Exhibit 10.3
Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
Supply Agreement
     This Supply Agreement (the “Agreement”) is made as of the 7th day of July,
2008 (the “Effective Date”) by and between Biodel Inc., a Delaware corporation
(“Biodel”), with its principal office and place of business at 100 Saw Mill
Road, Danbury, CT 06810, U.S.A., and N.V. Organon, a Dutch company (“Organon”)
with its principal office and place of business at Kloosterstraat 6, 5349 AB
OSS, The Netherlands (each of Biodel and Organon, a “Party” and together, the
“Parties”).
RECITALS
     Whereas, Biodel is a development stage specialty biopharmaceutical company
focused on the development and commercialization of innovative treatments for
endocrine disorders, such as diabetes;
     Whereas, Organon is in the business of manufacturing and supplying active
pharmaceutical ingredients, including the Product (as defined below);
     Whereas, Biodel and Organon now desire to enter into this Agreement to
provide the terms and conditions upon which Organon shall manufacture for and
supply to Biodel the Product.
Agreement
     Now Therefore, in consideration for the covenants set forth below, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties agree as set forth below.
1. Certain Definitions.
     1.1 “Additional Quantities” means any quantities for which Biodel has
issued a Purchase Order in accordance with § 4.2.
     1.2 “Affiliate” means, with respect to any Party, another entity or person
which directly or indirectly, is controlled by, or controls, or is under common
control with such Party, where, for purposes of this definition, the term
“control” means ownership, directly or indirectly, of more than 50% of the
shares of stock entitled to vote for the election of directors, in the case of a
corporation, or more than 50% of the equity interests in the case of any other
type of legal entity, status as a general partner in any partnership, or any
other arrangement whereby a Party controls or has the right to control the Board
of Directors or equivalent governing body of a corporation or other entity, or
if such level of ownership or control is prohibited in any country, any entity
owning or controlling at the maximum control or ownership right permitted in the
country where such entity exists.
     1.3 “Technical Change” means, with respect to the Product, any change,
including without limitation to the Specifications, the manufacturing process,
the manufacturing facility and equipment etc., that requires a notification by
either or both of the Parties to, or approval from, the relevant authorities
with respect to the End Product(s).

 

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     1.4 “Confidentiality Agreement” means the confidentiality agreement between
the Parties as executed concurrent with this Agreement and attached hereto as
Exhibit C.
     1.5 “Confidential Information” means any confidential or proprietary
information of a Party disclosed to the other Party or generated in the course
of this Agreement, including inventions, know-how, works of authorship,
software, data, software tools, designs, schematics, plans or other information
relating to any work in process, future development, engineering, manufacturing,
marketing or business plan, or financial or personnel matters relating to either
Party, its present or future products, sales, suppliers, customers, employees,
investors or business, however excluding any such information disclosed by
Organon to Biodel under the Confidentiality Agreement, which is and remains
governed thereby.
     1.6 “CPR” means the International Institute for Conflict Prevention &
Resolution.
     1.7 “End Product(s)” means Biodel’s proprietary VIAdel™ insulin
formulations, as developed by Biodel and used, distributed and/or sold solely in
the Territory.
     1.8 “Excluded Countries” means Australia, Bangladesh, Bhutan, Brunei,
Burma, Cambodia, China P.R., Hong Kong, India, Indonesia, Israel, Laos,
Malaysia, Maldive Islands, New Zealand, Pakistan, Philippines, Poland,
Singapore, South Korea, Sri Lanka, Taiwan, Thailand and Vietnam.
     1.9 “Fixed Quarterly Quantities” means the fixed quantities of Product,
measured in kilograms, that are described in § 4.1.
     1.10 “Current Good Manufacturing Practice” or “cGMP” means the methods to
be used in, and the facilities or controls to be used for, the manufacture,
processing, packing, or holding of a drug to assure that such drug meets the
regulatory requirements of the United States Food and Drug Administration and as
further defined in 21 C.F.R. Parts 210 and 211 and the guidance of the Center
for Drug Evaluation and Research (“CDER”) and the Center for Biologics
Evaluation and Research (“CBER”), and the European Commission Directive
2003/94/EC of October 8, 2003.
     1.11 “Intellectual Property Rights” means any and all rights in and to
discoveries, concepts, ideas, technical information, developments,
specifications, methods, drawings, designs, flow charts, diagrams, models,
formulae, procedures, processes, schematics, specifications, algorithms,
apparatus, inventions, ideas, know- how, materials, techniques, methodologies,
modifications, improvements, works of authorship and data (whether or not
protectable under patent, copyright, trade secrecy or similar laws), including
patents, utility models, and registered and unregistered designs, including mask
works, copyrights, trade secrets, design history, manufacturing documentation,
and any other form of protection afforded by law to inventions, models, designs,
works of authorship, databases or technical information and applications and
registrations with respect thereto.
     1.12 “Material Change to Organon’s Current Manufacturing Operations” means
a change or modification to the form, fit, function, method or process of
manufacture or production of the Product hereunder which (x) would reasonably be
expected to require any new regulatory filing(s) with respect to the Product
and/or Organon’s other customer’s end products

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or (y) could affect the safety, efficacy or quality of the Product and/or
Organon’s other customer’s end products.
     1.13 “Non-conforming Product” means Product that does not conform to the
Specifications, the Quality Agreement, or is not free and clear of all liens,
claims and encumbrances upon delivery.
     1.14 “Product” means Recombinant Human Insulin manufactured for and
supplied to Biodel under this Agreement for use in its manufacturing process of
the End Product(s).
     1.15 “Purchase Order” means a purchase order that is issued by, and binding
on, Biodel and to be accepted by Organon for the purpose of obtaining the
Product under this Agreement, all in accordance with § 4.3.
     1.16 “Quality Agreement” means a separate agreement, executed in accordance
with § 8.3 of the Agreement, between the Parties which shall be incorporated
herein by reference, and following its execution shall be attached hereto and
made a part hereof as Exhibit B, and which sets forth, among other things, the
quality control and quality assurance terms for the Product. In case of a
discrepancy between this Agreement and the Quality Agreement, as to quality
matters the terms of the Quality Agreement shall govern; otherwise the
provisions of this Agreement shall prevail.
     1.17 “Specifications” means the technical specifications for the Product,
as further described in Exhibit A.
     1.18 “Territory” means all countries in the world except the Excluded
Countries.
2. Performance Obligations
     2.1 Supply.
          (a) Performance. Organon shall manufacture and supply the Product in
accordance with the Specifications, Quality Agreement, and all applicable laws
and regulations. Organon shall perform its activities in accordance with
professional standards and practices, including, but not limited to, cGMP.
Organon shall provide cGMP facilities as well as resources for such services,
including, but not limited to, testing, release, storage, and manufacture of the
Product. Biodel shall provide, upon request and only for use in accordance with
the terms of this Agreement, Organon with any information that Organon
reasonably requires to perform its obligations under this Agreement.
          (b) Subcontracting. Notwithstanding § 13.1, neither Party shall
delegate or subcontract the performance of activities under this Agreement to
third party subcontractors without the prior written consent of the other Party,
provided (i) that such consent shall not be required to the extent Organon is
entitled, without Biodel’s consent, to delegate or subcontract pursuant to the
Quality Agreement, and (ii) that such consent shall not be unreasonably withheld
if (a) the delegating or sub-contracting Party controls the performance of such
activities and remains fully responsible to Organon for the performance of such
activities and any breach of this Agreement by such third party subcontractor,
and (b) the third party subcontractor agrees in

