Exhibit 10.22

 

[*] Indicates that a portion of this exhibit has been omitted based on a request
for confidential treatment submitted to the Securities and Exchange Commission. 
The omitted portion has been filed separately with the Commission.

 

SUPPLY AGREEMENT

 

This agreement (the “Agreement”) is entered into effective as of March 1, 2004
by and between The Curators of The University of Missouri, a public corporation
of the State of Missouri, contracting on behalf of its Research Reactor Center,
University of Missouri-Columbia (hereafter “University”), and NeoRx Corporation,
a Washington corporation (“NeoRx”).  University and NeoRx may hereafter from
time to time be referred to collectively as the “Parties” and individually as a
“Party.”

 

WITNESSETH

 

WHEREAS, NeoRx has obtained the rights to use certain technology and processes
to make, use, sell and distribute certain radiopharmaceutical products for
clinical and commercial purposes; and

 

WHEREAS, University owns facilities and has technical expertise to produce
radioisotopes, which are necessary for NeoRx to produce its radiopharmaceutical
products; and

 

WHEREAS, NeoRx desires that University manufacture and supply to and on behalf
of NeoRx certain quantities of reactor-produced radioisotopes in radiochemical
form from University, and University is willing and able to provide such
radioisotopes to and on behalf of NeoRx, all in accordance with the terms and
conditions set forth in this Agreement;

 

NOW THEREFORE, in consideration of the foregoing promises and agreements set
forth herein, the Parties agree as follows:

 

ARTICLE I - DEFINITIONS

 

1.1           “Affiliate” of a Party means any corporation or other business
entity controlled by, controlling or under common control with such Party.  For
this purpose, “control” means direct or indirect beneficial ownership of [*]
more of the voting and income interest in such corporation or other business
entity.

 

1.2           “Batch” means a specific quantity of the product intended to have
uniform character and quality and produced according to a single manufacturing
order during the same cycle of manufacture.

 

1.3           “Batch Record” means a QA approved copy of the Master Batch Record
used for the execution of the processing of a specific Batch.

 

1.4           “Calibration Time” means 12 Noon Central Time the day of
manufacture of the Product.  For purposes of this agreement, Calibration Time
will be either 12 Noon

 

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Central Standard Time (CST) or 12 Noon Central Daylight Time (CDT), whichever is
officially in effect in Columbia, Missouri.

 

1.5           “Certificate of Analysis” for the purposes of this agreement,
shall be interpreted the same as a Certificate of Conformance.  This is a
written certificate produced by the University verifying and certifying that the
Batch of the product was processed in accordance with the Master Batch Record
and meets the Release Specifications.

 

1.6           “cGMP” means the current Good Manufacturing Practices as required
by FDA under 21 CFR Parts 210, 211, and 820.  This includes FDA regulations,
policies, or guidelines in effect at a particular time for the manufacture,
testing and quality control of radiochemicals to be further processed into a
radiopharmaceutical drug product.

 

1.7           “Curie” or “Ci” is a radioactivity measure as defined in general
scientific literature.  All references to Curies or Ci amounts are stated in
terms of Calibration Time unless otherwise specified.  The total Curie content
in the Product will be determined as described in the Standard Operating
Procedure for total activity level.

 

1.8           “Effective Date” means the date this Agreement is entered into, as
indicated in the first paragraph of this Agreement.

 

1.9           “Facility” means University’s manufacturing facility located at
Research Reactor Center, University of Missouri-Columbia.

 

1.10         “FDA” means the United States Federal Food and Drug Administration
and any successor agency.

 

1.11         “Investigational New Drug” or “IND” means an application document
filed with the FDA defining an investigational new drug product for human use.

 

1.12         [Intentionally left blank]

 

1.13         “Lot File” means the written record of the Process methodology and
testing results related thereto of a specific Batch of Product ordered pursuant
to a Purchase Order.  The Lot File serves as the official documentation of the
Process and tests performed by University for the specific Batch of Product.

 

1.14         [*].

 

1.15         “Master Batch Record” means the document, to be created by
University, which sets forth the methodology and formulae for processing the
Product.

 

1.16         “Minimum Supply Capacity” has the meaning as set forth in
Section 2.5.

 

1.17         “MURR” means the Missouri University Research Reactor, which is a
research center within University.

 

1.18         “New Drug Application” or “NDA” means the application for marketing
a new drug product filed with the FDA.

 

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1.19         “Process,” “Processing,” and “Processed” shall have comparable
meanings and mean the act of manufacturing, handling, testing, storing,
analyzing, packaging, inspecting, labeling and shipping Product in accordance
with the Master Batch Record, Release Specifications and Standard Operating
Procedures.

 

1.20         “Product” means Holmium (166) Chloride Processed in accordance with
this Agreement.

