EXHIBIT
10.38


 


MANUFACTURING AGREEMENT




between


 


 


ABBOTT GMBH & CO. KG




and


 


RELIANT PHARMACEUTICALS, LLC


 


 


Dated as of December 3, 2003


 

















 


MANUFACTURING AGREEMENT


 


This Manufacturing Agreement (this “Agreement”)
is made and entered into as of December 3, 2003, by and between Reliant
Pharmaceuticals, LLC, a Delaware limited liability company (“Buyer”),
and Abbott GmbH & Co. KG (“Seller”). Buyer and Seller are sometimes
referred to hereinafter individually, as a “Party” and collectively as
the “Parties.”


 


W I T N E S S E T H:


 


WHEREAS, Buyer and Abbott Laboratories, an Illinois
corporation (“Parent”), have entered into an Asset Purchase Agreement of
even date herewith (the “Asset Purchase Agreement”); and


 


WHEREAS, in connection with the transactions contemplated
by the Asset Purchase Agreement, Buyer desires that Seller Manufacture (as
defined herein) and supply certain Products to Buyer, and Seller desires to
Manufacture and supply such Products to Buyer in accordance with this
Agreement.


 


NOW, THEREFORE, in consideration of the premises and
mutual covenants, agreements and provisions herein contained, and for other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties, intending to be legally bound, hereby agree
as follows:


 


ARTICLE
1 - 

DEFINITIONS


 


Any capitalized terms used but not otherwise defined
in this Agreement shall have the meanings set forth in the Asset Purchase
Agreement. In addition to the terms defined above and other terms defined
elsewhere in this Agreement, the following capitalized terms shall have the
following meanings when used herein:


 


1.1                               “Act”
shall mean collectively the Federal Food, Drug, and Cosmetic Act of 1938,
including any amendments thereto, and all regulations rules, guidelines and
procedures promulgated thereunder, and the Federal Controlled Substances Act,
including all amendments thereto, and all regulations rules, guidelines and
procedures promulgated thereunder.


 


1.2                               “Affiliate” means, with respect to any Person,
any other Person directly or indirectly controlling or controlled by, or under
direct or indirect common control with, such Person. For purposes of this
definition, a Person shall be deemed to control another Person if it owns or
controls more than fifty percent (50%) of the voting equity of the other Person
(or other comparable ownership if the Person is not a corporation), provided
that with respect to Seller, the term “Affiliate” shall specifically exclude
TAP Pharmaceutical Products Inc., TAP Finance Inc. and TAP Pharmaceuticals Inc.


 


1.3                               “Agreement”
shall have the meaning set forth in the introductory paragraph.


 


1.4                               “Approved
Transaction” shall have the meaning set forth in Section 7.3.


 


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1.5                               “Asset
Purchase Agreement” shall have the meaning set forth in the Recitals.


 


1.6                               “Business
Day” shall mean any day, other than a Saturday or Sunday, on which
commercial banks are not authorized by law to close in Chicago, Illinois or New
York, New York.


 


1.7                               “Buyer”
shall have the meaning set forth in the introductory paragraph.


 


1.8                               “Buyer
Indemnified Party(ies)” shall have the meaning set forth in Section
3.3(a).


 


1.9                               “cGMP”  shall mean the quality systems and current
good manufacturing practices set forth in 21 C.F.R. (Parts 210 and 211) and all
applicable directives, Regulatory Requirements (as defined below) and FDA (as
defined below) rules, regulations, guides, guidance, each as amended from time
to time and in effect during the Term of this Agreement.


 


1.10                        “Contract
Year” shall mean the twelve (12) month period coinciding with the calendar
year. Notwithstanding the foregoing, for purposes of this Agreement, the first
Contract Year of this Agreement shall mean the period from the Effective Date
to December 31, 2003. Thereafter, each Contract Year shall be from January 1
through December 31 of each calendar year during the Term of this Agreement.


 


1.11                        “Discretionary
Changes” has the meaning set forth in Section 4.7(c).


 


1.12                        “Effective
Date” shall mean the Closing (as defined in the Asset Purchase Agreement)
of the transactions contemplated in the Asset Purchase Agreement.


 


1.13                        “FDA”
shall mean the United States Food and Drug Administration or any successor
thereof.


 


1.14                        “Firm
Order” shall mean a firm Buyer obligation to purchase and take delivery of
Products, and a firm Seller obligation to Manufacture, sell and deliver
Products.


 


1.15                        “First
Extension Term” shall have the meaning set forth in Section 6.1(b).


 


1.16                        “Forecast”
shall have the meaning set forth in Section 2.2(b)(i).


 


1.17                        “Governmental Authority” means any nation or
government, any state, regional, local or other political subdivision thereof,
any supranational organization of sovereign states, and any entity, department,
commission, bureau, agency, authority, board, court, official or officer,
domestic or foreign, exercising executive, judicial, regulatory or
administrative functions of or pertaining to government.


 


1.18                        “Initial
Firm Order” shall have the meaning set forth in Section 2.2(a).


 


1.19                        “Initial
Forecast” shall have the meaning set forth in Section 2.2(a).


 


1.20                        “Initial
Term” shall have the meaning set forth in Section 6.1(a).


 


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1.21                        “Law” means each provision of any
currently existing federal, state, local or foreign law, statute, ordinance,
order, code, rule or regulation, promulgated or issued by any Governmental
Authority, as well as any binding judgments, decrees, injunctions or agreements
issued or entered into by any Governmental Authority.


 


1.22                        “Losses” shall have the
meaning set forth in Section 3.3(a).


 


1.23                        “Manufacturing”
or “Manufacture” shall mean the activities associated with producing a
finished dosage form Product including, but not limited to, Materials
acquisition, manufacturing, packaging, testing, handling and labeling/trade
dress of finished dosage form Product.


 


1.24                        “Materials”
means all ingredients, packaging supplies, printed materials and all other
components used to Manufacture the Products.


 


1.25                        “New
Products” shall have the meaning set forth in Section 2.5.


 


1.26                        “Non-Standard
Costs” means the dollar value of the costs incurred by the Seller at Buyer’s
request and/or approval that cannot, in advance, be directly and/or indirectly
assigned to a specific Product based on established and planned criteria.


 


1.27                        “Ordered
Materials” shall have the meaning set forth in Section 2.2(f).


 


1.28                        “Ordered
Products” shall have the meaning set forth in Section 2.2(f).


 


1.29                        “Parent”
shall have the meaning set forth in the Recitals.


 


1.30                        “Party”
or “Parties” shall have the meaning set forth in the introductory
paragraph.


 


1.31                        “Person”
means any individual, corporation, partnership, joint venture, limited
liability company, trust or unincorporated organization or Governmental Authority
or any agency or political subdivision thereof.


 


1.32                        “PPI”
shall have the meaning specified in Section 2.3(b).


 


1.33                        “Products”
shall mean the products listed in Exhibit 1.16 attached hereto, which
may be amended from time to time to add or subtract products thereto or
therefrom by mutual written agreement of the Parties (in accordance with the
terms of this Agreement).


 


1.34                        “Product
Complaints” shall have the meaning set forth in Section 5.7(a).


 


1.35                        “Product
Specifications” shall mean those product, process, Manufacturing and
labeling specifications used by Seller in the Manufacture of Products in
compliance with all applicable Regulatory Requirements, including Product
formula and materials required for the Manufacture of the Products that are to
be manufactured, purchased and supplied under this Agreement, as such are in
effect as of the Effective Date, as such specifications may be amended


 


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from time to time as required by any Regulatory Requirements
or by the mutual written agreement of the Parties.


 


1.36                        “Propafenone”
means propafenone (or any salt, ether or metabolite thereof, including,
propafenone hydrochloride), including, without limitation, any and all dosage
forms, formulas, strengths and types thereof.


 


1.37                        “Purchase
Order(s)” shall have the meaning set forth in Section 2.2(a).


 


1.38                        “Purchase
Price” shall have the meaning set forth in Section 2.3(a).


 


1.39                        “Put-Ups”
shall mean the final packaging configuration for a Product, also known as the
SKUs.


 


1.40                        “Quality
Agreement” shall have the meaning set forth in Section 4.6.


 


1.41                        “Registration(s)”
shall mean all permits, licenses, approvals and authorizations granted by any
Regulatory Authority with regard to any Product, including, without limitation,
the NDAs and INDs identified on Schedule 2.1(b) to the Asset Purchase
Agreement.


 


1.42                        “Regulatory
Authority” shall mean any foreign, federal, state or local regulatory
agency, department, bureau or other Governmental Authority, including, without
limitation, the FDA and the U.S. Drug Enforcement Administration, which is
responsible for issuing approvals, licenses, registrations (including but not
limited to, the Registrations), permits or authorizations necessary for, or
otherwise governs, the Manufacture, handling, use, storage, import, export,
transport, distribution or sale of Products in the Territory.


