PRODUCT KNOW-HOW LICENSE AGREEMENT

Exhibit 10.11

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

 

PRODUCT KNOW-HOW LICENSE AGREEMENT

among

SANOFI

BRISTOL-MYERS SQUIBB COMPANY

and

BRISTOL-MYERS SQUIBB SANOFI PHARMACEUTICALS HOLDING PARTNERSHIP

dated as of January 1, 1997

 

 

TABLE OF CONTENTS

 

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

ii

 

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

iii

 

SCHEDULES

 

EXHIBITS

 

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

 

This PRODUCT KNOW-HOW LICENSE AGREEMENT (this “ Agreement ”) dated as of January 1,1997 is hereby made by and among:

Sanofi, a société anonyme organized and existing under the laws of the French Republic (“ Sanofi ”):

Bristol-Myers Squibb Company, a corporation organized and existing under the laws of the State of Delaware, United States of America (“ BMS ”); and

Bristol-Myers Squibb Sanofi Pharmaceuticals Holding Partnership, a Delaware partnership (the “ Partnership ” and, together with Sanofi and BMS, the “ Parties ” and, individually, each a “ Party ”).

W I T N E S S E T H:

WHEREAS, Sanofi has discovered and patented two new chemical entities, one known as SR 47436 with the international non-proprietary name Irbesartan (“ Irbesartan ”) and one known as SR 25990C with the international non-proprietary name Clopidogrel Hydrogenosulphate (“ Clopidogrel ”), with potential ethical pharmaceutical applications in the cardiovascular therapeutic field;

WHEREAS, Sanofi, BMS and Sterling Winthrop Inc., a Delaware corporation (“Sterling”) entered into a Development Agreement dated July 29, 1993 (the “ Development Agreement ”) for, among other things, the development of Irbesartan and Clopidogrel;

WHEREAS, pursuant to an Amended and Restated Asset Purchase Agreement dated as of September 30,1994 among Eastman Kodak Company, Sanofi and Sterling, Sanofi acquired certain assets, and assumed certain obligations, of the ethical pharmaceutical business of Sterling, including the rights and obligations of Sterling under the Development Agreement;

WHEREAS, Sanofi and BMS have entered into a Territory B Alliance Support Agreement dated as of the date hereof (the “ Alliance Support Agreement ”) and have formed through their indirect wholly owned subsidiaries the Partnership pursuant to the partnership agreement dated as of the date hereof (the “ Partnership Agreement ”) for, among other things, the commercialization of the Products in Territory B (as such terms are defined herein);

WHEREAS, Sanofi and the Partnership have entered into an Irbesartan Intellectual Property License Agreement (the “ Irbesartan License Agreement ”) and a Clopidogrel Intellectual Property License and Supply Agreement dated as of the date hereof, pursuant to which Sanofi has granted a license to use certain patents, trademarks and know-how for the commercialization of the Products in Territory B that neither were developed with nor are owned by BMS;

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

2

 

WHEREAS, Sanofi and BMS have developed certain know-how under the Development Agreement for the commercialization of the Products in Territory B and, as a result, each has an undivided one-half direct ownership interest in the Developed Know-How (as such term is defined herein); and

WHEREAS, Sanofi and BMS are willing to grant to the Partnership, and the Partnership is willing to accept, a license under the Developed Know-How for the commercialization of the Products in Territory B on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and the terms and conditions set forth herein, the Parties hereby agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Defined Terms . As used in this Agreement, the following terms shall have the following meanings:

“ Adverse Event ” means any negative symptom experienced at the time of or after the taking of any Product of which any Party or any of its Affiliates becomes aware, whether or not considered drug related, including, without limitation, any side effects, injury, toxicity or sensitivity reaction, or significant failure of expected pharmacological action, as well as instances of symptomatic overdose, abuse or withdrawal reactions.

