EXHIBIT 10.55

 

THIS AGREEMENT is made by and between:

 

(1) AVECIA LIMITED, acting through its Avecia Biotechnology business, with
offices at Hexagon Tower, Blackley, Manchester, M9 8ZS, England (“Avecia”); and

 

(2) NUVELO, INC., a Delaware corporation with offices at 675 Almanor Avenue,
Sunnyvale, CA 94085, USA (“Nuvelo”).

 

WHEREAS

 

A Avecia has experience and knowledge with regard to process development,
fermentation and manufacture of recombinant proteins.

 

B Nuvelo is carrying out research and development in relation to the Product (as
defined below).

 

C In anticipation of entering into a definitive agreement to carry out a range
of activities in relation to the Product (as defined in this Agreement), Avecia
and Nuvelo entered into an Interim Agreement on 21 January 2005 (the “Interim
Agreement”) that set out the interim terms and conditions on which the following
portions of the Project, consisting of (i) assessment and planning, (ii)
transfer of process and assays, (iii) purchase of certain capital equipment,
(iv) replicate 15L fermentation and purification runs and (v) GMP consultancy
preparatory to GMP manufacture, would be carried out before execution of the
definitive agreement.

 

D Nuvelo now wishes Avecia to carry out activities in relation to the API (as
defined below), including validation work in respect of the Process (as defined
below).

 

NOW IT IS HEREBY AGREED BY NUVELO AND AVECIA AS FOLLOWS:

 

1. Definitions:

 

Affiliate    Any corporation, association or other business entity which
directly or indirectly controls, is controlled by or is under common control
with Avecia or Nuvelo and “control,” “controls” or “controlled” shall mean the
legal power to direct or cause the direction of the general management and
policies of such entity whether through the ownership of at least 50% of the
voting securities or voting capital stock of such business entity, or any other
comparable controlling equity or controlling ownership interest with respect to
a business entity other than a corporation. API    The polypeptide referred to
by Nuvelo as alfimeprase is the Active Pharmaceutical Ingredient. In accordance
with Annexe 18 of the EU Guide to Good Manufacturing Practice 2002, titled “Good

 

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     Manufacturing Practice for Active Pharmaceutical Ingredients,” an Active
Pharmaceutical Ingredient is any substance or mixture of substances intended to
be used in the manufacture of a drug (medicinal) product and that, when used in
the production of a drug, becomes an active ingredient of the drug product. Such
substances are intended to furnish pharmacological activity or other direct
effect in the diagnosis, cure, mitigation, treatment, or prevention of disease
or to affect the structure and function of the body. API Specification    The
specification for API attached to, and part of the Quality Agreement, which may
be amended from time to time in accordance with the terms and conditions of this
Agreement and the Quality Agreement. Applicable Laws    All applicable
supranational, national or local laws, rules and regulations, including without
limitation the United States Federal Food, Drug and Cosmetic Act, the
regulations promulgated pursuant thereto, any applicable non-U.S. equivalents
thereof, and any successor laws, rules or regulations thereto. Avecia Default   

Means:

 

(a) A Failure by Avecia to use reasonable commercial endeavours to progress the
Project;

 

(b) A Failure by Avecia to manufacture any Development Batch or any Validation
Batch in accordance with cGMP, specifically including any failure to follow
Avecia’s facilities’ Standard Operating Procedures that results in, or from
which arises, a Defective Batch;

 

(c) Solely with respect to the centrifuge trials, a failure by Avecia to conduct
the centrifuge trials in accordance with Avecia’s Standard Operating Procedures:
(1) for the fermentation and harvest suite or suites which are applicable to the
centrifuge trials in the reasonable determination of the Quality Team, a list of
which shall be generated by the Quality Team; and (2) for, as reasonably
modified from time to time as a result of the work carried out under the
Project, any equipment to be used in the centrifuge trials;

 

(d) Solely with respect to the Development Batches:

 

(1) A failure by Avecia personnel—including without limitation lack of
appropriate training, lack of attention to MBRs or Standard Operating

 

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Procedures, or lack of proper laboratory analysis—that results in, or from which
arises, a Defective Batch;

 

(2) A failure of Avecia documentation—including without limitation inadequate
Standard Operating Procedure or MBR documentation, improperly organized or lost
documentation, or poor analysis of information incorporated into any such
documentation—that results in, or from which arises, a Defective Batch;

 

(3) Adulteration—including without limitation adulteration from cleaning agents
and/or other contaminants, or adulteration from using reagents other than in the
order specified in the Work Programme or the MBRs for the Process—that results
in, or from which arises, a Defective Batch;

 

(4) A failure of Avecia equipment—including without limitation poor maintenance,
age of the equipment, computer malfunction, software malfunction or controller
malfunction, equipment being out of specification or not properly calibrated,
equipment not being validated for intended use, improper cleaning, improper
cleaning cycles or failure to clean equipment—that results in, or from which
arises, a Defective Batch;

 

(5) A Failure of an Avecia facility—including without limitation a cGMP
violation in the facility, improper environmental controls, including HVAC
system failure, poor construction or inadequate maintenance—that results in, or
from which arises, a Defective Batch; or

 

(6) A failure of Avecia raw materials—including without limitation raw materials
that are out of specification, quarantined, improperly tested, improperly
processed or expired—that results in, or from which arises, a Defective Batch;

 

(e) For the avoidance of doubt, a failure of a centrifuge trial or the
occurrence of a Defective Batch that is a Development Batch, that results from a
factor—other than any of the factors listed in Clauses (a) through (d)
above—which affects the Process or production of the API and was not known and
could not reasonably have been known by Avecia at the commencement of the
applicable stage of the Project shall not be considered to be an Avecia default;
such factors include, without limitation:

 

(1) the Process does not perform as anticipated due to a change of scale;

 

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(2) inability of the centrifuge to clarify the harvested broth to an acceptable
level;

 

(3) failure during a centrifuge run of the pH control system to maintain a
specified range; and

 

(4) failure during a centrifuge run of the feed strategy to generate the
expected product yield or quality; or

 

(f) The occurrence of a Defective Batch during the Validation Campaign is, and
is automatically deemed to be an Avecia Default, except upon the occurrence of a
Defective Batch which results from a factor—other than any of the factors listed
in Clauses (a) through (d) above—which affects the Process or production of the
API and was not known and could not reasonably have been known by Avecia before
the Defective Batch occurred, including, without limitation, a previously
unknown factor not studied either as part of the Amgen programme transferred to
Avecia or the Avecia laboratory work programme carried out pursuant to the
Project (the preceding in this Clause (f) referred to herein as a “Validation
Process Failure”).

Background Intellectual Property   

Any Intellectual Property owned by or Controlled by a Party (where “Controlled”
means the ability to grant a license or sublicense to the Intellectual
Property):

 

(a)    at the Commencement Date of this Agreement; or

 

(b)    after the Commencement Date that is either: (1) acquired independently of
the Project; or (2) developed independently of the Project by any employee of
that Party without use of or reference to any of the Confidential Information
disclosed by the other Party.

Batch    A quantity of API produced using the Process that (a) is expected to
have uniform character and quality within specified limits, and (b) is produced
according to a single manufacturing run during the same cycle of the Process.
Batch Dispute    The definition set forth in Clause 2.7(g). Cancellation Fee   
A sum calculated in accordance with Schedule 4. The Cancellation Fee may
include, as applicable as set forth in Schedule 4 and in accordance with the
terms

 

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     and conditions of this Agreement, the Development Batch Fee and/or the
Validation Campaign Fee. Certificate of Analysis    A document, the form of
which is approved in advance by the Quality Team, that is prepared and issued by
Avecia’s quality assurance department certifying analysis and cGMP manufacture
of the API and its compliance with the API Specification. cGMP    Current Good
Manufacturing Practices required by Regulatory Authorities with respect to the
development, manufacture, storage and supply of any Batch, including current
good manufacturing practices as incorporated in Annexe 18 of the EU Guide to
Good Manufacturing Practice 2002, titled “Good Manufacturing Practice for Active
Pharmaceutical Ingredients” (formerly ICH Q7A) and as interpreted in the USA
Federal Register Vol 66 No. 186 (formerly ICH Q7A), and subject to any
arrangements, additions or clarifications agreed in writing from time to time
between the Parties in the Quality Agreement. Commencement Date    21st January
2005. Completion    Completion of the Project as set out in Clause 4.
Confidential Information    Shall have the meaning given in the Confidentiality
Agreement, subject to Clause 7. New Intellectual Property shall be deemed to be
Confidential Information disclosed by Nuvelo. Confidentiality Agreement    The
confidentiality agreement entered into between the Parties and dated 21st
September 2004, attached hereto as Schedule 7. Defective Batch   

Either:

 

(a)    A Batch that has not been produced in accordance with cGMP, specifically
including all Standard Operating Procedures for Avecia’s facility and the Master
Batch Records for the Process, and for which any non-conformances from the SOPs
or the MBRs cannot be closed-out in accordance with the procedures for close-out
of non-conformances set forth in the Quality Agreement; or

 

(b)    A Batch, other than the first Development Batch or the Engineering Batch,
which cannot be Released.

 

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Development Batch or cGMP Development Batch    A Batch manufactured during
Development Batch Manufacture, specifically including the Engineering Batch.
Development Batch Manufacture    The work to manufacture the development Batches
and the Engineering Batch in accordance with Clause 2.3 and the Work Programme.
Engineering Batch    A Batch manufactured immediately prior to the Validation
Campaign for the purpose of re-testing the Process before commencement of the
Validation Campaign. Equipment    Any equipment (such as, without limitation,
columns, freezers, filtration skids, cassette holders, ammonia feed tanks) which
is required to be purchased in order for Avecia to carry out the Project and
which is set forth in Schedule 6 to this Agreement or set forth in the Work
Programme or any Programme Amendment Order. Executive Committee or EC    The
executive committee established pursuant to Clause 2.7. Expenditure    An amount
paid or due and payable to a Third Party for the purchase of subcontractor
services directly from the Third Party in accordance with Clause 13.2 or for the
purchase of goods or materials directly from the Third Party. Force Majeure   
Any cause beyond the reasonable control of the Party in question, which for the
avoidance of doubt and without prejudice to the generality of the foregoing, may
include governmental actions, war, riots, terrorism, civil commotion, fire,
flood, epidemic, labour disputes (excluding labour disputes involving the work
force or any part thereof of the Party in question), restraints or delays
affecting shipping or carriers, inability or delay in obtaining supplies of
adequate or suitable materials, and act of God, but shall not include failure of
the Product in clinical trials or failure of the Product to gain regulatory
approval. Handling Fee    A sum equivalent to 8% of the actual Expenditure for
the Equipment or consumables purchased under Clauses 3.2(a)(1), 3.2(a)(3) and
3.3. Hold Time    Any period of time during Development Batch Manufacture or the
Validation Campaign during which Batches are not being manufactured, whether by

 

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     agreement so that modifications to procedures, processes and/or facilities
or review thereof can be undertaken or as a result of a Nuvelo Delay or an
Avecia Default. Intellectual Property    Any Patent, trade secret, copyright or
other industrial or intellectual property right. Invention    Any invention,
innovation, improvement, development, discovery, computer program, device,
method, know-how, process, technique or the like, whether or not written or
otherwise fixed in any form or medium, regardless of the media on which
contained and whether or not patentable or copyrightable. New Intellectual
Property or New IP    Any Intellectual Property that claims or covers any New
Invention. New Invention    Any Invention directly resulting from or directly
arising out of Avecia’s performance of the Project. Non-Manufacturing Delay    A
delay resulting from a decision by Nuvelo to delay the Project for reasons
unrelated to: the Project; manufacture of the API under the Agreement; any
Avecia Default; or any Process Failure. Non-Manufacturing Delay may include,
without limitation, decisions made in response to the outcome of clinical trials
of the API. Nuvelo Delay    Any delay in the Development Batch Manufacture or
the Validation Campaign which is caused by Nuvelo including, without limitation,
unreasonable refusal to agree to any matter requiring mutual agreement under
this Agreement in a timely manner; but, each of the following is not, and shall
not be deemed to be, a Nuvelo Delay: (i) any delay or refusal by Nuvelo to agree
based upon or resulting from an Avecia Default; and (ii) any delay resulting
from Nuvelo’s refusal to take a license under a Patented, Licensed Avecia
Invention under Clause 5.2(c). Master Batch Record or MBR    A written
description of the procedure to be followed for manufacturing a Batch of the
API, including but not limited to the history of a Batch from the raw material
stage up through and until completion of the Batch, a complete list of all
active and inactive ingredients, components, weights and measures, descriptions
of drug product containers, closures, packaging materials, and labelling and
complete specifications for each, within the meaning of 21 Code of Federal
Regulations 211.186, or its successor as in effect from

 

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     time to time, and also in compliance with Annexe 18 of the EU Guide to Good
Manufacturing Practice 2002, titled “Good Manufacturing Practice for Active
Pharmaceutical Ingredients” (formerly ICH Q7A), or its successor as in effect
from time to time. Party or Parties    Avecia and Nuvelo are referred to
individually herein as a “Party”, and collectively as the “Parties”. Patent   
Any: (a) patent, including without limitation any inventor’s certificate or
design patent, and any substitution, extension, registration, confirmation,
reissue, re-examination or any like filing thereof related to a patent; and (b)
any pending patent application, including without limitation any continuation,
division or continuation-in-part thereof and any provisional application.
Process    The process for the manufacture of API communicated to Avecia by, or
on behalf of, Nuvelo and subsequently scaled-up by Avecia under and in
accordance with this Agreement. Process Assumptions    The following: (a)
requirements set forth in the Master Batch Records for the Process, (b)
requirements set forth in Avecia’s Standard Operating Procedures, and (c) raw
materials and consumables requirements and specifications. Any amounts of time
necessary to conduct a particular part of the Process, also referred to as cycle
times, are expressly excluded from Process Assumptions, irregardless of any
statements to the contrary set forth in the Work Programme. Product    Any
product that incorporates or contains the API. Programme Amendment Order    A
document in the form set out in Schedule 3 detailing changes to the Project
agreed upon and signed by both Parties. Project    The range of activities to be
carried out under this Agreement in accordance with the Work Programme, the
details of which are more fully set out in the Work Programme, and any
additional or alternative work not set forth in the Work Programme that may be
agreed in a Programme Amendment Order. Project Steering Committee or PSC    The
Project steering committee established pursuant to Clause 2.7.

 

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Quality Agreement   

The document, a copy of which is attached as Schedule 2, that sets forth,
amongst other things:

 

(a)    the mutually agreed quality standards applicable for the manufacture of
the API under the Agreement in accordance with cGMP; and

 

(b)    the roles and responsibilities of each Party’s personnel in relation to
quality assurance matters under this Agreement; and

 

(c)    the API Specifications.

Quality Team    The Avecia Quality Unit together with the Nuvelo Quality Unit,
as further set forth in the Quality Agreement. Regulatory Authority or
Regulatory Authorities    The U.S. Food and Drug Administration, the European
Agency for the Evaluation of Medicinal Products, and any equivalent governmental
regulatory body in any territory in the world, and any successor entity or
entities to any of the preceding. Regulatory Filing    Any and all
correspondence or petitions to Regulatory Authorities for the purpose of
registering the Product or the Process, or modifying or supplementing existing
filings and subsequent amendments and supplements thereto, as required by
Applicable Laws, in order to develop, manufacture, test, sell or distribute
Product or the API under this Agreement. Release or Released   

The process by which, in respect of each Batch:

 

(a)    Avecia’s Quality Unit:

 

(1)    reviews and approves completed Batch records;

 

(2)    reviews and approves all campaign Batch records and buffer Batch records;

 

(3)    closes out all non-conformances;

 

(4)    closes out all change controls;

 

(5)    issues a Certificate of Analysis;

 

(6)    Issues a Certificate of Compliance; and

 

(b)    Nuvelo’s Quality Unit:

 

(1)    Reviews, and, if appropriate, accepts all Batch related manufacturing
documentation;

 

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(2)    Reviews, and, if appropriate, accepts QC Batch related analyses; and

 

(3)    Reviews, and, if appropriate, accepts the Certificate of Analysis.

 

For the purpose of this definition, “Accepts” means Avecia has received written
notification from Nuvelo that Nuvelo accepts the documents referred to in Clause
(b) above. In the absence of such written notification that Nuvelo does or does
not accept such documents, upon the expiration of 30 calendar days from the date
on which Nuvelo receives Avecia’s written notification of Avecia’s completion of
the tasks referred to in Clause (a) above, Nuvelo is deemed to have accepted the
documents referred to in Clause (b) above. A Batch that has been Released may be
referred to as a “Released Batch”. A Released Batch, or set of Released Batches,
may also be referred to as “Released API”. If Nuvelo rejects the documents
referred to in Clause (b) above, the matter will be addressed in accordance with
Clause 2.7(g).

Standard Operating Procedures or SOPs    Written procedures requiring uniform
performance of specific functions, or uniform use of specific equipment or
resources to ensure data, analysis and manufacturing quality and uniformity.
Third Party    Any person or entity other than the Parties or their respective
Affiliates. Unremedied Breach    A material breach of this Agreement which is
not remedied within 30 calendar days after receipt of written notice from the
non-breaching Party requiring rectification of the breach. Validation Batch    A
Batch manufactured by Avecia as part of the Validation Campaign. Validation
Campaign    The campaign carried out by Avecia to manufacture three (3)
consecutive Validation Batches that can be Released out of up to five (5)
anticipated Validation Batches, intended to demonstrate to Regulatory
Authorities a high degree of assurance that the Process will consistently
produce Batches meeting pre-determined acceptance criteria necessary for
Release, as set out in more detail in Schedule 1 and the Quality Agreement.
Validation Master Plan    A validation project plan developed by Avecia and
reviewed, and if acceptable, approved by Nuvelo in writing which contains all of
the validation activities for

 

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     the Validation Campaign, including validation steps, deliverables, a time
schedule and responsibilities. Valid Claim    A claim of a Patent that: (a) in
the case of a pending claim, is being prosecuted, has been pending for no more
than 6 years and has not been abandoned or permitted to lapse, and (b) in the
case of an issued claim, has not expired or been held invalid or unenforceable
in a final binding court decision from which no appeal can be or is taken. Work
Programme    The protocol for the performance of the Project by Avecia, agreed
upon by the Parties and attached as Schedule 1 of this Agreement. The Work
Programme sets forth the timing and requirements for the activities to be
carried out under the Project, including the Work Programme Timeline, attached
to the Work Programme as Appendix 2.

 

  1.2 Interpretation. References in this Agreement to “Schedules” refer to the
Schedules incorporated into this Agreement, specifically including, without
limitation, the Confidentiality Agreement, the Quality Agreement, and the Work
Programme. To the extent that there is conflict between or ambiguity relating
to, on the one hand, any or all of the Schedules and, on the other, the
remainder of this Agreement, the wording of the remainder of this Agreement
shall prevail.

 

2. Performance of Project

 

  2.1 General.

 

  (a) Avecia shall carry out the Project in accordance with the terms and
conditions of this Agreement and the Quality Agreement with reasonable skill and
care and no less than the level of skill and care to be reasonably expected of a
professional provider of such services. Avecia also shall perform the Project in
compliance with all relevant professional standards, all Applicable Laws and
cGMP.

 

  (b) The Parties acknowledge that, having regard to the fact that the work to
be performed hereunder is by its nature developmental, Avecia does not guarantee
to Nuvelo the achievement of a successful outcome for the Project, but will use
reasonable commercial endeavours to ensure timely success.

 

  2.2 Laboratory work and scale-up activities

 

  (a)

Following the Commencement Date, Avecia shall carry out, and has carried out
with respect to a portion thereof as set forth in the Interim Agreement, a range
of activities, including

 

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data acquisition and assessment, process transfer, replicate 15L runs, process
characterisation, fermentation and downstream process, assay validation, process
transfer and prep for large scale manufacture, laboratory based cleaning studies
and centrifuge trials on two (2) 3000 litre Batches of the API, all as set out
in more detail in the Work Programme.

 

  (b) Centrifuge Trials.

 

  (1) Obligations and Timing. Avecia shall carry out production of two (2)
centrifuge trials on two (2) 3000 litre Batches of the API in accordance with
its ABC5000 facilities’ Standard Operating Procedures, the Master Batch Records
for the Process, all Applicable Laws and the terms and conditions of this
Agreement. Avecia shall commence modifications of its ABC5000 facility for the
centrifuge trials no later than week commencing July 4, 2005, Pacific Standard
Time. If Avecia fails to commence the modifications of its ABC5000 facility
necessary for the centrifuge trials before the expiration of the week commencing
July 4, 2005, Pacific Standard Time, then Nuvelo is entitled to terminate this
Agreement in accordance with Section 8.2 upon 10 calendar days written notice to
Avecia, without payment of any Cancellation Fees if Avecia has not commenced the
modifications before the expiration of the 10 calendar day period.

 

  (2) Process Failures; Additional Centrifuge Work. If neither of the two
centrifuge trials is successful for any reason other than an Avecia Default,
then the Parties shall meet to agree to an additional phase of process
development work, to include the performance of further centrifuge trials (all
such work referred to herein as “Additional Centrifuge Work”) and commercially
reasonable terms for the performance of the Additional Centrifuge Work. The
Additional Centrifuge Work shall be set forth in a Programme Amendment Order,
such Programme Amendment Order to include revised timings for Development Batch
Manufacture and Validation Campaign, as appropriate. If, other than as a result
of an Avecia Default, the Additional Centrifuge Work does not result in at least
one successful centrifuge trial and Development Batch Manufacture has not
commenced before the expiration of December 31, 2005, Pacific Standard Time,
then Nuvelo may either terminate the Agreement in accordance with Clause 8.2
upon a date that is 30 calendar days after December 31, 2005, Pacific Standard
Time or call an Urgent Meeting of the PSC to discuss whether further Additional
Centrifuge Work should be conducted.

 

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  (3) Centrifuge Trials; Avecia Default. If neither of the two centrifuge trials
is successful as a result of Avecia Default(s), Avecia shall promptly reprocess,
rework if pre-approved in writing by an authorized representative of Nuvelo or
re-perform, the centrifuge trials at Avecia’s cost and expense until either (i)
one of the centrifuge trials is successful or; (ii) the centrifuge trials are
unsuccessful other than as a result of an Avecia Default, at which time Clause
2.2(b)(2) will apply.