 


1.43                        “Regulatory
Requirements” shall mean all applicable approvals, licenses, registrations
(including but not limited to, the Registrations), cGMPs, and authorizations
and all other requirements of each applicable Regulatory Authority in relation
to the Products, including, but not limited to, each of the foregoing which is
necessary for, or otherwise governs, the Manufacture, handling, use, storage,
import, transport, distribution or sale of Products.


 


1.44                        “Remaining
Inventory” has the meaning set forth in Section 2.2(f).


 


1.45                        “Replacement
Goods” has the meaning set forth in Section 2.2(g).


 


1.46                        “Required
Changes” has the meaning set forth in Section 4.7(b).


 


1.47                        “Second
Extension Term” shall have the meaning set forth in Section 6.1(c).


 


1.48                        “Seller”
shall have the meaning set forth in the introductory paragraph.


 


1.49                        “Seller
Indemnified Party(ies)” shall have the meaning set forth in Section
3.3(b).


 


1.50                        “Shipment
Date” shall have the meaning set forth in Section 2.3(d).


 


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1.51                        “Standard
Manufacturing Batch” shall mean, with respect to each Product, the standard
planning batch size at the compounding stage, each of which as is set forth on Exhibit 1.16
attached hereto.


 


1.52                        “Term”
shall have the meaning set forth in Section 6.1(e).


 


1.53                        “Territory”
shall mean the United States of America, its territories and possessions,
including Puerto Rico.


 


1.54                        “Third
Party” shall mean any Person other than Seller or Seller’s Affiliates or
Buyer or Buyer’s Affiliates.


 


1.55                        “Transfer
Plan” shall have the meaning set forth in Section 6.7(a).


 


ARTICLE
2 - 

ORDERS, PRICING, PAYMENT AND CONFORMANCE


 


2.1                               Manufacture and Sale of Product; Initial
Purchase of Inventory.


 


(a)                                  Manufacture
and Sale. Upon and subject to the terms and conditions contained herein and
during the Term of this Agreement, Seller shall, and/or shall cause Seller’s
Affiliates to, Manufacture, sell and deliver Products to Buyer, and Buyer shall
purchase and take delivery of Products from Seller or Seller’s Affiliates. Seller
shall, and/or shall cause Seller’s Affiliates to, Manufacture, sell and deliver
Products hereunder in accordance with (i) the Product Specifications; (ii)
cGMP; and (iii) the Act and all other applicable Regulatory Requirements.


 


(b)                                 Initial
Inventory Purchase. As contemplated by Section 2.1(b) of the Asset Purchase
Agreement, on or prior to the Effective Date, Buyer shall deliver to Seller a
purchase order for the purchase of the Inventory set forth on Schedule
2.1(b) to the Asset Purchase Agreement. Except as otherwise provided in the
Asset Purchase Agreement, all other terms and conditions related to the purchase
and sale of such Inventory shall be governed by the terms of this Agreement.


 


2.2                               Forecasts, Orders.


 


(a)                                  Initial
Forecast; Initial Firm Order. Buyer’s forecast of the monthly requirements
of Product to be manufactured and supplied hereunder for the first eighteen
(18) calendar months of this Agreement (the “Initial Forecast”) shall be
delivered by Buyer to Seller prior to the Effective Date and shall be attached
to this Agreement as Exhibit 2.2(a) hereto. The portion of the
Initial Forecast commencing on the Effective Date and ending on the last day of
the fourth (4th) month after the Effective Date shall be deemed a Firm Order
(the “Initial Firm Order”) for which Buyer is obligated to order and
take delivery of the forecasted Product requirements. The Initial Firm Order
shall be confirmed by delivery by Buyer to Seller of a purchase order (each a “Purchase
Order”, collectively, “Purchase Orders”). Buyer shall submit to
Seller on the Effective Date a purchase order for the first month of the
Initial Firm Order, and Buyer shall submit a second Purchase Order for the
remainder of the period covered by Initial Firm Order on or before the
fifteenth (15th) Business Day after the Effective Date. The


 


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remainder of the Initial Forecast shall set forth
Buyer’s best estimate of its Product production and supply requirements.


 


(b)                                 Rolling
Forecast.


 


(i)                                     On
or before the fifteenth (15th) calendar day of each month during the Term (as
defined in Section 6.1 herein), Buyer shall provide Seller with an
updated eighteen (18) month forecast of the Products to be manufactured and
supplied (each a “Forecast”) for the eighteen (18) month period
beginning on the first day of the following calendar month. The first two
months of each Forecast will restate the balance of the Firm Order period of
the prior Forecast, and the first three (3) months of the Forecast shall
constitute the new Firm Order period for which Buyer is obligated to purchase
and take delivery of the forecasted Product, and the supply required for the
last month of such new Firm Order period shall not be more than one (1) full
Standard Manufacturing Batch from the quantity specified for such month in the
previous Forecast (or Initial Forecast, as the case may be). Except as provided
in Section 2.2(a), Purchase Orders setting forth Buyer’s monthly Product
requirements will be issued for the last month of each Firm Order period no
later than the fifteenth calendar day of the first month of each Firm Order
period, and such Purchase Order will be in agreement with the Firm Order period
of the Forecast. If a Purchase Order for any month is not submitted by such
deadline, Buyer shall be deemed to have submitted a Purchase Order for such
month for the amount of Product set forth in Buyer’s Forecast for such month.


 


(ii)                                  The
remainder of the Forecast shall set forth Buyer’s best estimate of its Product
production and supply requirements for the remainder of the Forecast period. Each
portion of such Forecast that is not deemed to be a Firm Order shall not be
deemed to create a binding obligation on Buyer to purchase and take delivery of
Products nor a binding obligation of Seller to deliver Products, except as
otherwise provided in Section 2.2(f).


 


(iii)                               Forecast and Purchase
Orders shall be in full Standard Manufacturing Batches. If a Product has
multiple SKUs, then the composite of the forecasted SKU must equate to the
Standard Manufacturing Batch. One Purchase Order shall be issued for each full
Standard Manufacturing Batch of Product and contain the required information
set forth in Section 2.2(e) hereof.


 


(c)                                  Variance
in Purchase Order. In the event that a Purchase Order requires delivery by
Seller or Seller’s Affiliates of Product in amount different than the amount
set forth in the Forecast for such month, Seller shall confirm to Buyer its
acceptance of the delivery schedule provided in such Purchase Order within
fifteen (15) calendar days after receipt of such Purchase Order. In the event
that Seller does not agree with the delivery schedule provided in such Purchase
Order, Seller shall so notify Buyer within such fifteen (15) day period, and
the Parties shall negotiate in good faith a mutually acceptable delivery
schedule for such Products. The Parties agree to negotiate in good faith any
changes proposed by Buyer to any order for Product pursuant to a Firm Order and
confirmed by a Purchase Order. Buyer shall use its reasonable efforts to give
Seller reasonable notice of any such proposed change.


 


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(d)                                 Purchase
Obligations; Delivery. The Parties agree and acknowledge that Buyer shall
be obligated to purchase, and Seller shall be obligated to Manufacture, and
sell and deliver to Buyer, EXW Seller’s Manufacturing Plant (Whippany, New
Jersey, USA), those Standard Manufacturing Batch quantities for which Buyer has
submitted (or is deemed to have submitted) a Purchase Order pursuant to Sections
2.2(a) and (b) (subject to Section 2.2(c)) and shall also
purchase the Remaining Inventory, if any, in accordance with Section 2.2(f)
of this Agreement.


 


(e)                                  Purchase
Order Terms. Each Purchase Order or any acknowledgment thereof, whether
printed, stamped, typed or written, shall be governed by the terms of this
Agreement, and none of the provisions of such Purchase Order or acknowledgment
shall be applicable except those specifying Product and quantity ordered,
delivery dates, special shipping instructions and invoice information. To the
extent any conflict may exist between the terms of any Purchase Order and this
Agreement, the terms of this Agreement shall control.