 

1.21         “Proprietary Information” means all information concerning a Party
(the “Disclosing Party”) which is furnished to or created by (such as notes,
analysis, compilations, studies, interpretations or other documents) the other
Party or its directors, officers, employees, agents, advisors or Affiliates
(collectively, the “Receiving Party”) as a result of entering into this
Agreement and in furtherance hereof.  The term Proprietary Information, however,
shall not include information which:

 

(a)           is in the public domain or becomes generally available to the
public through no fault of either Party; or

 

(b)           the Receiving Party can show by documentary evidence was within
its possession or control prior to its being furnished to the Receiving Party by
or on behalf of the Disclosing Party pursuant hereto, free of any obligation of
confidentiality; or

 

(c)           the Receiving Party can show by documentary evidence that came
into its possession or control subsequent to the date of this Agreement from a
third party free of any obligation of confidentiality; or

 

(d)           was independently developed by the Receiving Party without the
aid, application or use of the Proprietary Information; or

 

(e)           is required to be disclosed by law or order of any governmental
authority of competent jurisdiction (provided, that in such event, the Receiving
Party shall provide the Disclosing Party with notice of such law or order and
provide reasonable cooperation in connection with any attempt to challenge or
limit the scope of such disclosure).

 

1.22         “Purchase Order” means the definitive ordering document originated
by NeoRx that sets forth the quantity of Product ordered and the delivery
information.

 

1.23         “Release Specifications” means the set of analytical tests,
methods, and acceptance criteria for Product attributes which must be met in
order to prove the Product meets the standards of quality, purity, identity and
strength for this substance.  Release Specifications are a critical part of the
Process and are filed with the FDA as part of an IND, MF or an NDA.  All Release
Specifications are set forth on Exhibit A attached hereto, which were
established initially by NeoRx in consultation with University and which may be
amended from time to time by written agreement of the Parties and which are to
conform with all requirements of the FDA and applicable laws and regulations. 
Upon such amendment, University will implement any modified documents and/or
procedures pertinent to the revised Release Specifications.  Both parties have
the right to propose process and

 

3

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specification improvements that are mutually beneficial, provided that no such
improvements shall be implemented without the written approval of the other
party.

 

1.24         “Standard Operating Procedures” or “SOPs” means University’s
internal written standard operating procedures, designed by University,
governing all aspects of Processing the Product, conducting analytical tests of
Product, and maintaining records related thereto.

 

1.25         “Term” has the meaning as set forth in Section 10.1 (b).

 

1.26         “Waste” means all (a) rejected or unusable Product, (b) Product not
accepted for delivery by NeoRx, for whatever reason, and (c) waste relating to
University’s Processing of Product.

 

1.27         “Type B Package” is as defined by the Department of Transportation
and the Nuclear Regulatory Commission.

 

ARTICLE II- MANUFACTURE & SALE OF PRODUCT

 

2.1                               EQUIPMENT

 

2.1.1                     INSTALLATION

 

The Parties acknowledge that University must maintain in the Facility sufficient
dedicated equipment and associated components (the “Dedicated Equipment”) to
produce product.

 

2.1.2                     EXCLUSIVITY

 

(a)           During the Term, University may not use the Dedicated Equipment
for any purpose other than cGMP compatible processing of Holmium-166.

 

(b)           During the Term, University grants to NeoRx the first right to the
Holmium-166 production capacity at the University.

 

2.2                               PURCHASE AND SALE OF PRODUCT

 

University shall Process and sell to NeoRx, and NeoRx shall purchase from
University, during the Term, such quantities of the Product as NeoRx may from
time to time order from University.  University shall Process the Product in
strict conformity with this Agreement, including without limitation the Master
Batch Record, Standard Operating Procedures, Release Specifications and all
applicable laws and regulations.

 

2.3                               ORDERS AND FULFILLMENT

 

(a)           Purchase Orders.  NeoRx shall deliver to University a written or
electronic Purchase Order for the number of Curies that NeoRx desires to
purchase no later than [*] prior to the date of shipment from University.  Each
Curie shall be shipped in such manner, and to such location, as requested by
NeoRx in each Purchase Order, provided University is legally able to do so. 
Shipment time shall be [*], unless mutually agreed otherwise, for [*]

 

4

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Type B Package, as defined in Section 1.27, to Denton, Texas each Monday, or to
such location as requested by NeoRx.

 

(b)           Additional Provisions in Purchase Orders.  To the extent any
Purchase Order, invoice or acknowledgement form contains any provisions
additional or contrary to the provisions of this Agreement, such additional or
contrary provision shall have no force or effect and the terms of this Agreement
shall control unless otherwise agreed in writing by the Parties.

 

(c)           Output and Requirements.  During the Term, NeoRx agrees to
purchase from the University, and the University agrees to supply to NeoRx, at
least [*] of NeoRx’s U.S.  Product requirements.

