Exhibit 10.69

August 2009 Material Evaluation Agreement with Biken

Material Evaluation Agreement

This Agreement is made by and between Hemispherx Biopharma, Inc. (hereinafter
referred to as “Hemispherx”) and The Research Foundation for Microbial Diseases
of Osaka University (hereinafter referred to as “Biken”).
 
RECITALS

WHEREAS, Hemispherx owns intellectual property rights relating to poly I: poly
C12U, with the trade name of Ampligen® and possesses proprietary rights and
know-how relating to the manufacture and production of Ampligen®; and

WHEREAS, Biken is a manufacturer of biologicals in Japan, and has been engaged
for many years mainly in the research and development and manufacture of a
variety of infection-prophylactic vaccine products for human use.  As part of
the work activities relating to a research project entitled “The Research
Project on Clinical Application of the Influenza Virus Vaccine in the Intranasal
Dosage Form for Mucosal Administration” (hereinafter referred to as the
“Research Project”), which is subsidized by the Japanese Ministry of Health,
Labor and Welfare (hereinafter referred to as the MHLW”) and in which the
National Institute of Infectious Diseases of Japan (hereinafter referred to as
the “NIID”) plays a main part and Biken also participates as one of the
researchers and during and in the course of which, at the end of each fiscal
year research results obtained thereby are to be compiled by the NIID into an
annual research report that will be submitted to the MHLW and subsequently
placeｄ for public view, Biken has an intention to evaluate the functional
capability of Ampligen® in serving as an adjuvant to induce mucosal immune
response.  In addition, Biken owns jointly with the NIID the intellectual
property rights relating to the “Novel Vaccine Containing Adjuvant Capable of
Inducing Mucosal Immunity”, which is the object substance of the Research
Project, and possesses the technical know-how to prepare prototypes of such
adjuvanted vaccine preparation for experimental and research purposes.

NOW THEREFORE, in consideration of the mutual covenants and agreements made
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agrees as follows:

1.   OBJECTIVE
The objective of this Agreement is to set forth the terms and conditions under
which, as described in the Evaluation Program outlined in Exhibit 1 hereof,
Biken evaluates Ampligen® primarily from the aspects of both adjuvant-function
as induction of satisfactory mucosal immune response and its safety, in
collaboration with the Co-Researcher, by using the Prototype Vaccine Preparation
as defined in Paragraph (6) of Article 2 hereof (hereinafter referred to as the
“Evaluation”), in order to select candidates of both viral-antigens and
adjuvant-auxiliaries which are identified as the most promising substances and
determine the formulations of potential influenza virus vaccine candidates
containing such viral-antigens as the active ingredients and such
adjuvant-auxiliaries as well as other base material(s), during and in the course
of the Research Project aimed at practical use of a newly developed
adjuvanted-influenza virus vaccine which is capable of inducing a
cross-protective immunity against  new influenza viruses with new pandemic
potential.

 
1

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

 

2.   DEFINITIONS
(1)
“Ampligen®” shall mean poly I: poly C12U.

(2)
“Confidential Information” shall mean and include all present and future
techniques, inventions,   practices, enforcement, knowledge, know-how, skill,
experience, test data, analytical data, descriptions (including the explanation
set forth in Paragraph (3) of Article 6 hereof), and reports (whether in
electronic, documentary, eye readable or any other form) generated or obtained
by either Party or obtained through agreement with a third party with regard to
Ampligen® and/or the Evaluation to be performed by Biken in cooperation with the
Co-Researchers or disclosed by either Party to the other Party pursuant to or in
connection with this Agreement, and identified as being confidential, and
including any reports prepared by either Party for the other, excluding,
however, information which:

 
1)
is or comes into the public domain through no fault of the receiving Party;

 
2)
is known to the receiving Party prior to the date of disclosure, as evidenced by
written records of that Party;

 
3)
is lawfully disclosed to the receiving Party by a third party rightfully in
possession of it; or

 
4)
is independently and subsequently developed by an employee or agent of the
receiving Party who had no knowledge of the Confidential Information disclosed
under this Agreement or of any Confidential Information derived by the receiving
Party therefrom.

(3)
“Effective Date” means the date on which this Agreement is last executed by
either Party.