 


(f)                                    Remaining
Inventory. Upon the expiration or termination of this Agreement, Buyer
agrees to purchase from Seller or Seller’s Affiliates, and Seller agrees to
sell, or cause its applicable Affiliate to sell, to Buyer in accordance with
all Regulatory Requirements, (i) all Product covered by Purchase Orders in
accordance with Section 2.2(d) (the “Ordered Products”), which
shall be purchased and sold at the prices specified in the applicable Purchase
Order, and (ii) all Materials purchased by Seller in the normal course of
business and consistent with past practice in connection with the performance
of this Agreement and the Manufacture of Products hereunder (which, for the avoidance
of doubt shall include any raw materials obtained by Seller or its Affiliates
in contemplation any Firm Orders and any other raw materials purchased by
Seller pursuant to Buyer’s written approval or authorization) (the “Ordered
Materials” and, together with the Ordered Products, collectively, the “Remaining
Inventory”), which shall be purchased and sold for an amount equal to, as
applicable, either Seller’s or Seller’s Affiliate’s (A) then applicable
standard inventory cost, or (B) the acquisition cost (i.e.,
price paid by Seller or Seller’s Affiliate to the applicable vendor, plus
freight and set up costs) plus [***] percent ([***]%), plus any applicable tax,
excise charge, or similar charge provided for in Section 2.3(d),
provided that such Remaining Inventory complies with the representations,
warranties and covenants contained in Section 3.1 hereof. At the request
of Buyer and in no event later than thirty-five (35) Business Days prior to the
expiration of this Agreement, or immediately upon termination of this
Agreement, Seller shall provide Buyer with a detailed list and description of
the type and amount of Remaining Inventory to be purchased pursuant to this Section
2.2(f), and shall, at Buyer’s reasonable request, cooperate with Buyer in
verifying the amount and cost of such Remaining Inventory. Within three (3)
Business Days following Seller’s and Buyer’s agreement regarding amount and
cost of such Remaining Inventory, Buyer shall issue a purchase order to Seller
for such Remaining Inventory. Payment for such Remaining Inventory shall be
made by Buyer within sixty (60) days after receipt by Buyer of such Remaining
Inventory.


 






[***]:  Certain information on
this page has been omitted and filed separately with the Commission.  Confidential treatment has been requested
with respect to the omitted portions.


 


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(g)                                 Product
Returns. In the event that any amounts due to Buyer in respect of sales of
Product by or on behalf of Buyer after the Effective Date are reduced, offset,
credited or otherwise decreased as a result of or in respect of any Product
(with an expiration date of not less than twelve (12) months) or Buyer receives
a request for replacement or refund of Product (with an expiration date of not
less than twelve (12) months) (collectively, “Replacement Goods”), Buyer
shall within five (5) Business Days notify Parent of such Replacement Goods. The
Parties shall determine Parent’s obligations under Section 7.5 of the Asset
Purchase Agreement with reference to lot numbers, it being agreed that Parent
shall be responsible for those lots which Parent fully sold through the Closing
Date and with respect to any lots that are split between Buyer and Parent,
Parent shall be responsible in proportion to that percentage of the lot sold by
Parent through the Closing Date. Based on the foregoing, for Replacement Goods
that are Parent’s obligations pursuant to such Section 7.5 of the Asset
Purchase Agreement, Seller or its designee shall, at Buyer’s request, replace
such Replacement Goods with Product equivalent to the dosage and formulation of
such Replacement Goods pursuant to the terms and conditions of this Agreement
until the earlier to occur of (i) thirty-six (36) months from the Effective
Date or (ii) the issuance by Seller of two million (2,000,000) tablets as
replacement Product. Thereafter, Parent has no liability or obligation to Buyer
for any Replacement Goods. For any and all Replacement Goods replaced pursuant
to this Section 2.2(g), Buyer shall submit to Seller a deduction ticket
documenting the date, type and quantity of Replacement Goods and certifying
that such replaced Product (with an expiration date of not less than twelve
(12) months) have been destroyed in a manner consistent with applicable Law,
rule and regulation. Seller shall credit such Replacement Goods replaced
pursuant to this Section 2.2(g) against Buyer’s future Purchase Orders.


 


2.3                               Purchase Price; Adjustment; Shipment.


 


(a)                                  Purchase
Price. The initial price for each Product manufactured and supplied by
Seller hereunder shall be as set forth in Exhibit 1.16 attached hereto
(expressed in U.S. Dollars) (as such prices may be adjusted from time to time
pursuant to this Section 2.3, the “Purchase Price”). The Purchase
Price as of the Effective Date corresponds to the Product Specifications in
effect as of the Effective Date. Any changes to the Product Specifications
during the Term of this Agreement may result in changes to the Purchase Price. Such
Products shall be EXW (Whippany, New Jersey, USA). The Purchase Price shall be
subject to adjustment as provided in Section 2.3(b).


 


(b)                                 Purchase
Price Adjustments. For each Contract Year commencing January 1, 2005, the
Seller shall be allowed to adjust the Purchase Price for each Product to be
effective for such Contract Year based on the most recent available final
Producers’ Price Index for Pharmaceutical Products as published by the Bureau
of Labor Statistics, or any government successor thereof (“PPI”), using
the procedure set forth in Exhibit 1.16 attached hereto. For each
Contract Year in which Seller is entitled to adjust the Purchase Price pursuant
to this Section 2.3(b), Seller shall provide Buyer with written
notice of any change in the Purchase Price within ten (10) Business Days after
October 1st of the prior Contract Year. For the avoidance of doubt,
the Parties agree that the Purchase Price shall be subject to adjustment
hereunder not more than once per Contract Year.


 


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(c)                                  Payment.
Seller shall invoice Buyer upon delivery of Products in accordance with the
terms hereof, and Buyer agrees to pay Seller for such Products as set forth
herein. Buyer shall make payment within sixty (60) calendar days from the date
of the invoice of such Products pursuant to this Agreement, provided that this
obligation shall not apply to any Products that are rejected pursuant to the
provisions of Section 2.4 hereof until Buyer’s receipt of conforming
replacement Products in accordance with the terms of such section. All payments
hereunder shall be made in U.S. Dollars. Seller will issue invoices at the time
Product(s) are delivered to the carrier.


 


(d)                                 Shipment.
Buyer shall arrange transit of the Products from Seller’s facility located in
Whippany, New Jersey, USA. Seller will contact Buyer upon notification from
Seller’s quality control division that the Products are ready for shipment (“Shipment
Date”). Upon receipt of written instructions and upon agreement of the
Parties, alternate shipping routes may be utilized.


 


(e)                                  Public
Distribution of Product. Buyer shall be solely responsible for
determination and approval of the release and distribution of the Products for
public consumption.


 


2.4                               Replacement of Nonconforming Shipment.


 


(a)                                  Inspection;
Product Replacement. Buyer shall have a period of ten (10) Business Days
after the date of its receipt of a shipment of Product to inspect and accept or
reject such shipment for non-conformance with the Product Specifications based
on the outward appearance of such shipment. Buyer shall have a period of thirty
(30) days (forty-five (45) days if an outside testing laboratory is used) after
the date of its receipt of a shipment of Product to inspect and accept or
reject such shipment for any other non-conformance with the Product
Specifications or based upon a finding by Buyer of non-conformance, assuming
that such non-conformance has not been approved in writing by the Buyer and the
Seller, or due to deviation from cGMPs, Regulatory Requirements or any
applicable Law, rule, regulation, guideline or procedure, including the Act, in
the production of the shipment. If Buyer rejects such shipment, it shall
promptly so notify Seller, and the Parties shall thereafter attempt in good
faith to determine whether such Products did or did not conform to the
applicable Product Specifications and shall reasonably cooperate with each
other for such purpose (including, but not limited to, providing the other
Party with reasonable access to all documents, filings and other relevant materials
then in such Party’s possession or reasonably accessible to such Party and the
Buyer’s provision to Seller of samples of such shipment for testing). If either
Seller or Buyer determines that such shipment did not conform to the Product
Specifications, either Party may, if such Party determines it to be relevant,
submit samples of such shipment to an independent laboratory of nationally
recognized standing for testing. If such independent laboratory determines that
the shipment conformed in all respects to the Product Specifications, Buyer
shall bear all expenses of shipping and testing such shipment samples and shall
be obligated to accept and pay for such shipment. If Seller or such independent
laboratory confirms that such shipment did not meet the Product Specifications
in all respects, Seller shall replace, at no cost to Buyer, that portion of the
Product shipment that does not conform to the Product Specifications, and shall
bear all expenses of shipping and testing the shipment samples, including any
costs incurred by Buyer in returning such Product to Seller or its nominee. If
based on a facility inspection or audit by Buyer as


 


10

















 


provided herein, or based on a specific observation
made by any Regulatory Authority following an audit or inspection, Buyer
determines that a shipment or portion of a shipment was manufactured under
conditions that materially deviated from cGMPs, Regulatory Requirements or any
applicable Law, rule, regulation, guideline or procedure, including the Act,
Buyer and Seller shall agree upon the appropriate action to be taken in
conformance with the FDA483 or the action letter received by Seller relating to
the Products. If rejection of Product is warranted, Seller shall replace, at no
cost to Buyer, that portion of the Product shipment that was manufactured under
conditions deviating from cGMP, such Regulatory Requirements or applicable Law,
rule, regulation, guideline or procedure, including the Act. Any non-conforming
portion of any shipment shall be disposed of as directed by Seller, at Seller’s
expense. Any Product that Buyer does not reject pursuant to this Section 2.4
shall be deemed accepted and Buyer’s right to reject Product on the grounds
that it does not conform with the Product Specifications shall be deemed fully
waived and released by Buyer. Nothing in this Section 2.4 shall limit
the Buyer’s right to revoke acceptance of the Product in whole or in part under
the circumstances specified in Section 2-608 of the Illinois Uniform Commercial
Code for the purposes of determining Seller’s liability under Article 3
of this Agreement. Without limiting the foregoing, it is agreed that for
purposes of Section 2-607(3)(a) of the Illinois Uniform Commercial Code, Buyer
will not have been deemed to have discovered or should have discovered any
breach that is not, or reasonably would not be, discovered or detected by a
visual inspection by Buyer consisting of an identification of the Products
received by Buyer, a review of the Certificate of Analysis and a visual
inspection for physical damage to the Products shipped.