 

(d)           Notice of Inability to Fulfill.  University shall notify NeoRx by
telephone and in writing immediately if University acquires any information that
it will not be able to either (i) fulfill the then most recent Purchase Orders
or (ii) maintain Minimum Production Capacity.  University shall promptly notify
NeoRx by telephone and in writing of any other production issues (including any
proposed or potential shutdown of the Facility for any reason) or other
information of which University becomes aware that may affect the regulatory
status of the Product or the ability of University to supply Product in
accordance with this Agreement or any Purchase Orders.  For planned, extended
reactor shutdowns of greater than one week, the University shall notify NeoRx as
soon as the shutdown is scheduled but in no case less than [*] prior to the
scheduled shutdown.  For shutdowns of [*] duration or less, University shall
notify NeoRx as soon as possible.  The parties acknowledge that scheduled
shutdowns of [*] duration or less, provided the University gives at least [*]
notice, are not to be considered in breach of this Agreement.  Otherwise, the
foregoing notice requirements in no way prevent the University from being in
breach of this Agreement for its failure to Process and supply Product to NeoRx
pursuant to the terms of this Agreement (including, without limitation, the
requirements under Section 2.3 c).

 

2.4                               NEORX’S MINIMUM AND MAXIMUM PURCHASES

 

(a)           Subject to Section 2.5(a), during the Term, NeoRx shall purchase
and/or pay for a minimum of [*] of Product per [*], except for [*] Thanksgiving
and Christmas, and may purchase up to a maximum of [*] of Product [*].

 

(b)           Notwithstanding the above provisions, NeoRx will not be obligated
to make payment for any Curies of Product for which NeoRx does not accept
delivery as a result of the University’s inability to make the Product available
to NeoRx.

 

2.5                               UNIVERSITY’S SUPPLY CAPACITY

 

(a)           Minimum Supply Capacity.  Subject to the terms and conditions of
this Agreement, University will be capable of Processing, and NeoRx will have
the right to purchase, up to [*] of Product per [*], in [*] increments, on an
ongoing basis throughout the Term (the “Minimum Supply Capacity”).  Throughout
the Term, the University shall be capable of Processing a [*] Batch on any
single day for delivery on Monday (or as otherwise mutually agreed upon each
week) in time to meet NeoRx’s shipping requirements (as set forth in Section 2.3
(a)).

 

5

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(b)           Basis for Minimum Supply.  The Parties agree that the Minimum
Supply Capacity will be based on the calculated activity level at Calibration
Time.  The Parties acknowledge that although NeoRx will be obligated to make
applicable minimum payments to University as described in Section 2.4, NeoRx is
not obligated to accept delivery of the Curies available within the University’s
production capacity and that the actual number of Curies University will Process
and ship per calendar week will be dependent on the Purchase Orders University
receives from NeoRx.

 

(c)           Shipping Capacity.  University shall be obligated to ship a
maximum of [*] Type B Package per week, provided by NeoRx, per Monday to Denton,
Texas, or to such location as requested by NeoRx.  University agrees to place
NeoRx’s Type B Packages on University’s maintenance program at a cost set forth
in Section 4.4 below.  University agrees to place the NeoRx owned Type B
Packages into the MURR Type B Quality Assurance Program and shall provide
routine maintenance on said Packages at a cost set forth in Section 4.4 below. 
The maintenance items to be addressed under the terms of this agreement will be
limited to those items that are customarily performed by the user of a Type B
Package.  The scope of all maintenance items to be performed by MURR is
designated under the Nuclear Regulatory Commission (NRC) approved MURR Quality
Assurance Program and is limited to those hardware items that can be replaced or
maintained using commonly available techniques and equipment.  Examples of these
typical hardware items include o-rings, retainer bolts, and gaskets.  MURR shall
not be responsible for repairs that are outside of the scope of the MURR Quality
Assurance Program, such repairs must be performed by a qualified outside vendor
under the conditions set forth in the vendor’s NRC approved MURR Quality
Assurance Program at NeoRx’s expense.  The University shall notify NeoRx of the
necessity of third party maintenance and shall receive prior approval from NeoRx
before the performance of third party maintenance.  MURR assumes no
responsibility to provide replacement Type B Packages in the event of
catastrophic failure or regulatory obsolescence, unless such catastrophic
failure is due to MURR’s negligence or willful misconduct.

 

2.6                               RESPONSIBLE PERSONNEL

 

During the Term of this Agreement, University will staff the Processing of the
Product with personnel who are reasonably qualified consistent with industry
standards.  University will name a person responsible for production and a
person responsible for quality assurance.  The person responsible for quality
assurance and the person responsible for production will in no event be the same
person.  If any person named by University terminates his or her employment with
University during the Term of this Agreement, University shall replace that
individual as soon as possible with someone of a comparable level of experience.

 

2.7                               WASTE DISPOSAL

 

University shall be responsible for the disposition, in accordance with all
established regulations, of all waste generated at University.

 

6

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ARTICLE III - DELIVERY & TITLE

 

3.1                               DELIVERY

 

All Product purchased by NeoRx hereunder shall be delivered F.O.B.  Facility. 
Risk of loss and title to the Products shall pass to NeoRx upon delivery to and
receipt by NeoRx’s designated carrier.