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writing to comply with confidentiality restrictions at least as stringent as
those set forth in this Agreement.
     2.2 Regular Communication. Both Parties shall (i) be available for a
reasonable number of telephone and written consultations on a schedule to be
determined by mutual arrangement between the Parties, and (ii) shall respond to
all telephone and written (e.g. letters, e-mail, fax) communications from the
other Party within ten (10) business days or as otherwise reasonably requested.
     2.3 Regulatory Approval.
          (a) Applications for Approval. Up until [**] from termination or
expiry of this Agreement, the Parties shall cooperate diligently and in good
faith to obtain any and all necessary approvals and permits for the Product
and/or the End Product(s) in the Territory, provided that, with respect to all
End Product(s) other than (i) Biodel’s proprietary insulin formulation known as
VIAject™ and/or (ii), with respect to the US and the EU only, any second
proprietary insulin formulation as requested by Biodel prior to the termination
or expiry of this Agreement, and subsequently approved by Organon, which
approval shall not be unreasonably withheld, Organon shall only be obligated to
support Biodel in its efforts to obtain such approvals and permits for clinical
trials up to and including clinical Phase 2. Biodel shall inform Organon timely
of its intention to perform clinical trials or obtain marketing approval
anywhere in the Territory, as to reasonably enable Organon to fulfill its
obligations set out above.
          (b) Maintenance. Organon shall, with respect to VIAject™ and/or any
second formulation as approved by Organon in accordance with the foregoing,
cooperate diligently and in good faith support Biodel in maintaining any
marketing approval that (a) has been accepted for review by the relevant
regulatory authority prior to the date that lies [**] from termination or expiry
of this Agreement and/or (b) is obtained prior to the date that lies [**] from
termination or expiry of this Agreement.
          (c) Costs. Each Party shall bear all costs incurred by it and shall
pay all costs, consistent with industry practice, associated with obtaining such
approvals or permits for the Product and/or End Product(s).
          (d) Drug Master File for the Product. Without detracting from Biodel’s
sole responsibility for any regulatory and other filings with respect to the End
Product(s) anywhere in the Territory, including without limitation in the EU,
unless mutually agreed to between the Parties in good faith, (i) in connection
with applications for End Product(s) in the Territory other than the EU, Organon
shall, subject to the limitations set forth in this § 2.3 and to the extent
required by applicable laws and regulations, file and maintain the drug master
file(s) for the Product, and (ii) in connection with applications for End
Product(s) in the EU, Organon shall subject to the limitations set forth in this
§ 2.3 and pursuant to the Confidentiality Agreement, provide such information to
Biodel as is necessary to prepare and maintain the ‘Drug Substance Quality
Section’ of the ‘Common Technical Documents’ that form part of such
application(s).
          (e) Inspections. Subject to the limitations set forth in this § 2.3,
Organon shall provide access to the manufacturing facility and pertinent
information to inspectors from

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regulatory agencies conducting inspections in connection with applications and
permits relating to End Product(s).
     2.4 Regulatory Compliance. In performing its obligations hereunder each
Party shall comply with all applicable federal, state, municipal, or local laws,
rules, regulations, orders, decisions or permits of any relevant jurisdiction
relating to matters including, but not limited to employment, safety, health,
environmental standards and requirements, non-discrimination, equal employment
opportunity, import/export and privacy protection.
3. Ownership Rights
     3.1 Ownership Rights. Each Party shall retain ownership and control of
their respective works of authorship, inventions, know-how, information, data,
and all Intellectual Property Rights therein that were in existence as of the
Effective Date or are created hereafter, whether or not in the course of the
performance of its obligations under this Agreement. The Parties hereby
acknowledge that neither Party has, nor shall it acquire, any interest in any of
the other party’s Intellectual Property unless otherwise expressly agreed to in
writing.
     3.2 Reservation of Rights. Except for the rights expressly provided in this
Agreement, no other rights are granted by either Party to the other Party.
Notwithstanding anything to the contrary, no rights or licenses are granted
under this Agreement by either Party to the other for the use of any trade
names, trademarks, and service marks.
4. Sale and Purchase Terms
     4.1 Purchase.
          (a) Fixed Quarterly Quantities. Subject to the other provisions of
this Agreement and unless otherwise agreed upon by the Parties, Organon shall
sell and deliver to Biodel and its Affiliates, and Biodel and its Affiliates
shall purchase from Organon, for use only in Biodel’s End Product(s), one
hundred percent (100%) of the Fixed Quarterly Quantities for the Product as
provided in the table below.

          Calendar Quarter   Fixed Quarterly Quantities   Shelf Life Left
Q3 2008
  [**]   [**]
Q4 2008
  [**]   [**]
Total 2008
  [**]    
Q1 2009
  [**]   [**]
Q2 2009
  [**]   [**]
Q3 2009
  [**]   [**]
Q4 2009
  [**]   [**]
Total 2009
  [**]    
Q1 2010
  [**]   [**]
Q2 2010
  [**]   [**]
Q3 2010
  [**]   [**]
Q4 2010
  [**]   [**]
Total 2010
  [**]    

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The ‘Shelf Life Left calculation’ using the percentages set forth above will be
based upon the shelf life for the Product as stated in the Drug Master File as
filed with the FDA on the Effective Date (“Shelf Life”) and as measured at the
time of shipment of the Product to Biodel (“Shelf Life Left”). The Parties
acknowledge that the Shelf Life at the Effective Date is [**], and the Parties
affirm that they have no knowledge of facts or circumstances that are likely to
result in the Shelf Life being reduced. Notwithstanding the foregoing, if at any
time Organon notifies Biodel that the Shelf Life Left of the Product will be
less than [**], then Biodel shall have the option, within [**] of the date of
receipt of such notice, of either (i) reducing, in accordance with Section
4.l(b), the Product ordered by Biodel, or (ii) terminating the Agreement
pursuant to Section 11.2(a) with immediate effect; provided further than in
either instance Biodel shall not be obligated to pay the reduction fee
contemplated in Section 4.1(b) or the termination fee contemplated in
Section 11.3, as applicable. Under no circumstances, however, will Product be
delivered to Biodel with less than [**] Shelf Life Left.
          (b) Voluntary Reduction by Biodel. Notwithstanding § 4.1(a), Biodel
may, at its discretion, in writing request Organon to reduce any individual
Fixed Quarterly Quantities for which Biodel at the date of such request had not
issued a Purchase Order, or not yet had to issue a Purchase Order for in
accordance with § 4.3, and Organon shall approve of such request, provided that
(i) Biodel may only make such request [**] per calendar year, (ii) such
reduction, with respect to any individual Fixed Quarterly Quantities, is limited
to a total of [**] percent ([**]%) of the corresponding Fixed Quarterly
Quantities as originally included in the table above, and (iii) Biodel shall,
with respect to the [**] consecutive Purchase Orders that it in accordance with
§ 4.3 must issue following its request to reduce Fixed Quarterly Quantities,
concurrent with its respective payments in accordance with § 7.2 for such
reduced amount, pay Organon a reduction fee in the amount of [**] percent
([**]%) of the purchase price, as determined in accordance with § 7.1, that
Biodel would have had to pay to Organon for the reduced part(s) of the Fixed
Quarterly Quantities if Biodel had not requested to reduce. Notwithstanding the
foregoing, Biodel shall not be required to pay any reduction fee if the
reduction request is related to a Technical Change referred to under § 5.4(A) as
required by any regulatory authority, and the Technical Change significantly
affects the US and/or EU market for the End Product(s); provided, however, that
any disagreement between the Parties with respect to whether a reduction fee
should not be due pursuant to this sentence shall be subject to mediation in
accordance with the second paragraph of § 13.12.
As an illustration of the reduction fee: If X was the last calendar quarter for
which a Purchase Order was issued; calendar quarters Y and Z are next in line
with Fixed Quarterly Quantities of [**]. Reduction fee is payable and due
concurrent with payment for the, then reduced, Fixed Quarterly Quantities for
both Y and Z, respectively. Irrespective of the number of reduction requests,
Fixed Quarterly Quantities for Y and Z can never be reduced to less than [**]
(Y) and [**] (Z).
          (c) Reduction for Failure to Complete Enzyme Development Work. In the
event that the results of the enzyme development work as set forth on Exhibit D
cannot be included in the application for marketing approval for Biodel’s End
Product_known as VIAject™, which application is set to be filed no earlier than
[**] and no later than [**], Biodel shall have the right to reduce, in whole or
in part, the Fixed Quarterly Quantities for those quarters for which Biodel then
had not issued a Purchase Order, or not yet had to issue a Purchase Order for in
accordance with § 4.3.

