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EXHIBIT
10.19
CONFIDENTIAL PROVISIONS
REDACTED
Supply Agreement
for Licensed
Product
Between
SciClone Pharmaceuticals,
Inc.
901 Mariners Island
Blvd.
Suite 205
San Mateo, California
94404
United States of
America
(hereinafter referred to as
“SciClone”)
And
RESprotect GmbH
Fiedlerstrasse 34
01307 Dresden
Germany
(hereinafter referred to as
“RESprotect”)
PREAMBLE
| 1. |
RESprotect possesses certain intellectual property rights
related to RP101
((E)-5-(2-bromovinyl-)2’-deoxyuridine—also known as
BVDU). |
| 2. |
Resistys Inc. (“Resistys”) and RESprotect entered
into a license agreement dated as of September 13, 2004
(hereinafter the “2004 License Agreement”) whereby
Resistys obtained a license from RESprotect to, among other things,
the use of the active pharmaceutical ingredient (“API”)
RP101 ((E)-5-(2-bromovinyl-)2’-deoxyuridine—also known
as BVDU), salts of BVDU or a prodrug of BVDU (if developed by
RESprotect) under the RESprotect Patent Rights (as further defined
in the License Agreement), (hereinafter “Licensed
Product”), for the purpose of developing and obtaining
certain regulatory approval for the Licensed Product in finished
form (“Licensed Finished Product”). |
| 3. |
Resistys and RESprotect entered into a Supply Agreement for
Clinical Trial Material dated September 13, 2004 (hereinafter
the “2004 Supply Agreement”). |
| 4. |
Pursuant to a non-binding Term Sheet, effective March 15,
2007, RESprotect, Resistys, Avantogen Limited
(“Avantogen”), Avantogen Oncology Inc.
(“AOI”) and SciClone, agreed, among other things, to
complete certain definitive agreements, including an assignment by
Resistys and Avantogen to SciClone of the 2004 License Agreement
and an assignment by Resistys to SciClone of the 2004 Supply
Agreement. |
| 5. |
On the Effective Date, Resistys and Avantogen assigned the 2004
License Agreement to SciClone and Resistys assigned the 2004 Supply
Agreement to SciClone, with the consent of RESprotect. |
| 6. |
On the Effective Date, RESprotect and SciClone, entered into an
Amended and Restated License Agreement (the “2007 License
Agreement”) setting forth amendments to certain terms and
conditions of the 2004 License Agreement. |
| 7. |
On the Effective Date, SciClone will pay to RESprotect US
$365,474 in consideration for [****], currently in inventory,
pursuant to the [****] Invoice No. 12688 (which corresponds to
RESprotect invoices designated 07/2006 and 08/2006). |
| 8. |
Under Article 6 of the 2007 License Agreement RESprotect agrees
to manufacture and supply the quantities of Licensed Product as
required for conducting clinical trials (“Clinical
Trials”) in order to obtain regulatory approval for the
Licensed Product and the quantities of Licensed Product required
for commercial purposes following regulatory approval. These
supplies are the subject-matter of this Agreement. |
| **** |
Certain information on this page has been omitted and filed
separately with the commission. Confidential treatment has been
requested with respect to the omitted portions. |
| 9. |
For the sake of clarification, the Licensed Product for Phase
II Clinical Trials will be supplied in filled, finished [****] and
all other supplies of Licensed Product for Clinical Trials as well
as Licensed Product for commercial purposes will be supplied as the
untableted API. RESprotect and SciClone may choose to use the same
tablet manufacturer to benefit from economies of scale. |
| 10. |
For the sake of further clarification, the terms of this
Agreement independently cover: (1) the supply of the Licensed
Product for Clinical Trial purposes; and (2) commercial
purposes, after approval of the Licensed Product by the
FDA. |
| 11. |
In consideration of the premises and the mutual covenants and
agreements contained herein, SciClone and RESprotect agree as
follows, whereby in the following, capitalized terms not otherwise
defined herein shall have the meaning ascribed to them in the 2007
License Agreement. |
ARTICLE I
SUBJECT MATTER –
MANUFACTURE AND SUPPLY OF LICENSED PRODUCT;
PAYMENT FOR PAST
SUPPLY
Section 1.1 Pursuant to
the terms and conditions of this Agreement, SciClone shall purchase
the Licensed Product that it has ordered from RESprotect, and
RESprotect shall be obligated to manufacture or have manufactured,
sell and deliver such quantities of Licensed Product as ordered by
SciClone and confirmed by RESprotect as needed for Clinical Trials
until acceptance by the FDA of the first NDA or abbreviated NDA for
registration of the Licensed Finished Product for any indication
and SciClone shall purchase the Licensed Product that it has
ordered from RESprotect for commercial purposes, all as detailed
herein. Other than the material needed for Phase II Clinical Trials
which will be supplied in [****], the Licensed Product will be
provided as the API prior to tableting.