 

3.2                               SHIPPING CHARGES

 

NeoRx, in consultation with University, shall arrange for the shipment of the
Product from the University’s dock.  NeoRx shall be responsible for the payment
of all shipping charges associated with such shipments.  NeoRx shall make all
third-party payments directly.

 

3.3                               INSPECTION AND ACCEPTANCE

 

(a)           Product Conformance:  All Product shall comply with the Release
Specifications.  In accordance therewith, each Batch of Product delivered to
NeoRx shall be accompanied by or promptly followed by a Certificate of Analysis
relating to such Batch.  NeoRx may reject any Batch if University fails to
comply with Release Specifications or fails to deliver a Certificate of Analysis
along with such Batch, or if such Batch contains less than [*] of the activity
ordered by NeoRx in the applicable Purchase Order.  If NeoRx rejects a Batch for
such reasons, NeoRx may return such Batch to University (at University’s cost). 
NeoRx shall not be obligated to pay for such rejected Batch (and shall not be
obligated to pay for any shortfall below the Minimum Quantity resulting from
such rejected Batches).

 

(b)           Disputes Regarding Conformance of a Batch of Product:  The parties
agree to select a mutually agreeable independent laboratory as soon as possible
after the effective date of this agreement to assist in resolving disputes
regarding product conformance.  A sample of the Batch of Product in dispute will
be submitted from University to the independent lab for analysis.  If the
laboratory concludes that the Product is not in conformance as set forth in
subsection (a) above, the University shall pay for the analysis and reimburse
NeoRx in accordance with subsection (a) above.  Otherwise, NeoRx shall pay for
the analysis and accept the Batch.

 

3.4                               SHIPPING CONTAINERS

 

NeoRx has developed a design for a shipping container (“Container Design”) to be
used for the shipment of radiopharmaceutical products.  University owns a number
of depleted uranium containers (the “DU Containers”), which are necessary to
ship radiopharmaceutical products.  NeoRx agrees to license the use of the
Container Design to University [*], during the Term for all orders of the
Product.  The DU Containers loaned to NeoRx under this Agreement are to be used
solely for transport of radioactivity within MURR or shipment of radioactivity
as mutually agreed by NeoRx and the University.  NeoRx shall remain the sole
owner of the Container Design and University shall remain the sole owner of all
DU Containers; provided, however, that upon termination of this Agreement NeoRx
will have the option to lease the [*] DU Containers for [*] after termination of
the Agreement at a commercially reasonable rental rate.

 

7

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ARTICLE IV- PURCHASE PRICE AND PAYMENT

 

4.1          Curie Fee

 

In consideration for University Processing the Product in compliance with the
terms of this Agreement, NeoRx shall pay an amount equal to [*] per Curie for
the number of Curies ordered by NeoRx in the applicable Purchase Order.  The
Parties acknowledge that the foregoing per Curie price is based upon NeoRx’s
commitment to purchase and/or pay for a minimum of [*] Curies per [*], except
[*] Thanksgiving and Christmas, for the duration of the Term.  Shipments of [*]
shall be accepted by NeoRx, but shall qualify for a credit of [*].  Shipments of
[*], may be accepted by NeoRx at its discretion and, if accepted, will qualify
for a credit of [*] for each Curie or partial Curie below [*].

 

4.2                               BASIS OF CURIE FEE AND COSTS

 

The Parties agree that the price set forth in Section 4.1 is based on the total
Curie content ordered, and that the Curie fee includes the cost of labor,
materials, cost of Dedicated Equipment, and overhead to Process, including
testing the finished Product and is exclusive of the cost of shipping, and
packaging and handling expenses.

 

4.3                               ANNUAL ADJUSTMENT OF CURIE FEES

 

On the anniversary date of the Agreement the Curie price may be increased by an
amount not to exceed the change from January to January of the previous twelve
(12) months in the U.S.  Producer Price Index, all Commodities, as published by
the U.S.  Department of Labor Bureau of Labor Statistics or zero percent (0%),
whichever is greater.  In any event, however, the annual price adjustment shall
be limited to no more than [*].

 

4.4                               HANDLING AND MAINTENANCE CHARGES

 

NeoRx agrees to pay MURR’s standard handling and standard container maintenance
charges, currently [*] per shipment and [*] per shipment, respectively, but
subject to minor standard change during the Term.  The foregoing described
changes in such charges shall not occur more than [*], and for any year shall be
no greater [*], respectively.

 

ARTICLE V - REGULATORY MATTERS

 

5.1          General

 

University understands that it will be primarily responsible for ensuring that
the Facility and the Process will be cGMP compliant as required by the FDA. 
University will (a) create the Master Batch Record and Standard Operating
Procedures, which University will comply with in Processing the Product (in
addition to complying with the Release Specifications), (b) maintain all
required regulatory documents covering the Process and the Facility, and (c)
make all such required documents available to NeoRx for its review upon NeoRx’s
request.