 

  2.3 Development Batch Manufacture

 

  (a) Batch Production. Avecia shall carry out production of two (2) Development
Batches (in accordance with the terms set forth below) in its ABC5000 facility
in accordance with the terms and conditions of this Agreement, cGMP, Applicable
Laws and the Work Programme, with the primary aim of testing and improving Batch
records and operating procedures, clarifying any scale-up issues and ensuring
operator familiarity with the Process. Avecia also shall carry out an
Engineering Batch in accordance with Clause 2.3(e). Whilst Development Batch
Manufacture is intended to produce Development Batches which can be Released, it
is recognised that problems related to the Process that are not Avecia Defaults
may preclude this.

 

  (b) Development Batch Failure. If the Quality Team is in agreement that
neither of the two (2) Development Batches manufactured under Clause 2.3(a) can
be Released, Avecia shall, at the direction and option of Nuvelo, either:

 

  (1) reprocess one of the two (2) Development Batches produced during
Development Batch Manufacture in accordance with cGMP;

 

  (2) if pre-approved in writing by an authorized representative of Nuvelo,
rework one of the two (2) Development Batches produced during Development Batch
Manufacture in accordance with cGMP;

 

  (3) manufacture another Development Batch; or

 

  (4) immediately stop all work, as a result of a decision by Nuvelo to
terminate the Agreement in accordance with Clause 8.

 

  (c) Next Actions Upon Development Batch Failure.

 

  (1)

Avecia Default. In the event that the Quality Team is in agreement that the
second Development Batch or both of the two (2) Development Batches manufactured
under Clause 2.3(a) are Defective Batches as a result of an Avecia Default,
Avecia shall rework, reprocess or

 

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manufacture in accordance with Clause 2.3(b)—within 10 business days after the
Quality Team notified the PSC of the Quality Team’s determination if the Avecia
Default is of a nature that can be promptly corrected, otherwise, as soon as
reasonably practicable thereafter—at Avecia’s cost and expense, until such time
as Avecia generates a Development Batch that can be Released (or could have been
Released but for an issue that is not an Avecia Default); but if, as a result of
Avecia Default(s), Avecia fails to generate a Development Batch which can be
Released within 3 months from commencement of such rework, reprocessing or
further manufacture, then the PSC shall hold an Urgent Meeting to discuss
whether or not yet another Development Batch should be generated. Nuvelo is
entitled to terminate the Agreement, without payment of any Cancellation Fees,
if Development Batches cannot be Released as a result of Avecia Default(s)
before the expiration of the 3 month cure period provided in this Clause
2.3(c)(1). Nuvelo may terminate the Agreement during the 3 month cure period for
Unremedied Breach if Avecia fails to generate a Development Batch that can be
Released as a result of Avecia Default(s) and is not using commercially
reasonable efforts to generate at least one Development Batch that can be
Released per month during the three month cure period.

 

  (2) Process Failure. If the first 2 Development Batches cannot be Released for
a reason other than Avecia Default, at the request of Nuvelo, Avecia shall
rework, reprocess or manufacture Development Batches at a time and at a cost to
Nuvelo to be agreed by the Parties in good faith and recorded in a Programme
Amendment Order. If the rework, reprocessing or further manufacture results in
another Development Batch which is a Defective Batch for a reason other than
Avecia Default, then the PSC shall hold an Urgent Meeting to discuss whether or
not yet another Development Batch should be generated. If and at such time as
Avecia and Nuvelo agree that Process scale-up problems causing the Defective
Batches in accordance with this Clause 2.3(c)(2) are or will be satisfactorily
resolved, unless the Agreement is terminated by one the Parties, the Parties
will agree to a revised timetable for manufacture of a number of Development
Batches to be determined, upon commercially reasonable terms, in a Programme
Amendment Order.

 

  (d)

Successful Development Batch Release: Pre-Validation Campaign Review. If at
least one (1) of the two (2)

 

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Development Batches manufactured under Clause 2.3(a) can be Released or if
rework, reprocessing or further manufacture carried out in accordance with
Clause 2.3(b) results in a Development Batch which can be Released, the Project
Steering Committee shall review the activities carried out to date, solely to
evaluate operability of the Process and Avecia’s cGMP compliance in order to
ensure that both Parties are confident of success in the Validation Campaign
(“the Pre-Validation Campaign Review”). During the Pre-Validation Campaign
Review, the PSC, with input from the Quality Team, shall discuss readiness to
carry out the Validation Campaign, potential timing for its conduct and any
other issues concerning the Process operability or cGMP compliance. This
discussion will include a review and analysis of the actual performance of the
Development Batches compared to the Process Assumptions, and an attempt by the
PSC to reach agreement with respect to whether the Validation Campaign shall be
delayed, not be delayed, or not be carried out at all. If during the
Pre-Validation Campaign Review, the EC, after referral of the matter to it by
the Project Steering Committee, is unable to reach a final decision in
accordance with the terms of Clause 2.7(f) as to whether the Validation Campaign
shall be delayed, not be delayed, or not be carried out at all—solely due to
Process operability or Avecia cGMP compliance issues, or any other concerns
which resulted in a Development Batch being a Defective Batch— then either Party
may terminate this Agreement in accordance with and subject to the terms
provided for termination set forth in this Agreement, including the possibility
that the Parties may mutually agree to terminate the Agreement under Clause 8.4.

 

  (e) Proceeding to Validation Campaign. If at least one (1) Development Batch
is Released, then following completion of, and subject to either agreement by
the PSC or a determination made by the EC in the Pre-Validation Campaign Review,
Avecia shall carry out an Engineering Batch and shall proceed to and shall carry
out the Validation Campaign in accordance with the terms and conditions of this
Agreement for the performance of the Project in accordance with Clause 2.1, the
Work Programme and any revised timetable for performance of the Engineering
Batch and the Validation Campaign resulting from Pre-Validation Campaign Review.
Development Batch Manufacture shall be deemed to be complete when: (1) the
Quality Team has completed Release of at least one Development Batch, and that
Batch’s associated documentation has been delivered to Nuvelo; and (2) Avecia
has completed manufacture of an Engineering Batch that is not a Defective Batch,
and the Engineering Batch’s associated documentation has been delivered to
Nuvelo.

 

15

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  (f) Delivery of Defective Batches. In the event that during Development Batch
Manufacture it is determined by the Quality Team that a Development Batch is a
Defective Batch, the Defective Batch shall not be delivered to Nuvelo, unless
Nuvelo requests it. If Nuvelo requests delivery of the Defective Batch, Avecia
shall deliver such Defective Batch in accordance with Clause 4.2 and such
Defective Batch may be used in research or development internally, labelled for
non-human use or destroyed.

 

  (g) Quality Team Disagreement. If the Quality Team cannot reach agreement with
respect to whether or not a Development Batch is a Defective Batch, or whether
or not a Defective Batch resulted from an Avecia Default, the disagreement will
be resolved in accordance with Clause 2.7(g).

 

  2.4 Validation Campaign

 

  (a) cGMP Preparation

 

  (1) Avecia shall carry out cGMP preparation work following the decision that
Avecia shall carry out the Validation Campaign under and in accordance with
Clause 2.3(e) above. Such cGMP preparation work shall include the work
identified in the Work Programme, the Quality Agreement and any additional work
agreed under a Program Amendment Order pursuant to Clause 2.3(c)(2) or
otherwise.

 

  (2) Avecia shall produce a Validation Master Plan for review, comment and
approval by Nuvelo before the start of the Validation Campaign.

 

  (3) Avecia shall conduct the Validation Campaign in accordance with the terms
and conditions of this Agreement and the Quality Agreement. The Quality
Agreement sets forth how the Parties’ Quality Units will jointly review
non-conformances, determine severity, assess their level of impact on the API
and agree on actions which may include accepting a Validation Batch, failing a
Validation Batch or declaring a Validation Batch to be a Defective Batch,
disqualifying a Validation Batch from the series of three (3) consecutive
Batches or passing or failing the entire Validation Campaign.

 

  (b) Manufacture of Validation Batches

 

  (1)

Commencement of Validation Campaign. Avecia shall commence manufacture of
Validation Batches following confirmation by the Quality Team that the

 

16

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preparation work set forth in Clauses 2.4(a)(1) and 2.4(a)(2) has been completed
and the Master Batch Records have been approved in accordance with the Quality
Agreement. If the Quality Team is unable to reach agreement on such confirmation
and approval, the matter shall be referred to the PSC for resolution.

 

  (2) Number of Validation Batches. Subject to Clause 2.4(b)(3) below, the
Validation Campaign shall consist of up to five (5) Validation Batches with an
expectation of producing three (3) Released consecutive successful production
Batches and thus constitute a formal Validation Campaign. Avecia will ensure
that sufficient time is scheduled in its ABC5000 facility to complete a
Validation Campaign of up to five (5) Validation Batches.

 

  (3) 5th Validation Batch. In the event that the Quality Team determines that a
fifth (5th) Validation Batch is required, other than as a result of an Avecia
Default, in order to increase the chances of successful completion of the
Validation Campaign, Avecia shall carry out manufacture of a fifth (5th)
Validation Batch on the basis that Avecia will meet the costs of operating its
ABC 5000 facility and Nuvelo shall pay to Avecia, as an additional technical
consultancy fee, the actual Expenditures for any additional raw materials or
consumables required to be purchased in order to manufacture such fifth (5th)
Validation Batch, plus the Handling Fee, in accordance with Clause 3.2(b).

 

  (4) Documentation Review. During the Validation Campaign, the Parties shall
carry out review of the Master Batch Records, campaign Batch records and other
relevant documentation relating to each Validation Batch as it is manufactured.
This review and assessment will involve the Nuvelo Quality Unit and such other
of Nuvelo’s staff as Nuvelo directs, in Nuvelo’s discretion.

 

  (5) Completion of Validation Campaign. The Validation Campaign shall be deemed
to be complete when the Quality Team determines that the Validation Campaign has
completed three (3) Validation Batches that can be designated consecutive
successful production Batches that have completed Release, and all associated
documentation and a validation summary report have been delivered to Nuvelo in
accordance with Clause 4.2.

 

17

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  (c) Quality Unit Determination

 

  (1) Determination of Validation Success or Failure. The Quality Team shall
determine in accordance with the Quality Agreement and by reference to cGMP
whether the Validation Campaign has been successful. In the event that the
Quality Team determines that the Validation Campaign has not been successful,
then, as set forth in and in accordance with Clauses 2.4(c)(2) and 2.4(c)(3)
below, Avecia shall repeat the Validation Campaign or Validation Batches (as
appropriate) within 10 business days after the Quality Team notified the PSC of
the Quality Team’s determination, if the cause of the failure of the Validation
Campaign is of a nature that can be promptly corrected, otherwise, as soon as
reasonably practicable thereafter. In the event of any dispute arising amongst
the Quality Team, the matter will be resolved in accordance with Clause 2.7(g).

 

  (2) Avecia Default. If the Validation Campaign is determined not to be
successful as a result of an Avecia Default, then the repeated Validation
Campaign or Validation Batches (as appropriate) shall be promptly carried out by
Avecia at Avecia’s cost and expense; but if the repeated Validation Campaign or
Validation Batches (as appropriate) does not result in a successful Validation
Campaign as a result of an Avecia Default within 3 months of commencement of
such repeated Validation Campaign or Validation Batches (as appropriate), then
the PSC shall hold an Urgent Meeting to discuss whether or not the Validation
Campaign or Validation Batches (as appropriate) shall be repeated again. Nuvelo
is entitled to terminate the Agreement, without payment of any Cancellation
Fees, if, as a result of Avecia Default, the repeated Validation Campaign or
Validation Batches (as appropriate) does not result in a successful Validation
Campaign before the expiration of the 3 month cure period provided in this
Clause 2.4(c)(2). Nuvelo may terminate the Agreement during the 3 month cure
period for Unremedied Breach if Avecia fails to generate a successful Validation
Campaign and is not using commercially reasonable efforts to generate at least 5
Validation Batches that could lead to a successful Validation Campaign during
the three month cure period.

 

  (3)

Validation Process Failure. If the Validation Campaign is determined not to be
successful because of a Validation Process Failure, then, if requested in
writing by Nuvelo, a repeated Validation Campaign or Validation Batches (as
appropriate) shall be carried out by Avecia at a commercially reasonable cost to
Nuvelo to be agreed in good faith by the Parties and set out in

 

18

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a Programme Amendment Order. In the event that a repeated Validation Campaign
carried out under this Clause is determined not to be successful, then the
Parties shall meet to discuss what action should be taken.

 

  (d) Quality Team Disagreement. If the Quality Team cannot reach agreement with
respect to whether or not a Validation Batch is a Defective Batch, or whether or
not a Defective Batch resulted from an Avecia Default, the disagreement will be
resolved in accordance with Clause 2.7(g).

 

  2.5 Delays and Cancellations. Nuvelo shall have an option to, and otherwise
may as a result of an Avecia Default, delay commencement of, or cancel
Development Batch Manufacture or the Validation Campaign. The Parties also
acknowledge that delays may occur as a result of Process Failures, as set forth
below. In the event that Nuvelo decides to exercise such option or take such
action, the following provisions shall apply:

 

  (a) Notice. Nuvelo shall give written notice to Avecia of its intention to
delay or cancel Development Batch Manufacture or the Validation Campaign (as
appropriate), and, in the case of delay, setting out the estimated length, or
circumstances that would dictate the length, of the delay. Notice is deemed
given at such time as either Party notifies the other Party in writing that the
Validation Campaign will be delayed as a result of a Process Failure, and in
such case, the PSC shall determine the estimated length of the delay.

 

  (b) Cancellation Fees; Non-Manufacturing Delays or Cancellation. With respect
to any cancellation or Non-Manufacturing Delay, Nuvelo shall pay to Avecia the
Cancellation Fees in consideration for technical consultancy into the effect of
such Non-Manufacturing Delay or cancellation on the Project.

 

  (c)

Process Failure Delay Fee. With respect to any delay of the Validation Campaign
resulting from a Process Failure that results in a delay of the completion of
the usage of Avecia’s manufacturing facilities for the Validation Campaign by
more than two weeks after August 16, 2006, Nuvelo shall pay to Avecia, in
consideration for technical consultancy into the effect of such delay on the
Project, the sum of £212,470 pounds per week (the “Process Failure Delay Fee”)
for each week beyond the expiration of two weeks after August 16, 2006, during
which the completion continues to be delayed, until such time as Nuvelo has paid
to Avecia an amount in Process Failure Delay Fees that is equal to the lesser
of: £2,550,000 pounds; or the amount Nuvelo would have paid to Avecia in
Cancellation Fees if notice had been given regarding a Non-Manufacturing Delay
instead of a delay

 

19

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resulting from a Process Failure. Avecia shall make commercially reasonable
endeavours to raise revenue by utilising the production facility during the
period during which the Validation Campaign was intended to take place but for
the delay. Avecia shall refund to Nuvelo a sum equivalent to the revenue (net of
raw materials and consumables Expenditure) raised as a result of such
alternative use up to a maximum of 80% of the technical consultancy fee paid
under this Clause 2.5(c). For the purposes of this Clause 2.5(c), “Process
Failure” means the occurrence of a Defective Batch that results from a
factor—other than any of the factors listed in paragraphs (a) through (d) of the
definition of Avecia Default—which affects the Process or production of the API
and was not known and could not reasonably have been known by Avecia prior to
the time at which the factor became known, including, without limitation, a
previously unknown factor not studied either as part of the Amgen programme
transferred to Avecia or the Avecia laboratory work programme carried out
pursuant to the Project.

 

  (d) Delay. The Parties shall meet to discuss availability of Avecia’s
manufacturing facility for the delayed Development Batch Manufacture or the
Validation Campaign (as appropriate) in accordance with Clause 2.3 and 2.4 and,
except with respect to any delay resulting from or arising out of an Avecia
Default, Nuvelo’s refusal to take a license under a Patented, Licensed Avecia
Invention under Clause 5.2(c) or failure of the centrifuge trials, if the delay
is in excess of six (6) months, a commercially reasonable amount payable by
Nuvelo to Avecia in respect of such later commencement of Development Batch
Manufacture or the Validation Campaign (as appropriate).

 

  (e) Effect of Delay on Project. Except with respect to a delay resulting from
or arising out of an Avecia Default or Nuvelo’s refusal to take a license under
a Patented, Licensed Avecia Invention under Clause 5.2(c), Avecia shall not be
obliged to carry out the delayed Development Batch Manufacture or the Validation
Campaign (as appropriate) until the Parties have reached agreement on the later
commencement thereof, but will use reasonable commercial endeavours to
reschedule the availability of its facility and appropriate personnel. In the
case of a delay resulting from an Avecia default, if Nuvelo decides to have
Avecia proceed with Development Batch Manufacture and/or the Validation
Campaign, Avecia shall carry out the delayed Development Batch Manufacture or
Validation Campaign in accordance with the terms and conditions set forth in
Clauses 2.3 and 2.4.

 

  (f)

Effect of Cancellation. Where Nuvelo elects to cancel Development Batch
Manufacture, Avecia shall not be obliged to carry out the Validation Campaign,
and except with respect

 

20

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to any cancellation resulting from or arising out of an Avecia Default or
failure of the centrifuge trials, the Validation Campaign shall also be deemed
cancelled with effect from the date of notice of Nuvelo’s intention to cancel
Development Batches Manufacture and the Validation Campaign.

 

  2.6 Nuvelo Delay.

 

  (a) In the event of a Nuvelo Delay, Avecia and Nuvelo will use reasonable
commercial endeavours to minimize such Nuvelo Delay or, subject to agreement by
both Parties, to adjust the Development Batch Manufacture or the Validation
Campaign schedule to accommodate such delay. Any Nuvelo Delay which cannot be
avoided shall be considered to be Hold Time in respect of the affected Batch.

 

  (b) In the event that a Nuvelo Delay results in an inability for Avecia to
carry out the Development Batch Manufacture or the Validation Campaign in
accordance with the mutually agreed schedule therefor, then the Parties shall
meet to discuss availability of Avecia’s manufacturing facility for the delayed
Development Batch Manufacture or the Validation Campaign (as appropriate), and a
commercially reasonable amount payable by Nuvelo to Avecia in respect of such
later commencement of Development Batch Manufacture or the Validation Campaign
(as appropriate).

 

  2.7 Project Steering Committee, or PSC, Executive Committee, or EC, and
Resolution of Batch Disputes.

 

  (a) Membership.

 

  (1) PSC Membership. The PSC shall have at least 6 and up to 8 members, within
any case, an equal number of members appointed by each Party. Each Party’s
initial membership on the PSC shall be as set forth in Schedule 5. Each Party
may replace its PSC representatives at any time upon written notice to the other
Party, provided that each Party shall appoint and maintain for the duration of
the term of this Agreement representatives on the PSC of equivalent or higher
position within that Party as the original representative(s) set forth on
Schedule 5. The PSC shall keep minutes of its meetings and submit its meeting
minutes to the EC members for EC and Party review. The host Party at each
in-person meeting shall prepare the minutes for that meeting, otherwise, minute
taking will alternate between the Parties for each meeting.

 

  (2)

EC membership. The EC shall be composed of 2 members, 1 representative of each
Party. Each EC

 

21

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member shall not be a member of the PSC, shall have obtained, and maintain, the
level of vice president (or comparable title) or above, and shall be duly
authorized by the Party it represents to resolve any and all disagreements of
the PSC. The EC representatives are set forth on Schedule 5. Each Party may
replace its EC representative with another qualifying individual at any time
upon written notice to the other Party. The EC shall keep minutes of its
meetings and prepare a report for Party review. Minute taking will alternate
between the Parties for each meeting.

 

  (b) Power and Responsibilities.

 

  (1) PSC Powers and Responsibilities. The PSC shall have the following specific
responsibilities and authority:

 

  (i) to review and approve the overall plan for process development,
characterization, manufacturing and Release of Batches of Product;

 

  (ii) to review and approve resources and timelines for the Project, and any
changes for the Project;

 

  (iii) to evaluate and manage any changes or other incidents that may occur
during the course of the Project;

 

  (iv) to serve as a forum for the sharing of information between the Parties
with respect to Project activities and Project progress; and

 

  (v) to evaluate Batch Disputes that arise at the Quality Team level in
accordance with Clause 2.7(g).

 

  (2) EC Powers and Responsibilities. The EC shall support the PSC in
decision-making and support the overall strategy for the Project. The EC shall
have the following specific responsibilities and authority:

 

  (i) to resolve any disagreements of the PSC, but excluding Batch Disputes, in
accordance with Clause 2.7(f);

 

  (ii) to review PSC meeting minutes and evaluate the effectiveness and
composition of the PSC, providing any comments thereon back to the PSC for
consideration; and

 

  (iii) to serve as a forum for information sharing between senior management of
the Parties.

 

22

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  (c) Limitations on PSC and EC. The PSC and the EC shall have no power to amend
or waive compliance with this Agreement. Any amendments that alter the terms of
this Agreement shall be implemented, if at all, pursuant to Clause 14 below. The
PSC and EC shall have only the responsibility explicitly provided for them in
Clause 2.7(b), and shall not have any other powers or responsibilities.

 

  (d) Regular Meetings. The Parties shall endeavour to schedule regular meetings
of the PSC and EC at least 30 calendar days in advance. The PSC shall meet at
least once a calendar quarter, and at least 2 regular meetings per year will be
held in person. The EC shall meet twice a year, and shall decide whether or not
it will meet in person, by teleconference or videoconference. Committee meetings
held in person will alternate between sites designated by each Party and each
Party shall be responsible for all of its own expenses of participating in PSC
and EC meetings. With the consent of the representatives of each Party serving
on the PSC, other representatives of each Party may attend meetings of the PSC.
With the consent of each EC member, other representatives of each Party may
attend meetings of the EC, or portions thereof.

 

  (e) Additional & Urgent Meetings. Upon mutual agreement of the PSC or EC, not
to be unreasonably withheld, the Parties may schedule additional meetings of the
PSC or EC as necessary to appropriately conduct the Project, and any such
additional PSC or EC meetings will be held by teleconference or videoconference
and will be held no later than 15 calendar days after reasonably requested by a
Party. A meeting of the PSC may be requested on an urgent basis (“Urgent
Meeting”) for the following reasons: Batch failure, excessive downtime in the
facility being used to develop or manufacture Product, notice of a Batch
Dispute, significant cGMP or Applicable Law violation or significant
adulteration of Product or a Batch. An Urgent Meeting shall be held no later
than 3 business days after requested by a Party. Urgent meetings may be held
in-person, by teleconference or by videoconference. If the PSC cannot come to
agreement on a matter before it at an Urgent Meeting, except with respect to a
Batch Dispute, the matter shall be immediately referred to the EC for
resolution.