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     4.2 Additional Quantity. At any time Organon may, at its discretion, submit
a binding offer to Biodel for any Additional Quantity of Product it would be
willing to supply to Biodel in addition to the Fixed Quarterly Quantities.
Biodel has the right to accept such binding offer within [**] of its receipt
thereof by submitting a Purchase Order in accordance with § 4.3, after which
period the offer is no longer binding upon Organon.
     4.3 Purchase Orders. Biodel shall order Fixed Quarterly Quantities [**]
calendar quarters in advance, and Biodel shall order Additional Quantities in
accordance with Organon’s offer referred to in § 4.2, provided that Biodel shall
issue Purchase orders with respect to Q3 and Q4 2008 and Q1 2009 within [**] of
the Effective Date. All orders shall be evidenced by specific and separate
Purchase Orders issued by Biodel to Organon pursuant to this § 4.3. Purchase
Orders for Product may be submitted by Biodel to Organon in writing, or
electronically pursuant to a mutually agreed upon process. All Purchase Orders
shall contain: (a) the corresponding Fixed Quarterly Quantities; (b) the
purchase price for Product ordered, in accordance with § 7.1; (c) mutually
agreed to delivery dates, whereby Parties shall initially be bound to a delivery
date that lies within the corresponding calendar quarter; and
(d) shipping/installation instructions. If Biodel issues any such Purchase
Orders, Organon shall inform Biodel in writing of its acceptance or rejection
thereof. Upon Organon’s acceptance of a Purchase Order, which Organon shall not
refuse to accept on the basis of arguments that detract from Biodel’s rights
under §4.1, § 4.2 and/or § 7.1, such Purchase Order shall be deemed to be a
transaction issued under the terms of this Agreement between the Parties. No
additional or inconsistent terms in any Purchase Orders or Purchase Order
acknowledgements shall have any legal effect.
     4.4 Limits on Production of the Product. Without detracting from Organon’s
obligation to accept properly issued Purchase Orders, if Organon, becomes aware,
that it will be technically or practically unable (for example as a result of
supply chain issues or technical failures) to fill any Purchase Order or Fixed
Quarter Quantity which may become subject to a Purchase Order, then Organon
shall inform Biodel in writing with at least a [**] notice of any reduced
capacity, and Organon shall use commercially reasonable efforts to resolve the
condition that caused the need to reduce such capacity. Organon shall, taking
into account customer specific technical limitations (for example: specific
specifications and/or packaging requirements), allocate its available
Recombinant Human Insulin between Biodel and Organon’s other customers
proportionally in accordance with the amount of Recombinant Human Insulin
supplied thereto during the twelve (12) months prior to the condition that
caused the need to reduce such capacity.
5. Manufacture
     5.1 Raw Materials. Organon shall be responsible for obtaining, and shall
store at no cost to Biodel, any and all materials required for the manufacture
of the Product, in reasonable quantities consistent with Biodel’s forecasts and
orders for the Product.
     5.2 Manufacture of Product. Organon shall manufacture Product in accordance
with § 2.1, § 2.4, and any applicable regulations with respect to the
transportation, storage, use, handling and disposal of hazardous materials. If
and to the extent such is not addressed by the Quality Agreement, each Party
shall promptly notify the other of any new instructions or

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specifications with respect to the Product required under any applicable laws
and shall confer with each other with respect to the best means to comply with
such requirements. Organon represents and warrants to Biodel that it has, and
shall maintain during the term of this Agreement, all government permits,
including without limitation health, safety and environmental permits, necessary
for the conduct of the actions and procedures that it undertakes pursuant to
this Agreement.
     5.3 Product Specifications; Testing. Product supplied hereunder shall
conform to the Specification as set forth in Exhibit A and the warranty set
forth in § 8.2. Organon shall perform quality control testing and quality
oversight on the Product to be delivered to Biodel or its designee hereunder.
     5.4 Technical Changes. If throughout the duration of this Agreement any
controlling regulatory authority requires, or any Party voluntarily requests, a
Technical Change, the Parties shall discuss in good faith the consequences
thereof, including amending any of the terms of this Agreement. Without
detracting from each Party’s right to assess and decide with respect to any such
Technical Change,
(A) if such Technical Change, whether required by any controlling regulatory
authority or voluntarily requested by Biodel, is uniquely related to the use of
the Product in the End Product(s), Organon shall in no event be required to
implement such Technical Change to the extent that this would (i) adversely
affect Organon’s ability to manufacture Recombinant Human Insulin for its other
customers or (y) necessitate a Material Change to Organon’s Current
Manufacturing Operations, while
(B) if such Technical Change is required by any controlling regulatory authority
or voluntarily requested by Organon, Biodel shall not be required to implement
such Technical Change if such Technical Change is (i) not required for use of
the Product in the End Product(s) and (ii) would affect the safety, efficacy or
quality of the End Product(s), and (iii) would require significant regulatory
filings or new development work.
If the Parties, following good faith negotiations, fail to mutually agree on the
consequences of such required or voluntarily requested Technical Change
(including, without limitation, the allocation of the costs and expenses
associated therewith, taking into account, without limitation, to what extent
the relevant Technical Change is specifically related to the use of the Product
in the End Product(s)), then the Parties shall attempt to resolve the matter
through mediation in accordance with § 13.9 and § 13.12. Notwithstanding the
foregoing, with respect to a Technical Change requested by Organon that is not
required for the use of the Product in the End Product, Biodel shall not be
required to accept price increases associated with such Technical Change, unless
Biodel agrees with the proposed Technical Change.
6. Delivery and Acceptance
     6.1 Time and Place of Delivery. Organon shall ship the Product to Biodel’s
Danbury, Connecticut facility or to such other, or additional, U.S. location(s)
as Biodel shall designate from time to time, to arrive on the scheduled date, or
within the timeframe specified, as set forth in the Purchase Orders as accepted
by Organon in accordance with § 4.3. Any deviation

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from an agreed upon scheduled delivery date for Product shall occur only upon
approval by the Parties. Organon shall retain samples of each batch as described
in the Quality Agreement. In case Biodel, in a single Purchase Order, requires
other than standard packaging and/or packaging quantities and/or multiple
deliveries to one ore more U.S locations, Organon may charge Biodel with a
reasonable fee to cover costs resulting from such requirements.
     During the term of this Agreement no Product shall be delivered to Biodel
with less Shelf Life Left than that specified in § 4.1 (a), provided that if as
a result of any mutually agreed to delivery postponements such required level of
Shelf Life Left can no longer be met, such required level shall be reduced by
the duration of any such postponement.
     6.2 Risk of Loss. Organon shall bear the risk of loss for the Product until
delivery to such designated facility at which time title to the Product and the
risk of loss shall pass to Biodel.
     6.3 Documents. Each shipment of the Product shall be accompanied by
accurate and complete documents including, but not limited to relevant
certificates of analysis, certificates of compliance and a copy of the invoice.
     6.4 Inspection, Acceptance, and Rejection. Biodel shall have the right to
inspect the Product as follows:
          (a) Initial Inspection. Biodel shall, without limitation, have the
option to audit, inspect, review, and document, at Organon’s facility, any
activities related to the manufacture, including, but not limited to processing,
process testing, and final laboratory release testing to determine whether the
Product is acceptable to Biodel, complies with the Specifications, and is not a
Non-conforming Product. Any participation or presence by Biodel personnel does
not waive Organon’s responsibilities to provide the agreed upon quantity of the
Product, on the time of delivery, and in conformance with the Specifications.
          (b) Delivery Inspection. Within [**] from delivery at the facility
designated in accordance with §6.1, Biodel shall perform further testing to
determine whether the Product is acceptable to Biodel, and is not a
Non-conforming Product. If Biodel determines that a batch of Product does not
conform to the Specifications based on Biodel’s analysis performed on the
Product, or is for any other reason to be considered a Non-conforming Product,
Biodel shall notify Organon thereof in writing within [**] following delivery.
In the event the batch of Product does not conform to Specifications, or for any
other reason is confirmed to be Non-conforming Product, Organon shall at
Biodel’s option either (i) replace such Product free of charge as soon as
reasonably possible, but no later than [**], or (ii) issue a credit note on the
basis of the purchase price paid in accordance with § 7 for such Non-conforming
Product. If Biodel requests replacement of Non-conforming Product and Organon
determines that replacement of such Product in a timely manner is not
commercially reasonable, then it shall notify Biodel within a reasonable time,
issue a credit note as described in (ii) above, and the Parties shall discuss in
good faith a reasonable plan, including timeframes, to address any material
delivery shortfall created by such Non-conforming Product. If Biodel does not
notify Organon that any batch of Product is a Non-conforming Product within [**]
following delivery of such Product at Biodel’s facility, or does not reject any
Non-conforming Product in accordance with the procedure described above, such
batches of Product shall be deemed to have