Section 1.2 SciClone
represents and warrants that it shall not use the Licensed Product
for any other purposes or uses other than those set forth in the
2007 License Agreement and this Agreement.
Section 1.3 SciClone
undertakes that it shall purchase the entire amount of the Licensed
Product required for conducting Clinical Trials and commercial
purposes from RESprotect, subject to the terms and conditions
provided herein.
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Certain information on this page has been omitted and filed
separately with the commission. Confidential treatment has been
requested with respect to the omitted portions. |
Section 1.4 The details
of supplies, including prices for Licensed Product for Clinical
Trials are set forth below. The details of supplies, including
prices for Licensed Product for commercial purposes shall be agreed
upon between the Parties as soon as commercially practicable after
the completion of the scale-up batches as mentioned in Article 2
and in the Scale-Up Plan, unless agreed otherwise.
Section 1.5 Effective
with this Agreement, SciClone will pay to RESprotect US $365,474 in
consideration for [****], currently in inventory, pursuant to the
[****] Invoice No. 12688 (which corresponds to RESprotect
invoices designated 07/2006 and 08/2006). The payment shall be made
within 30 days from the effective date of this Agreement.
Furthermore, effective with this Agreement SciClone shall pay to
Resistys Inc. for payment to RESprotect the amount of US$49,761.00
outstanding under invoices of RESprotect 12/2006, 1/2007 and
2/2007.
Article II
SCALE-UP
Section 2.1 Scale-Up for
Supply of Licensed Product
a. Scale-Up Process .
SciClone will purchase from RESprotect the Licensed Product which
it requires for the manufacture of Licensed Finished Product prior
to and after FDA approval of Licensed Finished Product. RESprotect
has subcontracted with, among others, [****] to manufacture the
Licensed Product. SciClone and RESprotect acknowledge that the
manufacture of the Licensed Product by RESprotect will require a
scale-up period of approximately [****] and the expenditure of
considerable funds. SciClone and RESprotect agree to share [****]
when such scale-up costs are incurred. The expected scale-up costs
are set forth in Appendix 1 . RESprotect agrees to provide
SciClone with specific manufacturing information and documents
including certificates of analyses, batch records and all other
documents as required for FDA filings, within thirty (30) days
following a request for such specific manufacturing information by
SciClone, unless RESprotect is prevented from such provision by
reason of a conflicting existing provision with a contract
manufacturer of RESprotect. The details of the scale-up will be set
forth in a plan (“Scale-Up Plan”) which shall be
determined by good faith agreement between RESprotect and SciClone.
RESprotect and SciClone agree to cooperate in good faith to obtain
detailed information regarding the manufacturing process and
scale-up efforts by Third Party contractors of
RESprotect.
b. Scale-Up Efforts .
The parties further acknowledge that RESprotect’s lack of
diligence in timely accomplishing the scale-up in preparation for a
Clinical Trial will diminish the value of this Agreement to
SciClone and RESprotect. Accordingly, RESprotect shall at all times
put forth good faith commercially reasonable efforts in connection
with accomplishing the
| **** |
Certain information on this page has been omitted and filed
separately with the commission. Confidential treatment has been
requested with respect to the omitted portions. |
scale-up of Licensed Product for
Clinical Trials in accordance with the Scale-Up Plan; provided,
however, that the parties understand and agree that the timeline
and estimated expenditures may from time to time be subject to
reasonable adjustment by RESprotect in response to extenuating
circumstances not in the complete control of RESprotect. Any
deviation or delay in the scale-up process under the Scale-Up Plan
shall require consideration by the Development Committee as set
forth in the 2007 License Agreement. The final right of decision on
any delay or deviation in the scale-up process under the Scale-Up
Plan lies with RESprotect, except that any decision which leads to
an increase of more than [****] of SciClone’s annual payment
obligation pursuant to this Section 2.1b., or any delay of
more than [****], which would significantly diminish the value of
the opportunity to SciClone as demonstrated by SciClone, shall
require SciClone’s prior written consent.
c. Scale-Up Costs. The
payments to be made by SciClone to RESprotect for the scale-up
shall be made on quarterly, pro rata and upfront basis as follows:
SciClone shall make an upfront payment for the costs envisaged
under the scale-up for the subsequent calendar quarter within 15
days after the commencement of the respective calendar quarter. At
the end of each calendar year the payment shall be compared with
the actual costs incurred by RESprotect during that year. Any
underpayments of SciClone shall be settled by SciClone within 30
days after receipt of notice from RESprotect of such underpayment.