(4)
“Co-Researcher” means the following researchers, who are involved in the
Research Project as set forth in Recitals Clause hereof, who will cooperate with
Biken on the Evaluation:

Name
  
Institution/Organization  to which one
belongs
  
Title
Hideki Hasegawa
 
National Institute of Infectious Diseases.
 
Chief, Laboratory of Mucosal Vaccine Development, Influenza Virus Research
Center,
Masato Tashiro
 
National Institute of Infectious Diseases
 
Director,
Influenza Virus Research Center
Hiroshi Kida
  
Department of Disease Control,
Hokkaido University Graduate School of Veterinary Medicine
  
Professor

In case of any changes in personnel composition of the aforementioned
Co-Researcher, Biken shall so notify Hemispherx in writing.

(5)
“Party” shall mean either Hemispherx or Biken or both, as the case may be.

(6)
“Prototype Vaccine Preparation” shall mean the prototype of influenza virus
vaccine preparation in the form of intranasal and/or injectable dosage,
containing primarily of candidates of influenza viral-antigens and Ampligen® as
well as other base material(s), which is prepared by Biken for the purpose of
performing the Evaluation as defined in Article 1 hereof.

 
2

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

 

(7)
“Research Adviser” shall mean any of the following specialists, who dispenses
expert advice as required from Biken and/or the Co-Researcher in a position of
adviser on the Research Project during and in the course of which Biken performs
the Evaluation in cooperation with the Co-Researchers:

Name
  
Institution/Organization  to which one
belongs
  
Title
Koichi Yamanishi
  
National Institute of Biomedical Innovation
 
Director General
Takeshi Kurata
 
Toyama Institute of Health
 
Director
Shinichi Tamura
  
National Institute of Infectious Diseases
  
Research Fellow

3.   PROVISION OF MATERIAL AND RELATED INFORMATION
Provided that Biken agrees to the following terms, Hemispherx shall provide
Biken with Ampligen® and the Confidential Information relating to Ampligen®
including but not limited to any information regarding the safety of Ampligen®:

(1)
During the effective term of this Agreement, Hemispherx grants to Biken the
exclusive right to use Ampligen® and the Confidential Information relating to
Ampligen® for the purpose of performing the Evaluation as provided in Article 1
hereof in Japan.

(2)
Biken shall use Ampligen® and the Confidential Information relating to Ampligen®
solely for the purpose of performing the Evaluation in accordance with Paragraph
(1) of this Article.

(3)
Nothing contained herein shall be construed to grant to Biken any rights in
technology or license of any patent, copyright or trademark now or hereafter in
existence except for the purposes of the Evaluation.

 
4.   SUPPLY OF AMPLIGEN® AND PAYMENT
(1)
Hemispherx shall supply to Biken, pursuant to Biken’s written request, and Biken
shall purchase from Hemispherx, such volume of Ampligen® as will be necessary
for Biken in performing the Evaluation in Japan.  The price of Ampligen® for
such supply and purchase shall be $1,000/gram. Biken has indicated it intends to
purchase 750 ml (7.5 grams) of Ampligen® at 10 mg/ml for delivery in July, 2009.

(2)
The payments of the price provided in Paragraph (1) of this Article shall be
made by Biken to Hemispherx within thirty (30) days after Biken’s receipt and
inspection of the Ampligen® in the United States Dollars by means of telegraphic
transfer to the following bank account, unless Hemispherx notifies otherwise to
Biken in writing:

Bank:
 
Wachovia Bank
Bank Address:
 
Center Square Branch, 15th and Market Streets, Philadelphia, PA 19102 Phone
(215) 985-7377
SWIFT No:
 
International Swift Address: FUNB INT
Account Number:
 
2000-009-652305  ABA Number 031201467

 
3

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

 

Account Name:
  
Hemispherx Biopharma, Inc.

(3)
If Biken detects that the Ampligen® provided by Hemispherx has any defect, Biken
shall notify Hemispherx of it, and Hemispherx shall recall such defective items
and provide non-defective Ampligen® at its cost within thirty (30) days at the
latest after the receipt of said notice from Biken.  In this case, the period of
the payment set forth in the above paragraph shall be thirty (30) days after
Biken’s receipt and inspection of the replacement Ampligen®.

