim. Such interest shall be computed from (1) the date the Contractor received the Subcontractor’s claim (certified, if required) or (2) from the date that such Subcontract payments would otherwise be due, if such date is later, until the date of payment to the Subcontractor. If the Subcontractor’s certification was defective, but is cured prior to the date of settlement or the date on which the Board of Contract Appeals or Court enters judgment, such defect shall not affect the computation of interest to which the Subcontractor is entitled. Simple interest shall be paid at the rate fixed by the Secretary of the Treasury under the Contract Disputes Act, from the date such interest is first payable until payment to the Subcontractor, as such rate may be adjusted by the Secretary of the Treasury each six months during the pendency of the claim.
(e)		The Contractor and Subcontractor shall each bear their own costs of prosecuting any claims under this provision.
(f)		With respect to any claim under this provision affecting both the Contractor and the Subcontractor, the parties agree to enter into a formal or informal joint defense agreement, the parameters of which shall be mutually agreed upon by the parties, and further to (i) promptly cooperate in the case, (ii) grant reasonable requests to make records and employees available to the other party, (iii) provide to the other party free of charge, copies of all pleadings, filings, and communications with the Government, and (iv) inform the other party of all oral communications with the Government.
(g)		Nothing in this Subcontract shall be construed to grant the Subcontractor the right to file any claim under this Subcontract directly against the Government or to appeal, other than in the name of and with the consent of the Contractor, any final decision of the Government Contracting Officer under the Disputes clause of the Prime Contract.

H.22 PRODUCT CHANGES, COMPLAINTS, AND ADVERSE EVENTS

(a)

Subcontractor agrees to inform Contractor within fifteen (15) calendar days of the result of any regulatory development or change to vaccine-specific standard operating procedures that materially

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		affect the production of the vaccine. Subcontractor shall notify Contractor of and require written approval from Contractor for change to master batch records and vaccine specifications prior to the production of the vaccine.
(b)		***** Subcontractor agrees to inform Contractor of any manufacturing deviations that might be reportable under 21 CFR 600.14 within ten (10) calendar days of obtaining such information.
(c)		***** Subcontractor and Contractor shall report to the other any information that they have knowledge of concerning any adverse drug experience in connection with the use of the vaccine, including the incidence or severity thereof, associated with non-clinical toxicity studies, clinical uses, studies, investigations or tests, whether or not determined to be attributable to the vaccine. Reports of routine adverse drug experiences of the type defined in Section 214.80 of Title 21 of the United States Code of Federal Regulations shall be exchanged by each party on a quarterly basis. Reports of serious adverse drug experiences of the type defined in Sections 312.32 and 314.80 of Title 21 of the United States Code of Federal Regulations shall be made available to the other party within five (5) calendar days after a party becomes aware of such adverse drug experience. Upon receipt of any such information concerning any serious drug experience by either the Subcontractor or the Contractor, the parties shall promptly consult each other and use their best efforts to arrive at a mutually acceptable procedure for taking such possible actions as appropriate or required under the circumstances. The Contractor shall promptly provide a copy of any report filed with and communications received from