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been accepted by Biodel; provided, however, that in the case of any batch of
Product having latent defects that could not have been discovered by Biodel
within the applicable period described above despite reasonable inspection by
Biodel, Biodel may reject such batch of Product by giving written notice to
Organon of Biodel’s rejection of such batch of Product within [**] following
discovery of such latent defects.
     6.5 Expert. If the Parties fail to agree on whether a batch of the Product
does not conform to the Specifications or for any other reason is to be
considered a Non-conforming Product or on the responsibility therefore the
matter shall be finally determined by an expert to be nominated by agreement
between the Parties, or failing agreement, by an expert, to be nominated by the
CPR. The expert shall act as an expert and not as an arbitrator, but his opinion
shall be binding upon the parties and his fees and expenses shall be borne by
the party against which the expert’s opinion is rendered.
     In no event shall Product, whether Non-conforming or not, be returned to
Organon without its prior written consent. In case it is established in
accordance with the terms of this Agreement that Product is Non-Conforming,
Biodel shall at the instruction and cost of Organon either return or destroy
such Product.
7. Pricing; Payment
     7.1 Purchase Price. The purchase price of the Product purchased from and
delivered by Organon in any given calendar year pursuant to § 4 and § 6 shall be
€[**] Euros) per gram for all Product delivered.
     Within one month of each anniversary date of the Agreement, Organon may
adjust the purchase price in accordance with any unadjusted percentage change in
the Chemical Industry Wage Index for the previous 12 months period, as published
by the Central Bureau of Statistics in the Netherlands by a maximum of [**]
percent ([**]%) per adjustment.
     7.2 Payment. Biodel shall pay Organon for the Product within [**] of
delivery of Product in accordance with § 6.1, for which Organon shall submit an
invoice to Biodel, Attention: Accounts Payable, 100 Saw Mill Road, Danbury, CT
06810. If it in good faith disputes any portion of an invoice, then Biodel shall
pay the undisputed amounts and the Parties shall use good faith efforts to
reconcile the disputed amount as soon as practicable, in accordance with the
terms of this Agreement. Organon shall not suspend work or seek to terminate
this Agreement or any Purchase Order on account of Biodel’s failure to pay any
invoiced amount which is the subject of a good faith bona fide dispute, provided
that Biodel pays all undisputed amounts. In the event Organon has a good faith
belief that Biodel may not meet it’s financial obligations under this Agreement
then Organon shall notify Biodel, in writing, within a reasonable time, not to
exceed [**] of such concerns. The Parties shall discuss, and meet as necessary,
to negotiate a good faith resolution to such concerns, may refer the matter to
their respective senior management, or attempt to resolve through mediation in
accordance with § 13.12. If Biodel fails to pay any undisputed amount when due,
then, without prejudice to any other rights Organon may have, but only after
having in good faith consulted Biodel, Organon may provide notice to the
immediate effect that:

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          (i) default interest shall be due on the amount outstanding at the
rate of one percent (1%) per month;
          (ii) all costs, including judicial, made in order to obtain payment by
Biodel of the amount(s) due, shall be for account of Biodel;
          (iii) Organon shall, notwithstanding its obligation to consult in good
faith with Biodel, at its discretion be entitled to demand adequate security to
cover arrears, to demand prepayment of further deliveries as the terms thereof
shall be reasonably discussed with Biodel, or to suspend further deliveries.
     7.3 Taxes. Unless otherwise provided on the Purchase Order, in addition to
the price stated on the face of the invoice, Biodel shall pay costs for all
sales, use, or excise taxes, assessments or other charges attributable to the
sale, use, shipment transportation, or delivery of the goods. In the event that
any such charges can be waived or Biodel is entitled to a refund, Organon will
reasonably cooperate with Biodel and reasonably assist Biodel in obtaining such
waiver or refund.
8. Representations And Warranties; Covenants
     8.1 General Representations and Warranties. Each Party represents and
warrants:
          (a) Corporate Power and Authorization. It is duly organized and
validly existing under the laws of the state of its incorporation, and has full
corporate power and authority to execute and deliver this Agreement and to
perform all of its obligations hereunder; and
          (b) Binding Agreement. This Agreement is a legal and valid obligation
binding upon it and enforceable in accordance with its
terms; and
          (c) No Conflict. The execution, delivery and performance of this
Agreement by such Party does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a Party or by which it may be
bound, nor violate any law or regulation of any court, governmental body, or
administrative or other agency having jurisdiction over it; and
          (d) Resources. It has adequate resources, both financial and
otherwise, to perform its duties hereunder.
     8.2 Warranty. Organon represents and expressly warrants that the Product
provided hereunder shall conform to the Specifications shall be in compliance
with all applicable laws and regulations, and free from defect, claim,
encumbrance or lien, and, subject to § 4.3, shall be delivered according to the
terms of the relevant Purchase Order. Organon represents and expressly warrants
that it has and shall at all times throughout the term of this Agreement has,
whether by right, title, interest, including by license or otherwise, the
Intellectual Property Rights that are required to use, manufacture, market,
offer to sell, sell, import and export the Product in accordance with the terms
of this Agreement and that neither this Agreement nor the act of any Party
pursuant hereto shall infringe any third party rights. Biodel warrants that it
shall only use the Product for the sole purpose of the use, manufacture,
marketing, sale and distribution of the

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End Product(s) in the Territory only. EXCEPT AS EXPRESSLY PROVIDED HEREIN,
ORGANON MAKES NO OTHER WARRANTIES, EXPRESS OR IMPLIED, AS TO THE QUALITY OR
FITNESS FOR PURPOSE OF THE PRODUCT SUPPLIED TO BIODEL.
     8.3 Covenants. Contemporaneous with the Effective Date, the Parties hereby
agree to negotiate in good faith the execution of a Quality Agreement. Such
Quality Agreement shall be mutually agreed to in writing prior to the first
delivery of Product under this Agreement.
9. Indemnification And Liability
     9.1 Mutual Indemnification. Each Party (the “Indemnifying Party”) shall
defend, indemnify and hold harmless the other Party and its Affiliates, and
their respective directors, employees, consultants and agents (the “Indemnified
Parties”) from and against any and all liabilities, losses, damages, costs, and
other expenses (including reasonable attorneys’ and expert witnesses’ costs and
fees) (“Losses”) incurred by the Indemnified Parties as a result of any claim,
demand, action or proceeding by any third party (a “Claim”) to the extent
arising from or relating to (i) any material breach of any representation,
warranty, covenant, or obligation of the Indemnifying Party under this Agreement
or any intentional misconduct or negligence by the Indemnifying Party or any of
its employees, agents, or subcontractors, or (ii) the manufacture, sale and/or
use of End Product(s) by or on behalf of Biodel, except, in each case, to the
extent such Losses result from the intentional misconduct or negligence of, any
of the Indemnified Parties.
     9.2 Indemnification Procedures. In the event of any Claim for which any
Indemnified Party is or may be entitled to indemnification hereunder, the
Indemnified Party may, at its option, require the Indemnifying Party to defend
such Claim at the Indemnifying Party’s sole expense. Indemnifying Party may not
agree to settle any such Claim without the Indemnified Party’s express prior
written consent.
     9.3 Failure to Defend or Settle. If the Indemnifying Party fails or
wrongfully refuses to defend or settle any Claims, then the Indemnified Party
shall, upon written notice to the Indemnifying Party, have the right to defend
or settle (and control the defense of) such Claims. In such case, the
Indemnifying Party shall cooperate, at its own expense, with the Indemnified
Party and its counsel in the defense and settlement of such Claims, and shall
pay, as they become due, all costs, damages, and reasonable legal fees incurred
therefore.
     9.4 Liability. IN NO EVENT OTHER THAN IN CASE OF INTENTIONAL MISCONDUCT OR
GROSS NEGLIGENCE WILL EITHER OF THE PARTIES BE LIABLE TO THE OTHER FOR ANY
INDIRECT OR CONSEQUENTIAL LOSS OR DAMAGES OR LOSS OF PROFITS IN RELATION TO, OR
ARISING OUT OF THE OPERATION OR TERMINATION OF THIS AGREEMENT. EACH PARTY’S
LIABILITY TO THE OTHER PARTY UNDER THIS AGREEMENT, REGARDLESS OF THE CAUSE OF
ACTION, IS LIMITED TO THE TOTAL VALUE AMOUNT OF INVOICES PAID OR PAYABLE BY
BIODEL UNDER THIS AGREEMENT AND/OR THE SUPPLY AGREEMENT BETWEEN THE PARTIES OF 4
APRIL, 2004 WITHIN THE 12 MONTHS IMMEDIATELY PRECEDING SUCH CLAIM.