 

8

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5.2                               NEW DRUG APPLICATIONS

 

University shall cooperate with NeoRx with respect to any NDA obligations
relating to the Product that are imposed by the FDA or foreign regulations. 
NeoRx shall be responsible for obtaining FDA or other regulatory approval for
the NDA for any drug products utilizing the Product, and shall own the NDA. 
University agrees to comply with all commitments made in the NDA regarding
University’s Processing responsibilities, but NeoRx agrees not to make
commitments to the FDA on behalf of the University without the University’s
prior written approval.

 

5.3                               NOTICE OF SAFETY RELATED INFORMATION

 

MURR and NeoRx shall provide to each other prompt notice of any information it
receives relating to the safety of the Product, including any confirmed or
unconfirmed information on adverse, serious, or unexpected events associated
with the manufacture of the Product.  For serious (based on a good faith
evaluation), unexpected events, MURR and NeoRx shall give each other notice by
telephone within [*] after receipt of the information and followed by written
notice not less than [*] thereafter.  The Parties shall cooperate in responding
to all applicable governmental agencies and filing any reports with such
agencies concerning any reactions (including drug experience reports) caused by
the Product.  The Parties shall cooperate in providing timely assistance in
responding to any complaints relating to commercial goods produced and sold by
NeoRx that contain Product.  The costs associated with responding to such
complaints shall be borne by NeoRx; provided, however, if the complaint was
directly or indirectly caused by University’s failure to Process the Product in
strict accordance with the Master Batch Record or Release Specifications,
University shall reimburse NeoRx for all reasonable internal and external costs
and expenses incurred by NeoRx to appropriately respond to such complaints (up
to a maximum of [*] per batch).

 

ARTICLE VI - RECORDS AND AUDITS

 

6.1          Batch Records

 

The University shall retain all records of orders received, raw materials
purchased and stored, Batch Records for Product manufactured, work in progress,
Processing analyses and release control tests and the like for [*] or until NDA
full approval.  Should the University be unable to store the above-mentioned
records, for any reason, the records will be shipped to NeoRx Corporation for
archival.

 

6.2                               AGENCY RECORDS AND AUDITS

 

University shall make available to NeoRx and all applicable government agencies
all documents and updates that they have prepared with regard to Processing the
Products that are required by law to be filed with any governmental agency. 
University shall submit to all inquiries and inspections by any governmental
agency with authority to conduct such inquiries and inspections (hereinafter
collectively referred to as “Agency”).  University shall promptly notify NeoRx
of any Agency interactions and/or correspondence relating to University’s
operations that could relate, directly or indirectly, to the Product. 
University shall make available for inspection by NeoRx all documents and
correspondence received

 

9

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from any Agency that relate in any way to the Process or the Product. 
University shall immediately inform NeoRx of all Agency audits that relate in
any way to the Process or the Product.  Similarly, NeoRx shall inform University
in advance of any Agency planned audits of NeoRx if such audits relate directly
to the Products.  University shall immediately provide NeoRx with copies of any
regulatory letters or other documents issued by any Agency and received by
University in connection with the audit or any inspection relating to the
Product.

 

6.3                               FDA

 

NeoRx shall obtain and maintain all FDA and other regulatory approvals necessary
to enable NeoRx to use the Products as intended under this Agreement. 
University shall cooperate with NeoRx as required in order to secure and
maintain such governmental and other approvals.

 

6.4                               INSPECTIONS

 

University shall permit indoctrinated employees and/or appropriately trained
representatives of NeoRx to enter, consistent with MURR access protocols in
effect at the time, and conduct a reasonable inspection and/or audit of the
Facility and/or the documents associated with the Processing of Product during
normal business hours and with at least seventy-two (72) hours advanced notice
in order to determine whether the Products are being Processed in conformity
with the terms of this Agreement.  In addition, and in conformity with all
applicable laws, rules and regulations, University shall permit employees or
representatives of NeoRx to inspect Products designated for delivery to NeoRx
and otherwise provide NeoRx with such information as it may reasonably be
required to determine whether the Products are being Processed in accordance
with this Agreement, including without limitation in accordance with the Master
Batch Record, Standard Operating Procedures, and all applicable laws, rules and
regulations.

 

ARTICLE VII - REPRESENTATIONS AND WARRANTIES

 

7.1          Labor and Equipment

 

University represents that it shall furnish all labor, equipment and facilities
necessary to Process Product in the amounts, and in the timely manner, as set
forth in each Purchase Order.  University has obtained, and will maintain
throughout the Term, all licenses necessary to Process the Product.  University
will abide by all applicable rules, regulations, laws and mandates issued by all
applicable regulatory bodies.