 

  (f)

Decision Making & Dispute Resolution. The PSC and EC will reasonably discuss all
matters that come before them. Decisions of the PSC and EC will be made by
unanimous agreement, with each Party having one vote on the PSC and one vote on
the EC. If the PSC cannot come to agreement on an issue at the applicable PSC
meeting, other than with

 

23

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respect to a Batch Dispute, the PSC shall promptly refer the matter to the EC.
The EC shall meet no later than 15 calendar days after referral of a matter to
it by the PSC. The EC shall have 15 calendar days after meeting to resolve the
matter. If the EC cannot mutually agree on a resolution of the matter before the
expiration of the 15 day period, then Nuvelo is entitled to make the final
decision for the EC on the matter, which Nuvelo decision shall not be
unreasonable, with the exception of the following matters, which shall only be
resolved by mutual agreement of the EC, Avecia’s agreement to such matters not
be unreasonably withheld: (1) any matter which would require execution of a
Programme Amendment Order; (2) any matter which would, other than as a result of
an Avecia Default, adversely effect a manufacturing schedule— which schedule is
not in conflict with the Project timeline set forth in the Work Program
Timeline—established for a third party by Avecia, for use of Avecia’s
facilities; or (3) materially change the Project timeline set forth in the Work
Program Timeline. The decisions of the EC, whether determined by final decision
of Nuvelo or mutual decision, in accordance with the preceding sentence, shall
bind both of the Parties, except that: Avecia may refer a matter upon which
Nuvelo made a final decision to dispute resolution in accordance with Clause
19.2 if in Avecia’s reasonable, good faith judgement, Nuvelo’s decision would
(1) violate the express terms of this Agreement; or (2) result in a breach of
Applicable Law.

 

  (g) Dispute Resolution for Batch Disputes. If a dispute arises amongst the
Quality Team relating to whether or not a Batch of the API is a Defective Batch,
or whether or not a Defective Batch results from or arises out of an Avecia
Default (each of the preceding a “Batch Dispute”), such Batch Dispute shall be
resolved as follows.

 

  (1) The Quality Team shall immediately notify the Project Steering Committee
(PSC) in writing (the “Batch Dispute Notice”) that a Batch Dispute exists
amongst the Quality Team. The Quality Team will discuss the Batch Dispute in
good faith to attempt to reach agreement on: (i) whether a Batch is a Defective
Batch and, if so, what course of action shall be taken to address it; and (ii)
whether or not a Defective Batch resulted from or arose out of an Avecia
Default.

 

  (2)

In the event that the Quality Team fails to reach agreement on a Batch Dispute
within 15 calendar days after sending the Batch Dispute Notice to the PSC, the
Quality Team shall immediately refer the Batch Dispute to the PSC for
discussion, by written notice to the PSC. Once the Batch Dispute has been
referred to the PSC, the PSC has 5 business days from receipt of the referral
notice to either resolve the Batch Dispute or

 

24

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refer the Batch Dispute to an independent expert or laboratory, with the
expertise necessary to reasonably resolve the Batch Dispute.

 

  (3) If the PSC cannot resolve the Batch Dispute or agree upon an independent
expert or laboratory to resolve the Batch Dispute before the expiration of 5
business days after receiving the referral notice, the PSC shall immediately
notify the EC of its failure in writing. Within no later than 2 business days
after receiving notice of the failure from the PSC, each EC member shall
nominate an independent expert who shall not: be a current or former employee,
consultant or agent of a Party; have an immediate family member who is an
employee, consultant or agent of a Party; or have any financial interest in a
Party. Promptly thereafter, those two independent experts shall agree on a third
independent expert who shall use any reasonable information, materials and data
provided to him or her by the other two experts within 10 business days after
his or her agreement to act as the third independent expert, to either promptly
resolve the Batch Dispute or determine which independent Third Party laboratory
will conduct the work necessary to promptly resolve the Batch Dispute. Such
referral shall be solely for the purpose of establishing whether or not the
applicable Batch is a Defective Batch and whether or not any Defective Batch
results from or arises out of an Avecia Default. The decision of the independent
expert, or independent laboratory, shall be made in writing and shall be binding
upon the Parties. Whichever Party failed to accurately assess whether the Batch
was or was not a Defective Batch, or whether or not a Defective Batch resulted
from or arose out of an Avecia Default, shall bear the full cost and expense
associated with the hiring and performance of the independent experts and/or
laboratory.

 

  2.8 Programme Amendment Orders. The Parties may agree to vary the Project and
sums to be paid under Clause 3 as a result of a Project variation, so long as
such variation is made in writing in a Programme Amendment Order. The Parties
recognize that any of the following will require changes to the Work Programme
that may cause a change in payments set out in Clause 3:

 

  (a) Nuvelo requires Avecia to carry out additional or different work to that
specified in the Work Programme set forth in Schedule 1; or

 

  (b) the actual circumstances encountered in carrying out the Project differ
from the then current Process Assumptions; or

 

25

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  (c) in the event that there is a delay to the Project for any reason other
than Avecia Default or Nuvelo’s refusal to take a license under a Patented,
Licensed Avecia Invention, including a Nuvelo Delay; or

 

  (d) in the event that Additional Centrifuge Work is required as a result of a
failure, other than one attributable to an Avecia Default, of the centrifuge
trials pursuant to Clause 2.2(b); or

 

  (e) Hold Time, but excluding Hold Time resulting from or arising out of: (1)
an Avecia Default or (2) Nuvelo’s refusal to take a license under a Patented,
Licensed Avecia Invention.

 

  2.9 Regulatory Matters and Regulatory Assistance.

 

  (a) During the Project and following Completion, Avecia will provide
reasonable assistance to Nuvelo in respect of Nuvelo’s Regulatory Filing
activities for the Product and the Process, including preparatory to and during
Pre-Approval Inspection (PAI) and related quality unit support, as further set
forth below.

 

  (b) At no additional cost to Nuvelo, Avecia shall: provide Nuvelo with any and
all requested data created in connection with the development and manufacture of
the API under this Agreement which is reasonably necessary to support
submissions for regulatory approvals to Regulatory Authorities; and take all
actions necessary to recreate or modify as reasonably necessary any
documentation or materials provided by Avecia to Nuvelo for submission to
Regulatory Authorities that were not provided to Nuvelo in a form or format
reasonably acceptable to the applicable Regulatory Authority. Nuvelo shall
advise Avecia on the form or format Nuvelo, or the Regulatory Authority, to the
extent Nuvelo is aware of the Regulatory Authority’s requirements, may require
prior to provision of such documentation or materials by Avecia.

 

  (c) Subject to payment by Nuvelo of a reasonable commercial rate for such
assistance and Avecia’s reasonable expenses, Avecia shall develop any data
requested by Nuvelo concerning the development, manufacture or quality assurance
testing of the API which is necessary to support submissions for regulatory
approvals to Regulatory Authorities, which data was not anticipated to be
developed as part of the Project under the Work Programme or the Quality
Agreement.

 

  (d)

Nuvelo shall be responsible for preparing and filing all submissions for
regulatory approvals of Product. Nuvelo will confirm Nuvelo interpretations of
Avecia data in the Chemistry, Manufacturing and Controls (CMC) section of any

 

26

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submissions to Regulatory Authorities with Avecia before submission to
Regulatory Authorities. Nuvelo owns and shall own all Regulatory Filings related
to the Product and the API.

 

  (e) At no additional cost to Nuvelo, to the extent Nuvelo needs to submit and
make available any Master Batch Record in connection with obtaining any
regulatory approvals from any Regulatory Authority, to the fullest extent
permissible under Applicable Laws, Avecia shall provide Nuvelo with any and all
information necessary for Nuvelo to make the Master Batch Record available to
the applicable Regulatory Authority.

 

  (f) At no additional cost or expense to Nuvelo, Nuvelo shall have full access
to and the right to use and reference, any correspondence, facility and
engineering records and diagrams, validation documentation, Batch records,
reports, analyses, regulatory requirements and any other data and documentation
generated in connection with the Project, and Avecia shall provide Nuvelo with 1
full set of the foregoing documentation upon request.

 

  (g) Avecia will handle all waste resulting from or arising out of the Project
in accordance with Applicable Laws.

 

  (h) The provision of data, information or copies of records from Avecia’s work
is included in the fees set out in Clause 3. In the event that Avecia needs to
generate additional information under paragraph (c) above or re-analyze data in
an unanticipated way in response to a Regulatory Authority request, then that
information and data shall be provided subject to agreement of a reasonable
commercial rate based on the time/effort required.

 

  2.10 Quality Audits by Nuvelo & SCAR Reporting.

 

  (a) Nuvelo reserves the right to conduct, twice-a-year, comprehensive quality
audits of Avecia’s facilities, which may include a site tour, questioning of
employees in work areas and review of quality system documentation to the
appropriate quality standards. Avecia will be notified in advance of the
intention to conduct an audit and the audit’s scope, and a mutually convenient
date will be selected. During the audit, any non-conformances will be noted and
documented in a report issued by Nuvelo within thirty (30) business days. Avecia
will be requested to submit a written response and corrective action plan within
thirty (30) business days of receipt of the report. Avecia will close all
corrective actions that can be closed within 90 business days to the
satisfaction of Nuvelo. Corrective actions that cannot be closed out within 90
business days will have a timeline for closure agreed with Nuvelo.

 

27

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  (b) Supplier performance issues or non-conformances in the API will be
indicated to Avecia, in addition to any notifications through the PSC or EC, in
the form of a Nuvelo Supplier Corrective Action Report (SCAR)/Memo. Avecia will
be requested to respond to the SCAR/Memo usually within thirty (30) business
days post receipt.

 

3. Payments

 

  3.1 Consideration. In consideration of Avecia carrying out the technical
consultancy activities pursuant to the Project in accordance with the terms and
conditions of this Agreement and in consideration for sale and delivery of API
in accordance with the terms and conditions of this Agreement, Nuvelo shall pay
to Avecia a sum of ten million pounds (£10,000,000), to be paid, as follows, if
and only if the following terms and conditions set forth below are met:

 

Milestone

Number

--------------------------------------------------------------------------------

  

Anticipated/Approximate
Completion Date

Of Milestone

--------------------------------------------------------------------------------

  

Milestone/Invoice Trigger

--------------------------------------------------------------------------------

   Amount
Triggered by
Milestone (£)

--------------------------------------------------------------------------------

1

   Done and paid in full before the signature date of this Agreement    In
consideration for technical consultancy in relation to assessment and planning,
paid on the Commencement Date    105,000

2

   Done and paid in full before the signature date of this Agreement    In
consideration for Avecia carrying out technical consultancy preparatory to GMP
manufacture, paid on the Commencement Date    50,000

3

   Done and paid in full before the signature date of this Agreement    In
consideration for technical consultancy pursuant to commencement of the Project,
paid on 28th February 2005    300,000

4

   Signature of this Agreement    In consideration for Avecia carrying out
technical consultancy in relation to transfer of process and assays, payable on
completion of transfer of process and analytical methods    105,000

5

   Signature of this Agreement    In consideration for technical consultancy
pursuant to Process characterisation in the laboratory (Experimental set 1,
based on RPN analysis), payable on commencement of the Process characterisation
   136,250

6

   Signature of this Agreement    In consideration for technical consultancy
pursuant to assay validation, payable on commencement of assay validation   
358,750

7

   Signature of this Agreement    In consideration for technical consultancy
pursuant to preparation of the Project plan, payable on agreement of the Project
plan, including the manufacturing schedule by the PSC    50,000

 

28

--------------------------------------------------------------------------------

8

   Signature of this Agreement    In consideration for technical consultancy
pursuant to modification of ABC5000 facility modifications for centrifuge
trials, payable on commencement of modifications    350,000

9

   18-Jul-05    In consideration for technical consultancy pursuant to
preparation of a cleaning study, payable on completion of the cleaning study and
delivery of a report on such study    10,000

10

   08-Aug-05    In consideration for technical consultancy pursuant to
preparation of Batch records for centrifuge trials, payable on completion of
such Batch records    160,000

11

   14-Aug-05    In consideration for technical consultancy pursuant to
preparation for Development Batch Manufacture, payable three (3) months prior to
commencement of manufacture of the first Development Batch    420,000

12

   18-Aug-05    In consideration for technical consultancy pursuant to the
replicate 15L fermentation runs, payable on completion of the runs and delivery
of the associated technical report    54,500

13

   22-Aug-05    In consideration for technical consultancy in performance of the
centrifuge runs, payable on commencement of the first centrifuge run    200,000

14

   01-Sep-05    In consideration for technical consultancy pursuant to the
centrifuge runs, payable on completion of the first centrifuge run    250,000

15

   07-Sep-05    In consideration for technical consultancy pursuant to the
replicate purification runs, payable on completion of the runs and delivery of
the associated technical report    54,500

16

   26-Sep-05    In consideration for technical consultancy pursuant to 100L
labscale purification, payable on completion thereof    44,000

17

   26-Sep-05    In consideration for technical consultancy pursuant to
preparation of Batch records, payable on commencement of Batch record writing
(approval of Process Specification for GMP Development Batches)    88,500

 

29

--------------------------------------------------------------------------------

18

   28-Oct-05    In consideration for technical consultancy pursuant to
preparation for Development Batch Manufacture, payable on completion of the
plant report for centrifuge runs    200,000

19

   14-Nov-05    In consideration for technical consultancy pursuant to
preparation for Development Batch Manufacture, payable on completion of the
Batch records for Development Batch Manufacture    88,500

20

   14-Nov-05    In consideration for technical consultancy pursuant to
performance of Development Batch Manufacture, payable on commencement of
Development Batch Manufacture    751,250

21

   18-Nov-05    In consideration for technical consultancy pursuant to assay
validation, payable upon completion of assay validation for the first 10 assays
to be validated    291,250

22

   21-Nov-05   

In consideration for technical consultancy pursuant to characterisation of the
Process in the laboratory (Experimental Set 1) payable on delivery of the
fermentation technical report

and purification technical report

   136,250

23

   01-Dec-05    As a first stage payment in consideration for sale and delivery
of a Released Batch of API, payable on commencement of manufacture of the second
Development Batch    251,250

24

   20-Jan-06    In consideration for technical consultancy pursuant to assay
validation, payable upon completion of assay validation for the remainder of the
assays to be validated    417,000

25

   01-Mar-06    As a final stage payment in consideration for sale and delivery
of Released Development Batch(es), payable on Release of at least one
Development Batch during Development Batch Manufacture    510,000

26

   12-Apr-06    In consideration for technical consultancy during performance of
Engineering Batch manufacture, payable on commencement of manufacture of the
Engineering Batch    424,940

 

30

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27

   12-Apr-06    In consideration for technical consultancy in preparation of
Batch records for the Validation Campaign, payable on completion of such Batch
records    120,600

28

   26-Apr-06    In consideration for technical consultancy during Engineering
Batch manufacture, payable on completion of manufacture of the Engineering
Batch, as evidenced by commencement of post-Batch cleaning of the facility   
424,940

29

   26-Apr-06    As a first stage payment in consideration for sale and delivery
of Released API produced during the Validation Campaign, payable on commencement
of manufacture of the first Validation Batch    424,940

30

   26-Apr-06    In consideration for technical consultancy pursuant to
preparation of the Validation Master Plan under clause 2.4(a)(ii) of the Work
Programme, payable on completion of Validation Master Plan    50,000

31

   26-Apr-06    In consideration for technical consultancy pursuant to
preparation of the Validation Master Plan, payable on execution of the
Validation Master Plan    99,000

32

   12-May-06    As a second stage payment in consideration for sale and delivery
of Released API produced during the Validation Campaign, payable on commencement
of manufacture of the second Validation Batch    424,940

33

   29-May-06    As a third stage payment in consideration for sale and delivery
of Released API produced during the Validation Campaign, payable on commencement
of manufacture of the third Validation Batch    424,940

34

   12-Jun-06    As a fourth stage payment in consideration for sale and delivery
of Released API produced during the Validation Campaign, payable on commencement
of manufacture of the fourth Validation Batch    424,940

 

31

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35

 

26-Jun-06

   As a fifth stage payment in consideration for sale and delivery of Released
API produced during the Validation Campaign, payable on commencement of
manufacture of the fifth Validation Batch, if agreed under Clause 2.4(b)(3)  
Payment in accordance with
Clause 2.4(b)(3)

36

 

16-Aug-06

   As a sixth stage payment in consideration for sale and delivery of Released
API produced during the Validation Campaign, payable on Release of the first
Validation Batch   424,940

37

 

01-Sep-06

   As a seventh stage payment in consideration for sale and delivery of Released
API produced during the Validation Campaign, payable on Release of the second
Validation Batch   424,940

38

 

18-Sep-06

   As an eighth stage payment in consideration for sale and delivery of Released
API produced during the Validation Campaign, payable on Release of the third
Validation Batch   424,940

39

 

02-Oct-06

   As a ninth stage payment in consideration for sale and delivery of Released
API produced during the Validation Campaign, payable on Release of the fourth
Validation Batch, such stage payment to be the final stage payment for sale and
delivery of API produced during the Validation Campaign, in the event that the
PSC determines that a fifth Validation Batch is not required.   424,940

40

 

18-Oct-06

   As final stage payment in consideration for sale and delivery of Released API
produced during the Validation Campaign, payable on Release of the fifth
Validation Batch, in the event that the PSC determines that a fifth Validation
Batch is not required   Payment in accordance with
Clause 2.4(b)(3)

41

 

01-Dec-06

   In consideration for technical consultancy pursuant to preparation of
validation reports, payable on delivery of such reports   99,000

 

  3.2 Excluded Items.

 

  (a) The sums set out in Clause 3.1 above do not include:

 

  (1)

Expenditure actually incurred by Avecia for major consumable items (including,
without limitation, Expenditure associated with chromatography resins and
filtration membranes) intended to be used and not reasonably usable for other
purposes by Avecia, or

 

32

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actually used for cGMP Batches (including centrifuge trials conducted under
Clause 2.2, Development Batch Manufacture and the Validation Campaign); or

 

  (2) Expenditures actually incurred by Avecia for work conducted by
subcontractors, subcontracted by Avecia in accordance with Clause 13.2, for the
performance of the following assays, which assays are discussed in more detail
in the Work Programme: (i) intact MS, (ii) DNA or equivalent, (iii) USP/EP
Pyrogen, (iv) EPA Copper and Zinc, and (v) DNA sequence for cell bank; or

 

  (3) Expenditure actually incurred by Avecia in respect of other consumable
items purchased for use in the Project (including, without limitation,
disposable bags, tubing, hoses and chemical raw material costs), or actually
used for cGMP Batches (including centrifuge trials conducted under Clause 2.2,
Development Batch Manufacture and the Validation Campaign).

 

  (b) Avecia shall notify Nuvelo of the Expenditure incurred in respect of
Clause 3.2(a)(3) and Avecia shall obtain Nuvelo’s approval in writing prior to
incurring such Expenditure in Clause 3.2(a)(1) or 3.2(a)(2) and, subject to
approval in respect of Expenditure under Clauses 3.2(a)(1) or 3.2(a)(2), such
Expenditure shall thereupon form part of the consideration for the provision of
the technical consultancy services (including qualification, quality assurance
and quality control activities) by Avecia and Avecia shall invoice Nuvelo for:
(1) such amounts; and (2) in the case of Expenditure incurred under Clauses
3.2(a)(1) and 3.2(a)(3), the Handling Fee. Upon any termination of this
Agreement, all consumable items purchased by Avecia for the Project that are not
consumed or otherwise worn beyond further use by their use in the Project shall,
upon Nuvelo’s request, be sold to Nuvelo or Nuvelo’s designee for the sum total
of £1 and delivered by Avecia, ready for shipment, into the custody of a shipper
reasonably acceptable to Nuvelo or Nuvelo’s designee, the cost of shipment to be
at Nuvelo’s cost and expense, for Nuvelo’s or its designee’s use and disposal,
in its discretion.

 

  3.3 Equipment. In order for Avecia to provide technical consultancy services
work under this Agreement, it will be necessary for certain items of Equipment
to be purchased by Avecia. Avecia will be authorised to proceed with the
relevant services for which the Equipment is required on the following terms:

 

  (a)

Avecia shall obtain, from an independent Third Party, at least 2 quotations for
each item of Equipment and send a copy of the quotations by fax or email to
Nuvelo and Nuvelo shall inform Avecia within 5 business days of receipt which

 

33

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quotation Nuvelo approves and whether it authorises Avecia to proceed with the
services for which the item of Equipment is required. In the absence of such
approval, Avecia shall not proceed with the relevant services.

 

  (b) If Nuvelo gives its approval to the relevant quotation, Avecia shall be
considered authorised to proceed with the relevant services set forth under the
Work Programme or agreed upon Program Amendment Order and shall purchase the
item of Equipment for such purpose. Any Equipment purchased by Avecia shall be
dedicated to the Project, and shall not be used for any other use or purpose.
Avecia shall keep the Equipment in good working order. The purchase price of the
item of Equipment per the approved quotation shall thereupon form part of the
consideration for the provision of the technical consultancy services (including
qualification, quality assurance and quality control activities) by Avecia and
Avecia shall invoice Nuvelo for: (i) such amount; and (ii) the Handling Fee.

 

  (c) Following completion or termination of the Project, whichever occurs
first, at any time within 12 months following such completion or termination,
Nuvelo shall be entitled to purchase all or any portion of the Equipment from
Avecia for the sum total of £1.00 in its or their then current, good working
condition, subject to payment of any outstanding and undisputed fees by Nuvelo
to Avecia for work carried out under this Agreement in accordance with the terms
and conditions of this Agreement and the Work Programme.

 

  (d) Nuvelo shall provide to Avecia reasonable prior written notice of its wish
to purchase the Equipment so as to minimize any unplanned facility downtime and
Nuvelo shall be responsible for all commercially reasonable removal costs and
expenses. If the removal of any Equipment is performed by Nuvelo personnel,
Nuvelo agrees to pay for the making good of any damage caused to Avecia’s
facility as a result of such removal. If the removal is performed by Avecia
personnel, Avecia agrees to pay for the making good of any damage caused to the
Equipment being removed as a result of such removal.