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10. Insurance Protection. Each Party shall obtain and maintain during the term
of this Agreement liability, comprehensive, and workers’ compensation insurance
with a reputable insurance company to help protect against those insurable risks
that such Party may incur in connection with the performance of its obligations
under this Agreement. Each Party shall provide, upon request, to the other Party
any such policies of such insurance, and the premium receipt(s) and insurance
certificate(s) therefore.
11. Term; Termination
     11.1 Term. This Agreement shall begin on the Effective Date and, unless
terminated sooner as provided in § 11.2, end December 31st 2010.
     11.2 Termination Events
          (a) At Will. Biodel may terminate this Agreement with immediate effect
upon written notice to Organon.
          (b) For Cause. Organon shall have the right to terminate this
Agreement for cause with immediate effect if Biodel materially breaches this
Agreement and fails to cure such material breach within [**] after receiving
written notice that specifies the particulars of such breach.
          (c) Force Majeure. Organon shall have a right to terminate this
Agreement in accordance with § 13.13.
          (d) Business Circumstances. Organon shall have the right to terminate
this Agreement with immediate effect in the event of Biodel’s liquidation,
bankruptcy or state of insolvency.
          (e) Manufacturing Decisions. Organon may terminate this Agreement upon
a ten (10) business days written notice to Biodel if the Parties fail to reach
agreement after any mediation conducted in accordance with § 5.4.
     11.3 Effects of Termination. Upon the expiration or termination of this
Agreement, (a) Biodel shall pay to Organon all amounts due to Organon under this
Agreement; (b) Organon shall deliver to Biodel all Product for which a delivery
date under a Purchase Order has passed; and (c) subject to the Confidentiality
Agreement, each Party shall return to the other Party, upon the other Party’s
request, all tangible items of the other Party in its possession or under its
control evidencing the Confidential Information of the other Party. The
expiration or earlier termination of this Agreement shall not affect any rights
or claims of a Party hereunder that accrued prior to the date of such expiration
or earlier termination.
     In the event the Agreement is terminated (i) by Biodel pursuant to §
11.2(a), or (ii) by Organon pursuant to § 11.2(e) following the Parties’ failure
to reach agreement after any mediation conducted in accordance with § 5.4 with
respect to any Technical Change referred to under § 5.4(A), then Biodel has the
option, within [**] of sending or receiving a termination notice, to request
delivery of all Product for which, on or before the date of termination of this

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Agreement, a Purchase Order was issued in accordance with § 4.3 but no delivery
date has passed and Organon shall accept and perform such Purchase Orders, and
Biodel shall subsequently take delivery and pay for the Product, all in
accordance with the terms of this Agreement; provided that in the event that
Biodel does not timely make use of such option, Organon is entitled to, and
Biodel will within [**] sending or receiving such termination notice pay to
Organon a termination fee to the amount of (a) seventy-five percent (75%) of the
purchase price, as to be determined in accordance with §4.1 and § 7.1, of all
the Fixed Quarterly Quantities corresponding with the said Purchase Orders, plus
(b) fifty percent (50%) of the purchase price, as to be determined in accordance
with §4.1 and § 7.1, of the Fixed Quarterly Quantity corresponding to the
calendar quarter for which Biodel, but for the termination of this Agreement,
would have had to issue a Purchase Order for first.
     11.4 Survival. Sections (§) § 1, § 2.3, § 3, § 7.2 and § 7.3, § 8, § 9, §
10, § 11.3 and § 11.4, § 12, and § 13 shall survive the expiration or
termination of this Agreement.
12. Confidential Information
     12.1 Confidentiality Obligations. Each Party shall at all times, and
notwithstanding any termination or expiration of this Agreement, hold in
confidence and not disclose to any third party Confidential Information of the
other Party, except as approved in writing by the other Party to this Agreement,
and shall use the Confidential Information for no purpose other than the
purposes expressly permitted by this Agreement. Each Party shall only permit
access to Confidential Information of the other Party to those of its employees,
consultants, agents, and attorneys having a need to know and who are bound by
confidentiality obligations at least as restrictive as those contained herein.
The obligations in this § 12.1 shall terminate [**] years from the date of
expiration or termination of this Agreement in accordance with §11.
     12.2 Exceptions to Confidentiality Obligations. A Party’s obligations under
this Agreement with respect to any portion of the other Party’s Confidential
Information shall terminate when the Party that is subject to such obligations
can document in writing that such information: (a) entered the public domain
through no fault of such Party; (b) it was in such Party’s possession free of
any obligation of confidence at the time it was communicated to such Party by
the other Party; (c) it was rightfully communicated to such Party free of any
obligation of confidence subsequent to the time it was communicated to such
Party by the other Party; or (d) it was developed by employees or agents of such
Party independently of and without reference to any information communicated to
such Party by the other Party.
     12.3 Authorized Disclosure. Notwithstanding anything to the contrary, a
Party shall not be in violation of § 12.1 with regard to a disclosure of the
other Party’s Confidential Information that is in response to a valid order by a
court or other governmental body or necessary to comply with applicable law or
governmental regulations, provided that if such Party is required to make any
such disclosure of the other Party’s Confidential Information it shall to the
extent practicable give reasonable advance notice to the other Party of such
disclosure requirement in order to permit the other Party to seek confidential
treatment of or to limit the Confidential Information required to be disclosed.

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     12.4 Separate Confidential Disclosure Agreements. Any prior confidential
disclosure agreements between the Parties are incorporated by reference to this
Agreement, except for the Confidentiality Agreement. In case of a discrepancy
between the terms of this Agreement and such prior agreements, the terms of this
Agreement shall prevail; in case of a discrepancy between the terms of this
Agreement and the Confidentiality Agreement, the terms of the Confidentiality
Agreement shall prevail. Notwithstanding the foregoing, the Parties from time to
time may execute additional confidential disclosure agreements, as required by
their respective SOPs, for the limited and specific purpose of conducting
audits.
13. Miscellaneous
     13.1 Assignment. Except as expressly provided hereunder, and subject to the
Confidentiality Agreement, neither this Agreement nor any rights or obligations
hereunder may be assigned or otherwise transferred by either Party without the
prior written consent of the other (which consent shall not be unreasonably
withheld); provided, however, that either Party may assign this Agreement and
its rights and obligations hereunder without the other Party’s consent, to any
Affiliate or to any successor in title to the whole or part of that part of a
Party’s business to which this Agreement pertains. Notwithstanding the
foregoing, any such assignment to an Affiliate or successor in title shall not
relieve the assigning Party of its responsibilities for performance of its
obligations under this Agreement. The rights and obligations of the Parties
under this Agreement shall be binding upon and inure to the benefit of the
successors and permitted assigns of the Parties. Any assignment not in
accordance with this Agreement shall be void.
     In the event a prospective successor in title to the whole or part of that
part of a Party’s business to which this Agreement pertains desires to review
information that is subject to the Confidentiality Agreement, Organon shall
reasonably cooperate in arranging a supervised, read-only review (e.g. no notes
or copies) at Organon’s facilities in Oss, The Netherlands.
     13.2 Relationship of the Parties. It is expressly agreed that Organon and
Biodel shall be independent contractors and that the relationship between the
Parties shall not constitute a partnership, joint venture or agency of any kind.
Neither Party shall have the authority to make any statements, representations
or commitments of any kind, or to take any action, which shall be binding on the
other Party, without the prior written consent of the other Party.
     13.3 Amendment. Unless otherwise provided herein, this Agreement may not be
changed, waived, discharged, or terminated orally, but instead only by a written
document that is signed by the duly authorized officers of both Parties.
     13.4 Waiver. No failure or delay by either Party in exercising any right,
power, or privilege under this Agreement shall operate as a waiver thereof, nor
shall any single or partial waiver thereof include any other or further exercise
thereof or the exercise of any other right, power, or privilege.
     13.5 Severability. Whenever possible, each provision of the Agreement shall
be interpreted in such manner as to be effective and valid under applicable law,
but if any term or provision of this Agreement is held to be prohibited by or
invalid under applicable law, such