“ Affiliate ”, when used with reference to any Person, means any other Person controlling, controlled by, or under common control with, such Person; provided, however, that, with respect to Sanofi, the definition of Affiliate shall exclude Elf Aquitaine and any Person not controlled by Sanofi that would be an Affiliate of Sanofi solely by reason of its being controlled by Elf Aquitaine. For the purposes of this definition, “ control ” shall refer to the possession, directly or indirectly, of the power to direct the management or policies of a Person or to veto any material decision relating to the management or policies of a Person, in each case whether through the ownership of voting securities, by contract or otherwise, the beneficial ownership, directly or indirectly, of securities (excluding general partnership interests) representing at least 40% of the voting power of all outstanding voting securities of a Person or (c) the beneficial ownership of at least 50% of the partnership interests of a general partnership. The Parties confirm that each Co-Promotion Entity (as defined in the Alliance Support Agreement) in Territory B shall be considered to be an Affiliate of BMS.

“ Alliance Agreements ” has the meaning set forth in the Alliance Support Agreement.

“ Alliance Strategic Committee ” has the meaning set forth in the Alliance Support Agreement.

“ Clopidogrel Product ” means the product or products having as an active ingredient Clopidogrel or any salt, ester, metabolite or pro-drug thereof.

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

3

 

“ Competing Product ” means, with respect to any Product, any other product that [*], but which is not [*] set forth in Schedule [*] or selected for [*] by [*].

“ Developed Know-How ” means any and all technical data, information, material and other know-how that relate to the formulation of the Products, including, without limitation, any analytical methodology, chemical, toxicological, pharmacological and clinical data, formulae, procedures, protocols, techniques and results of experimentation and testing, developed by Sanofi and BMS under the Development Agreement.

“ Finance Committee ” has the meaning set forth in the Alliance Support Agreement.

“ Functional Committee ” means any Alliance Functional Committee (as such term is defined in the Alliance Support Agreement) or any License Functional Committee.

“ Governmental Authority ” means any federal, state or local or any foreign or supranational government, governmental, regulatory or administrative authority, agency or commission or any court, tribunal or judicial or arbitral body.

“ Irbesartan Product ” means the product or products having as an active ingredient Irbesartan or any salt, ester, metabolite or pro-drug thereof.

“ Lead ” means the right to initiate proposals and implement, or cause the implementation of, recommendations and decisions.

“ Line Extension ” means, for each Product and with respect to development conducted on or after January, 1 1997, any new dosage or new form of administration of such Product.

“ MAAs ” means, with respect to each Product, any marketing authorizations, licenses, approvals, registrations, certificates and exemptions submitted to or granted by or pending with any Governmental Authority for the purpose of allowing the manufacture, production, supply, marketing, distribution or sale of such Product in a particular country.

“ Major B Countries ” means any country in Territory B representing at least [*] of aggregate Net Sales of both Products in Territory B, as determined from time to time by [*].

“ Manufacturing and Sourcing Committee ” has the meaning set forth in the Alliance Support Agreement.

“ Marketing Entity ” has the meaning set forth in the Partnership Agreement.

“ Net Sales ” means for any given period and with respect to any Product, the gross amount invoiced in respect thereof by the Marketing Entities to any Person (excluding any

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

4

 

transfers between any Party and its Affiliates solely for purposes of resale, promotional use or clinical trials), less (i) quantity and/or cash discounts, allowances and/or rebates actually allowed or given, (ii) freight, postage and shipping insurance expenses (if separately identified in such invoice), (iii) sales taxes directly related to the sale to the extent included in the gross invoice price (but not including taxes assessed against the income derived from such sale) and (iv) amounts repaid or credited on account of rejections, outdating or the return of such Product.

“ New Indication ” means, for each Product and with respect to development conducted on or after January 1, 1997, any new therapeutic use or application of such Product.

“ Non-Promotional Countries ” means the countries in Territory B where the utilization of personal promotion by sales personnel is not a significant factor in obtaining product usage and achieving sales or where selling is by tender or comparable non-promotional method of sale, as determined from time to time by the Finance Committee.

“ Person ” means any individual, partnership, firm, corporation, soci é t é anonyme, soci é t é en nom collectif, soci é t é en participation, limited liability company, joint venture, association, trust or other entity or any government or any agency or political subdivision thereof, as well as any syndicate or group that would be deemed to be a person under Section 13(d)(3) of the U.S. Securities Exchange Act of 1934, as amended.