 

  3.4

Invoices and Timing of Payments. Avecia shall promptly issue invoices for the
sums set out in Clauses 3.1, 3.2 and 3.3 once such sums become payable in
accordance with Clauses 3.1, 3.2 and 3.3. In respect of invoices in respect of
sums set out in Clause 3.1, Nuvelo shall pay invoices received by Nuvelo on or
before the 15th day of each month by the end of that month and shall pay
invoices received by Nuvelo after the 15th day of each month by the end of the
following month. In respect of invoices in respect of sums set out in Clause
3.2, Nuvelo shall pay such sums within 30 calendar days after Nuvelo’s receipt
of the relevant invoice. In respect of

 

34

--------------------------------------------------------------------------------

 

invoices in respect of sums set out in Clause 3.3, Nuvelo shall pay such
invoices within ten (10) business days after receipt of the relevant invoice.
Payments shall be made in Pounds Sterling.

 

  3.5 Bank Account Details. All amounts payable to Avecia under this Agreement
shall be paid by wire transfer, quoting invoice numbers of payment, to an
account number specified in writing by Avecia.

 

  3.6 Taxes. Any payment under this Agreement is stated exclusive of any Value
Added Tax. It is the understanding of both Parties that the technical
consultancy services being provided under this Agreement are outside the scope
of UK VAT. However, in the event that UK VAT does become payable, the UK VAT
shall be for the account of Nuvelo and Avecia shall use best efforts to assist
Nuvelo in seeking recovery of such tax paid from the UK HM Customs and Excise.
If Nuvelo is otherwise required to withhold tax applicable to any payment under
this Agreement, Nuvelo shall promptly provide Avecia with the official receipts
and such other evidence of payment as Avecia may reasonably request and Nuvelo
shall render Avecia reasonable assistance in order to allow Avecia to obtain the
benefit of any relevant present or future double taxation treaty.

 

  3.7 Financial Tracking; Reporting. The PSC and Nuvelo’s financial team
representatives will review and measure the growth in value of the Project by
tracking resources used versus progress against the deliverables set out in the
Work Programme. In respect of consumables, raw materials and any other items
purchased by Avecia under Clause 3.2, Avecia will provide a breakdown by item
and include copies of invoices for those items of an individual price of greater
than £5,000, to the PSC and Nuvelo’s financial team representatives. Within 3
business days after the end of each month, Avecia will provide a financial
‘Earned Value Analysis’ report for that month to Nuvelo. Utilizing the Payment
Schedule set forth in Clause 3.1, the report will summarize the approximate
value of services provided to Nuvelo for each Project stage that Avecia actively
performed during that month. Upon written request by Nuvelo, Avecia shall
provide, within thirty days of receipt of Nuvelo’s written notice, documented
proof of purchase for all Expenditures and Equipment, or for specified
Expenditures and Equipment, passed through to Nuvelo in accordance with Sections
3.2, 3.3 and 3.4. Avecia will provide Nuvelo with a quarterly written report at
each regular PSC meeting setting forth the activity status of its manufacturing
suite(s) that are intended to be used or could be used for the Project, for the
six months following the date of submission of the report to Nuvelo. The report
will set forth the times when Avecia’s suites are available and when they are
committed to other projects.

 

35

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4. Completion of the Project

 

  4.1 Completion. Completion of the Project will be deemed to have occurred when
the Development Batch Manufacture, the Validation Campaign and any additional or
alternative work agreed in a Programme Amendment Order have been completed.

 

  4.2 Packaging, Shipping and Delivery. Deliveries of all material, including
documentation, returned consumable items or Equipment under Clauses 3.2 or 3.3,
and API will be made Ex Works, Avecia’s Billingham facility (Incoterms 2000),
subject to the following. Avecia is responsible for packaging and labelling the
API in anticipation of shipment. Avecia also shall employ a shipper, reasonably
acceptable to Nuvelo, for the shipment of all Released API and any Defective
Batch. Avecia will package the Released API or Defective Batch in validated
containers under validated shipping conditions. Until the shipping conditions
have been validated, Avecia will package the Released API or Defective Batch
with temperature monitoring devices that are able to function properly during
the shipping process, as further set forth in the Quality Agreement. Risk of
loss for all Released API or Defective Batch shall transfer to Nuvelo after
delivery of the Released API or Defective Batch to the Nuvelo-approved shipper
by Avecia, except with respect to any loss resulting from a failure of Avecia to
properly package and label the API for shipment. Nuvelo will purchase insurance
to cover any loss to the Released API or Defective Batch once it is delivered to
the shipper. Nuvelo agrees that it shall export the API sold to it promptly and
in any case within 3 months of the final stage payment for the API and shall
provide evidence of such export within 3 months thereof.

 

  4.3 Payment on Completion. Nuvelo shall pay to Avecia within thirty (30)
calendar days after Completion any sums required to be paid pursuant to Clause
3.2 above which may remain outstanding at Completion. Upon Completion, Nuvelo
shall pay any sums for milestones triggered pursuant to Clause 3.1 in accordance
with the payment terms set forth in Section 3.4.

 

  4.4 Irrevocable Option for Future Manufacturing Period.

 

  (a)

Avecia hereby grants Nuvelo an irrevocable option (the “Manufacturing Option”)
to purchase, upon commercially reasonable terms to be agreed under Clause 4.4(c)
below, 3 kilograms of Released API (“the Manufacturing Quantity”), to be
manufactured in the stream in Avecia’s ABC5000 facility

 

36

--------------------------------------------------------------------------------

 

in which the Process was validated under this Agreement, during the period
commencing April 1, 2007 and expiring October 31, 2008 (“the Manufacturing
Option Period”).

 

  (b) Following signature of this Agreement and whilst this Agreement remains in
force, Nuvelo shall use reasonable commercial endeavours to provide Avecia with
an estimate regarding the potential timing of the Manufacturing Quantity during
the Manufacturing Option Period. The obligation to provide the estimate will
commence on Release of the first Validation Batch and the forecast will be
updated at each PSC meeting or on Nuvelo becoming aware of a change in its
timeline if earlier. To exercise the Manufacturing Option, Nuvelo shall give
Avecia written notice of its exercise not later than 1 calendar year before the
date that Nuvelo expects Avecia to deliver the Manufacturing Quantity to Nuvelo.
In the absence of providing Avecia with timely written election, the option in
Clause 4.4(a) shall lapse.

 

  (c) No later than 30 calendar days after commencement of the Validation
Campaign, Avecia and Nuvelo shall promptly commence negotiations in good faith
for the supply of the API by Avecia to Nuvelo upon commercially reasonable terms
(“Supply Agreement”). The Supply Agreement is anticipated to contain provisions
related to anticipated volumes, pricing, forecasting mechanisms and quality
control provisions, and such other commercially reasonable provisions. The
Parties shall use reasonable commercial efforts to commence discussions
regarding possible key principles of any Supply Agreement after the first
successful Release of a Development Batch. Nuvelo shall have no obligation to
enter into the Supply Agreement and may immediately halt negotiations at any
time, as a result of an Avecia Default.

 

5. Intellectual Property & Confidential Information

 

  5.1 Background Intellectual Property. Except with respect to the licenses
granted in this Clause 5, nothing in this Agreement shall be deemed to imply any
license to a Party to use the other Party’s Background Intellectual Property.
Nothing in this Agreement shall affect the ownership by either Party of any of
its Background Intellectual Property.

 

  5.2 Non-exclusive Licenses under Background Intellectual Property and New
Intellectual Property.

 

  (a)

Project Use License. Subject to the terms and conditions of this Agreement,
Nuvelo grants to Avecia: (1) a royalty free, non-exclusive licence, without the
right to sublicense, under its Background Intellectual Property solely to
perform and otherwise carry out the Project, and for no other use or

 

37

--------------------------------------------------------------------------------

 

purpose; and (2) a royalty free, non-exclusive license, without the right to
sublicense without Nuvelo’s prior written approval, under the New Intellectual
Property solely to perform and otherwise carry out the Project.

 

  (b) Nuvelo Commercial License. Subject to the terms and conditions of this
Agreement, specifically including Clause 5.2(c), Avecia hereby grants Nuvelo a
royalty-free, irrevocable, non-exclusive, world-wide license, with power to
sub-license through multiple levels of sublicensees, under any of Avecia’s
Background Intellectual Property that is incorporated into the Process during
the Project, to make, have made, use, sell, offer for sale and import the
Product or the API or any form, including any filled or finished form, of the
Product or API.

 

  (c) Royalty-Bearing License. If Avecia believes in good faith that the Process
would be materially improved by the utilization in the Process of an Invention
or Inventions covered by a Valid Claim or Valid Claims within Avecia’s
Background IP, then if and only if Avecia has previously, and continues to only
grant access to such Inventions to Third Parties under a royalty-bearing license
(each such Invention a “Patented, Licensed Avecia Invention”), Avecia shall
notify Nuvelo in writing regarding Avecia’s proposal to incorporate any
Patented, Licensed Avecia Invention into the Process, and shall propose
commercially reasonable terms for a license to the Patent or Patents containing
the Valid Claim or Valid Claims covering the Patented, Licensed Avecia
Invention(s). Nuvelo has no obligation whatsoever to agree to the utilization of
any Patented, Licensed Avecia Invention in the Process, and Avecia shall not
delay or discontinue the Project as a result of a decision by Nuvelo not to
incorporate any Patented, Licensed Avecia Invention in the Process. If a duly
authorized representative of Nuvelo agrees in writing to the utilization of a
Patented, Licensed Avecia Invention in the Process, then Avecia shall grant
Nuvelo a worldwide license under the Patent(s) containing the Valid Claim(s)
that cover the Patented, Licensed Avecia Invention(s) to make, have made, use,
sell, offer for sale and import the Product or the API or any form, including
any filled or finished form, of the Product or API, subject to agreement upon
commercially reasonable terms.

 

  5.3

Ownership & Protection of New Intellectual Property. Any and all New Inventions,
and any and all New Intellectual Property, shall belong to Nuvelo. Avecia shall,
and shall ensure that its employees shall, at Nuvelo’s expense, perform all acts
and execute all instruments necessary to assign to Nuvelo all right, title and
interest in and to any and all New Invention and New Intellectual Property.
Nuvelo is entitled to, but has no obligation, to file, prosecute, maintain,
register, enforce or defend any and all New Intellectual

 

38

--------------------------------------------------------------------------------

 

Property. All fees, costs and expenses connected with Nuvelo’s filing,
prosecution, maintenance, enforcement or defense of New Intellectual Property
shall be borne and paid by Nuvelo.

 

  5.4 Non-exclusive license under New Intellectual Property. Subject to the
terms and conditions of this Agreement, Nuvelo hereby grants to Avecia a
royalty-free, irrevocable, non-exclusive, world-wide license, with power to
sub-license, but without the ability to grant Avecia’s sublicensees the ability
to grant sublicenses, under the New Intellectual Property for any use other than
to make, have made, use, sell, offer for sale or import, keep or otherwise deal
in Product or the API or any form, including any filled or finished form, of
Product or API.

 

  5.5 Provision of Technical Assistance and Process Transfer. If following
Completion or following termination of this Agreement for any reason, Nuvelo
requires Avecia’s technical assistance for the transfer of all or any portion of
the Process to Nuvelo or a Third Party designee of Nuvelo, or other technical
assistance, then Avecia shall promptly provide Nuvelo with all reasonable
assistance necessary to transfer the Process to Nuvelo or Nuvelo’s Third Party
designee, and Nuvelo will pay for Avecia’s reasonable, actual costs and expenses
associated with transfer of the Process, except that if Nuvelo terminates for
Avecia’s Unremedied Breach, Nuvelo shall only pay Avecia for one-third of
Avecia’s actual costs and expenses associated with such assistance
notwithstanding the provisions of Clause 9.1(b).

 

  5.6 Limitation. Avecia shall not, and shall not use the Process to, make, have
made, use, sell, offer for sale or import API or Product for any entity, other
than Nuvelo, in any territory, without the prior written consent of a duly
authorized representative of Nuvelo.

 

6. Warranties, Liability and Indemnity

 

  6.1 Warranties.

 

  (a) Each Party warrants to the other that:

 

  (1) it has the necessary right and authority to enter into this Agreement; and

 

  (2) to its knowledge as of the signature date of this Agreement, the use of
its Background Intellectual Property pursuant to this Agreement for the purposes
set out in this Agreement will not infringe the Intellectual Property of a Third
Party.

 

  (b)

Avecia represents and warrants that it has not been debarred, nor does it intend
to use for the Project any individual who has been debarred, under Section 306
of the Federal Food, Drug,

 

39

--------------------------------------------------------------------------------

 

and Cosmetic Act, 21 U.S.C. §335a(a) or (b). In the event that Avecia becomes
debarred, Avecia shall notify Nuvelo immediately.

 

  6.2 Nuvelo Indemnity to Avecia.

 

  (a) Except as otherwise provided below in Clause 6.2(b), Nuvelo shall
indemnify, defend and hold harmless Avecia, its Affiliates and their directors,
officers, employees and agents (the “Avecia Indemnitees”) from and against any
loss, claim, suit, liability, damage or expense, of whatsoever kind or nature
(“Loss”), resulting from or arising out of:

 

  (1) actual or suspected infringement of the Intellectual Property of any Third
Party arising from the Avecia Indemnitees’ application of Nuvelo’s Background IP
or information provided to the Avecia Indemnitees by Nuvelo, in the performance
of the Project;

 

  (2) Nuvelo or its Affiliates, or their directors, officers, employees or
agent’s use of any results of the Project performed by the Avecia Indemnitees
hereunder (including without limitation API or other materials manufactured); or

 

  (3) the negligence, wilful misconduct or breach of any Applicable Laws by
Nuvelo or its Affiliates, or their directors, officers, employees or agents;

 

  (b) Nuvelo has no obligation to indemnify, defend or hold harmless the Avecia
Indemnitees for any Loss to the extent resulting from or arising out of:

 

  (1) the actual or suspected infringement of the Intellectual Property of any
Third Party arising from any of the Avecia Indemnitees’ application of Avecia’s
Background IP or information not provided to the Avecia Indemnitees by Nuvelo or
its Affiliates, or their officers, directors, employees or agents, in the
performance of the Project;

 

  (2) the negligence or wilful misconduct of any of the Avecia Indemnitees;

 

  (3) any breach of this Agreement by any of the Avecia Indemnitees;

 

  (4) any failure by any of the Avecia Indemnitees to comply with Applicable
Laws; or

 

  (5)

in respect of the indemnity under paragraph (a)(2) of this Clause 6.2, Avecia’s
continuing use of Nuvelo’s

 

40

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Background IP, following Avecia receiving written notice, and supporting
documentation, from Nuvelo that use of any of such Background IP results in the
actual or suspected infringement of the intellectual property of any Third Party
and instructing Avecia to cease use of that part of Nuvelo’s Background IP which
results in such actual or suspected infringement.

 

  6.3 Avecia Indemnity to Nuvelo.

 

  (a) Except as otherwise provided below in Clause 6.3(b), Avecia shall
indemnify, defend and hold harmless Nuvelo and its Affiliates, and their
officers, directors, employees and agents (“Nuvelo Indemnitees”) from and
against any Loss resulting from or arising out of:

 

  (1) actual or suspected infringement of the Intellectual Property of any Third
Party by any of the Avecia Indemnitees’ or Avecia subcontractor’s application of
Avecia’s Background IP during the performance of the Project;

 

  (2) any of the Nuvelo Indemnitees’ use of any Avecia Background IP or any
results of the Project generated by any of the Avecia Indemnitees, or any Avecia
subcontractors, hereunder (including without limitation API or other materials
manufactured) to the extent any of the Nuvelo Indemnitees’ use of the Avecia
Background IP or any results of the Project results in the actual or suspected
infringement of the Intellectual Property of any Third Party, but with respect
to any results of the Project, solely to the extent such results were generated
through any of the Avecia Indemnitees’ application of Avecia’s Background IP in
the performance of the Project; or

 

  (3) the negligence, wilful misconduct or breach of any Applicable Laws by any
of the Avecia Indemnitees;

 

  (b) Avecia has no obligation to indemnify, defend or hold harmless the Nuvelo
Indemnitees for any Loss to the extent resulting from or arising out of:

 

  (1) the negligence or wilful misconduct of any of the Nuvelo Indemnitees;

 

  (2) any breach of this Agreement by any of the Nuvelo Indemnitees;

 

  (3) any failure by any of the Nuvelo Indemnitees to comply with Applicable
Laws; or

 

41

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  (4) in respect of the indemnity under paragraph (a)(2) of this Clause 6.3,
Nuvelo’s continuing use of any results of the Project, following Nuvelo
receiving written notice from Avecia, and supporting documentation, that use of
such results of the Project results in the actual or suspected infringement of
the intellectual property of any Third Party.

 

  6.4 Indirect, Consequential and Special Damages Excluded. Except with respect
to indemnity under Clauses 6.2 and 6.3 above or any breach of intellectual
property or confidentiality provisions in accordance with Clauses 5 and 7, in no
event shall either Party be liable for any special, incidental, consequential or
indirect damages arising in any way out of or relating to this Agreement,
however caused and on any theory of liability. This limitation will apply even
if the other Party has been advised of the possibility of such damages.

 

  6.5 Limitation. Neither Party’s liability under this Agreement will exceed the
total amount that would be due to Avecia if the Project was fully completed,
except with respect to any liability of Avecia arising under Clause 9.1(c).

 

  6.6 Insurance. Each Party shall secure and maintain in full force and effect
during the term of this Agreement policies of insurance providing coverage for
(a) employer’s liability and (b) public and products liability having policy
limits, deductibles and other terms appropriate to the conduct of that Party’s
business. Evidence of such insurance in the form of a broker’s letter will be
made available for examination upon request of the other Party.

 

  6.7 General Conditions of Indemnification. Each Party’s agreement to
indemnify, defend and hold the other harmless in accordance with Clauses 6.2 and
6.3 is conditioned on the indemnified Party: (a) providing prompt written notice
to the indemnifying Party of any claim or lawsuit with potential for a Loss no
more than ten (10) business days after the indemnified Party has knowledge of
such claim or lawsuit, but the ten (10) day time period shall not preclude
indemnity hereunder so long as the delay has not materially prejudiced defense
of the claim or suit; (b) permitting the indemnifying Party to have full conduct
and control to investigate, prepare for, defend against and settle any such
claim or lawsuit; (c) providing the indemnifying Party, at the indemnifying
Party’s reasonable expense, with the full cooperation and assistance in the
investigation of, preparation for and defense of any such claim or lawsuit; and
(d) not agreeing to any compromise or settlement materially adverse to the
rights of the indemnified Party under this Agreement without the indemnifying
Party’s prior written consent. This Clause 6.7 survives termination of this
Agreement with respect to any Loss arising from the Parties’ performance during
the term of this Agreement and with respect to any conditions and obligations
that survive the termination or expiration of this Agreement.

 

42

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7. Confidentiality

 

  7.1 The provisions of the Confidentiality Agreement shall remain in full force
and effect, except to the extent modified by the terms and conditions of this
Agreement.

 

  7.2 The obligations of confidentiality and non-disclosure set forth in the
Confidentiality Agreement will continue for seven (7) years after the expiration
or termination of this Agreement, and the Confidentiality Agreement shall not
terminate or expire before the termination of this Agreement.

 

  7.3 Avecia may use the Confidential Information solely for the purpose of the
performance of the Project, except that Avecia may use New IP in accordance with
the license set forth in Clause 5.4, subject to entry of any relevant Third
Party customer or supplier into confidentiality obligations to protect the
confidentiality of such New IP, which obligations are no less onerous than those
contained in this Agreement.

 

  7.4 The Confidentiality Agreement shall, with effect from the date hereof, be
deemed to be extended to cover disclosures of information by either Party,
together with any information acquired by, or otherwise exposed to, either Party
as a result of site visits, in each case pursuant to and subject to this
Agreement.

 

8. Duration and Termination

 

  8.1 Commencement and Duration. This Agreement and the Project shall commence
on the Commencement Date and shall continue (unless terminated in accordance
with the provisions of Clauses 8.2, 8.3 or 8.4) until Completion.

 

  8.2 Termination by Nuvelo. Subject to Clause 9, Nuvelo may terminate this
Agreement at any time with or without cause, cause including Unremedied Breach,
effective immediately upon written notice to Avecia.

 

  8.3 Termination by Avecia. Avecia may terminate this Agreement immediately
upon notice to Nuvelo in respect of an Unremedied Breach by Nuvelo, where
material breach includes a failure by Nuvelo to pay an amount owed to Avecia
under this Agreement within 10 business days of when it is due.

 

  8.4 Termination by Agreement. Subject to Clause 9, this Agreement may be
terminated by mutual agreement at any time prior to Completion.

 

43

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9. Consequences of Termination

 

  9.1 General. In the event of termination by either Party under Clause 8 above:

 

  (a) Termination other than for Unremedied Breach. Upon termination of this
Agreement, other than for termination by Nuvelo in connection with an Unremedied
Breach by Avecia, Nuvelo will pay Avecia:

 

  (1) all sums due and payable up to the date of termination but not yet paid,
but excluding any payments (other than the Handling Fee) due in respect of
subcontractors appointed under Clause 13.2 or consumable items or Equipment
purchased under Clauses 3.2 and 3.3: (i) that can be returned; or (ii) the
ordering of or contract for which can be cancelled;

 

  (2) all reasonable costs already incurred by Avecia up to the date of
termination in accordance with the terms and conditions of this Agreement and
uncancellable expenses incurred by Avecia after termination which could not
reasonably be avoided after a reasonable attempt by Avecia to mitigate such
costs, including reasonable cancellation charges payable by Avecia to a
subcontractor appointed under Clause 13.2 or the seller of consumables or
Equipment in respect of consumables or Equipment (i) that has been returned to
the seller, or (ii) the order of or contract for which has been cancelled; and

 

  (3) the Cancellation Fee in consideration for technical consultancy services
performed up to date of termination and in winding down and cancelling the
Project, if and only if the Agreement is terminated by: (i) Avecia under Clause
8.3; or (ii) by Nuvelo in accordance with Clause 8.2, but excluding termination
by Nuvelo (A) for Unremedied Breach; (B) due to Force Majeure affecting Avecia;
or (C) in accordance with Clause 2.2(b).