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provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of the Agreement and this
Agreement shall be interpreted and construed as if such provision had never been
contained herein.
     13.6 Notices. All notices and statements to be given (which shall be in
writing) and all payments to be made hereunder shall be given or made at the
respective addresses of the Parties as set forth above, unless notification of a
change of address is given. All notices, payments and statements to be made
hereunder shall be mailed by certified or registered mail, return receipt
requested, or sent by overnight courier, or by facsimile or other electronic
means. Any notice given pursuant to this Agreement by mail shall be considered
effective three (3) business days after mailing. Any notice sent by overnight
courier shall be considered effective one day after mailing. The date of
transmission of any notice sent by electronic means shall be deemed to be the
date the notice or statement is transmitted.
     13.7 Construction. The section headings of this Agreement are inserted only
for ease of reference only, and shall not be used to interpret, define,
construe, or describe the scope or extent of any aspect of this Agreement.
Unless otherwise expressly stated, when used in this Agreement the word
“including” means “including but not limited to.” Each Party represents that it
has had the opportunity to participate in the preparation of this Agreement and
hence the Parties agree that the rule of construction that ambiguities be
resolved against the drafting Party shall not apply to this Agreement.
     13.8 No Third Party Beneficiaries. Unless expressly provided, no provisions
of this Agreement are intended or shall be construed to confer upon or give to
any person other than Biodel and Organon any rights, remedies, or other benefits
under or by reason of this Agreement.
     13.9 Dispute Resolution. If a dispute arises under this Agreement, the
Parties shall use reasonable efforts to attempt to resolve such dispute,
including escalation of discussions to the appropriate level of management, as
provided in § 13.12, prior to commencing an action against the other Party.
Notwithstanding the foregoing, either Party may at any time seek equitable
relief under § 13.10 without first attempting to resolve a dispute under this §
13.9 provided, however, that such Party notifies the other Party promptly after
it files any such action.
     13.10 Equitable Relief. Each Party acknowledges and agrees that any
breaches of this Agreement (included without limitation violations of §3 and/or
§12) may cause the non-breaching Party irreparable damage for which the award of
monetary damages would be inadequate. Consequently, the non-breaching Party may
seek to enjoin the breaching Party from any and all acts in violation of any
such provisions, which remedy shall be cumulative and not exclusive, and a Party
may seek the entry of an injunction enjoining any breach or threatened breach of
such provisions, in addition to any other relief to which the non-breaching
Party may be entitled at law or in equity.
     13.11 Governing Law. This Agreement shall be governed by and interpreted
under the laws of the State of New York without regard to its conflict or choice
of law provisions. The United Nations Convention on Contracts for the
International Sale of Goods shall not apply to this Agreement.

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     13.12 Alternative Dispute Resolution. The Parties shall attempt by direct
good faith negotiations to resolve promptly any dispute arising out of or
relating to this Agreement. If the matter cannot be resolved in the normal
course of business either Party shall give the other Party written notice (the
“Dispute Notice”) of any such dispute not resolved at which time the dispute
shall be referred to the senior management of the respective Parties who shall
likewise attempt to resolve the dispute.
     If the dispute has not been resolved by negotiation as detailed above, or
if the Parties fail to meet, within thirty (30) business days of the Dispute
Notice, then the Parties shall endeavor to settle the dispute by mediation under
the supervision of and in accordance with the CPR Model Mediation Procedure for
Business Disputes in Europe. Unless otherwise agreed, both parties or each
individual party may request the CPR to appoint an independent mediator. The
language of the mediation shall be in English and the seat of mediation shall be
agreed upon by both parties or, in the event the parties do not timely agree,
the seat will be determined by the mediator.
     If the dispute has not been resolved by mediation as detailed above within
ninety (90) days of the Dispute Notice, either party may submit the dispute to
arbitration for resolution in accordance with the CPR Arbitration Rules. A
single, impartial arbitrator mutually acceptable to the Parties shall conduct
the arbitration. In the event the Parties cannot agree on an arbitrator within
twenty (20) business days of the submission of the dispute to arbitration,
either Party may request the CPR to appoint an arbitrator.
     The seat of the arbitration shall be in London, United Kingdom, unless the
Parties agree otherwise. As a condition of appointment of the arbitrator, said
arbitrator shall agree to use her/his best efforts to conclude the proceeding
within ninety (90) business days. Said arbitrator shall have the authority to
limit the volume of evidence and documents to be submitted by the Parties. Any
court having jurisdiction thereof may enter judgment upon the award rendered by
the arbitrator. This § 13.12 shall, however, not be construed to limit or to
preclude the rights of either Party under § 13.10 from bringing any action in
any court of competent jurisdiction for injunctive or other provisional relief
as necessary or appropriate.
     13.13 Force Majeure. Neither Party shall be liable to the other for any
failure or delay in the performance of any of its obligations under this
Agreement arising out of any event or circumstance beyond its reasonable
control, including war, rebellion, terrorism, civil commotion, strikes,
lock-outs or industrial disputes; fire, explosion, earthquake, acts of God,
flood or drought; or requisitioning or other act or order by any government,
council, or constituted body. If such failure or delay occurs, then the affected
Party shall give the other Party notice of the circumstances causing such
failure or delay, and such Party shall be excused from the performance of such
of its obligations that it is thereby disabled from performing for so long as it
is disabled and for thirty (30) days thereafter; provided, however, that such
affected Party commences and continues to take reasonable and diligent actions
to cure such failure or delay. Notwithstanding the foregoing, if a Party is
disabled from the performance of any material obligation under this Agreement
for a period of ninety (90) days or more, then the other Party shall have the
right to terminate this Agreement upon written notice to the other Party, in
which event the provisions of § 11.3 shall apply.

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     13.14 Attorneys’ Fees. If any claim, action, or dispute arises between the
Parties with respect to any matter covered by this Agreement that leads to a
proceeding before a court of competent jurisdiction to resolve such claim, the
Prevailing Party in such proceeding shall be entitled to receive from the other
Party its reasonable attorneys’ fees, expert witness fees, court costs and other
out-of-pocket costs incurred in connection with such proceeding, in addition to
any other relief that it may be awarded. For purposes of this § 13.14, the term
“Prevailing Party” means that Party in whose favor any monetary or equitable
award is made or in whose favor any dispute is resolved, regardless of any
settlement offers.
     13.15 Publicity. Neither Party shall disclose the fact that they are
conducting business together or the existence of, or the provisions of, this
Agreement to any other party unless such disclosure is in response to a valid
order by a court or other governmental body or necessary to comply with
applicable governmental law or regulations provided. Notwithstanding the
foregoing, each Party shall have the right to issue from time to time press
releases that disclose the relationship of the Parties under this Agreement upon
the agreement of the Parties, which agreement shall not be unreasonably
withheld, delayed, or conditioned. Any press releases that are to be issued by
either Party shall be in a form and substance as may be mutually agreed upon by
the Parties.
     13.16 Entire Agreement. This Agreement includes all exhibits attached
hereto (subject to § 8.3 with regard to the Quality Agreement) and any
Specifications that are executed by authorized representatives of the Parties,
and constitutes the entire Agreement by and between the Parties as to the
subject matter hereof. Subject to § 12.4, this Agreement supersedes and replaces
in its entirety all prior agreements, understandings, letters of intent, and
memoranda of understanding by and between the Parties hereto, in either written
or oral form, including without limitation the supply agreement between the
Parties of 4 April, 2005. No amendment or modification of this Agreement shall
be valid unless set forth in writing referencing this Agreement and executed by
authorized representatives of both Parties.
     13.17 English Language. This Agreement has been prepared in the English
language and the English language shall control its interpretation. In addition,
all notices required or permitted to be given hereunder, and all written,
electronic, oral or other communications between the Parties regarding this
Agreement, or delivered pursuant to the terms of this Agreement, shall be in the
English language. Any proceedings related to dispute resolution including, but
not limited to legal, equitable, or alternative dispute resolution, shall be
conducted in the English language.