Any excess payments of SciClone shall be used to settle SciClone
upfront payment obligation for the following quarter(s) or, if
there is no further quarter to come, be re-paid to
SciClone.
d. Scale-up Period
Production and Supply . RESprotect shall deliver to SciClone
and any Sublicensee [****] of the Licensed Product derived by
RESprotect under the Scale-up process (“Clinical Scale-up
Batches”) [****]. The details of the supplies of the Clinical
Scale-Up Batches shall be in accordance with the provisions under
Article 6 below.
e. Pre- and Post Scale-up
Period Production . Before the [****] of each Clinical Scale-up
Batch, which is allocated to SciClone, is fully utilized,
RESprotect agrees to supply SciClone or any Sublicensee of SciClone
(“Sublicensee”) with additional quantities of Licensed
Product and after the shares of the Clinical Scale-up Batches are
allocated, RESprotect agrees to supply SciClone or any Sublicensee
with quantities of Licensed Product in accordance with orders
received from SciClone or its Sublicensee. All such additional
quantities of Licensed Product shall be shipped to SciClone or its
Sublicensee, as appropriate, in accordance with its written
instructions at the expense of SciClone. The details of the
supplies shall be in accordance with the provisions under Article 6
below.
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Certain information on this page has been omitted and filed
separately with the commission. Confidential treatment has been
requested with respect to the omitted portions. |
ARTICLE III
SECOND PRODUCTION
SOURCE
Section 3.1 Second
Production Source . RESprotect and SciClone are interested in
saving costs with regard to the manufacture of the Licensed
Product. However, RESprotect represents and SciClone acknowledges:
(i) that the current manufacture and supply of Licensed
Product is subject to Know-how of Third Parties and licensed to
RESprotect and that RESprotect is contractually bound to these
Third Parties; (ii) that the manufacture process of Licensed
Product is covered by RESprotect Know-how and (iii) that only
sources located within [****] are suitable as potential
additional/alternative sources of supply of Licensed Product which
sources must agree to supply exclusively (to the extent permitted
by law) to RESprotect, SciClone and Sublicensees and (iv) that
such supplier must comply with the quality and quantity standards
required by RESprotect, SciClone and Sublicensees and be cGMP
compliant. If SciClone identifies a source of supply for Licensed
Product complying to the aforementioned conditions above it will
provide RESprotect with written notice showing the conditions to be
met, the costs of such source, the manufacture and quality
standards of such source and authorizations and approvals it
possesses, e.g. drug manufacture authorization. RESprotect
undertakes to review such submission in good faith within 30 days
after receipt of the submission, taking into consideration inter
alia its obligations vis-a-vis its existing suppliers, and to
provide SciClone with a written opinion detailing whether such
alternative source of supply is acceptable to it in view of the
above-mentioned preconditions. In any event, no contractual
agreement shall be concluded with the potential
alternative/additional source or any other obligation entered into
with this source which is binding upon RESprotect without the
written consent of RESprotect, which shall not unreasonably
withheld.
Section 3.2 Cheaper
Second Production Source . Notwithstanding the foregoing, in
the event that a source of supply of Licensed Product identified by
SciClone can supply the Licensed Product at a price documented by a
written and bona fide offer that is at least [****], RESprotect
shall have thirty (30) days to match the lower price or shall
be deemed to have consented to SciClone’s use of that
alternate production source, provided that SciClone, within thirty
(30) days after such consent has been deemed to be given,
enters into a legally binding agreement with such source at
identical terms and conditions as reflected in the written and bona
fide offer of such source. RESprotect agrees to assist SciClone in
obtaining any necessary permissions to obtain Licensed Product
directly from the lower priced production source, provided that to
this end RESprotect is not obligated to make any payments to amend
the contracts with its suppliers or to breach any of the agreements
with its suppliers. Notwithstanding the foregoing, RESprotect and
SciClone agree to cooperate in good faith to obtain the most cost
effective source of Licensed Product. To this end, RESprotect
agrees to make commercially reasonable efforts to obtain the
Licensed Product in the most cost effective manner.