5.   CONFIDENTIALITY  
(1)
Except as provided elsewhere herein, each Party shall keep in strict confidence
and shall not disclose to any third party any Confidential Information
(including the Ampligen® as owned by Hemispherx) provided or disclosed by the
other Party hereunder during the effective period hereof without first obtaining
the written consent of said other Party.

(2)
Notwithstanding the provisions of the preceding Paragraph hereof, Biken may
disclose the  Confidential Information (including the Ampligen® as owned by
Hemispherx) provided or disclosed by Hemispherx hereunder during the effective
period hereof to the Co-Researcher and/or the Research Adviser, as defined in
Paragraphs (4) and (7) of Article 2 of this Agreement, respectively, provided
both are then bound and agree to all provisions of this Agreement relating to
the confidentiality of Ampligen® and Confidential Information.

(3)
Each Party shall exercise the same degree of care and safeguards with respect to
the Confidential Information (including Ampligen® as owned by Hemispherx) as
used to maintain the confidentiality of its own information of the similar
nature; provided, however, the degree of the care and safeguard shall not at any
time be less than the reasonable degree.

 (4)
If Biken wishes to publish research papers relating to the use of Ampligen® and
the Confidential Information relating to Ampligen® provided by Hemispherx
pursuant to or in connection with this Agreement for the purpose of the
Evaluation, or to publicly disclose any information relating to or resulting
from such use, together with the Co-Researchers, Biken shall make reasonable
efforts to provide Hemispherx with a copy of the proposed research papers for
Hemispherx’s review and comment upon knowing such planned publication.  As for
the research results to be compiled into annual research reports to be submitted
to the MHLW and subsequently placed for public view in connection with the
Research Project referred to in the Recitals hereof, it is deemed that by virtue
of the execution of this Agreement by the Parties hereto that Hemispherx has
consented thereto provided Biken shall provide Hemispherx a copy of the
published annual research reports for Hemispherx’s review and comment after such
reports have been placed  for public view.

 
(5)
If either Party is required by any governmental agency, court or other
quasi-judicial or regulatory authorities to provide any of the Confidential
Information (including Ampligen® as owned by Hemispherx) provided or disclosed
by the other Party hereunder during the effective period hereof, the Party
shall, if possible, promptly notify the other Party in writing prior to any such
disclosure so that said other Party may seek an appropriate remedy and/or waive
compliance with the provisions of this Agreement.

(6)
The provisions in this Article shall remain in force for five (5) years from the
Effective Date notwithstanding termination or cancellation of this Agreement; it
being understood and agreed that the foregoing provisions of this Article shall
not be construed as permitting either Party to voluntarily disclose any
Confidential Information (including Ampligen® as owned by Hemispherx) provided
or disclosed by the other Party to it hereunder during the effective period
hereof to any third party subsequent to the expiration of the aforesaid period
of confidentiality.

 
4

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

 

6.   EVALUATION AND TERM OF AGREEMENT
(1)
Biken may, by giving prior written notice to Hemispherx, commission a part of
the evaluation tests which are necessitated by the Evaluation Program outlined
in Exhibit 1 hereof, to external specialized testing institutions; provided,
however, that in such a case, Biken shall require said external specialized
testing institutions be bound by and agree to all provision of this Agreement
relating to the Intellectual Property, the confidentiality of Ampligen® and
Confidential Information..

(2)
This Agreement shall come into force and effect on the Effective Date, and shall
continue to be in force and effect until terminated upon the earlier of:

 
(a)
One year following the Effective Date or the date of receipt of Ampligen® by
Biken, whichever is later

 
(b)
Completion of the Evaluation Program

(3)
Upon termination of this Agreement unless otherwise agreed, Biken shall return
to Hemispherx or destroy, as instructed by Hemispherx, all documents and data,
whatever the type or media thereof may be, concerning Ampligen® and the
Confidential Information relating to Ampligen® provided and disclosed by
Hemispherx to Biken pursuant to or in connection with this Agreement.

(4)
Notwithstanding Paragraphs (3) of this Article, subject to compliance with this
Agreement, Biken may keep one (1) copy or sample of the Confidential Information
for archival purposes.