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     In Witness Whereof, the Parties hereto have this day caused this Agreement
to be executed by their duly authorized officers.

                      N.V. Organon       Biodel Inc.    
 
                   
By:
  /s/ Adriaan Sanders       By:   /s/ Solomon S. Steiner    
 
 
 
Name: Adriaan Sanders          
 
Name: Solomon S. Steiner    
 
  Title: VP API/BT Global Supply Chain           Title: President & Chief
Executive Officer    
 
                    Date: 10-July-2008       Date: 7-July-2008    
 
                    N.V. Organon                
 
                   
By:
  /s/ K.S. Schouten                
 
                   
 
  Name: K.S. Schouten                
 
  Title: Managing Director                
 
                    Date: 10-July-2008                

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Exhibit A
SPECIFICATIONS
     Product shall be delivered with a Certificate of Analysis following the
most recent version of the European Pharmacopeia (EP) or the United States
Pharmacopeia (USP), respectively, whereby the A-21 desamido levels of all
batches of Product delivered in a calendar quarter shall be at or below [**]
percent ([**]%).

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Exhibit B
QUALITY AGREEMENT
To be provided

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Exhibit C
CONFIDENTIALITY AGREEMENT

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CONFIDENTIALITY AGREEMENT
     THIS CONFIDENTIALITY AGREEMENT (The “Agreement”) is made this 7th day of
July 2008 by and between
N.V. Organon, a limited liability company incorporated under Dutch law having
its registered office at Kloosterstraat 6, 5349 AB Oss, the Netherlands
(“Organon”),
and
Biodel Inc., a Delaware corporation, with its principal office and place of
business at having its offices at 100, Saw Mill Road, Danbury CT 06810, U.S.A.,
(“Biodel”),
each a “Party”, and when collectively referred to, “Parties”
WITNESSETH:
     WHEREAS, Organon (through its predecessor organization Diosynth B.V.) and
Biodel have previously entered into a supply agreement, dated the 4th day of
April 2005 regarding the supply to Biodel of recombinant human insulin (rHI)
(the “Product”) by Organon in respect of Biodel’s proprietary formulations of
insulin (the “End Product(s)”; the “Old Supply Agreement”);
     WHEREAS, Organon and Biodel have in good faith negotiated the terms and
conditions of a new supply agreement for the manufacture for and supply to
Biodel of the Product for the End Product(s), which new supply agreement is
executed concurrent with this Agreement and replaces the Old Supply Agreement
(the “New Supply Agreement”);
     WHEREAS, Biodel has requested Organon to grant access to Biodel of
Organon’s certain proprietary information with respect to the Product
(“Confidential Information”) as is necessary for the purpose of preparing and
maintaining the ‘Drug Substance Quality Section’ of the ‘Common Technical
Documents’ that form part of Biodel’s application for a marketing authorization
for its End Product VIAject® (the “Marketing Authorization”) with the relevant
regulatory bodies in the European Union (the “EMEA”) (the “Purpose”); and
     WHEREAS, in consideration of the foregoing, which forms part of this
Agreement, the Parties agree to the terms and conditions as set out below;
IT IS HEREBY AGREED AS FOLLOWS:

1.   Upon execution of this Agreement by the Parties, Organon shall, solely for
the Purpose and only to the extent required therefore and subject to the final
sentence of this Article 1, discuss, Confidential Information with the following
Representatives (as defined below) of Biodel only:       • [**]       (jointly,
the “Designated Persons”),

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    who will, prior to the aforementioned discussion of Confidential
Information, co-sign this Agreement as an acknowledgement of having reviewed
this Agreement with Biodel’s General Counsel with the purpose of understanding
Biodel’s obligations hereunder. The Parties agree that the Designated Persons
shall also be Representatives of Biodel Europe (as defined in Article 10
hereof). For the avoidance of doubt, (i) physical access to and disclosure of
the Confidential Information to the Designated Persons shall only be granted by
Organon as of the date that lies [**] before the date of submission of an
application for the Marketing Authorization with the EMEA, provided that the
terms of this Agreement shall fully apply thereto, and (ii) any other
proprietary and confidential information than the Confidential Information (e.g.
proprietary and confidential information that Organon also discloses to Biodel
with respect to regulatory filings in other countries and/or jurisdictions in
the Territory than the European Union), or any other proprietary and
confidential information shall be governed by the confidentiality terms under
the New Supply Agreement.     2.   For purposes of this Agreement, the term
Confidential Information shall not include information which, as adequately
substantiated by documentation, (i) is or becomes publicly available other than
as a result of a disclosure by Biodel or any of its directors, officers,
employees, affiliates, or other representatives (with regard to Biodel or
Organon, respectively, the “Representatives”, in the case of Biodel including
without limitation the Designated Persons) in violation of this Agreement or
other obligation of confidentiality or (ii) is or becomes available to Biodel or
its Representatives on a non-confidential basis from a source (other than
Organon or its Representatives) not known by Biodel or its Representatives to be
prohibited from disclosing such Confidential Information to Biodel or its
Representatives by a legal, contractual or fiduciary obligation.   3.   Biodel
agrees to keep secret and confidential all Confidential Information and to use
the Confidential Information solely for the Purpose. In that respect, and
subject to the other terms of this Agreement, Biodel, solely through its
Designated Persons, is entitled to provide the Confidential Information to, and
to liaise with, the EMEA only. The Designated Persons shall keep a detailed log
of the dealings and correspondence with the EMEA regarding the Confidential
Information and Biodel shall at least quarterly provide Organon with an update
of any permitted use, as described in the Purpose, of Confidential Information,
including copies of the aforementioned dealings and correspondence. Unless
Biodel has obtained Organon’s prior written approval thereto, (i) Biodel shall
not in any way amend or modify (e.g. change, delete, add to) the Confidential
Information, or parts thereof, (ii) nor shall Biodel respond to any questions by
the EMEA if and to the extent the response directly or indirectly requires or
results in the use of or the reference to, or is otherwise related to, the
Confidential Information.   4.   Except as explicitly provided for in Articles 3
and 10 hereof, Biodel shall not, and shall cause the Designated Persons not to,
(i) disclose any of the Confidential Information to any other person (without
limitation including Biodel’s Representatives other than the Designated
Persons), and/or (ii) make copies of, and/or prepare analyses, compilations,
forecasts, studies, or other documents based in whole or in part on, or
otherwise containing or reflecting any of, the Confidential Information.