 

  (4) Fifty percent (50%) of the Development Batch Fee that otherwise would have
been due and payable, as calculated in accordance with Schedule 4, in
consideration for technical consultancy services performed up to the date of
termination and in winding down and cancelling the Project, if and only if,
other than as a result of an Avecia Default, Nuvelo terminates the Agreement
under Clause 8.2 as a result of a failure of the centrifuge trials and a failure
by Avecia to commence Development Batch Manufacture before the expiration of
December 31, 2005, Pacific Standard Time, in accordance with Section 2.2(b)(2).

 

44

--------------------------------------------------------------------------------

  (b) Termination for Unremedied Breach; Avecia Default. If Nuvelo terminates
for Avecia’s Unremedied Breach, no later than 5 days after the effective date of
Nuvelo’s termination, Avecia shall pay to Nuvelo, as compensation for Nuvelo’s
loss of monies paid to Avecia for work not performed in accordance with the
terms and conditions of this Agreement, a sum equivalent to any and all monies
paid to Avecia under this Agreement, less amounts paid for technical consultancy
work completed by Avecia in accordance with the terms and conditions of this
Agreement and not affected by the breach. In the event of an Avecia Default in
the performance of any portion of the Project, Nuvelo is entitled to request
Avecia to: (i) promptly repeat the applicable portion of the Project at Avecia’s
own cost or (ii) reimburse Nuvelo for the price for that particular portion of
the Project. Failure by Avecia to timely cure an Avecia Default results in an
Unremedied Breach of the Agreement.

 

  (c) Currency Exchange Rate Losses. If Nuvelo terminates this Agreement for
Unremedied Breach by Avecia, Avecia shall be liable for any currency exchange
rate losses incurred by Nuvelo up through and until January 1, 2007, as a result
of commitments made by Nuvelo to enable Nuvelo to pay Avecia the payments set
forth in Clause 3.1 in British pounds sterling. Within 5 business days after the
effective date of termination of the Agreement for Avecia’s Unremedied Breach,
Nuvelo shall arrange to sell all British pounds sterling purchased by Nuvelo in
anticipation of its obligation to make future payments under this Agreement, and
Nuvelo shall also arrange to sell all contracts to purchase British pounds
sterling purchased by Nuvelo in anticipation of its obligations to make future
payments under this Agreement. Avecia shall pay to Nuvelo an amount equal to any
currency exchange losses actually incurred by Nuvelo in connection with such
sales, as reduced by any amounts owed by Nuvelo to Avecia as of the effective
date of termination on account of services completed by Avecia in compliance
with and prior to termination of this Agreement. Avecia will pay any undisputed
amounts owed to Nuvelo under this Clause 9.1(c) within five (5) business days of
its receipt of an invoice for such amounts from Nuvelo. All payments to Nuvelo
under and in accordance with this Clause 9.1(c) will be made in United States
dollars.

 

  (d) Subject to Section 6.5, the rights and remedies set out in this Clause 9.1
in respect of the consequences of termination do not limit any other remedies or
damages to which a Party may be entitled in law or in equity.

 

  9.2

Acquired Rights. Termination or expiry of this Agreement, for whatever reason,
shall not prejudice the rights of either Party

 

45

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acquired before such termination or expiry, including the right to payment for
services actually performed under the Project in accordance with the terms and
conditions of this Agreement, pursuant to Clause 3.

 

  9.3 Survival. The provisions of Clauses 1.2, 2.9, 2.10(a), 3.3(c), 3.3(d),
3.5, 3.6, 3.7, 5, 6.2 through 6.5, 6.7 and 7 through 20 shall survive the
termination or expiry of this Agreement for the term set forth in the applicable
Clause, or if no period is specified, the earlier of perpetuity of the maximum
amount of time permitted under Delaware law.

 

10. Independent Contractor

 

Nothing in this Agreement shall create, or be deemed to create, a partnership or
the relationship of principal and agent or employer and employee between the
Parties. Each Party agrees to perform under this Agreement solely as an
independent contractor.

 

11. Entire Agreement

 

This Agreement and with the Schedules attached hereto contain the entire
agreement between the Parties with respect to the subject matter set forth
therein and supersedes any previous agreements relating to the Project
(including the Interim Agreement) and any understandings between the Parties
with respect thereto.

 

12. Announcements And Publicity

 

Subject to the prior written approval of the other Party, a Party may make an
official press release, announcement or other formal publicity relating to the
transactions which are the subject of this Agreement. The Party wishing to make
such release, announcement or publicity shall provide a copy of the text thereof
to the other Party for its review, revision and approval, not to be unreasonably
withheld or delayed. Nothing in this Clause 12 shall preclude disclosure of the
terms of this Agreement as required by Applicable Laws, including without
limitation the regulations of the United States Securities and Exchange
Commission.

 

13. Assignment and Subcontracting

 

  13.1 This Agreement shall be binding upon and inure to the benefit of the
Parties hereto and their respective legal successors but shall not otherwise be
assignable by either Party, without the prior written consent of the other
Party, which consent shall not be unreasonably withheld or delayed, except that
either Party may assign this Agreement without consent to an Affiliate or a
purchaser or acquirer of a Party, or of the part of a Party’s business to which
this Agreement relates.

 

46

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  13.2 With Nuvelo’s prior written consent as to the ability to subcontract
particular work and as to the identity of each subcontractor, Avecia may
subcontract certain analytical work under the Project in accordance with the
Quality Agreement, subject to inclusion in such subcontract of confidentiality
and intellectual property provisions no less onerous than those contained
herein, and commercially reasonable cancellation provisions. Except as provided
otherwise in Section 3.2(a)(2) or in a Programme Amendment Order, Avecia is
responsible for all costs, fees and Expenditures associated with any
subcontracted work, and shall not pass any such costs, fees or Expenditures
through to Nuvelo. Avecia shall be liable for any acts or omissions of any
subcontractor as if such acts or omissions were Avecia’s own.

 

14. Variation

 

No variation, modification or amendment of this Agreement shall bind either
Party unless made in writing in the English language and agreed to in writing by
duly authorized officers of both Parties.

 

15. Illegality

 

If any provision of this Agreement is agreed by the Parties to be illegal, void
or unenforceable under any law that is applicable hereto or if any court of
competent jurisdiction in a final decision so determines, this Agreement shall
continue in force and effect except that the illegal, void or unenforceable
provision shall be deemed to be excised herefrom with effect from the date of
such agreement or judicial decision or such earlier date as the Parties may
agree.

 

16. Waiver

 

A failure by either Party hereto to exercise or enforce any rights conferred
upon it by this Agreement shall not be deemed to be a waiver of any such rights
or operate so as to bar the exercise or enforcement thereof at any subsequent
time or times.

 

17. Notices

 

  17.1 Formal Notices. Any formal notice required or permitted under this
Agreement shall be in writing which may take the form of a letter or facsimile
and shall be sent by prepaid post, facsimile, or hand delivery (including
messenger service). The addresses for any such notice or other communication
shall be those stated on the first page of this Agreement.

 

47

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  17.2 Other Communications. In addition to the methods set out in Clause 17.1,
any communications other than formal notices between the Parties may be made by
telephone or by email.

 

  17.3 Change of Address. Any Party may, at any time by written notice to the
other Party, change the address or the facsimile numbers to which notices or
other communications shall be sent. All notices and other communications shall
have been duly given or made (i) when delivered by hand (including by messenger
service) upon delivery or (ii) when delivered by post upon delivery or (iii)
when faxed upon receipt of a legible copy by recipient and production of a
satisfactory transmission report by sender confirming transmission of the fax in
full to the appropriate number by the fax machine which sent the fax.

 

18. Force Majeure

 

Neither Party shall be liable to the other Party in any manner whatsoever for
any failure or delay in performing its obligations under this Agreement if and
to the extent, and for the duration, that such is due to Force Majeure. Without
prejudice to Clause 8, any said failure or delay shall not give either Party the
right to terminate this Agreement except, and to the extent that such Force
Majeure continues for a period exceeding three (3) months. Termination as a
result of Force Majeure shall take effect as if the Agreement had been
terminated by mutual agreement under Clause 8.4.

 

19. Law and Jurisdiction

 

  19.1 Law. This Agreement is governed by and shall be construed and interpreted
in accordance with the laws of the State of Delaware, United States of America.
Any proceedings between the Parties shall be conducted in the English language.

 

  19.2 Referral to Senior Managers. Prior to any dispute, difference or
disagreement concerning this Agreement proceeding to litigation pursuant to
Clauses 19.1 and 19.4, the Parties shall seek to resolve the matter within
thirty (30) calendar days by referring it to the CFO of Avecia and the CEO of
Nuvelo, each of which shall have the authority necessary to fully resolve the
dispute.

 

  19.3 Interim Steps. Neither of the Parties shall be deemed to be precluded
from taking such interim formal steps as may be considered necessary to protect
such Party’s position while the procedures referred to in Clause 19.2 are
pursued.

 

  19.4 Jurisdiction. Except as provided for in Clause 19.2, in relation to any
legal action or proceedings to enforce this Agreement or arising out of or in
connection with this Agreement each of the Parties irrevocably consents and
submits to the exclusive jurisdiction and venue of the federal and state courts
located in the State of Delaware.

 

48

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20. General

 

  20.1 Headings. The headings for each Clause or Paragraph or Section in this
Agreement, and in the Schedules, have been inserted for convenience of reference
only and are not intended to limit or expand on the meaning of the language
contained in the particular clause, paragraph or section.

 

  20.2 Ambiguities. Ambiguities, if any, in this Agreement shall not be
construed against any Party, irrespective of which Party may be deemed to have
authored the ambiguous provision.

 

  20.3 Counterparts. This Agreement may be executed in two or more counterparts,
including facsimile counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.

 

49

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IN WITNESS WHEREOF, the authorized representatives of the Parties have executed
this Agreement as of the last date set forth below, and upon its execution, this
Agreement becomes effective as of the Commencement Date.

 

For and on behalf of AVECIA LIMITED

        Signature  

/s/ Kevin Cox

           

Name

 

Kevin Cox

           

Position

 

VP Biotechnology

           

Date

 

30 June 2005

           

 

For and on behalf of NUVELO INC.

        Signature  

/s/ Lee Bendekgey

      Signature  

/s/ Michael Levy

Name

 

Lee Bendekgey

     

Name

 

Michael Levy

Position

 

CFO

     

Position

 

SVP R&D

Date

 

30 June 2005

     

Date

 

30 June 2005

 

50

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Schedule 1

 

The Work Programme

 

51

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Schedule 2

 

Quality Agreement

 

52

--------------------------------------------------------------------------------

 

Schedule 3

 

Programme Amendment Order

 

(1)    Project Title & Number

 

(2)    Date Project Started

 

(3)    P.A.O. Number

(4)    Reason for P.A.O.

(5)    Amendment required and new milestones

(6)    Impact on price, time frame, resources

(7)    Amended payment schedule (if required)

 

53

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Authorisation

                   

for Avecia

     

for customer

 

54

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Schedule 4

 

The Cancellation Fee

 

A. The Cancellation Fee shall be a percentage of:

 

  (1) in the case of Development Batch Manufacture, the total payment to be made
in respect of Development Batch Manufacture for completion of milestones 11, 17,
19, 20, 23 and 25 under Clause 3.1, being £2,109,500 (“Development Batch Fee”)
less any sums already received for milestones 11, 17, 19, 20, 23 and 25 under
this Agreement in respect of Development Batch Manufacture at the date on which
notice is given of termination, cancellation or Non-Manufacturing Delay.

 

  (2) in the case of the Validation Campaign, the total payment to be made in
respect of the Validation Campaign for completion of milestones 26, 27, 28, 29,
30, 31, 32, 33, 34, 36, 37, 38, 39 and 41 under Clause 3.1, including
manufacture of the Engineering Batch (or as otherwise agreed in writing), being
£4,618,000 (“the Validation Campaign Fee”) less any sums already received for
milestones 26, 27, 28, 29, 30, 31, 32, 33, 34, 36, 37, 38, 39 and 41 under this
Agreement in respect of the Validation Campaign and the Engineering Batch under
Clause 3.1 at the date on which notice is given of termination, cancellation or
Non-Manufacturing Delay.

 

B. The applicable percentage shall be dependent on the amount of notice of
termination, cancellation or Non-Manufacturing Delay given by Nuvelo prior to
the date for commencement of Development Batch Manufacture or the Validation
Campaign (as appropriate).

 

C. The Cancellation Fee shall be calculated as follows:

 

Notice Period

--------------------------------------------------------------------------------

   Percentage of Validation Campaign Fee
or Development Batch Fee (as
appropriate)

--------------------------------------------------------------------------------

 

Nine months or more

   0 %

Fewer than nine months but more than six months

   50 %

Six months or fewer but more than four months

   70 %

Four months or fewer but more than one month

   90 %

One month or less

   100 %

 

D.

Avecia shall make commercially reasonable endeavours to raise revenue by
utilising the production facility during the period during which

 

55

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Development Batch Manufacture or the Validation Campaign (as appropriate) was
intended to take place but for termination, cancellation on Non-Manufacturing
Delay by Nuvelo. Avecia shall refund to Nuvelo a sum equivalent to the revenue
(net of raw materials and consumables Expenditure) raised as a result of such
alternative use up to a maximum of 80% of the Cancellation Fee paid.

 

E. Where the Cancellation Fee is less than the amount already paid to Avecia by
Nuvelo under this Agreement in consideration for Development Batch Manufacture
or the Validation Campaign (as appropriate), Avecia shall pay to Nuvelo the
difference between the applicable Cancellation Fee and the amount already paid
in consideration for the Development Batch Manufacture or the Validation
Campaign (as appropriate).

 

56

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Schedule 5

 

Committee Members

 

Project Steering Committee Members

 

Nuvelo

--------------------------------------------------------------------------------

  

Avecia

--------------------------------------------------------------------------------

Simon Allen, VP Business Development

Leslie Barnes, Director, R&D Finance

Dr. Kirk Hayenga, Senior Director, PSM

Dr. Brian Kersten, Senior Director,

Regulatory and QA

  

Dr Stephen Taylor, Business General

Manager, Biologics

Steve Bagshaw, Head of Business

Planning

Dr Mark Carver, Head of R&D

Dr Klaus Neurohr, Head of Quality &

Regulatory Affairs

 

Executive Committee Members

 

Nuvelo

--------------------------------------------------------------------------------

  

Avecia

--------------------------------------------------------------------------------

Dr. Michael Levy

Senior Vice President,

Research and Development

  

Dr Kevin Cox, Senior Vice-President,

Avecia Biotechnology

 

57

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Schedule 6

 

The Equipment

 

Liquid Nitrogen Dewars (x2) and Data Logger

Depth Filtration System

1000L jacketed bag holder

Delipid filter skid

2x1000mm chromatography columns, hydraulic skid and spares

2 x Freezers (-30°C & - 70°C)

 

58

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Schedule 7

 

The Confidentiality Agreement

 

See attached

 

59

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Schedule 1 Work Programme

 

B2422 Work Programme

 

Scope Statement

 

Program to carry out technology transfer of the alfimeprase Process, Process
characterization and validation of in-process and bulk API assays by Avecia and
manufacture of two (2) cGMP Development Batches, one (1) Engineering Batch and
up to five (5) Validation Batches of alfimeprase in Avecia’s ABC 5000 facility.

 

Contents

 

Stage 1.   

Data Acquisition and Assessment

Stage 2.   

Process Transfer & Fit

Stage 3.   

Capital Equipment Specification and Procurement

Stage 4.   

15L Fermentation Runs

Stage 5.   

Laboratory Scale Purification Runs

Stage 6.   

Assay Transfer of Validated Methods

Stage 7.   

Assay Transfer

Stage 8.   

Assay Validation

Stage 9.   

Laboratory Process Characterisation (LPC)

Stage 10.   

Fermentation Scale-Up and Centrifuge Trials at 3000L scale

Stage 11.   

cGMP Preparation at 3000L scale

Stage 12.   

Two (2) cGMP Development Batches at 3000L scale

Stage 13.   

Validation Documentation

Stage 14.   

One (1) Engineering Batch at 3000L scale

Stage 15.   

Up to Five (5) Validation Batches at 3000L scale

Appendix 1   

Process Assumptions

Appendix 2   

B2422 Work Programme Timeline (see attachment)

 

Detailed Work Programme

 

Stage 1. Data Acquisition and Assessment

 

  1.1. Objectives

 

  1.1.1. To perform systematic review and gap analysis of Amgen technical
information regarding the fermentation, harvest and purification steps for the
alfimeprase Process.

 

  1.1.2. To perform systematic review and gap analysis of Amgen technical
information regarding the analytical testing for the alfimeprase Process.

 

  1.1.3. To perform systematic review and gap analysis of Amgen technical
information regarding the genetically modified organism (GMO; Pichia) for
alfimeprase.

 

  1.2. Activities

 

  1.2.1. Review and evaluate all Amgen technical reports, laboratory notebooks,
laboratory reports and previous process batch records to define the alfimeprase
Process.

 

Page 1 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

  1.2.2. Review the analytical methods listed below.

 

Method number

--------------------------------------------------------------------------------

  

Assay

--------------------------------------------------------------------------------

  

Characteristic

--------------------------------------------------------------------------------

A0819

  

Genotypic Verification (V)

   MCB and WCB Identity

A0662

  

Microbial Contaminants (V)

   Safety

A0359

  

Viable Cell Count (V)

   MCB and WCB Quality

A01382

  

AEX-Quant (V)

   Strength

A0848

  

Clot Lysis (validated)

   Potency

A0120

  

Absorbance at 280nm (validated)

   Strength

A0829

  

SEC (V)

   Purity

A0874

  

RP HPLC in-process (V)

   Purity

A0831

  

AEX-Qual (V)

   Purity

A0830

  

RP HPLC (V)

   Purity

A0815

  

SDS PAGE Coomassie (V)

   Purity, Identity

A0815

  

SDS PAGE Silver

   Purity

A0847

  

Peptide map (V)

   Identity

A0924

  

Intact MS OUTSOURCED (V)

   Identity

A0862

  

Anti Pichia EIA (V)

   Impurities

A01339

  

DNA or equivalent OUTSOURCED (V)

   Impurities

A0221

  

Appearance (V)

   Quality     

USP/EP Pyrogen (rabbit) OUTSOURCED

   Safety

A0736

  

Bioburden (V)

   Safety

A0857

  

MES (V)

   Process clearance

A0837

  

Imidazole (V)

   Process clearance

A01102

  

EPA Copper and Zinc OUTSOURCED

   Buffer Monitoring

A0442

  

DNA sequence for cell bank OUTSOURCED (V)

   MCB and WCB Safety

A0719

  

Cell bank contamination (V)

   MCB and WCB Safety

A0404

  

Polysorbate 80 (V)

   Buffer monitoring

A0410

  

Sucrose and Mannitol (V)

   Buffer monitoring

A0225

  

Citrate (V)

   Buffer monitoring

A0302

  

Sulphate (V)

   Buffer monitoring

A0986

  

Tris (V)

   Buffer monitoring     

EP Osmolality

   Quality     

USP/EP pH

   Quality     

USP/EP Conductivity

   Quality

 

  (V) denotes analytical methods that require some validation work.

 

  1.2.3. Generate a GMO assessment to work with alfimeprase at Avecia.

 

  1.3. Deliverables

 

  1.3.1. Definition of a detailed work programme

 

  1.3.2. Project timeline

 

Page 2 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

Stage 2. Process Transfer & Fit

 

  2.1. Objective

 

  2.1.1. To perform a gap analysis to identify new facility equipment required
to manufacture alfimeprase.

 

  2.2. Activities

 

  2.2.1. Based on the technical data review (Stage 1), Avecia to highlight the
requirements for new equipment purchases to support manufacture of alfimeprase.

 

  2.3. Deliverables

 

  2.3.1. Scope of equipment requirements

 

Stage 3. Capital Equipment Specification and Procurement

 

  3.1. Objectives

 

  3.1.1. To purchase Equipment for use during Centrifuge Trials

 

  3.1.2. To purchase Equipment for use during cGMP manufacture

 

  3.2. Activities

 

  3.2.1. Generate a user requirement specification (URS) for all new Equipment.

 

  3.2.2. Obtain vendor quotes and generate bid comparisons (as appropriate) for
all new Equipment for Nuvelo to review.

 

  3.2.3. Upon receiving Nuvelo confirmation, place relevant order to purchase
new Equipment and management of supplier regarding factory acceptance testing
and delivery.

 

New Equipment for Centrifuge Trials

--------------------------------------------------------------------------------

   Estimated cost
£000s

--------------------------------------------------------------------------------

Liquid Nitrogen Dewars (x2) and Data Logger

   8.752     

--------------------------------------------------------------------------------

Total

   8.752     

--------------------------------------------------------------------------------

 

New Equipment for GMP manufacture

--------------------------------------------------------------------------------

   Estimated cost
£000s

--------------------------------------------------------------------------------

Depth Filtration System

   120

1000L jacketed bag holder

   30

Delipid filter skid

   10

2x1000mm chromatography columns, hydraulic skid and spares

   303

2 x Freezers (-30°C & - 70°C)

   6     

--------------------------------------------------------------------------------

Total

   469     

--------------------------------------------------------------------------------

 

Page 3 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

  3.2.4. In addition Avecia would need to make certain plant modifications to
ABC5000 stream 2 facility and provide items of a generic nature at Avecia cost.

 

Modification to fermenter control software

Trace heating on glucose line

Ammonia feed tank

Various tankage

0.2 µm filtration skid

Small UF rig (Sartorius Beta)

 

  3.3. Deliverables

 

  3.3.1. URS for each new Equipment purchase.

 

  3.3.2. Installed and qualified new Equipment fit for purpose.

 

Stage 4. 15L Fermentation Runs

 

  4.1. Objectives

 

  4.1.1. To demonstrate robustness and reproducibility of the fermentation
Process at laboratory scale within Avecia (familiarisation).

 

  4.1.2. To demonstrate the fermentation Process comparability after
substitution of several raw materials (comparability).

 

  4.2. Activities

 

  4.2.1. Receive alfimeprase working cell bank (WCB) vials.

 

  4.2.2. Generate and ensure technical approval of laboratory protocols with
Nuvelo.

 

  4.2.3. Perform four (4) fermentation runs at 15L using Avecia preferred
supplier raw materials. Presentation of familiarisation data set to Nuvelo.

