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Exhibit 10.7
 
 

image [aeolusimage3.jpg]

 
March, 28 2012
 

 
Stephanie McSwain
Vice President, Manufacturing
Aeolus Pharmaceuticals, Inc.
26361 Crown Valley Parkway
Mission Viejo, CA 92681
 
 
Dear Stephanie,
 
 
Thank you for your continued interest in Johnson Matthey Pharma Services
(JMPS).  As a follow-up to your recent request, we are pleased to provide Aeolus
Pharmaceuticals (Aeolus) with this proposal for Program Support, Process
Development and Analytical Development for Desired Form of 2318.C.
 
Please contact me if I can provide additional information or be of additional
service.  We appreciate the opportunity to support your chemistry service needs
and look forward to your feedback on this proposal.
 
All the Best,
 
 
/s/ Todd Stark
Todd Stark, Ph.D.
 
Manager, Business Development
Johnson Matthey Pharma Services
 
978-496-7088
tstark@jmusa.com
 
 
 
 

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Proposal for Program Support, Process Development and Analytical Development for
Desired Form of 2318.C
 
 
Appendix 5 to the Research and Manufacturing Agreement Dated:  February 16, 2011
 
 
Proposal Date:  March, 28 2012
 
Johnson Matthey Pharma Services (JMPS) is pleased to provide Aeolus
Pharmaceuticals (Aeolus) with this proposal for Program Support, Process
Development and Analytical Development for Desired Form of 2318.C.  JMPS will
use commercially reasonable efforts to meet all milestones for the estimated
fees as outlined in this proposal.  This proposal is based on technical
information provided by Aeolus and other available technical information within
the public literature and available at JMPS.
 
 
Summary
 
Proposal No:  AEO-120322-1206
     
Stage #
Description
Service Fee
Est. Direct Expenses*
Est Duration
1
Program Support ([…***…] FTE Months)
$[…***…]
$[…***…]
[…***…]
2
Process Development ([…***…] FTE Months)
$[…***…]
$[…***…]
[…***…]
3
Analytical Development ([…***…] FTE Months)
$[…***…]
$[…***…]
[…***…]
 
Total
$[…***…]
$[…***…]
[…***…]

*Includes […***…].
 
JMPS will use commercially reasonable efforts to achieve the deliverables as
outlined in this proposal.  This estimate is based on a specific scope of work
that was developed using technical information provided by Aeolus.  Project
objectives or technical details may differ from those assumed in this
estimate.  If a significant difference occurs from the originally proposed scope
of work or with the actual technical details from those assumed, JMPS will
assess the impact of such a change and inform Aeolus.  JMPS and Aeolus will
promptly and in good faith develop and agree to a modified project plan to
ensure that project delays are avoided or minimized.  If these changes result in
additional cost, Aeolus must authorize the additional cost in writing prior to
implementation.
 
JMPS will schedule resources and order materials upon acceptance of this
proposal.  Scheduling is contingent on prevailing staff commitments, raw
material, and equipment availability.  Aeolus will be notified of the expected
start date as soon as is practical.  JMPS will appoint a project leader to
oversee the work and serve as the primary technical liaison with
Aeolus.  Project updates will be submitted weekly and conference calls will be
arranged on a frequency agreed upon by both parties.
 
JMPS offers to perform this work on a time and materials basis.  Direct Expenses
(raw materials, supplies, waste, equipment, outside testing and freight) will be
charged additionally for the actual cost incurred plus the […***…]% handling
fee.  JMPS is pleased to offer a monthly FTE rate of $[…***…] per month.  Aeolus
will be invoiced monthly for actual labor and direct expenses
incurred.  Invoices are payable within thirty (30) days from the date of
 
 
 
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issuance.  Materials will be shipped from JMPS’s facility F.C.A (Incoterm 2010)
within 30 days of project completion.
 
All work specified in this proposal is subject to the Research and Manufacturing
Agreement between Johnson Matthey Pharma Materials dba Johnson Matthey Pharma
Services and Aeolus Pharmaceuticals dated February 16, 2011.  This proposal is
valid for thirty (30) days from the preparation date.
 
 
Stage 1:  Program Support
 
JMPS will provide program support to Aeolus in the preparation of supporting
documents on an as needed basis as requested by Aeolus.  This support includes,
but is not limited to, report writing and document preparation supporting Aeolus
interaction with government agencies.  Example activities may include reports
for pre-IND meetings and preparation of IND filing documentation.
 
 
Stage 2:  Process Development
 
Process development research activities will include (a) improvement of the
overall process efficiency (b)streamlining of the anion exchange processes in
the 2318.A to 2318.B to 2318.C conversion and (c) optimization of the isolation
process for the most desirable form of 2318.C.
 
1.  
Improve volumetric efficiency of the Rothemund condensation workup

 
[…***…]

2.  
Streamlining the process from 2318.A to 2318.B

 
[…***…]

3.  
Process development for the most desirable form of 2318.C

 
[…***…]

4.  
Small scale batch

 
[…***…]

 
Deliverables:
 
· Weekly project updates
· A brief (1-2 page) report summarizing the process and yields.
 
Stage 2:  Analytical Development
 
 
 
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Once the process recommended process changes are determined, additional method
development is expected and will depend on the extent of the process
changes.  Validation of new test methods or revised test methods is not part of
the scope under this proposal.
 
 
 
1.
 
Analytical method development for most desirable form of 2318.C
   
Minimally a method or methods will be required to confirm the final desired form
of 2318.C in addition to the current methods for release of 2318.C.
2.  
Analytical method development for in-process control and isolated intermediates
   
Test methods will be developed to account for any changes in isolated
intermediates or in-process methods.  The GC method for residual solvents may
also need to be developed and revised.

 
Deliverables:
 
· Weekly project updates
· Copies of revised test methods
 
 
 
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AUTHORIZATION
 
 
Appendix 5 to the Research and Manufacturing Agreement Dated:  February 16, 2011
 
 
Program Support, Process Development and Analytical Development for Desired Form
of 2318.C
 
 
AEO-120322-1206
 
 

 
This proposal, including all work and material provided by JMPS hereunder, shall
be governed by the Research and Manufacturing Agreement between Johnson Matthey
Pharma Materials dba Johnson Matthey Pharma Services and Aeolus
Pharmaceuticals.  By its signature below, Aeolus Pharmaceuticals hereby
authorizes Johnson Matthey Pharma Services to perform the work detailed in this
proposal subject to the Research and Manufacturing Agreement dated February 16,
2011.
 

 
 
For:  Aeolus Pharmaceuticals
 

/s/ John L.
McManus                                                               
Date:  4/30/12                                                      
Signature

John L. McManus                                                      
Printed Name

 
For:  Johnson Matthey Pharmaceutical Materials, Inc. d/b/a Johnson Matthey
Pharma Services
 

/s/ Jayachandra
Reddy                                                               
Date:  April 30, 2012                                                        
Jayachandra Reddy, Ph.D.
General Manager
 
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