 


(b)                                 Sample
Retention. Seller, on behalf of both Buyer and Seller, shall retain
representative samples and associated documentation from each lot of finished
Product and manufacturer’s corresponding lot of key ingredients used in the
Manufacture of Products for the period required by the applicable FDA
regulations and the Act.


 


2.5                               New Products. Buyer shall notify Seller if Buyer
desires Seller to Manufacture any additional product strengths and/or Put-Ups
of the Products that Seller does not Manufacture (collectively, “New
Products”). The Parties shall negotiate in good faith to determine whether
Seller shall develop such New Products for Buyer. If the Parties agree upon a
development plan, Seller shall be reimbursed for all direct and actual
out-of-pocket development costs as shall be agreed to by the parties. This
Agreement and Exhibit 1.16 attached hereto shall then be amended to
include such New Products. Initial pricing for any New Products shall set forth
on Exhibit 1.16, and shall be adjusted annually in accordance with Section
2.3(b); provided however, pricing for such New Products shall not be
adjusted if such New Products are added to Exhibit 1.16 within the
last calendar quarter of the initial Term of this Agreement.


 


2.6                               Stability. During the Term, Seller shall conduct the commercial stability
program pursuant to Regulatory Requirements applicable as of the Effective Date
at its own expense. Should additional stability studies be required, the
Parties shall agree, in good faith, upon the protocol, and associated charges,
based on the then current charge rates for the staff services, with invoicing
for such additional services to occur when the lot is placed on stability.


 


2.7                               Non-Standard Costs. The Parties
acknowledge that during the Term of this Agreement, Seller and/or its
Affiliates may incur Non-Standard Costs. Seller will invoice Buyer


 


11

















 


monthly for Non-Standard Costs, if any, on a time and
Material basis, at the rates set forth on Exhibit 1.16. Buyer shall
pay such invoice within thirty (30) days after the date of invoice.


 


ARTICLE
3 - 

WARRANTIES, COVENANTS AND INDEMNIFICATION


 


3.1                                 Representations, Warranties and Covenants.


 


(a)                                  Seller,
in its own name and on behalf of any of its Affiliates engaged in the
performance of the actions contemplated hereby, including, without limitation,
the Manufacture, sale and delivery of Products hereunder, hereby represents,
warrants and covenants to Buyer that all Products that are Manufactured,
supplied and delivered by Seller or any of Seller’s Affiliates under and
pursuant to this Agreement will:


 


(i)                                     conform
in all respects to the Product Specifications;


 


(ii)                                  be
free and clear from all liens, Encumbrances and defects of title, other than
those that arise directly as a result of actions taken by the Buyer; and


 


(iii)                               comply with all of the
requirements under the Act, any Regulatory Requirements and any other
applicable Law, rule, regulation, guideline or procedure, and will not, at the
time of such delivery, (i) be adulterated or misbranded within the meaning of
the Act, or (ii) be an article which may not, under the provisions of the Act,
be introduced into interstate commerce.


 


(b)                                 Seller
and its Affiliates hereby represent, warrant and covenant to Buyer that Seller
or any of its Affiliates shall not willfully or intentionally disrupt or cause
the disruption of the supply of Product to Buyer as provided herein. Notwithstanding
the foregoing, an event of force majeure under Section 8.4 herein shall
not constitute a willful or intentional disruption of the supply of Product
under this Section 3.1(b).


 


3.2                               Recalls. In the event that any Product is quarantined or recalled, or is
subject to stop-sale action, whether voluntarily or by action of any
Governmental Authority, it is agreed and understood that any expenses,
including reasonable fees of any experts or attorneys that may be used by
either Party, government fines or penalties, related to such recall, quarantine
or stop-sale, shall be borne by Buyer, unless it is determined that Seller has
breached its representations, warranties, covenants, agreements or obligations
under this Agreement and such breach is a material basis upon which said recall, quarantine or stop-sale was
initiated, in which case such expenses shall be borne by Seller to the extent
caused by Seller’s breach. Said determination of any recall, quarantine or
stop-sale action may be made by the Governmental Authority involved, or by
mutual agreement of the Parties following examination and review of all records
pertinent to the Manufacture of the Product subject to such recall, quarantine
or stop-sale action.


 


3.3                               Indemnification.


 


(a)                                  Seller
Indemnification. Seller agrees to defend, indemnify and hold Buyer, its
Affiliates and all of their respective parents, Affiliates, subsidiaries,
officers, directors, managers, members, employees, agents, assignees and
successors (collectively, the “Buyer


 


12

















 


Indemnified Parties”) harmless at
all times from and against and in respect of any and all judgments, losses,
liabilities, costs or expenses (including reasonable attorney’s fees)
(collectively, “Losses”) which any Buyer Indemnified Party may suffer or
incur either directly or in connection with any claims, demands, actions,
causes of action, liabilities, suits, proceedings, investigations, inquiries,
injunctions or regulatory actions by a Third Party to the extent such Losses
arise from or are based upon a breach by Seller of any of its representations,
warranties, agreements, covenants or obligations contained in or made pursuant
to this Agreement; provided, however, Seller shall not be
required to indemnify any Buyer Indemnified Party to the extent such Losses
arise from (i) a reckless act of such Buyer Indemnified Party, (ii) the
negligence or willful misconduct of Buyer or its Affiliates or any of their
respective employees, agents, contractors or consultants, or (iii) a breach of
this Agreement by Buyer or its Affiliates.


 


(b)                                 Buyer
Indemnification. Buyer agrees to defend, indemnify and hold Seller, its
Affiliates and all of their respective parents, Affiliates, subsidiaries,
officers, directors, employees, agents, assignees and successors (collectively,
the “Seller Indemnified Parties”) harmless at all times from and against
and in respect of any and all Losses which any Seller Indemnified Party may
suffer or incur either directly or in connection with any claims, demands,
actions, causes of action, liabilities, suits, proceedings, investigations,
inquiries, injunctions or regulatory actions by a Third Party to the extent
such Losses arise from or are based upon a breach by Buyer of any of its
representations, agreements, covenants or obligations contained in or made
pursuant to this Agreement; provided however, Buyer shall not be required to
indemnify any Seller Indemnified Party to the extent such Losses arise from (i)
a reckless act of such Seller Indemnified Party, (ii) the negligence or willful
misconduct of Seller or its Affiliates or any of their respective employees,
agents, contractors or consultants, or (iii) a breach of this Agreement by
Seller or its Affiliates.


 


(c)                                  Notice
of Claims. The indemnified party shall promptly notify the indemnifying
party in writing of all matters which may give rise to the right to
indemnification hereunder; provided, however, that failure to
timely give the notice provided in this Section 3.3(b) shall not be
a defense to the liability of the indemnifying party for such claim, but the
indemnifying party may recover any actual damages arising from the indemnified
party’s failure to give such timely notice. The indemnified party shall not
admit any liability with respect to, or settle, compromise or discharge any
such matter covered by this Section 3.3 without the indemnifying party’s
prior written consent (which shall not be unreasonably withheld). The
indemnifying party shall have the right, with the consent of the indemnified
party (which shall not be unreasonably withheld), to settle all indemnifiable
matters related to claims by third parties which are susceptible to being
settled. In connection with any claim giving rise to indemnity hereunder
resulting from or arising out of any claim or legal proceeding by a person
other than the indemnified party, the indemnifying party at its sole cost and
expense may, upon written notice to the indemnified party received by the
indemnified party within ten (10) calendar days after the indemnifying party’s
receipt of notice of such claim, assume the defense of any such claim or legal
proceeding. If the indemnifying party assumes the defense of any such claim or
legal proceeding, the indemnifying party shall select counsel reasonably
acceptable to the indemnified party to conduct the defense of such claims or
legal proceedings and, at the indemnifying party’s sole cost and expense (which
costs and expenses shall not be applied against any indemnity limitation
herein), shall take all steps necessary in the defense or settlement thereof. The
indemnified party shall be entitled to participate in (but not control) the


 


13

















 


defense of any such action, with its own counsel and
at its own expense, and shall be entitled to any and all information and
documentation relating thereto. If the indemnifying party does not assume (or
continue to diligently and competently prosecute) the defense of any such claim
or litigation resulting therefrom in accordance with the terms hereof, the
indemnified party may, at the indemnifying party’s expense, defend against such
claim or litigation in such manner as it may deem appropriate, including, but
not limited to, settling such claim or litigation, after giving notice of the same
to the indemnifying party, on such terms as the indemnified party may deem
appropriate. The indemnified party will cooperate reasonably with the
indemnifying party in its efforts to conduct or resolve such matters, including
by making available to the indemnifying party relevant documents and witnesses.
The indemnified party and the indemnifying party shall keep each other informed
of all settlement negotiations with third parties and of the progress of any
litigation with third parties. The indemnified party and the indemnifying party
shall permit each other reasonable access to books and records and shall
otherwise cooperate with all reasonable requests of each other in connection
with any indemnifiable matter resulting from a claim by a third Person.