7.   INTELLECTUAL PROPERTY
Each party acknowledges and agrees in relation to all trademarks, patents and
other intellectual property rights in all inventions, discoveries and other
intellectual property which are or were made, conceived, reduced to practice,
generated or arise out of the Research Project and the Evaluation (all herein
“Intellectual Property”) that Hemispherx shall have and retain complete
ownership of and title to all Intellectual Property relating to  Ampligen® and
Biken shall have and retain complete ownership of and title to all Intellectual
Property relating to the nasal delivery technology and the “Novel Vaccine
Containing Adjuvant Capable of Inducing Mucosal Immunity”. Hemispherx
acknowledges and agrees that, pursuant to this Agreement, the Research Project
and the Evaluation, it will not obtain any rights in and to  the nasal delivery
technology and the “Novel Vaccine Containing Adjuvant Capable of Inducing
Mucosal Immunity” as owned jointly by Biken and NIID, and Biken acknowledges and
agrees that, pursuant to this Agreement, the Research Project and the
Evaluation, it will not obtain any rights in and to Ampligen®.  The provisions
of this Article 7 shall survive any termination or expiry of this Agreement.

8.   PATENT INFRINGEMENT
In the event that a third party files claims or suits against either Party, to
whom the other Party has provided and/or disclosed its own Confidential
Information (including Ampligen® as owned by Hemispherx) pursuant to this
Agreement during the effective period hereof, on the basis of the alleged
infringement of any patent or other intellectual property right of said third
party in connection with such information, the disclosing Party shall, at its
sole cost and responsibility, deal with, dispose of and settle such claims or
suits brought by said third party and shall pay and bear any and all costs,
damages and liabilities incurred in connection therewith.

 
5

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

 

9.   FORCE MAJEUR
(1)
Force Majeur shall be deemed to have prevented, restricted or interfered with
the performance by a  Party hereto of any of its obligations hereunder if such
event occurs by reason of flood, fire, explosion, strike, war, revolution, civic
commotions, political riot, acts of public enemies, blockage or embargo or
sanctions or any law, interdict, order proclamation, regulation, ordinance,
demand or requirements of any government.

(2)
Neither Party shall be held responsible for damages caused by any delay or
default due to force  majeur.

10. SUCCESSORS AND ASSIGNS　
This Agreement and all rights and obligations arising hereunder shall not be
assigned or otherwise transferred by either Party, whether by operation of law
or otherwise, unless the other Party has given its written consent thereto, and
any such purported assignment or transfer without such written consent shall be
null and void.

11. HEADINGS
The headings of the clauses of this Agreement have been inserted only to
facilitate reference and shall not be taken as being of any significance
whatsoever in the construction and interpretation of this Agreement.

12. GENERAL
(1)
No waiver by either Party of a provision hereof or default hereunder shall be
deemed as a waiver of any other provisions or default.

(2)
Any notices or communications to or from the respective Parties required or
permitted to be given hereunder shall be deemed to have been received:

1)
if mailed by registered prepaid airmail to the recipient at the address as set
forth in Article 14 hereof and the date of receipt shall be deemed to be
fourteen (14) working days after date of mailing unless the contrary can be
proved;

2)
if sent by telefax to the recipient at the number given herein and evidence
exists of receipt of thereof on the next business day of the recipient after
sending unless the contrary can be proved and provided that such telefax message
is confirmed by registered prepaid post.

(3)
This Agreement including the attached Exhibit hereto constitutes the entire
agreement between the Parties hereof with respect to the subject matter
hereof.  This Agreement may only be changed or amended by writing executed by
the authorized representatives of the Parties which refers to this Agreement and
contains a copy thereof as an attached document.

(4)
If any provision of this Agreement is found by any court of competent
jurisdiction to be invalid or unenforceable for any reason whatsoever, this
shall not in itself be deemed to affect the other provisions thereof and such
invalid or unenforceable clause shall be severable from the remaining terms of
this Agreement.

 
6

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

 

13.     RESOLUTION OF DISPUTE
(1)
Any dispute at any time between the Parties hereto arising out of or pursuant to
this Agreement or its interpretation, rectification, breach or termination
shall, if not resolved through negotiations between the Parties, be finally
settled by arbitration.  Arbitration shall be conducted in Switzerland pursuant
to the rules of the Swiss Arbitration Association.