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5.   Biodel agrees to assume liability for any breach of this Agreement
resulting from the act or omission of any of its Representatives, and Biodel
shall guarantee the respecting of all obligations under this Agreement by it or
its Representatives. Biodel hereby represents and warrants that it has entered
into confidentiality agreements with each of its Representatives that will
enable Biodel to meet its obligations hereunder.   6.   In the event that Biodel
or its Representatives are requested pursuant to, or required by, applicable
law, regulation or legal process to disclose any of the Confidential
Information, whether or not such disclosure is or would be in accordance with
the Purpose, Biodel will notify Organon promptly so that it may take appropriate
action or direct Biodel to take such action, including but not limited to,
seeking an appropriate protective order, or, in Organon’s sole discretion, waive
compliance with the terms of this Agreement (and Biodel will provide such
cooperation as Organon shall reasonably request). In the event that (i) despite
Organon’s and Biodel’s mutual efforts to take appropriate action to protect the
Confidential Information from disclosure Biodel or its Representatives are
nonetheless legally compelled to disclose such Confidential Information, or
(ii) Organon waives compliance with the terms of this Agreement, Biodel or its
Representatives, as the case may be, will furnish only that portion of the
Confidential Information which they are advised in writing by counsel is legally
required and will give Organon written notice (unless prohibited by law) of the
Confidential Information to be disclosed as far in advance as practicable and
exercise all reasonable efforts to obtain reliable assurance that confidential
treatment will be accorded the Confidential Information.   7.   If, for whatever
reason, (i) Biodel has not submitted an application for the Marketing
Authorization with the EMEA prior to [**], (ii) Biodel has not obtained approval
from the EMEA with respect to the Marketing Authorization prior to [**], and/or
(iii) Biodel intends to assign or otherwise transfer the Marketing
Authorization, or any of its rights thereunder, to any third party or affiliate
(other than to Biodel Europe in accordance with Article 10 hereof), then Biodel
shall timely inform Organon thereof and, subsequently, if and to the extent
requested by Organon, return and/or deliver to Organon, at Biodel’s expense, any
and all copies of the Confidential Information, and no copy thereof will be
retained by Biodel or its Representatives; provided that any orally disclosed
Confidential Information will continue to be subject to the terms of this
Agreement, and provided further that Biodel may retain one complete archival
copy of the Confidential Information, with an independent third party mutually
agreed to in writing between the Parties, in accordance with professional
standards of practice for the sole purpose of meeting its regulatory
obligations. With respect to the foregoing, in the event of the occurrence of a
circumstance referred to under (i) or (ii) above, Organon shall only request
such return of the Confidential Information if good faith discussions with
Biodel have not lead to amendment of the dates mentioned in (i) and/or (ii); in
the event of the occurrence of a circumstance referred to under (iii), Organon
shall only request such return of the Confidential Information if the
(prospective) transferee party, at the time of such transfer, is active in the
manufacturing of recombinant human insulin API market, or can reasonably be
expected to become active therein within [**]. By way of example with respect to
the occurrence of a circumstance referred to under (ii) above, Organon shall
reasonably agree to an amendment of the date mentioned in (ii) above if EMEA

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    requests the performance of additional clinical development work which would
reasonably be expected to delay receipt of approval for the Marketing
Authorization beyond the date specified in (ii) above. If Organon for any reason
did not make use of its rights hereunder with respect to a particular event as
referred to above, such does not preclude Organon from exercising such rights
with respect to such other previous, simultaneous or subsequent events.   8.  
Biodel acknowledges that remedies at law may be inadequate to protect Organon
against any actual or threatened breach of this Agreement by it or any of its
Representatives, and, without prejudice to any other rights and remedies
otherwise available to Organon, Biodel agrees that Organon may seek to enjoin
Biodel from any and all acts in violation of any such provisions, which remedy
shall be cumulative and not exclusive, and Organon may seek the entry of an
injunction enjoining Biodel from any breach or threatened breach of such
provisions, in addition to any other relief to which Organon may be entitled at
law or in equity, without proof of actual damages. In the event of litigation
relating to this Agreement, if a court of competent jurisdiction determines in a
final, non-appealable order that this Agreement has been breached by Biodel
and/or its Representatives, then Biodel will reimburse Organon for its costs and
expenses (including, without limitation, reasonable legal fees and expenses)
incurred in connection with all such litigation to the extent a judgment is
actually obtained.   9.   No failure or delay by Organon in exercising any right
hereunder will operate as a waiver thereof, nor will any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any right hereunder.   10.   Neither this Agreement nor any rights or
obligations hereunder may be assigned or otherwise transferred by Biodel without
the prior written consent of Organon; provided, however, that Biodel may assign
this Agreement and its rights and obligations hereunder (including, without
limitation, the transfer of Confidential Information through Designated Persons)
without Organon’s consent to any corporation or other business entity which
(i) is based in a member state of the European Union (other than an Excluded
Country, as defined in the New Supply Agreement), and (ii) is wholly owned and
controlled by Biodel. Notwithstanding the foregoing, any such assignment shall
not relieve Biodel of its responsibilities for performance of its obligations
under this Agreement. The rights and obligations of the Parties under this
Agreement shall be binding upon and inure to the benefit of the successors and
permitted assigns of the Parties. Any assignment not in accordance with this
Agreement shall be void.   11.   This Agreement will be governed by, construed
in accordance with and enforceable under the laws of The Netherlands. Each party
consents and submits to personal jurisdiction in The Netherlands, to settle any
dispute concerning the conclusion, validity, interpretation or performance of
this Agreement. Biodel and the Designated Persons agree that they may be served
with process at the address set forth on the first page hereof.   12.   This
Agreement contains the entire agreement between Biodel and Organon concerning
the Confidential Information, and as such prevails over the Confidentiality
Agreement of

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    11 April 2007, and no provision of this Agreement may be waived, amended or
modified, in whole or in part, nor any consent given, unless beforehand approved
in writing by duly authorized Representatives of Organon and Biodel
respectively, which writing specifically refers to this Agreement and the
provision so amended or modified or for which such waiver or consent is given.
In the event that any provision of this Agreement is deemed invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions of this Agreement will not in any way be affected or impaired
thereby.   13.   Neither this Agreement nor any disclosure of Confidential
Information shall be deemed by implication or otherwise to vest in Biodel any
present or future rights in any patents, trade secrets or property belonging to
or controlled by Organon and no license is granted except as explicitly stated
in this Agreement. Biodel further acknowledges and agrees that this Agreement
does not, by implication or otherwise, purport in any way to an obligation on
the part of Organon (i) to supply Biodel with the Product, other than agreed to
in the New Supply Agreement, or (ii) to expand the scope of the Purpose.   14.  
This Agreement is and remains valid until the date of termination or expiry of
the New Supply Agreement or, if applicable, of any written supply arrangement
following the New Supply Agreement; provided that the obligations of
confidentiality and non-use set forth in this Agreement expire [**] years from
such date.       AS AGREED upon and signed in duplicate by authorised
representatives of each party

              N.V. Organon   Biodel Inc.    
 
            /s/ Adriaan Sanders    /s/ Solomon S. Steiner              
By:    Adriaan Sanders
  By:   Solomon S. Steiner, Pd.D    
Title: VP API/BT Global Supply Chain
  Title:   President and CEO    
Date: 10-6-08
  Date:   7 July 2008    
Place:
  Place:   Danbury, CT USA    
 
           
N.V. Organon
           
 
           
/s/ K. S. Schouten
 
By:   K. S. Schouten
           
Title: Managing Director
           
Date: 10-6-08
           
Place:
           

     Pursuant to Article 1 of this Agreement, the Designated Persons indicate by
their signature below that they acknowledge having reviewed this Agreement with
Biodel’s General Counsel for the sole purpose of understanding Biodel’s
obligations hereunder. The Parties agree that the Designated Individuals shall
not become individually liable as a result of signing below.

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          /s/ [**]
 
       
By:
  [**]    
Title:
  [**]    
Date:
       
Place:
       

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          /s/ [**]

   
By:
  [**]    
Title:
  [**]    
Date:
       
Place:
       
 
        /s/ [**]

   
By:
  [**]    
Title:
  [**]    
Date:
       
Place:
       

     
 
By:
   
Title:
   
Date:
   
Place:
   
 
   
 
By:
   
Title:
   
Date:
   
Place:
   
 
   
 
By:
   
Title:
   
Date:
   
Place:
   
 
   
 
By:
   
Title:
   
Date:
   
Place:
   
 
   
 
By:
   
Title:
   
Date:
   
Place:
   

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By:
   
Title:
   
Date:
   
Place:
   

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Exhibit D
ENZYME DEVELOPMENT WORK PLAN
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission.
A total of 6 pages have been omitted.
[**]

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