“ Product ” means a Clopidogrel Product or an Irbesartan Product and “ Products ” means both a Clopidogrel Product and an Irbesartan Product.

“ Safety Problem ” has the meaning set forth in the Alliance Support Agreement.

“ Sanofi Pharma ” means Sanofi Pharma, a soci é t é anonyme organized and existing under the laws of the French Republic.

“Serious Adverse Event” means any Adverse Event that is life-threatening in that such Adverse Event places the patient at risk of dying, requires hospitalization, prolongs existing hospitalization or results in permanent disability, birth defect, cancer or death.

“ Territory ” means either Territory A or Territory B and “ Territories ” means both Territory A and Territory B.

“ Territory A ” means the countries and geographic areas described and listed in Schedule 1A attached hereto.

“ Territory B ” means the countries and geographic areas described and listed in Schedule 1 B attached hereto.

“ Third Party ” means a Person who or which is neither a Party nor an Affiliate of a Party.

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

5

 

1.2 Additional Defined Terms. The following additional defined terms shall have the meanings set forth in the sections of this Agreement listed below:

 

ARTICLE 2

GRANT OF LICENSE

2.1 License Grant . Subject to the terms and conditions of this Agreement, Sanofi and BMS each separately grant to the Partnership an exclusive license for the term hereof in their respective undivided one-half direct ownership interest in the Developed Know-How, and the Partnership hereby accepts, an exclusive license for the term hereof under the Developed Know-How (i) to make, have made, sell, offer for sale and import the Products in Territory B, (ii) subject to Article 7 hereof, to develop Irbesartan Products and Clopidogrel Products for Territory B, including, without limitation, New Indications and Line Extensions thereof, and (iii) with the prior approval of the Manufacturing and Sourcing Committee, to make, have made, and export the Products outside of Territory B; provided, however, that such exclusivity shall not apply to Sanofi and BMS with respect to any ongoing studies that are being conducted by Sanofi and BMS under the Development Agreement (the “ Ongoing Studies ”).

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

6

 

2.2 No Transfer . The Partnership hereby acknowledges and agrees that this Agreement does not, and shall not be deemed to, transfer any proprietary ownership interest whatsoever to the Partnership in or to the Developed Know-How. Nothing herein shall give the Partnership any right, title or interest in or to any of the Developed Know-How, except the rights granted pursuant to this Agreement.

2.3 No Implicit Rights . All of the rights granted hereunder are explicitly stated herein and nothing in this Agreement shall be construed to grant any implied rights whatsoever to the Partnership in or to the Developed Know-How.

2.4 Corporate Name Authorization . The Partnership shall be permitted to use both the Sanofi and BMS corporate names, on a [*] basis for the term hereof, solely (i) as part of its corporate name and (ii) in connection with any promotional, advertising or marketing necessary or desirable for the commercialization of the Products in Territory B in accordance with this Agreement and the Alliance Support Agreement. The grant of rights pursuant to this Section 2.4 shall automatically terminate upon the earlier of (i) the expiration or early termination of this Agreement and (ii) the expiration or early termination of the Alliance Support Agreement.

2.5 Goodwill . The Partnership hereby acknowledges that all goodwill connected with the Sanofi and BMS corporate names shall inure to the benefit of Sanofi and BMS, as the case may be, and the Partnership shall not take any action that may be detrimental to such goodwill.

2.6 Representations and Warranties . Each of BMS and Sanofi represents and warrants to the other Parties hereto that: (i) it has, and will at all times during the term of this Agreement have, the right, power and authority to license the Developed Know-How and to perform its other obligations hereunder, (ii) it is not aware of any asserted or unasserted claims or demand of any Third Party it believes to be enforceable against the Developed Know-How and (iii) to the best of such Party’s knowledge and belief, the Partnership’s exercise of any right to the Developed Know-How, as contemplated by this Agreement, will not infringe any intellectual property right of any Third Party.

2.7 Improvements . Any new or useful invention, process or improvement, patentable or unpatentable, relating to the formulation of any Product under the Developed Know-How developed or acquired by the Partnership during the term hereof, shall be the property of the Partnership which shall have all ownership rights thereto, subject to Article 7 hereof.