(2)
The decision of the arbitrator shall be final and binding and shall be capable
of being made an order of any court having jurisdiction over any of the Parties.

(3)
This Agreement shall be governed by and construed in accordance with the laws of
Japan.

14      COUNTERPARTS OF AGREEMENT
This Agreement is prepared and made in the English language in duplicate.

15.     DOMICILIA
The Parties hereto choose domicilia citandi et executandi for all purposes in
terms of this Agreement as follows:

(1)
Hemispherx Biopharma, Inc.

One Penn Center
1617 JFK Blvd.
Philadelphia, PA 19103

  
Telephone:
215-988-0080

 
Telefax :
215-988-0739

(2)
The Research Foundation for Microbial Diseases of Osaka University (Biken)

3-1, Yamada-Oka, Suita
Osaka, 565-0871, Japan
  
Telephone:
+81-6-6877-4804

 
Telefax:
+81-6-6876-1984

 
Either Party shall be entitled to change the domicilia citandi et executandi
chosen by it giving the other Party thirty (30) days notice of such change of
address.

IN WITNESS WHEROF, the Parties have caused this Agreement to be executed by
their duly authorized representatives as of the day and year set forth below.

HEMISPHERX BIOPHARMA, INC.
 
THE RESEARCH FOUNDATION FOR
   
MICROBIAL DISEASES OF OSAKA UNIVERSITY
     
/s/ William A. Carter
 
/s/ Yoshinobu Okuno
Represented by:
 
Represented by:
     
Name:
William Carter, MD
 
Name:
Yoshinoub Okuno
Title:
Chairman and CEO
 
Title:
Director
Date:
August 13, 2009
 
Date:
August 19, 2009

 

 
7

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

 

Exhibit 1
 
2008 Evaluation Program

The Outline of the Evaluation Program on the Ampligen® as a candidate for
Adjuvant incorporated into Potential Influenza Virus Vaccines in the form of
Intranasal Mucosal Administration
1.
Evaluation of the Efficacy and Stability of Prototype Vaccines (one-year study)

Evaluate the immunogenicity of intranasal prototype vaccines containing antigens
from 3 sub-type influenza viruses, namely, H1N1, H3N2 and B.
(1)
Evaluation of immunogenicity of prototype vaccines in mouse models

1)
Step-1

Investigate the immunogenicity of prototype vaccines containing
different-concentrated antigens in combination with the Ampligen® of varying
concentration levels.
the needed volume of the Ampligen®: around 140 mg
2)
Step-2

Evaluate antigens prepared with different culture methods for selection of
candidate vaccine strain.
the needed volume of the Ampligen®: around 100 mg
3)
Step-3

Assess the efficacy of prototype vaccines on challenge experiment.
the needed volume of the Ampligen®: around 100 mg
(2)
Evaluation of immunogenicity of prototype vaccines in animal models other than
mice

the needed volume of the Ampligen®: around 500 mg
(3)
Evaluation of stability of prototype vaccines for formulation of candidate
vaccines (preliminary tests)   the needed volume of the Ampligen®: around 750 mg

The total volume of Ampligen® as required for the above-mentioned Safety and
Stability Evaluation Studies: around 1600 mg

2.
Evaluation of the Safety Profile of the Ampligen® (one-year study)

Perform the following testing items through procuring external GLP (Good
Laboratory Practice) study-related services from contract research
organizations:

 
(1)
Single dose toxicity study (FD (fatal dose) in rat models)

the needed volume of the Ampligen®: around 160 mg
(2)
Single dose toxicity study (Setting test for probable maximum repeat-dose in dog
models)

the needed volume of the Ampligen®: around 160 mg
(3)
Repeated dose toxicity study (Toxicity study in rat models)

the needed volume of the Ampligen®: around 5 mg
 
The total volume of Ampligen® as required for the above-mentioned Safety
Evaluation Studies: around 325 mg.