 


(d)                                 Other
Limitations.


 


(i)                                     No
liability shall arise in respect of any breach of any representation, warranty,
covenant or agreement herein to the extent that liability for such breach
occurs (or is increased) directly or indirectly as a result of any retrospective
application of a change in applicable Law, or in accounting policies,
procedures or practices, announced or, if not announced in advance of taking
effect, taking effect, after the Effective Date.


 


(ii)                                  No
party hereto shall be entitled to recover any Losses or other amounts due from
the other Party pursuant to this Agreement by retaining or setting off amounts
(whether or not such amounts are liquidated or reduced to judgment) against any
amounts due or to become due from such first party to such second party
hereunder or under any document or instrument delivered pursuant hereto or
thereto or in connection herewith or therewith.


 


(e)                                  Survival.
This Section 3.3 shall survive the termination of this Agreement for a
period of three (3) years.


 


3.4                               Limitations
on Liability. This Section 3.4 shall survive the termination of this
Agreement for a period of three (3) years. NEITHER PARTY OR ANY OF SUCH PARTY’S AFFILIATES SHALL HAVE ANY
LIABILITY TO THE OTHER PARTY OR ANY OF ITS AFFILIATES FOR ANY CONSEQUENTIAL,
INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES UNDER THIS AGREEMENT AND LOSSES
INDEMNIFIABLE HEREUNDER SHALL NOT INCLUDE SUCH DAMAGES, EXCEPT, IN EACH CASE,
(i) TO THE EXTENT SUCH OTHER PARTY OR SUCH OTHER PARTY’S AFFILIATE IS REQUIRED
TO PAY SUCH AMOUNT TO A THIRD PARTY IN RESPECT TO A FINAL JUDGMENT OR ORDER
OBTAINED BY THE THIRD PARTY, OR (ii) AS A RESULT OF SELLER’S  BREACH OF SECTION 3.1(b) HEREIN. Buyer hereby agrees and acknowledges that it
has a duty to mitigate (consistent with applicable law) any and all damages
suffered and losses


 


14

















 


recoverable by Buyer under
this Agreement, including without limitation the damages and losses set forth
in this Section 3.4.


 


3.5                               Insurance. Each of Buyer and Seller shall obtain and maintain in full force
during the Term of this Agreement insurance policies from a reputable insurance
company or pursuant to a self-insurance program providing such Party with
insurance coverage for the Products that is reasonably consistent with the
levels of insurance coverage customarily maintained in the pharmaceutical
industry.


 


ARTICLE
4 - 

MANUFACTURING OF THE PRODUCTS


 


4.1                               cGMP. Seller and its Affiliates shall Manufacture and supply the
Products to Buyer at all times in full compliance with the Act, cGMP and any
other applicable Regulatory Requirements. Seller and its Affiliates shall
maintain during the Term of this Agreement and for a period thereafter
consistent with Seller’s policies and standard cGMP requirements, all records
as are necessary or appropriate to demonstrate compliance with the Act, cGMP
and any other applicable quality control standards of any Regulatory Authority
in the Territory. If Seller fails to comply with cGMPs in a manner, as
demonstrated by an observation of a Regulatory Authority, Seller shall
diligently proceed to remedy such deviation in accordance with Seller’s
response to the observation.


 


4.2                               Audit.
Buyer shall have the right, either by itself or through independent outside
auditors or consultants, not more than once per year during the Term of this
Agreement, unless reasonable cause is shown, to inspect and audit any areas of
Seller’s or its Affiliates’ facilities in which any portion of the
Manufacturing of the Products is performed for the examination of production or
quality records or to perform cGMP audits, at its sole expense, on reasonable
advance notice, during Seller’s normal business hours in a manner that does not
interfere unreasonably with Seller’s operations. Any such auditor or consultant
shall enter into an agreement with the Parties on terms in which such
independent auditor shall agree to maintain the confidentiality of the
information obtained during the course of such audit.


 


4.3                               Acquisition of Raw Materials. Seller or its Affiliates shall
provide all Materials necessary for the Manufacture, shipping and delivery of
Products to Buyer, as part of the Purchase Price. Seller shall be responsible
for vendor quality approval for vendors of Materials, all of which shall comply
with Product Specifications.


 


4.4                               Use of Trademarks, Trade Names, Service Marks.
Except as set forth in the Asset Purchase Agreement and as to currently
existing Product inventory packaged and labeled by Seller with its own
trademarks, trade names, service marks and existing Product Registrations,
Buyer shall, in a manner consistent with Buyer’s forecasts for requirements of
Products, promptly supply Seller with approved artwork to comply with required
copy changes. Buyer shall be solely responsible for any costs incurred by Buyer
and related to providing these items to Seller, as well as any reasonable
incremental direct out-of-pocket costs of Seller related to incorporating these
items into the Manufacturing process that are above Seller’s cost of packaging
and labeling Product inventory with its own trademarks, trade names, service
marks and existing Product Registrations. Seller shall invoice Buyer separately
for any such costs and


 


15

















 


expenses. Buyer and Seller shall meet promptly after
the Effective Date to outline a plan to convert trade dress for Products to
Buyer trade dress. Buyer shall have the sole responsibility to ensure that the
labeling and artwork for the Product complies with all FDA, customs and other
Governmental Authority marking and labeling requirements. All production of
Products initiated six (6) months or longer after the Effective Date shall be
in Buyer’s trade dress.


 


4.5                               Exception
Documentation, Certificates of Analysis and Batch Records.


 


(a)                                  Exceptions.
Buyer shall be required to review and approve or reject all exception
documentation associated with the Manufacture of Product in accordance with
procedures stated in the Quality Agreement. Seller shall make available to
Buyer any and all data supporting the investigation of such exception,
including but not limited to, the batch records.


 


(b)                                 Certificate
of Analysis. Seller shall provide a certificate of analysis and other
documents as defined in the Quality Agreement for any Product to be released
hereunder, in a form in accordance with the cGMPs and all other applicable
Regulatory Requirements and Product Specifications and as shall be agreed upon
by the parties. For any batch that initially failed to meet any Product
Specification, the certificate of analysis shall document the exception. Products that do not meet dissolution
specifications at USP Stage I and II testing shall not be accepted by Buyer
(and such requirement shall be included in the Product Specifications/Quality
Manual).


 


(c)                                  Access
to Batch Documentation; Annual Audit. Full batch documentation including
batch production records, and Manufacturing and analytical procedures shall be
available for review by Buyer in conjunction with the annual audit or at
semi-annual status meetings.


 


(d)                                 Certificate
of Compliance. Prior to the first delivery of Product hereunder and
thereafter at least once per Contract Year, Seller shall provide a certificate
of compliance, in form and substance reasonably satisfactory to Buyer,
certifying compliance with the Product Specifications, cGMP, the Act,
Regulatory Requirements and all related processes and procedures contemplated
hereby.


 


4.6                               Quality
Agreement. Within at least thirty (30) days following the Effective Date of
this Agreement, the Parties shall mutually agree upon an intercompany quality
agreement which will appropriately address regulatory, operational and quality
responsibilities and shall be in substantially the form attached hereto as Exhibit
4.6 (the “Quality Agreement”). The Quality Agreement will include a
key contact list for each Party.


 


4.7                               Manufacturing and Packaging Changes.


 


(a)                                  Product
Changes. Seller shall not make any changes to the Product Specifications
and/or Manufacturing that would require approval from, or notification to, any
Regulatory Authority applicable to the performance of this Agreement, without
the prior written consent of Buyer, which such consent shall not be
unreasonably withheld. The timing of Seller’s notice to Buyer of any such
change shall permit adequate time for Buyer to make any necessary


 


16

















 


regulatory filings and obtain any necessary approval
thereof from a Regulatory Authority prior to the change being implemented.