ARTICLE 3

SUB-LICENSE

3.1 General Sub-License . Except as permitted under Section 3.2 hereof, the Partnership shall not, without the prior written consent of both Sanofi and BMS, sub-license any of its rights and obligations under this Agreement; provided, however, that if the representatives of Sanofi and BMS on any Functional Committee, the Alliance Strategic Committee or the License Steering Committee, consensually agree to sub-license any of the Partnership’s rights or

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

7

 

obligations hereunder, such agreement shall be deemed to be the consent of Sanofi and BMS for the purposes of this Section 3.1. No such sub-license shall relieve the Partnership of its obligations hereunder.

3.2 Sub-License for Alliance Agreements . The Partnership shall sub-license those of its rights and obligations under this Agreement, to any Affiliate of Sanofi or BMS that is a party to any Alliance Agreement, solely for the purposes of permitting such Affiliate to perform its obligations under such Alliance Agreement.

3.3 Termination of Sub-License . Sanofi and BMS each shall have the right to require the Partnership to terminate any sub-license of rights hereunder in the event that the sub-licensee fails to comply in any material respect with, or takes any action contrary to, the terms of such sub-license or any decision made by any Functional Committee, the Alliance Strategic Committee or the License Steering Committee, and such sub-licensee has failed to remedy such non-compliance within thirty (30) days from its receipt of written notice thereof from Sanofi, BMS or the Partnership.

ARTICLE 4

PROVISION OF DOCUMENTS

4.1 Initial Exchange . As promptly as practicable following the date hereof, each of Sanofi and BMS shall make available to the Partnership copies of all relevant data, studies and materials comprising Developed Know-How in such Party’s possession that shall be available as of such date.

4.2 Continuing Exchange . During the term of this Agreement, each of Sanofi and BMS shall make available to the Partnership, from time to time, copies of all relevant data, studies and materials comprising subsequently developed or acquired Developed Know-How in such Party’s possession as soon as practicable after the development or acquisition thereof.

ARTICLE 5

CONSIDERATION

5.1  Development Royalty . In consideration of the rights and licenses granted hereunder, the Partnership shall pay, or shall cause to be paid, for the term of this Agreement the following aggregate amounts as a development royalty (each a “ Development Royalty ”):

(i) To [*], an amount equal to [*]of Net Sales of Irbesartan Products in Territory B; and

(ii) To [*], an amount based on Net Sales of Clopidogrel Products in Territory B, which shall be determined by [*] no later than sixty (60) days after the first commercial sale of any Clopidogrel Product in Territory B.

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

8

 

5.2 Payment . For the term of this Agreement, the Partnership shall pay or cause to be paid to each of Sanofi and BMS all amounts due hereunder on a quarterly basis within sixty (60) days of the end of each calendar quarter. Each such payment shall be accompanied by an accurate statement of the amount of Net Sales of the Products, broken down Product-by-Product, during such calendar quarter and the calculation of all payments to be made to each of Sanofi and BMS for such calendar quarter (each a “ Payment Report ”).

5.3 Method of Payment . (a) All payments to be made hereunder shall be made by wire transfer in immediately available funds, and shall be made in US dollars to the respective bank accounts of Sanofi and BMS as notified to the Partnership by the relevant Party, unless the Parties agree to settle such payments through other means.

(b) Amounts due from the Partnership to BMS or Sanofi in respect of sales based on a currency other than US dollars shall be converted to US dollars using the methodology determined for such purpose by the Finance Committee.

5.4 Records . The Partnership shall maintain (i) books, records and accounts which accurately and fairly reflect, in reasonable detail, the Net Sales of the Products and (ii) an adequate system of internal accounting controls. All books, records and accounts referred to in clause (i) above shall be maintained for not less than three (3) years, or for such longer period if and as required by applicable law, following the date of the sales constituting the Net Sales and shall be made available for reasonable review upon request by Sanofi and/or BMS.