 

  4.2.4. Receive the original alfimeprase raw material list and specifications
from Nuvelo.

 

  4.2.5. Review and technical approval of a comparability procedure drafted by
Nuvelo.

 

  4.2.6. Perform four (4) fermentation runs at 15L for comparability, two (2)
using the original alfimeprase Process raw materials and two (2) using Avecia
preferred supplier raw materials. Presentation of comparability data set to
Nuvelo.

 

  4.2.7. Generate familiarisation and comparability technical reports.

 

  4.3. Deliverables

 

  4.3.1. Interim fermentation familiarisation technical report.

 

  4.3.2. Final fermentation comparability technical report.

 

  4.3.3. QA review of limited data from familiarization and comparability
technical reports for Nuvelo.

 

Stage 5. Laboratory Scale Purification Runs

 

  5.1. Objectives

 

  5.1.1. To demonstrate robustness and reproducibility of the purification
Process at 15L laboratory scale within Avecia (familiarisation).

 

  5.1.2. To demonstrate the purification Process comparability after
substitution of several fermentation and purification raw materials
(comparability).

 

Page 4 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

  5.1.3. To demonstrate cleanability of alfimeprase in relation to proteins used
in cleaning validation studies.

 

  5.2. Activities

 

  5.2.1. Receive the alfimeprase fermentation diafiltered, concentrated,
clarified broth (DCCB) from Nuvelo.

 

  5.2.2. Perform two (2) purification runs through to final Product using Nuvelo
DCCB.

 

  5.2.3. Perform analytical testing of the purification Process using ‘Nuvelo
DCCB’.

 

  5.2.4. Receive the first 2 x 15L Avecia fermentation broth from Stage 4
familiarisation. Create DCCB and purify 2 x 15L to final Product.

 

  5.2.5. Perform analytical testing of purification Process using Avecia DCCB.

 

  5.2.6. Receive the second 2 x 15L Avecia fermentation broth from Stage 4
familiarisation. Create DCCB and purify 1 x 15L to final Product.

 

  5.2.7. Perform analytical testing of Avecia DCCB purification Process.

 

  5.2.8. Presentation of familiarisation data set to Nuvelo.

 

  5.2.9. Generate interim familiarisation technical report.

 

  5.2.10. Perform cleanability studies.

 

  5.2.11. Review and technical approval of a comparability procedure drafted by
Nuvelo.

 

  5.2.12. Receive the next 4 x 15L Avecia fermentation broth from Stage 4
comparability. Create DCCB and purify 2 x 15L (one from each preferred raw
material supplier) to final Product.

 

  5.2.13. Perform analytical testing.

 

  5.2.14. Generate comparability technical report.

 

  5.3. Deliverables

 

  5.3.1. Interim purification familiarisation technical report.

 

  5.3.2. Final purification comparability technical report.

 

  5.3.3. Cleanability technical report.

 

  5.3.4. QA review of limited data from familiarization and comparability
technical reports for Nuvelo.

 

Stage 6. Assay Transfer of Validated Methods

 

  6.1. Objectives

 

  6.1.1. To transfer the validated clot lysis and appearance analytical methods
to Avecia QC.

 

  6.2. Activities

 

  6.2.1. Receive appropriate samples, historical data and reference standard
from Nuvelo.

 

  6.2.2. Jointly review and ensure QA approval of analytical transfer protocols
with Nuvelo for the clot lysis and appearance assays.

 

  6.2.3. Execute protocols and report data.

 

  6.2.4. Generate validation reports.

 

  6.3. Deliverables

 

  6.3.1. Validated method transfer reports.

 

Page 5 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

Stage 7. Assay Transfer

 

  7.1. Objectives

 

  7.1.1. To transfer the non-validated Amgen analytical methods to Avecia.

 

  7.1.2. To transfer the non-validated Amgen analytical methods identified to be
outsourced in Stage 1.2.2 to Avecia approved outsourced testing houses.

 

  7.2. Activities

 

  7.2.1. Receive appropriate samples, historical data and reference standard
from Nuvelo.

 

  7.2.2. Jointly review and ensure QA approval of analytical transfer protocols
with Nuvelo for non-validated assays defined in stage 1.2.2.

 

  7.2.3. Jointly review additional work required on assays to prepare for assay
validation.

 

  7.2.4. Execute transfer protocols and report data.

 

  7.2.5. Generate transfer reports as determined by Nuvelo.

 

7.3. Deliverables

 

  7.3.1. Method transfer data and reports (if required) for each assay.

 

Stage 8. Assay Validation

 

  8.1. Objective

 

  8.1.1. To ensure validation of all the analytical methods identified by (V) in
analytical table from Stage 1.2.2 of the work programme, for API Release testing
during the validation batches.

 

  8.2. Activities

 

  8.2.1. Generate validation sub-plan for analytical assays

 

  8.2.2. Jointly review and ensure QA approval of analytical validation
protocols with Nuvelo for non-validated assays identified by (V) in the
analytical table from Stage 1.2.2 of the work programme.

 

  8.2.3. Execute validation protocols in accordance with ICH Q2A and Q2B and
report data.

 

  8.2.4. Generate validation reports.

 

  8.3. Deliverables

 

  8.3.1. Method validation data and reports for each assay.

 

Stage 9. Laboratory Process Characterisation (LPC)

 

  9.1. Objective

 

  9.1.1. To evaluate key operational parameters and ranges for critical Process
steps.

 

  9.2. Activities for LPC experimental set #1

 

  9.2.1. Review and evaluate all Amgen technical reports and data from previous
LPC studies.

 

  9.2.2. Perform a RPN analysis.

 

  9.2.3. Perform Fermentation Studies

 

  9.2.3.1. Investigate degradation of seed fermenter media on sterilisation.

 

  9.2.3.2. Investigate the addition of antifoam (heating to filter sterilise)
for addition to fermenter.

 

  9.2.3.3. Investigate seed fermenter inoculum volume.

 

Page 6 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

  9.2.3.4. Investigate the change over to time triggers at a specified feed flow
rate.

 

  9.2.4. Perform Purification Studies

 

  9.2.4.1. Investigate the SPHP step to determine the optimum UV cut-off range.

 

  9.2.4.2. Investigate the SPHP step and reduction in gradient range during
elution.

 

  9.2.4.3. Investigate the temperature of operation during the IMAC step.

 

  9.2.4.4. Investigate the requirement for wash step #2 during the IMAC step.

 

  9.2.4.5. Investigate the pH of the load and buffer material during the IMAC
step.

 

  9.3. Deliverables

 

  9.3.1. RPN analysis report

 

  9.3.2. LPC Experimental set 1 Fermentation technical report

 

  9.3.3. LPC Experimental set 1 Purification technical report

 

Stage 10. Fermentation Scale-Up and Centrifuge Trials at 3000L scale

 

  10.1. Objectives

 

  10.1.1. Release of working cell bank (WCB) for cGMP use

 

  10.1.2. To provide the first data on fermentation performance at 3000L scale

 

  10.1.3. To provide early definition of centrifuge operating conditions which
can only be determined empirically

 

  10.1.4. To allow greater chance that the first cGMP Development batch would
make useful Product and de-risk that stage of the programme.

 

  10.2. Activities

 

  10.2.1. Perform QC identity and purity testing of WCB and generate a Release
Certificate of Analysis (CofA), approved by QA for the WCB.

 

  10.2.2. Order all raw materials and consumables.

 

  10.2.3. Generate draft manufacturing batch records.

 

  10.2.4. Review and technical approval of a comparability procedure drafted by
Nuvelo.

 

  10.2.5. Carry out first 3000L fermentation and centrifuge trial. Analyse
centrifuge performance data.

 

  10.2.6. Carry out the second fermentation and centrifuge trial with parameters
to mimic the operation of the first cGMP Development batch or with refined
parameters based on failure of batch 1, if necessary.

 

  10.2.7. Supply 4 x 50 L fermentation broth for lab-scale purification. Store 2
x 50L of fermentation broth for future purifications.

 

  10.2.8. Perform 2 x 50L purification using broth from centrifuge trials to
supply research grade material to Nuvelo.

 

  10.2.9. Generate manufacturing trial summary report.

 

  10.3. Deliverables

 

  10.3.1. QC document for cell bank testing.

 

  10.3.2. Release CofA for the WCB.

 

  10.3.3. Draft manufacturing batch records.

 

  10.3.4. Research grade material.

 

Page 7 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

  10.3.5. Manufacturing batch summary report.

 

  10.3.6. Comparability report.

 

Stage 11. cGMP Preparation at 3000L scale

 

  11.1. Objectives

 

  11.1.1. To prepare for cGMP manufacture.

 

  11.2. Activities

 

  11.2.1. Generate a Process specification document.

 

  11.2.2. Generate cGMP manufacturing batch records.

 

  11.2.3. Generate QC document detailing the Release Product Specification
(refer to Appendix 2).

 

  11.2.4. Order all raw materials and consumables.

 

  11.2.5. Review and technical approval of a comparability procedure drafted by
Nuvelo.

 

  11.3. Deliverables

 

  11.3.1. Avecia QA approved Process specification document.

 

  11.3.2. Avecia QA approved cGMP manufacturing batch records.

 

  11.3.3. Avecia QA approved QC Document (Product Specification).

 

Stage 12. Two (2) cGMP Development Batches at 3000L scale

 

  12.1. Objectives

 

  12.1.1. To perform two (2) cGMP batches at 3000L scale

 

  12.1.2. To supply cGMP Product from at least 1 x 3000L Batch for clinical use.

 

  12.2. Activities

 

  12.2.1. Run the first cGMP Development batch at 3000L scale.

 

  12.2.2. Perform limited analytical testing according to Appendix 7 of the
Quality Agreement.

 

  12.2.3. Perform full analytical testing for API Release of the first batch (to
be jointly agreed and conditional on all limited testing performed in stage
12.2.2 being completed successfully).

 

  12.2.4. Perform QA batch disposition for API Release of first batch if all
Release testing was performed.

 

  12.2.5. Run the second cGMP Development batch at 3000L scale.

 

  12.2.6. Perform limited analytical testing according to Appendix 7 of the
Quality Agreement.

 

  12.2.7. Perform full analytical testing for API Release of the second batch
(to be jointly agreed and conditional on all limited testing performed in stage
12.2.6 being completed successfully).

 

  12.2.8. Perform QA batch disposition for API Release of second batch.

 

  12.2.9. Generate manufacturing batch summary reports

 

  12.2.10. Review the Process assumptions and cycle times as part of
pre-validation review.

 

  12.3. Deliverables

 

  12.3.1. Released cGMP API from at least 1 cGMP Development Batch to be
supplied for clinical use.

 

  12.3.2. Any material not Released for clinical use will be made available to
Nuvelo for research purposes.

 

  12.3.3. Manufacturing batch summary reports.

 

Page 8 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

Stage 13. Validation Documentation

 

  13.1. Objective

 

  13.1.1. To generate and QA approval of validation documentation to support
successful validation campaign.

 

  13.2. Activities

 

  13.2.1. Generate and approve the validation documentation shown below.

 

Document

--------------------------------------------------------------------------------

  

Purpose

--------------------------------------------------------------------------------

  

Accountable

Function

--------------------------------------------------------------------------------

  

Approving

Functions

(Final formal Release by QA)

--------------------------------------------------------------------------------

Validation Master Plan    Defines overview Validation strategy for Product    QA
   QA,QC, M, R&D Validation Sub Plans   

Defines specific Validation plans for Project relating to Equipment
Qualification

Cleaning Validation

Analytical Validation

Process Validation

Electronic systems

Training

   Various    QA,QC, M, R&D Process Validation Sub Plan   

Defines specific activities to be undertaken in Process Validation programme

And links these to relevant technical reports and the Development Report

   R&D    QA,QC, M, R&D Process Validation Protocol   

Document listing:

Runs to be undertaken in the manufacturing campaign, the expected specification
of material produced (and the acceptances ranges for this). Critical process
control parameters and acceptance ranges.

The results derived from the Process Validation Campaign shall be recorded in
this document

   R&D    QA,QC, M, R&D Process Validation Sub Plan Report    Report detailing
and analysing the outcome and data derived from the Process Validation Campaign
   R&D    QA,QC, M, R&D Validation Summary Report    Summary document reviewing
output from Validation Programme and formally closing it.    QA    QA,QC, M, R&D

 

Page 9 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

  13.3. Deliverables

 

  13.3.1. Avecia QA approved validation documentation as listed above.

 

Stage 14. One (1) Engineering Batch at 3000L scale

 

  14.1. Objectives

 

  14.1.1. To re-familiarise with the Process after the extended hold period.

 

  14.1.2. To de-risk the validation batches.

 

  14.2. Activities

 

  14.2.1. Order all raw materials and consumables.

 

  14.2.2. Run one (1) engineering batch.

 

  14.2.3. Perform limited analytical testing according to Appendix 4.

 

  14.3. Deliverables

 

  14.3.1. Manufacturing batch summary report.

 

Stage 15. Up to Five (5) Validation Batches at 3000L scale

 

  15.1. Objective

 

  15.1.1. To demonstrate consistent successful cGMP manufacture by performing up
to five (5) consecutive batches with at least 3 consecutive batches conforming
to approved validation documentation.

 

  15.1.2. Perform Release Testing during validation batches.

 

  15.2. Activities

 

  15.2.1. Run up to five (5) consecutive cGMP manufacturing batches as per the
approved validation documentation.

 

  15.2.2. Justify both Process and Product quality conformance for three (3)
consecutive batches as per the validation documentation.

 

  15.2.3. Perform QA batch disposition for API Release of all acceptable
Batches.

 

  15.3. Deliverables

 

  15.3.1. Released cGMP API, from 3 consecutive batches, to be supplied for
clinical use.

 

  15.3.2. Validation summary report.

 

Page 10 of 11

--------------------------------------------------------------------------------

Schedule 1    Work Programme

 

Appendix 1 Process Assumptions

 

Cycle Times

 

Fermentation & Harvest

The fermentation Process (from inoculation of the production vessel through to
harvesting of the last of the culture) is estimated to be completed in no more
than seven (7) days (168 hours). Occupation of any one (1) inoculum vessel is
also required for no more than one (1) day (24 hours).

 

Purification

The Process is estimated to require no more than six (6) days (144 hours)
occupation of the purification area for the process of each complete
fermentation batch (including dispensing into final bulk containers).

 

The total cycle time for each Batch is estimated to be no more than fourteen
(14) days in the ABC 5000 facility.

 

Occupancy times include time required for key in process control tests to be
completed.

 

Appendix 2 B2422 Work Programme Timeline (see attachment)

 

Page 11 of 11

--------------------------------------------------------------------------------

LOGO [g17073img01.jpg]

B2422 Work Programme Timeline Wed 29/06/05 ID Task Name Duration Start Finish
Predecessors

 

1 LOI signed 0 wks Fri 21/01/05 Fri 21/01/05 2 Stage 1 Data Review 9 wks Mon
20/12/04 Mon 21/02/05

 

12 Stage 1A Shipments to Avecia 8.57 wks Fri 21/01/05 Tue 22/03/05 18 Stage 2
Process Transfer & Fit 10 wks Mon 10/01/05 Mon 21/03/05

 

22 Regulatory Submission Reports 64.86 wks Mon 06/06/05 Sun 03/09/06 23 15L
Familiarisation 2.29 wks Mon 11/07/05 Wed 27/07/05

 

30 15L Comparability 16.29 wks Mon 06/06/05 Wed 28/09/05 43 Centrifuge Trials
17.14 wks Mon 18/07/05 Tue 15/11/05

 

57 LPC#1 2.57 wks Fri 25/11/05 Tue 13/12/05 65 GMP Runs 24.57 wks Mon 10/10/05
Fri 31/03/06

 

78 LPC#2 2.57 wks Wed 10/05/06 Sun 28/05/06 86 Validation Campaign 19.57 wks Wed
19/04/06 Sun 03/09/06

 

100 Stage 3 Capital Specification and Procurement 28.4 wks Mon 21/03/05 Wed
05/10/05 101 Stage 3A Specification 7 wks Mon 21/03/05 Mon 09/05/05

 

118 Stage 3B Quotes / Order 25.83 wks Fri 08/04/05 Wed 05/10/05 135 Stage 4 15L
Fermentation 22.79 wks Tue 08/03/05 Mon 15/08/05

 

136 Agreed scope of work with Nuvelo 0 wks Tue 15/03/05 Tue 15/03/05 7FF+6.2 wks
137 Receive R&D WCB vials 0 wks Mon 14/03/05 Mon 14/03/05 16

 

138 Receive RM CofA’s 0 wks Tue 08/03/05 Tue 08/03/05 9FS+3.5 wks 139 Order Av
RM’s 1 wk Tue 15/03/05 Tue 22/03/05 136SS

 

140 Order Am RM’s 0 wks Mon 25/04/05 Mon 25/04/05 141 15L Fermentations #1a/b
(Avecia media) 5 days Tue 05/04/05 Sun 10/04/05 11,137FS+22 days

 

142 Supply 15L #1 feedstock to DSP 0 wks Sun 10/04/05 Sun 10/04/05 141 143 15L
#2a/b Fermentations (Avecia media) 5 days Tue 19/04/05 Sun 24/04/05 141FS+9 days

 

144 Supply 15L #2 feedstock to DSP 0 wks Sun 24/04/05 Sun 24/04/05 143 145
Interim Familiarisation Technical Data 7 wks Mon 25/04/05 Mon 13/06/05 144FS+1
day

 

146 15L #3a Comparability Fermentation (Avecia media) 2 wks Mon 11/07/05 Mon
25/07/05 140FS+11 wks 147 Supply 15L #3 feedstock to DSP 0 wks Mon 25/07/05 Mon
25/07/05 146

 

148 15L #3b Comparability Fermentation (Amgen media) 2 wks Mon 25/07/05 Mon
08/08/05 146 149 Supply 15L #3 feedstock to DSP 0 wks Mon 08/08/05 Mon 08/08/05
148

 

150 Review Data with Nuvelo 0 wks Mon 01/08/05 Mon 01/08/05 147FS+1 wk 151
Technical Report 2 wks Mon 01/08/05 Mon 15/08/05 150

 

152 Cleaning studies 3 wks Mon 16/05/05 Mon 06/06/05 143FS+3.2 wks 153 Stage 5
Purification runs 26.8 wks Tue 08/03/05 Mon 12/09/05

 

154 Agreed scope of work with Nuvelo 0 wks Tue 15/03/05 Tue 15/03/05 136 155
Order raw materials 2 wks Tue 08/03/05 Tue 22/03/05 154SS-1 wk

 

156 Receive DCCB material from Amgen 0 wks Tue 22/03/05 Tue 22/03/05 155 157
Conduct Amgen DCCB experiments 10 days Tue 29/03/05 Fri 08/04/05

 

158 15L #1a processing and analysis 3 wks Mon 11/04/05 Mon 02/05/05 142FS+1 day
159 15L #1b processing and analysis 3 wks Mon 18/04/05 Mon 09/05/05 158SS+1 wk

 

160 15L #2a processing and analysis (#2b held in reserve) 3 wks Mon 25/04/05 Mon
16/05/05 144FS+1 day 161 Interim Familiarisation Report 5 wks Mon 16/05/05 Mon
20/06/05 160

 

162 15L #3a processing 1 wk Mon 25/07/05 Mon 01/08/05 147SS 163 15L #3b
processing 1 wk Mon 08/08/05 Mon 15/08/05 149

 

164 15L #3b analysis (comparability testing)—external time?? 2 wks Mon 15/08/05
Mon 29/08/05 163 165 Review Data with Nuvelo 1 wk Mon 29/08/05 Mon 05/09/05 164

 

166 Technical Report 2 wks Mon 29/08/05 Mon 12/09/05 164 167 Cleaning Report 2
wks Mon 06/06/05 Mon 20/06/05 152

 

168 Stage 6 Assay Transfer of Validated Methods 28.5 wks Fri 21/01/05 Mon
08/08/05 169 Agreed scope of work with Nuvelo 0 wks Fri 21/01/05 Fri 21/01/05
8FF

 

170 Avecia receives samples 0 wks Fri 04/03/05 Fri 04/03/05 171 Avecia receives
Ref Std 0 wks Fri 25/03/05 Fri 25/03/05 170FF+3 wks

 

172 A0848 Clot Lysis 8 wks Wed 25/05/05 Wed 20/07/05 186SS+10 wks

 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter 2nd Quarter 3rd
Quarter 4th Quarter 1st Quarter Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

 

21/01

 

15/03 14/03 08/03 15/03 22/03

 

25/04 05/04 10/04 10/04 19/04 24/04 24/04

 

25/04 13/06

 

11/07 25/07 25/07 25/07 08/08 08/08 01/08 01/08 15/08 16/05 06/06

 

15/03 08/03 22/03 22/03 29/03 08/04 11/04 02/05 18/04 09/05 25/04 16/05 16/05
20/06

 

25/07 01/08 08/08 15/08 15/08 29/08 29/08 05/09 29/08 12/09 06/06 20/06

 

21/01

 

04/03 25/03

 

25/05 20/07

 

1 of 3 Schedule 1 (Appendix 2)

--------------------------------------------------------------------------------

LOGO [g17073img02.jpg]

 

B2422 Work Programme Timeline Wed 29/06/05 ID Task Name Duration Start Finish

 

173 A0221 Appearance 5 wks Wed 25/05/05 Wed 29/06/05 174 A0120 Protein
Concentration 20.7 wks Wed 16/03/05 Mon 08/08/05

 

184 Stage 7 Assay Transfer to Avecia 33.99 wks Wed 16/03/05 Wed 09/11/05 185
A01382 AEX-Quant 20.7 wks Wed 16/03/05 Mon 08/08/05

 

195 A0874 RP HPLC in-process 20.7 wks Wed 16/03/05 Mon 08/08/05 205 A0831
AEX-Qual 20.7 wks Wed 16/03/05 Mon 08/08/05

 

215 A0830 RP HPLC 20.7 wks Wed 16/03/05 Mon 08/08/05 225 A0829 SEC-HPLC 20.7 wks
Wed 16/03/05 Mon 08/08/05

 

235 A0815 SDS PAGE Coomassie 19.7 wks Wed 16/03/05 Mon 01/08/05 245 A0110 SDS
PAGE Silver Stain (not going to QC) 17.7 wks Wed 16/03/05 Mon 18/07/05

 