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Certain information on this page has been omitted and filed
separately with the commission. Confidential treatment has been
requested with respect to the omitted portions. |
Section 3.3 Second
Production Source upon Failure to Meet Scale-up
Plan.
a. If RESprotect fails to
substantially adhere to its obligations under the Scale-up process
for Clinical Trial material as provided for in Article II, then
SciClone shall give written notice thereof to RESprotect stating in
reasonable detail the particular failure(s). RESprotect shall have
a period of thirty (30) days from the receipt of such notice
to meet with SciClone to discuss the activities that are being
pursued to address the failure of diligence and to initiate a
program to address the failure of diligence. Following such 30-day
period RESprotect shall have a period of ninety (90) days to
cure the lack of diligence or, at its discretion, to find a second
production source that is reasonably acceptable to SciClone and
RESprotect and that complies with the requirements set forth in
Section 3.1.
b. If RESprotect does not
cure the failure within the aforementioned 90-day period and does
not present a second production source to SciClone reasonably
acceptable to SciClone and complying with the conditions of
Section 3.1(iii), SciClone shall have the right to request
from RESprotect to enter into an agreement with a second production
source for the Licensed Product, which is identified by SciClone
and satisfies the conditions of Section 3.1(iii). RESprotect
agrees and acknowledges that a sublicense of the RESprotect
manufacturing IP and know-how and those of its suppliers to
SciClone is essential for transferring the production of the
Licensed Product to the second source and RESprotect agrees to
assist SciClone in obtaining any necessary permissions, licenses or
sublicenses required for SciClone to obtain the Licensed Product
from a second production source alone or together with RESprotect,
provided that to this end RESprotect is not obligated to make any
payments or to breach any of the agreements with its suppliers.
RESprotect shall only be allowed to reject the second source
presented by SciClone on the following grounds: (i) it is not
ensured that the second production source complies with the quality
standards requested by the FDA and necessary to fulfill the product
specifications for the Licensed Product established by RESprotect
or does not possess the necessary manufacture authorizations,
(ii) exclusivity of supply (to the extent legally permissible)
to RESprotect, its other licensees, SciClone and its Sublicensees
is not ensured; (iii) the second source is not located in the
[****] (iv) the second source does not, at the reasonable
determination of RESprotect, possess sufficient reputation in the
market or technical capabilities, (v) it is not ensured that
also RESprotect has access to the second source and the second
source will supply RESprotect and its other licensees (if
RESprotect so requests), provided that in case of shortages of
supply where a supply to both RESprotect and SciClone is not
possible, the available supply shall be allocated between the
parties at a ratio reflecting the actual or projected sales of
Licensed Finished Product by each party, further provided that in
case the second source at the beginning of the scale up phase, for
a maximum period of [****], is not able to produce sufficient
supply of Licensed Product to satisfy both RESprotect and SciClone
needs, SciClone will have the prior right to satisfy its demand and
thereupon RESprotect shall be supplied with the remaining (if any)
stock, or (vi) entering into an agreement with the second
production source would violate any obligations of RESprotect
vis-a-vis its current production source, especially in relation to
the intellectual property rights of this production
source.
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Certain information on this page has been omitted and filed
separately with the commission. Confidential treatment has been
requested with respect to the omitted portions. |
c. In case the second
production source fails to satisfy the need for supply of Licensed
Product for both RESprotect and SciClone for a period exceeding the
aforementioned [****] period then RESprotect shall be free to
independently identify an alternative production source to satisfy
its need for supply of Licensed Product at its cost and SciClone
shall resume all responsibility for the supply agreement with the
second production source.
d. The costs of the second
production source under this section 3.3 (i.e. the costs of setting
up the manufacture process and the costs of manufacture) shall
either (i) be solely borne by SciClone and shall be credited
against the requirement for Milestone Payments pursuant to
Section 3.1 and Royalties pursuant to Section 3.3 of the
2007 License Agreement, provided that the Milestone Payments or
Royalties are due at the time the costs are incurred and shall be
credited or (ii) be borne by SciClone and RESprotect in
proportion to the amount of Licensed Product actually supplied by
the second production source to SciClone and RESprotect. For the
avoidance of doubt, if the second source within the first [****] of
the scale up phase does not supply to RESprotect any amount of
Licensed Product the cost of the second source shall be borne by
SciClone as outlined in (i) above.
Section 3.4
Confidentiality; Cooperation by RESprotect . Any alternate
produc
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