5.5 Payment Reports . (a) At the request of Sanofi, the Partnership shall, and shall if applicable cause its sub-licensees to, permit Sanofi or an independent, certified public accountant not having any significant relation to either BMS or Sanofi, as appointed by Sanofi, at reasonable times and upon reasonable notice, to examine the books and records of the Partnership as may be necessary to (i) determine, with respect to any calendar quarter ending not more than two (2) years prior to the related request, the correctness of any Payment Report or payment made under this Agreement or any Alliance Agreement or (ii) obtain information as to the amount payable for any such calendar quarter in the case of failure on the part of the Partnership to report or pay pursuant to this Agreement or on the part of any party to any Alliance Agreement; provided, however, that Sanofi shall not have the right to make such audit request more than once every twelve (12) calendar months. The results of any such audit shall be promptly made available to BMS, Sanofi and the Partnership.

(b) Sanofi shall bear the full cost and expense of any such audit, unless such audit discloses that the amount due to Sanofi is more than the amount paid by [*] of the amount due, in which case BMS shall bear the full cost and expense of such audit

(c) The determination by an independent, certified public accountant pursuant to this Section 5.5 as to the amount due and payable by the Partnership shall be conclusive and binding on the Parties hereto.

5.6 Taxes . All payments due under this Agreement shall be paid in full without deduction, except for taxes (if any) required to be withheld by applicable law in Territory B with respect to such payments. In the event the Partnership is required under

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

9

 

applicable law to withhold any tax to the revenue authorities in any country in Territory B regarding any payment to Sanofi and/or BMS, the amount of such tax shall be deducted by the Partnership and paid to the relevant revenue authority, and the Partnership shall notify the relevant Party thereof and shall promptly furnish to such Party all copies of any tax certificate or other documentation evidencing such withholding. In the event that any such tax shall subsequently be found to be due, payment of such tax shall be the responsibility of Sanofi or BMS, as the case may be.

ARTICLE 6

LICENSE STEERING COMMITTEE

6.1 License Steering Committee . In order to ensure the proper use of the Developed Know-How by the Partnership for the commercialization and further development of the Products, Sanofi and BMS shall be represented by a License Steering Committee (the “ License Steering Committee ”), which shall be responsible for the following decisions (collectively, the “ License Strategic Decisions ”):

(i) recommended Product profiles, claim structures and dosages for file submissions using the form set forth in Exhibit 6.1-A attached hereto;

(ii) the core positioning strategies and key messages with respect to the commercialization of the Products using the form set forth in Exhibit 6.1-B attached hereto;

(iii) approval of the centrally funded budget for certain programs and expenses using the form set forth in Exhibit 6.1 - C attached hereto;

(iv) overall pricing guidelines using the form set forth in Exhibit 6.1-D attached hereto; and

(v) overall strategy and expenses for Phase IIIB studies, differentiation programs and studies for New Indications and Line Extensions using the form set forth in Exhibit 6.1-E attached hereto.

6.2 License Functional Committees . Subject to the general oversight and authority of the License Steering Committee, the following functional committees (the “ License Functional Committees ”) are hereby established and shall be maintained and empowered as hereinafter provided: (i) a marketing working group (the “ Marketing Working Group ”), (ii) a development committee (the “ Development Committee ”) and (iii) a regulatory committee (the “ Regulatory Committee ”).

6.3 Marketing Working Group. (a) The Marketing Working Group shall be responsible for (i) developing and seeking approval for the centrally funded budget for certain programs and expenses using the form set forth in Exhibit 6.1-C attached hereto, (ii) implementing such centrally funded budget, (iii) allocating marketing responsibilities among Sanofi, BMS and their respective Affiliates, under such centrally funded budget, (iv) the modification or substitution (if any) of the trademarks for the Products set forth in

 

* CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

10

 

Schedule 5.07(b) of the Alliance Support Agreement, (v) developing and coordinating opinion leader support in Territory B, (vi) analyzing the competitive market and developing centrally funded programs to implement differentiation strategies in Territory B, (vii) directing centrally funded market and outcomes research, (viii) directing Product-related public relations and communications strategies and (ix) monitoring the sales of the Products and each Product’s market share in Territory B. The Marketing Working Group shall report and make its recommendations to the License Steering Committee.

(b) The Marketing Working Group also shall be responsible for developing and ensuring the implementation of the Territory-wide centrally funded marketing plan for each Product, and for ensuring that such pla