 

7.2                               PROCESSING REQUIREMENTS

 

University represents, warrants and agrees that it will Process all of the
Product in strict accordance with this Agreement, including without limitation
(i) the Master Batch Record, (ii) the Standard Operating Procedures, (iii) the
Release Specifications, (iv) all federal, state and local laws, statutes,
regulations or other requirements relating thereto and applicable to the
intended use of such Product, and (v) [*].  University further represents that
it is not a party to any other agreement that could hinder its ability to
fulfill its obligations under this Agreement.

 

10

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7.3                               RECORDS RELATING TO WASTE DISPOSAL

 

University represents that it shall obtain and maintain all waste generator
licenses, disposal manifests and other records in accordance with Federal
statutes, laws and regulations and the statutes, laws and regulations of the
State of Missouri.

 

7.4                               CHANGES

 

University agrees that it will not implement any material revisions or changes
to the Product, Process, Master Batch Record or Standard Operating Procedures
associated with University’s Processing of the Product for and on behalf of
NeoRx without prior written notification to NeoRx in order to give NeoRx an
opportunity to validate that such changes would have no negative impact on the
Product.  A “material revisions or changes” means any revision or change that
would impact (a) the raw materials supplier, (b) materials specifications, (c)
formulation process, (d) formulation equipment, or (e) testing procedures. 
Furthermore, University will not make any changes, material or otherwise, to the
Release Specifications without prior written approval of NeoRx.

 

7.5                               SAFETY PROCEDURES

 

University represents that it shall have primary responsibility for adopting and
enforcing safety procedures for the handling and production of the Products that
comply in all material respects with all federal, state and local environmental
and occupational safety and health requirements to which University is subject.

 

ARTICLE VIII - CONFIDENTIAL INFORMATION

 

8.1          Limitations on Disclosures

 

Except to the extent expressly authorized by this Agreement, during the Term of
this Agreement and five (5) years thereafter, neither Party shall:

 

(a)           disclose, publish, or make available any Proprietary Information
disclosed to it by the other to any third party, including employees who do not
need to know or have access to such Proprietary Information; or

 

(b)           sell, transfer, or otherwise use or exploit any such Proprietary
Information disclosed to it by the other Party; or

 

(c)           knowingly permit the sale, transfer, use or exploitation by a
third party of any such Proprietary Information which may have been disclosed to
such third party, including employees who do not need to know or have access to
such Proprietary Information.

 

During the Term of this Agreement, neither Party shall make any press release or
other disclosure of the terms of this Agreement without the prior written
consent of the other Party, except as required by law or by a court of competent
jurisdiction and pursuant to the disclosure requirements of federal or state
regulatory agencies, including the United States Securities and Exchange
Commission.

 

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8.2                               USE OF PARTIES’ NAMES

 

Neither Party shall advertise any connection with the other Party nor make use
of the other Party’s name or other identifying marks or property, nor make
representations, either express or implied, without the other Party’s prior
written approval.  The prior sentence shall not, however, be construed so as to
prevent mention of the contribution of either Party in any scientific
publication.

 

8.3                               SCHOLARLY PUBLICATIONS

 

Notwithstanding paragraph 8.1(b) University shall have the right to publish in
scholarly journals and make scholarly presentations concerning any information
it may develop as a result of this Agreement.  University shall provide NeoRx
with a copy of any proposed scholarly publication or presentation 45 days before
submission for publication or presentation to allow NeoRx to review and comment
on the publication or presentation and delete any confidential Proprietary
Information of NeoRx.  NeoRx may request a 60-day delay of the publication or
presentation to allow the preparation of patent applications should the
materials disclose an invention.

 

ARTICLE IX - INDEMNIFICATION

 

9.1          Indemnification

 

(a)           Subject to Section 9.2, NeoRx shall defend, indemnify, and hold
harmless University, its officers, agents, employees and Affiliates from any
third-party loss, claim, action, damage, expense or liability (including defense
costs and reasonable attorneys’ fees) arising out of NeoRx’s (a) breach,
violation or nonfulfillment of any of its covenant, agreements, representations
or warranties under this Agreement, (b) handling, possession, or use of the
Products after University’s delivery of the same to NeoRx, (c) negligence or
willful misconduct, or (d) breach of any third party’s trade secret rights,
except to the extent that such loss, claim, action, damage, expense or liability
is based on, arises out of, or is due to the negligence or willful misconduct
of, or breach of this Agreement by, University.

 

(b)           Subject to Section 9.2, to the extent permitted by Missouri law
and without waiving sovereign immunity, University shall defend, indemnify, and
hold harmless NeoRx, its officers, agents, employees and Affiliates from any
third-party loss, claim, action, damage, expense or liability (including defense
costs and reasonable attorneys’ fees) arising out of University’s (a) breach,
violation or nonfulfillment of any of its covenant, agreements, representations
or warranties under this Agreement, (b) handling, possession, or use of the
Products prior to University’s delivery of the same to NeoRx, (c) negligence or
willful misconduct, (d) disposal of any Waste, or (e) breach of any third
party’s trade secret rights, except to the extent that such loss, claim, action,
damage, expense or liability is based on, arises out of, or is due to the
negligence or willful misconduct of, or breach of this Agreement by, NeoRx.