252 A0862 Anti Pichia EIA 10 wks Mon 20/06/05 Mon 29/08/05 262 A0847 Peptide map
10 wks Mon 04/07/05 Mon 12/09/05

 

272 A0404 Polysorbate 80 8.29 wks Mon 20/06/05 Wed 17/08/05 282 A0857 MES 9.29
wks Mon 08/08/05 Wed 12/10/05

 

292 A0837 Imidazole 9.29 wks Mon 08/08/05 Wed 12/10/05 302 A0410
Sucrose/Mannitol 13.29 wks Mon 08/08/05 Wed 09/11/05

 

312 A0225 Citrate 8.29 wks Mon 08/08/05 Wed 05/10/05 322 A0986 Tris 8.29 wks Mon
08/08/05 Wed 05/10/05

 

332 A0302 Sulphate 11.29 wks Mon 08/08/05 Wed 26/10/05 342 A0819 Genotypic
Verification (direct to QC) 4 wks Mon 04/04/05 Mon 02/05/05

 

343 A0662 Microbial Contaminants (ditrect to QC) 4 wks Mon 04/04/05 Mon 02/05/05
344 A0719 Microbial Contaminants (Cell Bank) (ditrect to QC) 4 wks Mon 04/04/05
Mon 02/05/05

 

345 A0359 Viable Cell Count (direct to QC?) 4 wks Mon 08/08/05 Mon 05/09/05 346
A0736 Bioburden (direct to QC) 4 wks Mon 04/04/05 Mon 02/05/05

 

347 Stage 8 Assay Validation 43.71 wks Wed 29/06/05 Mon 01/05/06 348 A01382
AEX-Quant 9 wks Mon 18/07/05 Mon 19/09/05

 

353 A0874 RP HPLC in-process 9 wks Mon 18/07/05 Mon 19/09/05 358 A0831 AEX-Qual
9 wks Mon 18/07/05 Mon 19/09/05

 

363 A0830 RP HPLC 7 wks Mon 18/07/05 Mon 05/09/05

 

368 A0829 SEC-HPLC 9 wks Mon 18/07/05 Mon 19/09/05 373 A0815 SDS PAGE Coomassie
9 wks Mon 11/07/05 Mon 12/09/05

 

378 A0862 Anti Pichia EIA 9 wks Mon 08/08/05 Mon 10/10/05 383 A0847 Peptide map
9 wks Mon 15/08/05 Mon 17/10/05

 

388 A0404 Polysorbate 80 9 wks Wed 27/07/05 Wed 28/09/05 393 A0736 Bioburden 9
wks Mon 14/11/05 Mon 16/01/06

 

398 A0857 MES 9 wks Wed 14/09/05 Wed 16/11/05 403 A0837 Imidazole 9 wks Wed
14/09/05 Wed 16/11/05

 

408 A0410 Sucrose/Mannitol 9 wks Wed 19/10/05 Wed 21/12/05 413 A0225 Citrate 9
wks Wed 14/09/05 Wed 16/11/05

 

418 A0986 Tris 9 wks Wed 21/09/05 Wed 23/11/05 423 A0302 Sulphate 9 wks Wed
28/09/05 Wed 30/11/05

 

428 A0662 Microbial Contaminants 9 wks Mon 21/11/05 Mon 23/01/06 433 A0819
Genotypic Verification (Cell Bank) 9 wks Mon 02/01/06 Mon 06/03/06

 

438 A0719 Microbial Contaminants (Cell Bank) 9 wks Mon 02/01/06 Mon 06/03/06 443
A0442 DNA Sequence Analysis (Cell Bank) (Outsourced) 17 wks Mon 02/01/06 Mon
01/05/06

 

457 A0359 Viable Cell Count (Cell Bank) 9 wks Mon 02/01/06 Mon 06/03/06 462
A0924 Intact MS (Outsourced) 18 wks Wed 29/06/05 Wed 02/11/05

 

476 A01339 DNA (Outsourced) 18 wks Wed 29/06/05 Wed 02/11/05 490 USP/EP Pyrogen
(Outsourced) 12 wks Wed 29/06/05 Wed 21/09/05

 

496 A01102 Zinc (Outsourced) 9 wks Mon 10/10/05 Mon 12/12/05 501 EPA 200.7
Copper (Outsourced) 9 wks Mon 10/10/05 Mon 12/12/05

 

506 Stage 9 Laboratory Process Characterisation 57.71 wks Fri 04/03/05 Wed
12/04/06 507 LPC reports received from Amgen 0 wks Fri 04/03/05 Fri 04/03/05

 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter 2nd Quarter 3rd
Quarter 4th Quarter 1st Quarter Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

 

25/05 29/06

 

04/04 02/05 04/04 02/05 04/04 02/05

 

08/08 05/09 04/04 02/05

 

04/03

 

2 of 3 Schedule 1 (Appendix 2)

--------------------------------------------------------------------------------

LOGO [g17073img03.jpg]

 

B2422 Work Programme Timeline Wed 29/06/05 ID Task Name Duration Start Finish
Predecessors

 

508 Avecia review of reports 3 days Fri 04/03/05 Mon 07/03/05 507 509
Avecia/Nuvelo/Amgen LPC meeting 4 days Mon 07/03/05 Fri 11/03/05 508

 

510 Agreed scope of work with Nuvelo 0 wks Mon 16/05/05 Mon 16/05/05 508FS+10
wks 511 Order materials 2 wks Mon 02/05/05 Mon 16/05/05 510FF

 

512 Fermentation 4 wks Fri 16/09/05 Fri 14/10/05 511FS+3 wks,14416/004/10 513
Purification (pre-work & IMAC) #1 7 wks Mon 16/05/05 Mon 04/07/05 511

 

514 Purification (SPHP) #1 2 wks Fri 14/10/05 Fri 28/10/05 536 515 Technical
Report #1 4 wks Fri 28/10/05 Fri 25/11/05 514

 

516 Experimental set #2 (scope to be defined after GMP batches) 8 wks Wed
15/02/06 Wed 12/04/06 517 Stage 10 ABC5000 Fermentation and Centrifuge trials
32.37 wks Tue 15/03/05 Fri 28/10/05

 

518 Agreed scope of work with Nuvelo 0 wks Tue 15/03/05 Tue 15/03/05 136 519 Raw
Materials Delivery 6 wks Mon 23/05/05 Mon 04/07/05

 

520 Installation/Qualification of liquid N2 dewars 4 wks Fri 01/07/05 Fri
29/07/05 120FS+12 wks 521 Receive GMP WCB 0 wks Fri 29/07/05 Fri 29/07/05 520

 

522 Complete cell bank testing (excl. DNA sequence) 2 wks Fri 29/07/05 Fri
12/08/05 521 523 Facility handover to Nuvelo 0 wks Mon 04/07/05 Mon 04/07/05

 

524 Completion of draft manufacturing batch records 0 wks Mon 22/08/05 Mon
22/08/05 526SS 525 Installation and Commissioning of new systems (estimated) 7
wks Mon 04/07/05 Mon 22/08/05 523

 

526 Inoculum + Seed 2.5 days Mon 22/08/05 Wed 24/08/05 525 527 Fermentation 1 5
days Wed 24/08/05 Mon 29/08/05 518,519,526

 

528 Large scale centrifuge trial 1 2 days Mon 29/08/05 Wed 31/08/05 527 529
Inoculum + Seed 2.5 days Wed 31/08/05 Sat 03/09/05 528

 

530 Fermentation 2 5 days Sat 03/09/05 Thu 08/09/05 529 531 Large scale
centrifuge trial 2 1 day Thu 08/09/05 Fri 09/09/05 530

 

532 Lab-scale purification (2 x 50L) 3 wks Fri 09/09/05 Fri 30/09/05 531 533
Plant Report 4 wks Fri 30/09/05 Fri 28/10/05 532

 

534 Stage 11 GMP Preparation 9.43 wks Fri 09/09/05 Mon 14/11/05 535
Documentation 9.43 wks Fri 09/09/05 Mon 14/11/05

 

541 Equipment Qualification (upstream) 5 wks Mon 19/09/05 Mon 24/10/05 531,130
542 Equipment Qualification (downstream) 6 wks Mon 03/10/05 Mon 14/11/05 541SS+2
wks

 

543 Column Qualification 2 wks Wed 05/10/05 Wed 19/10/05 128 544 Stage 12 GMP
Production 17.29 wks Mon 14/11/05 Wed 15/03/06 545 Batch 1 17.14 wks Mon
14/11/05 Tue 14/03/06 546 Manufacture 2 wks Mon 14/11/05 Mon 28/11/05
535,541,539,543,5

 

547 Pack-off 1 day Mon 28/11/05 Tue 29/11/05 546 548 QC limited testing 1 wk Tue
29/11/05 Tue 06/12/05 547 549 QC testing (estimated) 5 wks Tue 06/12/05 Tue
10/01/06 548 550 QA Disposition (estimated) 9 wks Tue 10/01/06 Tue 14/03/06 549

 

551 Batch 2 14.14 wks Tue 06/12/05 Wed 15/03/06 552 Manufacture 2 wks Tue
06/12/05 Tue 20/12/05 548 553 Pack-off 1 day Tue 20/12/05 Wed 21/12/05 552 554
QC limited testing 1 wk Wed 21/12/05 Wed 28/12/05 553

 

555 QC testing (estimated) 5 wks Wed 28/12/05 Wed 01/02/06 554 556 QA
Disposition (estimated) 11 wks Wed 28/12/05 Wed 15/03/06 555SS

 

557 Manufacturing Summary Report 4 wks Wed 15/02/06 Wed 15/03/06 556FF 558 Fill
Finish & Stability Trials (Nuvelo) 112 wks Wed 25/01/06 Wed 19/03/08

 

562 Stage 13 Validation Documentation 8 wks Wed 15/03/06 Wed 10/05/06 557 563
Stage 14 Pre-Validation Batch 2 wks Wed 10/05/06 Wed 24/05/06 562 564 Stage 15
Process Validation Campaign 12 wks Wed 24/05/06 Wed 16/08/06 563

 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter 2nd Quarter 3rd
Quarter 4th Quarter 1st Quarter Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

 

04/03 07/03 07/03 11/03 16/05 02/05 16/05 16/09 14/10 16/05 04/07 14/10 28/10
28/10 25/11 15/02 12/04 15/03

 

23/05 04/07 01/07 29/07 29/07 29/07 12/08 04/07 22/08 04/07 22/08 22/08 24/08
24/08 29/08 29/08 31/08 31/08 03/09 03/09 08/09 08/09 09/09 09/09 30/09 30/09
28/10

 

19/09 24/10 03/10 14/11 05/10 19/10 14/11 28/11 28/11 29/11 29/11 06/12 06/12
10/01 10/01 14/03

 

06/12 20/12 20/12 21/12 21/12 28/12 28/12 01/02 28/12 15/03 15/02 15/03 15/03
10/05 10/05 24/05 24/05 16/08

 

3 of 3 Schedule 1 (Appendix 2)

--------------------------------------------------------------------------------

QUALITY AGREEMENT

 

Nuvelo, Inc.

675 Almanor Avenue

Sunnyvale, CA 94085

 

and

 

Avecia Biotechnology

Biologics Business

PO Box 2

Belasis Avenue

Billingham

Cleveland

TS23 1YN

 

Name            Name      Klaus J Neurohr       Brian S Kersten Head of Quality
and Regulatory Affairs       Sr. Director RA/QA Date            Date     

 

Date    30 Jun 05    Modification 0    Page 1 of 19

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Index

 

1.    Quality Agreement    4      1.1   

Purpose

   4      1.2   

Duration of Agreement

   4      1.3   

API

   4      1.4   

Regulatory Compliance

   4 2.    Manufacturing cGMP Compliance    5      2.1   

Materials

   5      2.2   

Documentation

   5      2.3   

Change Control

   6      2.4   

Process Control

   7      2.5   

Training

   7      2.6   

Calibration

   8 3.    Quality Control    8 4.    Stability    8 5.    Quality Assurance   
9      5.1   

Documentation

   9      5.2   

Batch Disposition

   9      5.3   

Internal Audits

   10      5.4   

Audits by Nuvelo

   10      5.5   

Regulatory Actions

   10 6.    Dispute Resolution    11 7.    Qualification    11      7.1   

Equipment Computer Facility and Utility Qualification

   12      7.2   

Laboratory Qualification

   12      7.3   

Cleaning Verification and Validation

   12

 

Date    30 Jun 05    Modification 0    Page 2 of 19

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8.

  

Revisions

   12

Appendix 1

  

Glossary of terms

    

Appendix 2

  

Responsibilities

    

Appendix 3

  

List of Contacts

    

Appendix 4

  

Batch Disposition Roles and Responsibilities

    

Appendix 5

  

Responsibilities for Shipment of the Manufactured API

    

Appendix 6

  

Draft Release Testing Specification and Criteria for Acceptance for Bulk
Alfimeprase API

    

Appendix 7

   Draft Limited Testing and Criteria for Acceptance to Demonstrate
Acceptability of Process Performance for Bulk Alfimeprase API     

 

Date    30 Jun 05    Modification 0    Page 3 of 19

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1. Quality Agreement

 

1.1 Purpose

 

  1.1.1 This agreement defines the roles and responsibilities for both Avecia
and Nuvelo with respect to quality assurance and regulatory compliance matters.

 

  1.1.2 This Quality agreement also defines how Avecia Quality Unit and Nuvelo
Quality Unit will interact with each other over Quality related issues.

 

  1.1.3 This Quality agreement shall be incorporated with and constitute a part
of the Commercial Agreement between Avecia and Nuvelo.

 

1.2 Duration of Agreement

 

  1.2.1 The Quality agreement will be effective as of the Commencement Date of
the Commercial Agreement and will expire with the termination of the Commercial
Agreement.

 

  1.2.2 Avecia QA will review, and up-date the Quality Agreement accordingly, in
agreement with Nuvelo QA on completion of the centrifuge trial runs, GMP runs
and prior to the Validation runs.

 

1.3 API

 

  1.3.1 Avecia will manufacture all bulk Active Pharmaceutical Ingredient (API)
in accordance with cGMP regulations.

 

1.4 Regulatory Compliance

 

  1.4.1 Avecia will manufacture the API in compliance with all applicable EU
regulations including the Rules and Guidance for Pharmaceutical Manufacturers
and Distributors 2002 Annexe 18 GMP for API in the EU.

 

  1.4.2 Avecia will manufacture the API in compliance with ICHQ7A, as
incorporated in the Federal Register Vol 66 No186 (formerly ICHQ7A) and those
sections applicable within the FDA regulations 210, 211, 600, 601 and 610.

 

  1.4.3 Avecia will maintain all licenses and approvals necessary to manufacture
the API and comply with all FDA regulations applicable to a manufacturer.

 

  1.4.4 Avecia will test and release the API using validated analytical methods
in compliance with FDA regulations and the most current versions of ICH
guidance, including ICHQ2A, “Text on Validation of Analytical Procedures and
ICHQ2B, “ Validation of Analytical Procedures: Methodology”. The analytical
methods will be validated by Avecia prior to the execution of the validation
lots.

 

  1.4.5 Avecia will ensure that it is in compliance with all computer and
software validation requirements in accordance to 21 CFR Part 11.

 

Date    30 Jun 05    Modification 0    Page 4 of 19

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  1.4.6 Avecia will identify to Nuvelo in writing all raw materials in the
product of direct or indirect animal origin. Avecia will source these materials
from countries which are not listed in 9 CFR section 94.18 and further, the
materials must have supporting Certificates of Compliance as required by the
European Union Directive R 999/2001.

 

2. Manufacturing cGMP Compliance

 

2.1 Materials

 

  2.1.1 Avecia will use raw materials, packaging and labelling components that
are acceptable to Nuvelo and sampled, tested via methods approved by Avecia and
stored in accordance with Avecia documentation and procedures.

 

  2.1.2 Avecia is responsible for ensuring that all materials procured by Avecia
for use in the API are in compliance with specifications for such raw materials.
Avecia are also responsible for ensuring the raw materials are acceptable to
Nuvelo for use in the manufacture of the API. Nuvelo shall confirm to Avecia the
acceptability of the raw materials in writing. Raw materials are given an
expiration date upon the satisfactory completion of all initial tests. Avecia
will hold the relevant Certificates of Analysis for the materials.

 

  2.1.3 Avecia will purchase raw materials from suppliers that are acceptable to
Nuvelo and approved by Avecia. Nuvelo shall confirm to Avecia the acceptability
of the suppliers in writing.

 

  2.1.4 Avecia and Nuvelo will jointly agree to a list of key suppliers who will
be audited by Avecia to ensure that they are in compliance with the FDA and EU
regulations.

 

2.2 Documentation

 

  2.2.1 Avecia will prepare the necessary documentation for each lot of API in
its standard format as evidence that the API was manufactured in compliance with
current GMP.

 

  2.2.2 Avecia will retain batch documentation for at least one year after the
expiry date of the batch, five years after the records of manufacture have been
completed, or three years after the distribution of the batch whichever is the
larger. Before disposing of batch documentation, Avecia will give advanced
written warning of 3 months to Nuvelo.

 

  2.2.3 Avecia will store the API under conditions approved by Nuvelo. Avecia
will hold records of storage conditions according to Avecia’s Standard Operating
Procedures.

 

  2.2.4 Avecia and Nuvelo will agree on storage conditions, containers and
delivery configuration. Avecia is responsible for packaging and labelling the
API for shipment, and delivery of the API. Avecia will co-operate with Nuvelo
for shipping arrangements. Avecia will deliver the API in validated shipping
containers under validated shipping conditions. Until the shipping conditions
have been validated, Avecia will deliver the API with temperature monitoring
devices ready and capable of proper monitoring during shipment. Down loaded data
from the temperature monitoring devices shall be sent to Nuvelo within 3
business days of the return of the Temp Tale.(see Appendix 5)

 

  2.2.5 Delivery of API - Nuvelo will authorise Avecia to deliver upon
submission of a Nuvelo delivery request form, to a location designated by
Nuvelo. Delivery records, etc., will be documented and maintained by Avecia.

 

Date    30 Jun 05    Modification 0    Page 5 of 19

--------------------------------------------------------------------------------

  2.2.6 Avecia will deliver samples upon the submission of a Nuvelo sample
request form, and Avecia will co-operate with Nuvelo for transit arrangements.

 

2.3 Change Control

 

These change activities will be documented in accordance with cGMP and shall be
considered by Avecia to be records of the quality system, available for review
and audit.

 

  2.3.1 Equipment

 

Avecia shall provide Nuvelo written notice of any proposed changes to the
processing equipment used to manufacture the API, including:

 

a) Design changes to process equipment.

 

b) Major repairs to process equipment, excluding routine preventative
maintenance/repair activities. Replacement of equipment with identical equipment
will be considered a major repair for the purposes of this agreement.

 

c) Scale up of lot size for manufacture of the component that does not involve
use of alternative equipment.

 

  2.3.2 Components

 

Avecia shall purchase components used to manufacture and package Nuvelo APIs in
accordance with Nuvelo’s requirements. Avecia shall provide Nuvelo written
notice of any proposed changes, including changes to the sources of, and
processes for the manufacture for the raw materials, including packaging
changes, to the specified raw materials or components used in the manufacture of
the API. Avecia shall implement and maintain an appropriate quality agreement
and purchasing controls with each raw material supplier, to ensure that Avecia
is informed in advance of any such changes by its suppliers to raw material
composition or manufacturing processes.

 

  2.3.3 Processes

 

Avecia shall notify Nuvelo of planned process changes in writing, prior to
implementation and subject to Nuvelo’s Quality Assurance (QA) and Process
Sciences Manufacturing (PSM) groups’ approvals.

 

Prior to any change being implemented, Nuvelo shall be given the opportunity to
purchase components and API made by the existing process as assurance of
continuity of supply.

 

  2.3.4 Other Activities

 

Other activities, listed below, shall be documented in accordance with cGMP and
shall be considered by Avecia to be records of the quality system, available for
review and audit.

 

Date    30 Jun 05    Modification 0    Page 6 of 19

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a) Adjustments necessary to operate equipment efficiently and safely for the
manufacture of the API. These may be recorded on quality documents; however,
such documentation is only a requirement where it is specified on the Standard
Operating Procedures used in that part of the processing.

 

b) Changes to lots of raw materials to make the API. These will be recorded as
required by the quality system.

 

2.4 Process Control

 

  2.4.1 Inspections

 

a) Raw materials, intermediates, components, containers, and container closures
for the API manufactured will be inspected upon receipt per requirements of
Avecia quality system. Documentation of those inspections will be retained in
the batch record and appropriate samples will be maintained by Avecia.

 

b) Avecia and Nuvelo will work together to determine the required in-process
inspections. In-process inspections may occur during the manufacture of the API.
These inspection activities will be documented in lab notebooks, Batch Sheets
and /or Test Sheets, whichever is appropriate. A copy will be retained in the
batch record.

 

c) Cleanliness : The API will be manufactured in an environment that is clean
and meets current Avecia facility, regulatory and safety standards, specifically
including cGMP. The facility will be monitored on a regular basis during
manufacturing according to Avecia approved procedures.

 

d) Identification and Traceability Criteria: All materials for making the API
must be properly identified and traceable. Identification shall include part
number and lot number as a minimum. The quality status of each of these must
also be identified. The quality status may be identified electronically, marked
on the container or referenced to a lab notebook.

 

e) Acceptance Criteria: Acceptance of the API is based on achievement of the
acceptance criteria in the API Specification identified by Nuvelo requirements.
A draft Specification is attached to this Quality Agreement as Appendix 6.

 

f) The specification will be jointly approved by Avecia and Nuvelo QA prior to
use in manufacturing cGMP API lots and the approved specification will be held
in a separate QC document. In the cGMP Development Batches and the Engineering
Batch identified in the Work Programme, a limited set of release tests to
demonstrate the suitability of the API for full release will be performed prior
to performance of all required release testing. A draft of the proposed limited
testing for these batches is attached to this Quality Agreement in Appendix 7.

 

2.5 Training

 

Personnel manufacturing and/or testing the API must be trained appropriately on
the equipment and methods used. This training must be documented in a training
record. The training records will be maintained by Avecia for inspection.

 

Date    30 Jun 05    Modification 0    Page 7 of 19

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2.6 Calibration

 

All equipment used to manufacture, test or store raw or intermediate materials
or final APIs will be calibrated to meet the requirements of NIST standards.