 


(b)                                 Required
Changes. For changes to the Product Specifications or Manufacturing
relating solely to the Products that are required by Laws and other Regulatory
Requirements (including, without limitation, cGMP), or by medical or scientific
concerns as to the toxicity, safety and/or efficacy of the Products
(collectively, “Required Changes”), the Parties shall cooperate in
making such changes promptly.


 


(c)                                  Discretionary
Changes. Seller shall consider in good faith any request by Buyer to make
changes to the Product Specifications or Manufacturing that are not Required
Changes, including, but not limited to, changes to the existing Product,
Product line extensions, or changes to the existing or additional packaging
(collectively, “Discretionary Changes”). Any analytical improvements
shall be considered Discretionary Changes unless requested or required by
Regulatory Authorities in which case such improvements shall be considered a
Required Change. Any change requested by Seller which is not a Required Change
shall be made only with the written consent of the Buyer, which consent shall
not be unreasonably withheld.


 


(d)                                 Costs
of Changes. Any and all costs associated with (i) Required Changes
initiated by either Party, or (ii) Discretionary Changes initiated by the Buyer
shall be borne by the Buyer. Any Discretionary Changes initiated by Seller
shall be agreed to by the Parties including which Party or Parties shall be
responsible for the funding of such Discretionary Change.


 


4.8                               Management of Products.


 


(a)                                  Appointment
of Representatives. Each Party shall appoint one or more representatives to
serve as contacts for the other Party; such contacts shall have primary
responsibility for the overall coordination of the Products and the
Manufacturing and delivery of the Products to Buyer hereunder, as well as the
performance of each Party’s obligations under this Agreement. The names and
contact information of such contact(s) shall be delivered by each Party to the
other Party not less than ten (10) Business Days after the Effective Date and
will be the names included in the key contact list in the Quality Agreement.


 


(b)                                 Semiannual
Meetings. From time to time during the Term of this Agreement, but in any
event not less than once every six (6) months, the two business unit managers
shall meet (either in person or by teleconference) to discuss each Party’s
performance of the terms of this Agreement and to make recommendations to
improve its future performance.


 


4.9                               Restrictions
on Sale of Products. From and after
the Effective Date, Seller shall not, and shall cause each of its Affiliates
not to, (a) market, distribute or sell any of the Products or any
pharmaceutical product containing Propafenone as an active ingredient within
the Territory, (b) knowingly cause or facilitate the Products to be marketed,
distributed, or sold within the Territory, except by or on behalf of Buyer
pursuant to this Agreement, (c) market, distribute or sell the Products outside
the Territory to a Third Party who Seller or any of Seller’s Affiliates knows
intends to distribute the Products within the Territory, (d) knowingly supply
any bulk API Propafenone to any Third Party for ultimate sale and/or
distribution in the Territory, or


 


17

















 


(e) market, sell,
distribute, or manufacture for any other Person, generic finished Propafenone
in the Territory during the ten (10) year period commencing on the Effective
Date and ending on the tenth year anniversary of the Effective Date. Except for
a termination of this Agreement pursuant to Section 6.2 prior to the
Effective Date, the restrictions pursuant to Section 4.9(e) shall
survive the termination or expiration of this Agreement as provided therein.


 


ARTICLE
5 - 

REGULATORY MATTERS.


 


5.1                               Maintenance of Registrations. Except
as otherwise provided in this Agreement or the Asset Purchase Agreement, Buyer
shall maintain all Registrations. Seller shall fully cooperate and assist, at
Buyer’s expense, with all reasonable requests of Buyer related to the
maintenance of such Registrations. Neither Seller nor any of its Affiliates
shall take any action intended to adversely affect or that could reasonably be
expected to adversely affect any of the Registrations.


 


5.2                               Reporting. Except as to
responsibilities which Seller may not, as a matter of law, transfer, Buyer
shall prepare any reports related to matters regarding the Manufacture and
production of Products to any applicable Regulatory Authorities in accordance
with pertinent Laws and regulations, provided that Seller provides to Buyer all
information in its possession or control required to prepare any such reports. Seller
shall promptly furnish copies of any such reports related to the Manufacture and production of the
Products to Buyer. Seller shall also advise Buyer of any occurrences or
information arising out of Seller’s Manufacturing and production activities
that have or could reasonably be expected to have adverse regulatory compliance
and/or reporting consequences with respect to or concerning Products.


 


5.3                               FDA Inspections. Except as
otherwise provided herein, Seller shall be responsible, at Seller’s sole
expense, for handling and responding to any FDA or other Regulatory Authority
inspections with respect to Seller’s Manufacture
of the Products during the Term of this Agreement. Seller shall provide to
Buyer any information reasonably requested by Buyer and all information
requested by any Regulatory Authority concerning any inspection by any
Governmental Authority related to the Products. To the extent Seller requires
the assistance of Buyer in order to fulfill its obligations pursuant to this Section
5.3, Buyer agrees to fully cooperate and assist Seller, at Buyer’s sole
expense. In the event Seller is provided notice by any Regulatory Authority
that it will be inspected by such Regulatory Authority in connection with the
Products, Seller shall promptly notify Buyer of any observations made during
such inspection. Notwithstanding any provision herein to the contrary, Seller
shall provide Buyer with the opportunity to comment on any filings, notices or
other correspondence with any Regulatory Authority that relates to or could
affect the Manufacture or supply of Products hereunder.


 


5.4                               Notice to Buyer. In the event
Seller, the Products or any facility at which the Products or any component
thereof are Manufactured, packaged, tested or stored are inspected by any
Regulatory Authority, Seller shall promptly notify Buyer, to the extent that
such inspection affects the Product(s) or the Manufacture thereof under this
Agreement, of (i) any such inspection with reasonable advance notice, and (ii)
any alleged written violations or deficiencies relating to the Manufacturing
facility at which Products are Manufactured,


 


18

















 


packaged, tested or stored, and (iii) the corrective
action to be taken, and shall promptly contest such alleged violations or
deficiencies in good faith or take the required corrective action, each at
Seller’s sole expense.


 


5.5                               Seller’s Intellectual Property.


 


(a)                                  No
License. Except as provided in the Asset Purchase Agreement, the Other
Agreements, or otherwise provided herein, Seller has granted no license,
express or implied, to Buyer to use Seller’s proprietary technology or rights
relating to Seller’s Manufacturing process, other than for purposes of this
Agreement.


 


(b)                                 Improvements.
Subject to Section 5.5(c), if Seller, in its sole discretion, deems
patentable any improvement or invention relating to Seller’s proprietary
technology, know-how or rights relating to Seller’s Manufacturing processes
made or reduced to practice in the course of this Agreement, and if such
improvement or invention relates exclusively to the Seller’s Manufacturing
operations in general, Seller shall solely own and shall be entitled to apply
for patent protection on such improvements or inventions at Seller’s expense
and risk.


 


(c)                                  Buyer’s
Rights. Subject to Section 5.5(b), Buyer shall be entitled to all
such rights relating to any improvement or invention relating to Seller’s or
any of Seller’s Affiliate’s proprietary technology, know-how or rights relating
exclusively to the Products or the Manufacture
thereof, and Seller shall assign, and cause its Affiliates to assign, in each
case free of charge, such rights to Buyer and assist Buyer in securing any
patent or other intellectual property right relating thereto at Buyer’s sole
expense.


 


(d)                                 License
Right to Buyer. To the extent not otherwise transferred to Buyer pursuant
to the Asset Purchase Agreement or this Agreement, with respect to any (i)
improvements or inventions covered by Section 5.5(b) above that are
necessary to Manufacture the Products in accordance with Product
Specifications, or (ii) any Product Specifications, Seller hereby grants, on
behalf of itself and its Affiliates (and shall be deemed to have granted) to
Buyer, without any further action by Seller or any of Seller’s Affiliates, a
fully-paid, non-exclusive, perpetual, sub-licensable, irrevocable, royalty-free
license to use such improvements, inventions or Product Specifications solely
for the purposes of the Manufacture of the Products.


 


(e)                                  Identification
of Seller on Labels. Seller hereby grants Buyer a non-exclusive,
royalty-free limited right and license to use the Seller’s name solely for the
purpose of identifying Seller as the manufacturer on all packaging materials,
labels, inserts and any other printed matter included in the Products to the
extent required by Law and regulations.