 

9.2          No Personal Liability

 

No shareholder, member, officer, employee or board member (the “Individuals”),
individual or collectively, of either University or NeoRx incurs or assumes any
individual or

 

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personal liability by the execution of this Agreement or by reason of the
default of either Party in the performance of any of the terms herein.  All such
liability of the Individuals of each Party is hereby released by the other Party
as a condition of and in partial consideration for the execution of this
Agreement.

 

9.3                               PROCEDURE

 

Each Party agrees to give to the indemnifying Party (a) prompt notice of any
claim or suit coming within the purview of the indemnities contained in this
Article IX, (b) all relevant facts in its possession or control, subject to the
treatment of such information pursuant to Article VIII, (c) the right to
exclusive control of the defense of any action (at its sole expense), and (d)
its cooperation in the defense of any such action.

 

ARTICLE X - TERM AND TERMINATION

 

10.1        Term

 

(a)           Subject to the Parties’ ability to terminate this Agreement as set
forth in this Article X, the “Initial Term” of this Agreement shall commence on
the Effective Date and shall continue through [*] (the “Initial Term”).

 

(b)           NeoRx shall have the option to renew this Agreement, with the
consent of the University which will not be unreasonably withheld, under the
same terms and conditions, for up to [*] additional [*] terms (the “Extension
Term(s)”) beyond the Initial Term; provided, that NeoRx shall exercise its
option, if at all, in writing with no less than [*] remaining in the
then-current Term.  The Initial Term and Extension Terms, if any, unless
terminated earlier pursuant to the terms of this Agreement, are referred to
herein as the “Term.”

 

(c)           Notwithstanding clauses (a) and (b) above, the Parties acknowledge
that at any time they may agree to replace this Agreement in its entirety with a
long-term commercial supply agreement.

 

10.2                        TERMINATION BY EITHER PARTY

 

Either Party may terminate this Agreement at any time after the happening of any
of the following events; provided, however, that the Party terminating this
Agreement shall provide the other with written notice of such termination prior
to the date thereof:

 

(a)           either Party breaches any of its agreements, covenants,
representations or warranties as set forth in this Agreement and the breaching
Party fails to cure such breach within fifteen (15) days of written notice
thereof from the non-breaching Party; or

 

(b)           University fails to timely fulfill [*] Purchase Orders in any
rolling six (6) month period; or

 

(c)           the FDA (or other governmental agency with authority), Missouri
Department of Health or other regulatory agency orders University to cease
Processing the Product or orders NeoRx to permanently cease utilizing the
Product.

 

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Notwithstanding any provision in this Agreement to the contrary, University
shall continue to Process the Product, and deliver Product in response to any
Purchase Order, through the date of termination, unless such Process and
delivery requirements are waived in writing by NeoRx.

 

10.3                        DISPUTES

 

In the event of a dispute regarding the interpretation of this Agreement, the
Parties agree they will endeavor to resolve such dispute amicably.  In the event
a dispute cannot be resolved by the Parties, then upon the written request of
any Party that includes a summary of the dispute, a senior executive officer of
NeoRx and a senior official of MURR shall promptly meet and endeavor to resolve
the dispute through good-faith negotiations within thirty (30) days of their
receipt of the dispute.

 

10.4                        RETURN OF INFORMATION

 

Upon expiration or termination of this Agreement, each Party shall return all
originals and copies of the other Party s Proprietary Information it may have
received or created.

 

10.5                        RIGHTS ON TERMINATION

 

(a)           Continuing Obligations.  Upon termination of this Agreement, each
of the Parties shall continue to be bound by its obligations under Articles VII,
VIII and IX of this Agreement.

 

(b)           NeoRx’s Additional Remedies.  If NeoRx terminates this Agreement
pursuant to Section 10.2(a) (for University’s breach of this Agreement) or
Section 10.2(b) (for University’s failure to timely fulfill Purchase Orders),
then, in addition to any other remedy available to NeoRx at law:

 

(i)            during the six (6) months following termination, if requested by
NeoRx University shall provide not more than [*] person-hours of the time of
University employees, at no additional cost to NeoRx, to facilitate a transition
to a third party facility for Processing the Product

 

(ii)           within thirty (30) days of such termination, University shall
transfer to NeoRx certified copies of the Lot Files and all records relating to
batches of the Product delivered to NeoRx; and

 

(iii)          University will, at NeoRx’s request, continue to Process Product
pursuant to the terms and conditions of this Agreement and sell the same to
NeoRx at the prices in effect at time of termination for the remainder of the
Term.