 
8

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

 

2009 Evaluation Program

Preliminary Evaluation of the Immunogenicity of and Long-term Stability Test
with an Inactivated Whole-virion Form of Pre-pandemic Influenza (A/H5N1)
Experimental Vaccine Combined with Adjuvant Ampligen® (The Study Plan for the
2009 Fiscal Year)

Study 1.  Pharmacological study to investigate the feasibility of approaches for
optimal dosage level and dosing schedule of an intranasal whole-virion
pre-pandemic influenza (H5N1) experimental vaccine combined with Ampligen® as an
adjuvant in mice model.

[Objective]
Our previous preliminary studies conducted in the 2008 Fiscal Year (FY)
demonstrated the potential of using Ampligen® as an adjuvant when combined with
experimental intranasal whole-virion pre-pandemic influenza vaccines (A/H5N1)
for enhancing immunogenicity for induction of immune responses in animal
models.  The objective of this pharmacological study is to identify an approach
for the optimal dosage level of viral antigen and dosing schedule of an
intranasal whole-virion pre-pandemic influenza experimental vaccine combined
with Ampligen® using mice model.

[Method]
We will prepare intranasal whole-inactivated A/H5N1 influenza vaccine
(attenuated PR8-IBCDC-RG2 strain, as derived from A/Indo/5/2005(H5N1) strain)
combined with Ampligen® as an adjuvant with the addition of CVP base (at a final
concentration of 0.55% CVP, 1.2% L-arginine and 1% glycerol) as a viscosity
improver.  BALB/c mice will be immunized intranasally either one, two, three, or
four times at 2-week intervals with such experimental vaccines.  Serum and nasal
wash of immunized mice will be respectively collected for antibody determination
2 weeks after the final immunization. We will determine the levels of HI titers
(hemagglutination inhibition titers), NT titers (neutralization titers), serum
IgG-ELISA antibody titers in immunized mouse serum, and mucosal IgA-ELISA
antibodies in each nasal wash sample.

Study 2.  Pharmacological study of an experimental vaccine combined with
Ampligen® as an adjuvant in Cynomolgus monkey models

[Objective]
Pharmacological studies will be performed to evaluate an approach as identified
based on the results from Study 1 for the optimal dosage level of viral antigen
and dosing schedule of an intranasal whole-virion pre-pandemic influenza
vaccines (A/H5N1) vaccine combined with Ampligen® in Cynomolgus monkey (Macaca
fascicularis) models.

[Method]
We will prepare an inactivated whole-virion form of pre-pandemic influenza
(A/H5N1) experimental vaccine combined with Ampligen® as an adjuvant with the
addition of CVP base as a viscosity improver. Cynomolgus monkey will be
immunized intranasally with an experimental vaccine at 2-week intervals using
such approach as identified based on the results from Study 1 for the optimal
dosage level of viral antigen and dosing schedule thereof.  Serum, nasal wash,
and saliva of immunized mice will be respectively collected from each monkey for
antibody determination 2 weeks after the final immunization We will determine
the levels of HI titers (hemagglutination inhibition titers), NT titers
(neutralization titers), serum IgG-ELISA antibody titers in immunized mouse
serum, and mucosal IgA-ELISA antibodies in each nasal wash or salivary sample.

 
9

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

 

Study 3.  Long-term stability and accelerated tests with inactivated
whole-virion of pre-pandemic influenza (A/H5N1) experimental vaccines combined
with Ampligen®

[Objective]
The long-term stability and accelerated tests will be conducted on inactivated
whole-virion form of pre-pandemic influenza (A/H5N1) experimental vaccines
combined with Ampligen®

[Method]
On the basis of the results from Study 2, we will determine the optimal
formulation of a candidate for evaluation as an inactivated whole-virion form of
pre-pandemic influenza (A/H5N1) experimental vaccine combined with Ampligen® in
human subjects.  Such optimal candidate vaccine formulation will be put through
the following tests which assess the stability thereof after being stored for a
specified period of time at an ambient temperature of 10±2 degrees Celsius (for
long-term stability study) or 25±2 degrees Celsius with relative humidity at
60±5% (for accelerated test).
Ø
Sterility test

Ø
Pyrogen test

Ø
Test for leukopenic toxicity (mice)

Ø
Test for protein content

Ø
Test for freedom from abnormal toxicity

Ø
Potency tests (Single radial immunodiffusion test and Immunogenicity test)

Ø
RNA quantification test

 
10

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