 

3. Quality Control

 

3.1 All analytical methods will be validated prior to the execution of the
validation lots in accordance with FDA regulation and ICH guidelines.

 

3.2 The testing activities for the API that are to be performed by Avecia QC
will be in accordance with the specifications agreed upon by Avecia and Nuvelo.
Avecia will not sub contract any testing without prior written approval from
Nuvelo. All sub contractor analytical laboratories will be audited by Avecia.
Avecia warrants that all sub contractors used will be FDA and EU GMP compliant.

 

3.3 Avecia will notify Nuvelo of any critical or major investigations and Out of
Specification (OOS), Out of Trend (OOT) results related to the In process
testing and final testing of the API within 72 hours or next working day
(Monday-Friday). Nuvelo approval of such documentation is required and will be
shown by sign-off on the back-page of the copy of the original
investigation/OOS/OOT form faxed by Avecia QA to Nuvelo QA. Notification will be
provided for minor investigations, OOS and OOT results on a weekly basis and no
approval by Nuvelo QA is required.

 

3.4 Avecia QC will retain sufficient samples of raw materials and the API from
each batch to allow at least twice the quantity necessary to determine whether
it meets the API Specifications, a draft of which is attached hereto as Appendix
6, excluding bioburden and endotoxin testing.

 

3.5 Avecia QC will retain samples for at least 1 year after the expiration date
of the last lot of drug API containing the API. Avecia will inform Nuvelo of
this date and give advanced written warning of expiration of 3 months to Nuvelo.

 

3.6 Avecia QC will produce a Certificate of Analysis for each batch of API
confirming that the API has been tested via approved methods in accordance with
the Specification in the jointly approved QC document. Avecia will perform
release testing for the API within 30 calendar days after the last day of
manufacture. Avecia will ship the API to Nuvelo/Nuvelo designated site within 90
calendar days of API release.

 

3.7 Avecia QA will target a bioburden level of £10 CFU/100mL.

 

4. Stability

 

4.1 Nuvelo is responsible, where appropriate, for determining that a routine
stability monitoring program is implemented.

 

4.2 Avecia will provide Nuvelo or its designee with stability samples within two
weeks of the last day of manufacture of each Batch and of each validation lot.

 

Date    30 Jun 05    Modification 0    Page 8 of 19

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5. Quality Assurance

 

5.1 Documentation

 

  5.1.1 Avecia QA is responsible for ensuring creation of the Nuvelo API
specific manufacturing master documentation. Avecia QA and Nuvelo QA will
approve the batch documentation before commencement of manufacturing. Nuvelo QA
are responsible for ensuring that the batch manufacturing records issued by
Avecia QA for approval are done so within 2 business days of receipt of the
final draft.

 

  5.1.2 Avecia QA will approve Standard Operating Procedures required for the
manufacture of the API.

 

  5.1.3 Avecia QA will inform Nuvelo of any major and critical Non Conformance
Reports generated during the manufacture of each batch of API within 2 business
days. Nuvelo sign-off is required on each critical or major non-conformance
reports before closure of investigation. Notification will be provided for all
minor non-conformances on a weekly basis.

 

  5.1.4 Avecia QA will inform Nuvelo of any changes to the master batch records,
bills of material specification and equipment.

 

  5.1.5 Avecia QA will notify on a weekly basis via e-mail or e-room all Change
Controls raised. All major and critical change controls raised will require
Nuvelo sign off prior to implementation.

 

5.2 Batch Disposition

 

  5.2.1 For each batch of API, Avecia QA will provide to Nuvelo copies of the
release, executed batch record, Certificate of Analysis, Certificate of
Conformance, any deviation/change control reports. Nuvelo will review and
approve, as appropriate, the batch record and then accordingly forward a
signed-off copy of the API disposition form to Avecia as confirmation of
Nuvelo’s acceptance of the batch.

 

  5.2.2 Avecia QA is responsible for ensuring that the API has been manufactured
according to the Specifications attached hereto as Appendix 6, Standard
Operating Procedures, Master Batch Records and cGMP.

 

  5.2.3 Reprocess/Rework: Avecia QA will not internally authorise any rework
without written prior approval from Nuvelo. Reprocessing may be performed at
Avecia with internal approval. The details of the reprocessing will be included
in the batch record. Approval from Regulatory Affairs (RA), QA and PSM
management will be required for any rework activities.

 

  5.2.4 Nuvelo QA must respond within 2 business days to any Avecia QA issues
reported during batch disposition.

 

  5.2.5 The release of the API ready for shipping is the responsibility of
Avecia QA.

 

  5.2.6 Avecia QA will be responsible for ensuring that appropriate Batch
Records are copied and dispatched to Nuvelo QA within 10 business days after
final disposition.

 

Date    30 Jun 05    Modification 0    Page 9 of 19

--------------------------------------------------------------------------------

  5.2.7 Responsibilities for shipment of the API are detailed in Appendix 5.

 

  5.2.8 Batch Disposition roles and responsibilities are detailed in (Appendix
4).

 

5.3 Internal Audits

 

  5.3.1 Avecia QA will carry out routine internal audits for GMP compliance
according to approved schedules developed as part of the Avecia Quality System.

 

5.4 Audits by Nuvelo

 

  5.4.1 Nuvelo reserves the right to conduct twice-a-year, comprehensive quality
audits of Avecia’s facilities, which may include a site tour, questioning of
employees in work areas and review of quality system documentation to the
appropriate quality standards. Avecia will be notified in advance of the
intention to conduct an audit and the audit’s scope, and a mutually convenient
date will be selected. During the audit, any non-conformances will be noted and
documented in a report issued by Nuvelo within thirty (30) business days. Avecia
will be requested to submit an acceptable written response and corrective action
plan within thirty (30) business days of receipt of the report. Avecia will
close all corrective actions that can be closed within 90 business days to the
satisfaction of Nuvelo. Corrective actions that cannot practically be closed out
within 90 business days will have a timeline for closure agreed with Nuvelo.

 

  5.4.2 Supplier performance issues or non-conformances in the API will be
indicated to Avecia in the form of a Nuvelo Supplier Corrective Action Report
(SCAR)/Memo. Avecia will be requested to respond to the SCAR/Memo usually within
thirty (30) business days post receipt.

 

5.5 Regulatory Actions

 

  5.5.1 Avecia QA will provide Nuvelo information and support for any Nuvelo
regulatory submission (e.g., CMC) upon request. Nuvelo RA will supply Avecia
with copies of the submitted information that relates to manufacture by Avecia.

 

  5.5.2 Nuvelo will inform Avecia QA of any pertinent changes in the CMC section
of its regulatory document.

 

  5.5.3 Avecia QA will inform Nuvelo in writing of any change of any kind to the
Process that may impact Nuvelo regulatory submissions. Avecia shall not make any
change to the Process without Nuvelo’s written prior approval of the change.

 

  5.5.4 Avecia QA will provide Nuvelo with advanced written notice of any
FDA/MHRA regulatory inspections where possible.

 

  5.5.5 Avecia will also allow Nuvelo representatives to be present at site
during any FDA/regulatory audits relating to Nuvelo’s API. All responses to any
FDA/MHRA findings must be reviewed and approved by Nuvelo prior to submission.

 

  5.5.6 During other regulatory audits (for non-Nuvelo APIs), if any findings
are identified, Avecia will inform Nuvelo where their API is potentially
affected.

 

Date    30 Jun 05    Modification 0    Page 10 of 19

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  5.5.7 Avecia will confirm Nuvelo interpretations of Avecia data in the CMC
section before Nuvelo’s submission to Regulatory Agencies.

 

6. Dispute Resolution

 

If a dispute arises amongst the Quality Team relating to whether or not a Batch
of the API is a Defective Batch, or whether or not a Defective Batch results
from or arises out of an Avecia Default (each of the preceding a “Batch
Dispute”), such Batch Dispute shall be resolved as follows.

 

(1) The Quality Team shall immediately notify the Project Steering Committee
(PSC) in writing (the “Batch Dispute Notice”) that a Batch Dispute exists
amongst the Quality Team. The Quality Team will discuss the Batch Dispute in
good faith to attempt to reach agreement on: (i) whether a Batch is a Defective
Batch and, if so, what course of action shall be taken to address it; and (ii)
whether or not a Defective Batch resulted from or arose out of an Avecia
Default.

 

(2) In the event that the Quality Team fails to reach agreement on a Batch
Dispute within 15 days after sending the Batch Dispute Notice to the PSC, the
Quality Team shall immediately refer the Batch Dispute to the PSC for
discussion, by written notice to the PSC. Once the Batch Dispute has been
referred to the PSC, the PSC has 5 business days from receipt of the referral
notice to either resolve the Batch Dispute or refer the Batch Dispute to an
independent expert or laboratory, with the expertise necessary to reasonably
resolve the Batch Dispute.

 

(3) If the PSC cannot resolve the Batch Dispute or agree upon an independent
expert or laboratory to resolve the Batch Dispute before the expiration of 5
business days after receiving the referral notice, the PSC shall immediately
notify the EC of its failure in writing. Within no later than 2 business days
after receiving notice of the failure from the PSC, each EC member shall
nominate an independent expert who shall not: be a current or former employee,
consultant or agent of a Party; have an immediate family member who is an
employee, consultant or agent of a Party; or have any financial interest in a
Party. Promptly thereafter, those two independent experts shall agree on a third
independent expert who shall use any reasonable information, materials and data
provided to him or her by the other two experts within 10 business days after
his or her agreement to act as the third independent expert, to either promptly
resolve the Batch Dispute or determine which independent Third Party laboratory
will conduct the work necessary to promptly resolve the Batch Dispute. Such
referral shall be solely for the purpose of establishing whether or not the
applicable Batch is a Defective Batch and whether or not any Defective Batch
results from or arises out of an Avecia Default. The decision of the independent
expert, or independent laboratory, shall be made in writing and shall be binding
upon the Parties. Whichever Party failed to accurately assess whether the Batch
was or was not a Defective Batch, or whether or not a Defective Batch resulted
from or arose out of an Avecia Default, shall bear the full cost and expense
associated with the hiring and performance of the independent experts and/or
laboratory. .

 

7. Qualification

 

Avecia will generate the Validation Master Plan which contains the Validation
Strategy. Avecia QA, Nuvelo QA and Nuvelo Process Sciences and Manufacturing
will jointly approve the Validation Master Plan which contains appropriate
validation sub plans for the project which will be approved by Avecia QA.

 

Date    30 Jun 05    Modification 0    Page 11 of 19

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7.1 Equipment, Computer Facility and Utility Qualification

 

  7.1.1  Avecia is responsible for ensuring that equipment, computer, facility,
utility and support systems for the manufacture of Nuvelo API are qualified
according to regulatory requirements including 21 CFR Part 11. Avecia will
perform required Installation Qualification (IQ)/Operational Qualification
(OQ)/Performance Qualification (PQ)/calibration activities.

 

7.2 Laboratory Qualification

 

  7.2.1  Avecia is responsible for ensuring that all QC laboratories are in
compliance with FDA cGMP regulations and are appropriately qualified in all of
the methodology associated with Nuvelo’s APIs.

 

  7.2.2  Validation methodology will be developed in compliance with ICH Q2A
Text on Validation of Analytical Procedures and ICH Q2B Validation of Analytical
Procedures; Methodology. The degree of validation of methods will be agreed with
Nuvelo according to the status of the API.

 

7.3 Cleaning Validation and Verification

 

  7.3.1  Avecia is responsible for ensuring that a cleaning verification is
conducted, and documented in accordance with cGMP and that a cleaning
verification of API contact parts used in the manufacture of Nuvelo API is
carried out between batches of different APIs to prevent cross-contamination.

 

  7.3.2  Nuvelo will provide information (solubility, toxicity, dose, etc.) to
establish cleaning limits.

 

8.0 REVISIONS

 

Mod.

No.

--------------------------------------------------------------------------------

   DATE

--------------------------------------------------------------------------------

  

REVISION DETAILS

--------------------------------------------------------------------------------

   BY

--------------------------------------------------------------------------------

0

   30 Jun 05    New Agreement    DH

 

Date    30 Jun 05    Modification 0    Page 12 of 19

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Appendix 1

 

Glossary of Terms

 

API: Active Pharmaceutical Ingredient.

 

cGMP: Current Good Manufacturing Practice.

 

ICH: International Conference on Harmonization.

 

Certificate of Analysis: A compilation of the analytical test methods applied,
specifications for each test and test results for a particular
intermediate/finished API lot. The certificate should be reviewed and approved
by QA management.

 

Certificate of Conformance: Certification confirming that an intermediate or
finished API has been manufactured in compliance to the cGMP’s and that quality
records associated have been reviewed and approved by QA management.

 

Commercial Agreement: the Agreement effective 21 January 2005 for the
manufacture of the API by and between Avecia and Nuvelo.

 

Approved Suppliers: Suppliers approved within Avecia’s quality system and
qualified using FDA/EU guidelines, and approved by Nuvelo.

 

Key Suppliers: Suppliers that supply key ingredients for the manufacture of the
API. Change to these Suppliers would impact the API quality.

 

OOS: Out of Specification.

 

OOT: Out of Trend.

 

NIST: National Institute of Standards.

 

In-Process Control: Checks performed during production to monitor and if
appropriate, to adjust the process and/or to ensure that the API conforms to the
specifications attached to the QA Agreement as Appendix 6.

 

Critical Non-conformance: A non-conformance which would impact API quality.

 

Major Non-conformance: A non-conformance which has a potential to impact API
quality and requires an investigation to assess the impact on API quality.

 

Minor Non-conformance: A non-conformance which has no impact on API quality

 

Reprocess: Reprocess is defined as repeat processing of a manufacturing step
that does not affect the disposition of the API. For example: a 0.22 micron
filtration when the filter integrity failed.

 

Rework: Upon prior written approval of Nuvelo, rework may occur on
identification of a non-conformance associated with the finished API (this
applies to intermediate stages of API also) that may affect the API quality.
Rework is only performed upon the prior written approval of Nuvelo as a result
of an investigation through the non-conformance reporting process or as a result
of a change that occurred in the drug master file (ex: expiration date). For
example: Relabeling of vials due to incorrect sample lot #. This would lead to
an non-conformance and then the change would be approved by Nuvelo before
commencement of the rework .

 

Date    30 Jun 05    Modification 0    Page 13 of 19

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Appendix 2

 

Responsibilities

 

Responsibility

--------------------------------------------------------------------------------

   Avecia

--------------------------------------------------------------------------------

   Nuvelo

--------------------------------------------------------------------------------

Formula

        ü

API Method

   ü     

Scale-up Procedure

   ü     

Qualification Procedures

   ü    ü

Stability Programme

        ü

Raw Material Selection

   ü    ü

Documentation for TSE risk

   ü     

Specific API Information (safety, transport etc)

        ü

API ready for shipping

   ü     

API Storage

   ü     

API Specification

   ü    ü

Method of Analysis

   ü     

Method of Analysis verification

   ü    ü

Analysis + Release

   ü    ü

Storage of API QC Samples

   ü     

Manufacture of API

   ü     

Batch Number Assignment

   ü     

Expiry Date Assignment

   ü    ü

Manufacturing Documentation

   ü     

In Process Controls

   ü     

Audit of API Manufacturer

        ü

Deviation Management

   ü    ü

Change Management

   ü    ü

Retention of Records

   ü     

Shipping Study

        ü

 

Date    30 Jun 05    Modification 0    Page 14 of 19

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Appendix 3

 

List of Contacts

 

Area of Responsibility   

AVECIA

Main Phone:

+44 (0) 1642 363511

  

NUVELO

Main Phone: 408-215-4000

QA   

Ian Snowball

+44 (0) 1642 364476

ian.snowball@avecia.com

  

Wendy van der Linden

Ph: 408-215-4348

wvanderlinden@nuvelo.com

PSM    N/A   

Kirk Hayenga

Ph: 408-215-4344

khayenga@nuvelo.com

Mike Berry

Ph: 408-215-4581

mberry@nuvelo.com

RA   

Dave Theakston

+44 (0) 1642 364034

dave.theakston@avecia.com

  

Brian S. Kersten

Ph: 408-215-4401

bkersten@nuvelo.com

QC   

Helen Bickley

+44 (0) 1642 364483

helen.bickley@avecia.com

  

Katie Reid

Ph: 408-215-4544

kreid@nuvelo.com

 

Date    30 Jun 05    Modification 0    Page 15 of 19

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Appendix 4

 

Batch Disposition Roles and Responsibilities.

 

Responsibilities for API Batch Disposition

--------------------------------------------------------------------------------

   Avecia
QC

--------------------------------------------------------------------------------

   Avecia
QA

--------------------------------------------------------------------------------

   Nuvelo

--------------------------------------------------------------------------------

Final Review of all batch related manufacturing documentation

        Ö     

Review of QC batch related analyses

   Ö          

Final Review of QC batch related analyses

        Ö     

Generation of Certificate of Analysis (C of A)

   Ö          

Final Review of C of A

        Ö     

Final review of batch record and acceptance of the batch

             Ö

Generation of Water and Environmental (WESRs)

   Ö          

Summary Reports for Manufacturing Period

   Ö          

Final Review of WESRs

        Ö     

BSE free statement for the batch

        Ö     

Review of completed Non Conformance Reports

             Ö

Review of completed Change Control Reports

             Ö

Review and Client Approval of Major/Critical NCRs, investigations, OOS and OOT
results

             Ö

Review and Client Approval of Major/Critical Change Control Reports

             Ö

Final Approval of all Non Conformance Reports

        Ö     

Final Approval of all Change Control Reports

        Ö     

Final approval of Lab investigations

        Ö     

Notification of Minor, Changes, NCRs, investigations, OOS and OOT results to
Nuvelo

        Ö     

Compliance check against Avecia batch disposition procedure

        Ö     

Batch Disposition

        Ö     

Dispatch Instruction

             Ö

Copies of all batch documentation to Customer

        Ö     

 

Date    30 Jun 05    Modification 0    Page 16 of 19

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Appendix 5

 

Responsibilities for Delivery/Shipment of the Manufactured API

 

Responsibilities

--------------------------------------------------------------------------------

   Avecia

--------------------------------------------------------------------------------

   Avecia
QA

--------------------------------------------------------------------------------

   Nuvelo

--------------------------------------------------------------------------------

Provide Avecia with completed dispatch request form for shipment. Including,
Batch number, quantity, reason for delivery, delivery contact and address.     
        ü Approve dispatch request form.         ü      Agree dispatch time and
date.    ü    ü    ü Generate shipping documentation†    ü         ü Send
documentation to courier for checks (if applicable).    ü           Provide all
documentation to Avecia QA prior to shipment.    ü           Arrange transport,
packaging conditions/configuration and temperature monitoring devices and
downloaded data.    ü         ü Arrange insurance cover for shipment (if
required)              ü Check dispatch batch records & shipping documentation.
        ü      Execute dispatch batch record         ü      Inform recipient of
shipment.    ü         ü Return of confirmation receipts from recipient to
Avecia QA.    ü           Complete Final Product Log (SP3703)         ü     
Arrange customer invoice if using Avecia’s courier account.    ü          

 

† Documentation includes:

 

  a. Cover letter (3 copies)

 

  b. MSDS (3 copies)

 

  c. CofA (3 copies)

 

  d. A signed statement of identity which details the quantity, container sizes,
an accurate description of the material and the usage of the material.

 

  e. Customs invoice for shipments in EU.

 

  f. For deliveries to the United States.

 

  i. A signed US Customs declaration, indicating that the material is produced
by recombinant microbial fermentation (including the strain) and stating the
material does not contain any animal or cell culture derived products or
additives such as albumin or serum.

 

  ii. For material that does contain any animal or cell culture derived products
or additives such as albumin or serum, a USDA permit is required for US customs
clearance. Obtaining a USDA permit is the responsibility of the customer.

 

  iii. A signed US Customs invoice stating the declared value of the shipment.

 

  g. Avecia finance department will confirm the type of commercial agreement, as
either technical consultancy or sale of product.

 

  i. For ‘technical consultancy’ contracts, the declared value for all delivered
material will be zero (0).

 

  ii. For ‘sale of product’ contracts the declared value for delivered material
will be the cost of replacement.

 

Date    30 Jun 05    Modification 0    Page 17 of 19

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Appendix 6

 

Draft Release Testing Specification and

Criteria for Acceptance for Bulk Alfimeprase API

 

Parameter

--------------------------------------------------------------------------------

  

Method Type

--------------------------------------------------------------------------------

  

Acceptance Criterion

--------------------------------------------------------------------------------

Appearance    Appearance    Clear, colorless liquid
practically free of particulates Purity    Bioburden    Report result   
SDS-PAGE, Coomassie Stain    Report % main band; main band same position as
standard    SE-HPLC    Main Peak ³ 95%    RP-HPLC    Main Peak ³ 88%    AE-HPLC
   Main Peak ³ 93% Impurities    Pyrogenicity    Absence of pyrogens (dose level
of 10 mL/kg)    Nucleic Acid Content    £ 10 pg/1 mg alfimeprase    Yeast
Contaminant Immunoassay    £0.01% (w/w) Potency    Clot Lysis Activity    ³ 70%
of standard activity Identity    Molecular Weight    22570 - 22583 Da    Peptide
map    Conforms to standard Quantity    Protein Concentration    9.0 to 11.0
mg/mL Excipients / Chemical Composition    PH    7.9 ± 0.4    Osmolality    315
to 455 mOsm/kg    Zn Content    0.43 to 0.65 mM    Polysorbate 80    0.005 to
0.015% (w/v)

 

Date    30 Jun 05    Modification 0    Page 18 of 19

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Appendix 7

 

Draft Limited Testing and Criteria for Acceptance to Demonstrate Acceptability
of Process Performance for Bulk Alfimeprase API

 

Parameter

--------------------------------------------------------------------------------

  

Method Type

--------------------------------------------------------------------------------

  

Acceptance Criterion

--------------------------------------------------------------------------------

Purity    Bioburden    Report result    RP-HPLC    Main Peak ³ 88%    AE-HPLC   
Main Peak ³ 93% Impurities    Yeast Contaminant
Immunoassay    £0.01% (w/w) Potency    Clot Lysis Activity    ³ 70% of standard
activity Quantity    Protein Concentration    9.0 to 11.0 mg/mL Excipients /
Chemical Composition    Osmolality    315 to 455 mOsm/kg

 

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