 

ARTICLE XI - FORCE MAJEURE

 

Neither Party hereto shall be liable to the other in damages for, nor shall this
Agreement be terminable by reason of, any delay or default in such Party s
performance hereunder if such delay or default is caused by conditions beyond
such Party’s control including, but not limited to, acts of God, war,
insurrection, civil commotion, destruction of

 

14

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production facilities or materials by earthquake, fire, flood or storm, labor
disturbances including strikes or lockouts or epidemic (“Force Majeure”).  Each
Party hereto agrees to promptly notify the other Party of any event of Force
Majeure and to employ all reasonable efforts toward prompt resumption of its
performance hereunder when possible if such performance is delayed or
interrupted by reason of such event.

 

ARTICLE XII - MISCELLANEOUS

 

12.1                        ASSIGNMENT

 

This Agreement shall be binding upon and inure to the benefit of the Parties,
their successors and permitted assigns.  Notwithstanding the foregoing, NeoRx
may assign its rights and/or delegate its obligations under this Agreement to
any third party.  NeoRx will give University immediate notice of any such
assignment.  University may not assign its rights and/or delegate its
obligations under this Agreement to any third party without NeoRx’s prior
written consent.

 

12.2                        ENTIRE AGREEMENT; AMENDMENTS; COUNTERPARTS

 

This Agreement, along with each Purchase Order and the attached Exhibits,
contains the entire understanding of the Parties hereto relating to the subject
matter contained herein, supersedes all prior agreements, promises and
understandings of the Parties.  This Agreement may not be modified, amended or
any provision waived except by written agreement of the Parties.  This Agreement
may be executed in counterparts, each of which shall be deemed to be an original
and all of which together shall constitute one and the same agreement.

 

12.3                        NOTICES

 

All notices, demands, requests and other communications shall be in writing or
by written telecommunication, and shall be given when delivered personally to
the addressee or, if mailed, by certified mail, return receipt requested,
postage prepaid, or sent by written telecommunication, when delivered to the
addresses specified below.  Either Party may from time to time change its
address, facsimile number or designated individual by notice to the other Party.

 

If to NeoRx:

 

NeoRx Corporation

 

 

300 Elliott Avenue West, Suite 500

 

 

Seattle, Washington 98119

 

 

Attention:  Anna Wight, Legal Department

 

 

 

If to University:

 

MU Research Reactor

 

 

1513 Research Park Dr.

 

 

Columbia, MO 65211

 

 

Attention:  Ken Brooks

 

Such notice, demand, request, and other communications shall be deemed to have
been given as of the date so delivered or transmitted by facsimile (as long as
the transmitting machine confirms successful transmission) or, if mailed, three
(3) business days after the date so mailed, or, if sent by overnight courier
service, one (1) business day after the date so sent.

 

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12.4                        RELATIONSHIP OF PARTIES

 

The Parties are acting herein as independent contractors and independent
employers.  Nothing herein contained shall create or be construed as creating a
partnership, joint venture, joint employer or agency relationship between the
Parties and no Party shall have the authority to bind the other in any respect.

 

12.5                        NO WAIVER; SEVERABILITY

 

Any provision of this Agreement may be waived at any time in writing executed by
the Party for whose benefit such provision exists; provided, however, that the
failure to enforce any provision of this Agreement shall not constitute a waiver
thereof.  In the event that any provision of this Agreement shall be held
invalid or unenforceable under applicable law, the remainder of this Agreement
shall remain valid and enforceable, unless such invalidity or unenforceability
substantially diminishes the rights and obligations, taken as a whole, of any
Party.

 

12.6                        AGREEMENT APPROVAL; FURTHER ASSURANCES

 

Each Party hereby represents and warrants that all necessary corporate approvals
for this Agreement have been obtained, and the person whose signature appears
below has the authority necessary to execute this Agreement on behalf of the
Party indicated.  Each Party agrees that it shall execute such further documents
and perform such further acts as may be necessary to comply with the terms of
this Agreement.

 

12.7                        CAPTIONS

 

The captions in this Agreement are solely for convenience of reference and shall
not be used for purposes of interpreting or construing the provisions hereof.

 

12.8                        INTELLECTUAL PROPERTY

 

No trademark, trade name, logo, trade dress, copyright or license therein, or
other intellectual property rights (collectively, “Intellectual Property”) are
conveyed by this Agreement, and neither Party shall have the right to use the
other Party’s Intellectual Property for any purpose whatsoever without prior
written consent.

 

12.9                        SURVIVAL

 

The provisions in Article V, VII, VIII, IX and XII, and Sections 2.7, 3.4, 6.1,
6.2, 10.3, 10.4 and 10.5, shall survive the termination of this Agreement.

 

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
duly their authorized representatives, effective on this date first set forth
above.

 

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THE CURATORS OF THE
UNIVERSITY OF MISSOURI

NEORX CORPORATION

 

 

 

 

By:

 

/s/ Lisa J. Wimmenauer

 

By:

 

/s/ Anna Wight

 

 

 

 

 

Name:

 Lisa J. Wimmenauer

 

Name:

 Anna Wight

 

 

 

 

 

Its:

Associate Director of Business Services

 

Its: 

 Vice President Legal

 

 

17

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Exhibit A

 

[*]

 

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