 


5.6                               Buyer’s Intellectual Property. Buyer
has granted no license, express or implied, to Seller to use Buyer’s
proprietary technology, know-how or rights relating to Products, other than for
purposes of this Agreement. If Buyer, in its sole discretion, deems patentable
any improvement or invention related to the Products or to Buyer’s proprietary
technology, know-how or rights relating to the Products, then Buyer shall
solely own and shall be entitled to apply for patent protection on such
improvements or inventions at Buyer’s sole expense and risk.


 


19

















 


5.7                               Complaints, Recalls.


 


(a)                                  Complaints
concerning the Manufacture or supply by Seller of Products hereunder (“Product
Complaints”) received by either Party will be promptly faxed and in no
event later than five (5) Business Days after receipt by the recipient to the other
Party to:


 


Abbott Laboratories

1401 Sheridan Road

D-44K, Bldg. R1

North Chicago, IL 60064-6255

Attention: Quality Assurance Department

Fax: 847-937-4261


 


and


 


Reliant Pharmaceuticals, LLC 

110 Allen Road

Liberty Corner, NJ 07938

Attention: Quality Assurance Department

Fax: 908-542-9405


 


(b)                                 The
Parties shall cooperate with each other to investigate all complaints
associated with the Manufacture or supply of Products hereunder and to complete
a written report in a form reasonably satisfactory to both Parties. In the
event either Party should be required to initiate a recall, field alert,
Product withdrawal or field correction with respect to any Product supplied and
delivered under this Agreement, that Party shall promptly notify the other
Party in writing. Except where one Party is required by Law to do so, Buyer
shall have the sole and exclusive right to initiate any recall, field alert,
Product withdrawal or field correction and shall provide Seller with written
notice thereof. Nothing contained in this Section 5.8 shall relieve the
other Party of its obligations under Article 3 hereof.


 


ARTICLE
6 - 

TERM; TERMINATION; TECHNICAL TRANSFER


 


6.1                               Initial Term; Extension Terms.


 


(a)                                  Initial
Term. The initial term of this Agreement will commence upon the Effective
Date and will continue through December 31, 2008, unless terminated earlier in
accordance with the provisions of this Article 6 (the “Initial Term”).


 


(b)                                 First
Extension Term. During the Initial Term of this Agreement, Buyer shall use
commercially reasonable efforts to transfer the Manufacturing of the Rythmol®SR
Product(s) to a Third Party effective upon the expiration of the Initial Term
of this Agreement and shall provide Seller with reasonable written evidence of
such efforts. If, as of the end of the fourth Contract Year during the Initial
Term, after exercise of its commercially reasonable efforts and/or prohibition
of such transfer by applicable Law, rule or regulation, Buyer notifies Seller
that it reasonably believes it may be unable to transfer the Manufacturing of
the Rythmol®SR Product(s) hereunder prior to the end of the Initial Term (which
notice shall describe the basis for such reasonable belief), Buyer shall have
the option to extend the Term hereunder for the


 


20

















 


Manufacture of the Rythmol®SR Product(s) for an
additional two (2) year period, upon not less than twelve (12) months written
notice to the Seller prior to the end of the Initial Term (such additional two
(2) year period, the “First Extension Term”).


 


(c)                                  Second
Extension Term. During the First Extension Term of this Agreement, Buyer
shall use commercially reasonable efforts to transfer the Manufacturing of the
Rythmol®SR Product(s) to a Third Party effective upon the expiration of the
First Extension Term of this Agreement and shall provide Seller with reasonable
written evidence of such efforts. If, as of the end of the first year of the
First Extension Term, after exercise of its commercially reasonable efforts
and/or prohibition of such transfer by applicable Law, rule or regulation,
Buyer notifies Seller that it reasonably believes it may be unable to transfer
the Manufacturing of the Rythmol®SR Product(s) hereunder prior to the
expiration of the First Extension Term (which notice shall describe the basis
for such reasonable belief), Buyer shall have the option to extend the Term
hereunder for the Manufacture of the Rythmol®SR Product(s) for an additional
two (2) year period, upon not less than twelve (12) months written notice to
the Seller prior to the end of the First Extension Term (such additional two
(2) year period, the “Second Extension Term”).


 


(d)                                 Price
Adjustment During Extension Terms. If Buyer elects to exercise the option
with respect to the First Extension Term and Second Extension Term, then the
Purchase Price shall be adjusted as of the expiration of the Initial Term and
the First Extension Term, as applicable, of this Agreement and annually
thereafter, if applicable, to reflect Seller’s then applicable costs to
Manufacture the Rythmol®SR Product(s) plus fifteen percent (15%).


 


(e)                                  Definition
of “Term”. As used herein, the “Term” shall be deemed to include the
Initial Term and each of the First Extension Term and the Second Extension
Term, as applicable.


 


6.2                               Termination Prior to Effective Date.
In the event that the Asset Purchase Agreement is terminated prior to the
Closing of the transactions contemplated thereby, this Agreement shall
automatically terminate without any affirmative action of either Party, and shall
be deemed null and void ab initio.
In the event of such an automatic termination neither Party shall have any
liabilities or obligations to the other Party hereunder as a result of such
termination of this Agreement.


 


6.3                               Voluntary Termination. During the Term, Buyer may, in its
sole discretion, terminate this Agreement for any reason or no reason
whatsoever upon one (1) year prior written notice to Seller.


 


6.4                               Material Breach. Either Party may
terminate this Agreement upon forty-five (45) calendar day’s prior written
notice in accordance with Section 8.11 to the other Party if the other
Party is in material breach of this Agreement and fails to cure that breach
within such forty-five (45) day period.


 


6.5                               Insolvency. Either Party may
terminate this Agreement on immediate notice if at any time the other Party (a)
shall voluntarily file in any court pursuant to any statute of any Governmental
Authority in any country a petition in bankruptcy or insolvency or for


 


21

















 


reorganization or for the appointment of a receiver or
trustee of such Party or of its assets; (b) shall be served with an involuntary
petition against it, filed in any insolvency proceeding, and such petition
shall not be dismissed within sixty (60) days after the filing thereof; (c)
shall be a Party to any dissolution or liquidation; or (d) shall make a general
assignment for the benefit of its creditors.


 


6.6                               Effect of Termination. Termination
of this Agreement shall not affect any obligations of either Party incurred
prior to its termination, including, without limitation, each Party’s
obligations with respect to any Firm Orders that have been submitted or are
deemed to have been submitted pursuant to Article 2 hereof; provided,
however, if Buyer is in material breach of this Agreement for failure to
pay or otherwise, Seller shall have no obligation with respect to any Firm
Order until such time as such breach is cured. Buyer shall purchase all
Remaining Inventory as set forth in Section 2.2(f) above.


 


6.7                               Technical Transfer.


 


(a)                                  Transfer
Plan. The Parties hereby agree that effective at the time of any expiration
or termination of this Agreement in accordance with Section 6.1 and Section
6.2 hereof or at Buyer’s request in the event that Buyer desires to qualify
a source other than Seller to Manufacture a Product, the Parties shall meet and
mutually agree upon a reasonable plan (the “Transfer Plan”) to transfer
the Manufacture of the Product, including the Product Specifications, from
Seller or Seller’s Affiliates to Buyer or Buyer’s designees to enable Buyer or
Buyer’s designees to Manufacture the Products. The Transfer Plan may include,
at Buyer’s reasonable request, the right to observe Seller’s or Seller’s
Affiliate’s Manufacture of the Product(s), subject to reasonable
confidentiality undertakings on behalf of such observers, and reasonable
cooperation by Seller and Seller’s Affiliates prior to and following the
effectiveness of the transfer, including as may be necessary to assist Buyer in
the discharge of its obligations under Sections 6.1(b) and 6.1(c)
hereof as set forth in such Transfer Plan.


 


(b)                                 Intellectual
Property Associated with Transfer Plan. Buyers shall receive, pursuant to
this Section 6.7, the necessary Product Specifications and know-how and
certain intellectual property developed in the course of this Agreement as
described in Section 5.5 to permit the Buyer or Buyer’s designee to
Manufacture the products in accordance with the Product Specifications in place
at the time of the transfer. At any time after the Effective Date, Seller shall
reasonably cooperate with Buyer’s efforts to qualify a source other than Seller
to Manufacture the Products and obtain necessary approvals for such
qualifications. The effective date of such transfer shall be specified by Buyer
upon written notice to Seller (provided that such transfer shall not relieve
Seller of any obligations accrued prior to such transfer date, including the
responsibility for Firm Orders already placed and any Remaining Inventory).


 


(c)                                  One
Transfer Plan per Product. Seller shall only be obligated to cooperate with
Buyer in the qualification of one source other than Seller for the Manufacture
of any Product (meaning all formulations and or packaging configurations for
such Product). For the avoidance of doubt, the Parties agree that there shall
be one Transfer Plan in respect of Rythmol®IR and one Transfer Plan in respect
of Rythmol®SR.


 


22

















 


(d)                                 Costs
of Transfer Plan. In the event that this Agreement terminates for any
reason except Seller’s material breach, all direct actual out-of-pocket costs
incurred by Seller in connection with each such Transfer Plan, and the Seller’s
and Seller’s Affiliates’ time (at the current staff rates) incurred in
connection with each such Transfer Plan, shall be the sole responsibility of
the Buyer. In the event that this Agreement terminates as result of Section
6.3 as a result of Seller’s material breach, all direct actual
out-of-pocket costs incurred in connection with such Transfer Plan, and the
Seller’s and Seller’s Affiliates’ time at the current staff rates incurred in
connection with such Transfer Plan, shall be the sole responsibility of Seller.


 


ARTICLE
7 - 

CONFIDENTIALITY


 


7.1                               Buyer’s Information. Except as
provided in Section 7.3, all information provided by Buyer to Seller
concerning this Agreement shall be maintained in strict confidence by Seller. Such
information shall remain the property of Buyer, and Seller shall not use the
same for or on behalf of any Person or entity other than Buyer or make use of
any such information except for the purposes for which it was provided.


 


7.2                               Seller’s Information. Except as
provided in Section 7.3, all information provided by Seller to Buyer
concerning this Agreement shall be maintained in strict confidence by Buyer. Such
information shall remain the property of Seller, and Buyer shall not make use
of any such information except for the purposes for which it was provided.


 


7.3                               Exceptions. The covenants of the
receiving Party contained in Section 7.1 and Section 7.2 shall
not apply to information that:  (a) is
already in the public domain at the time of disclosure; (b) becomes part of the
public domain through no action or omission of the receiving Party after
disclosure to the receiving Party; or (c) is required to be disclosed by Law or
a court or other Governmental Authority or Regulatory Authority. Notwithstanding
any provision herein to the contrary, nothing herein shall prevent or prohibit
any disclosure of any information concerning this Agreement (i) required under
applicable securities Laws and the rules and regulations of any stock exchange
or market system on which any Party’s securities are or may be traded, (ii) by Buyer in connection with an Approved
Transaction (as defined below), and/or (iii) to investment bankers and/or
financing sources in connection with bona fide financing transactions involving
Buyer or an Affiliate. In addition, the Parties (and any of their
respective Affiliates and representatives) may disclose to any and all Persons,
without limitation of any kind, the “tax treatment” and “tax structure,” within
the meaning of Treasury Regulation Section 1.6011-4, of the transactions
contemplated hereby, and by the Asset Purchase Agreement and the Other
Agreements, and all materials of any kind (including opinions or other tax
analyses) that are provided to it relating to such tax treatment and tax
structure (but no other details regarding matters covered by this agreement,
including, without limitation, the identities of the parties); provided,
however, that each party recognizes that the privilege each has to
maintain, in its sole discretion, the confidentiality of a communication
relating to the transactions contemplated hereby, and by the Asset Purchase
Agreement and the Other Agreements, including a confidential communication with
its attorney or a confidential communication with a federally authorized tax
practitioner under Section 7525 of the Internal Revenue Code of 1986, as amended,
is not intended to be affected by the foregoing. For the purposes of this
Agreement, each of the following shall constitute an “Approved Transaction”: (i) the
conversion of Buyer


 


23

















 


from a limited liability company to a corporation
following which the equityholders of Buyer immediately prior to such conversion
hold shares in the resulting corporation in approximately the same relative
proportions as they did in the pre-conversion entity, (ii) the issuance by
Buyer of securities in connection with any financing transaction or public
offering, (iii) the merger, consolidation or other similar transaction (i.e., wherein all or substantially all of
Buyer’s equity interests or assets are acquired by another entity).


 


7.4                               Survival. This Article 7
shall survive termination of this Agreement for a period of five (5) years.


 


ARTICLE
8 - 

MISCELLANEOUS


 


8.1                               Corporate Organization and Authority. Each Party represents and warrants
to the other Party that it is a corporation duly organized, validly existing,
and in good standing under the Laws of the jurisdiction wherein it is
organized, and that it has all necessary power and authorization to perform its
obligations under this Agreement and to discharge them pursuant to the terms
hereof.


 


8.2                               No Conflicts; Enforceability. The
execution, delivery and performance of this Agreement by each Party is not and
shall not be prohibited or limited by, and will not result in the breach of or
a default under: (i) the Articles of Incorporation or Bylaws or the constituent
documents of any Party and/or its Affiliates; (ii) the Intellectual Property;
(iii) any binding agreement or instrument; or (iv) any applicable order, Law,
writ, injunction or decree of any court or Governmental Authority. This
Agreement has been duly executed and delivered by each Party, and constitutes,
the legal, valid and binding obligations of each Party and its Affiliates,
enforceable against each Party and its Affiliates in accordance with its terms,
except as enforceability may be limited or affected by applicable bankruptcy,
insolvency, moratorium, reorganization or other Laws of general application
relating to or affecting creditors’ rights generally.


 


8.3                               Public Announcements. Except as
provided for in Section 10.2 of the Asset Purchase Agreement, neither
Party shall make any publicity releases, interviews or other dissemination of
information concerning this Agreement or its terms, or either Party’s
performance hereunder, to communication media, financial analysts or others
without the prior written approval of the other Party, which approval shall not
be unreasonably withheld. Either Party may, upon written notice to the other,
make any disclosure in filings with Governmental Authorities or Regulatory Authorities
as required by Law or applicable court or other order; provided, however,
that the other Party shall have the opportunity to review and comment on such
disclosures and filings.


 


8.4                               Force Majeure. Neither Party shall
be liable to the other if, and to the extent that, the performance or delay in
performance of any of its obligations under this Agreement is prevented,
restricted, delayed or interfered with due to circumstances beyond the
reasonable control of such Party, including, without limitation, fires, floods,
explosions, epidemics, accidents, acts of God and/or wars, riots, strikes,
lockouts or other concerted acts of workers. The Party claiming an event of
force majeure shall promptly notify the other Party in writing and


 


24

















 


provide full particulars of the cause or event and the
date of first occurrence thereof as soon as possible after the event and also
keep the other Party informed of any further developments. The Party so
affected shall use its commercially reasonable efforts to remove the cause of
non-performance, and both Parties shall resume performance hereunder with the
utmost dispatch when such cause is removed, unless this Agreement has
previously been terminated under Article 6 hereof.


 


8.5                               Entire Agreement. This Agreement,
the Asset Purchase Agreement and the Other Agreements contain the entire
agreement and understanding between the Parties hereto with respect to the
subject matter hereof and supersede all prior agreements and understandings,
whether written or oral, relating to such subject matter; provided, however,
that except as otherwise expressly agreed by the Parties, nothing herein shall
modify or supersede the Asset Purchase Agreement.


 


8.6                               Amendment and Waiver. This Agreement
may be amended only by a writing that specifically states that such is an
amendment, specifically states its purpose and that is signed by both Parties. No
course of dealing between the Parties or failure by either Party to exercise
any right or remedy hereunder shall constitute an amendment to this Agreement
or a waiver of any other right or remedy or the later exercise of any right or
remedy.


 


8.7                               Governing Law. This Agreement
shall be governed by and construed in accordance with the substantive law of
the State of Illinois, without regard to the conflicts of law provisions
thereof.


 


8.8                               Alternative Dispute Resolution. Any
dispute, controversy or claim between the Parties arising out or relating to
this Agreement, or the breach, termination or invalidity thereof, which is not
settled by written agreement between the Parties shall be finally settled
pursuant to the alternative dispute resolution procedures set forth in Exhibit
8.8 attached hereto; provided, however, that nothing herein
shall prevent or prohibit any Party from seeking injunctive/equitable relief in
any court with appropriate jurisdiction.


 


8.9                               Successors and Assigns. The
provisions of this Agreement shall be binding upon and inure to the benefit of
the Parties hereto and their respective successors and assigns; provided,
however, that except as otherwise provided herein, no Party may assign,
delegate or otherwise transfer any of its rights or obligations under this
Agreement without first receiving the prior written consent of the other Party,
which consent shall not be unreasonably withheld, except that either Party may
assign and delegate its rights and duties hereunder without obtaining such
consent (a) to any Affiliate of such Party or (b) to any Person or entity that
acquires substantially all of the business or assets of such Party, if such
Party guarantees the performance of the acquiring Party and the acquiring Party
expressly assumes the assigning Party’s obligations hereunder. For the purposes
of this Section 8.9, none of the following shall constitute an
assignment by Buyer: (a) the conversion of Buyer from a limited liability
company to a corporation (whether such conversion is effected by statutory
conversion provisions, merger or otherwise), or (b) the issuance of debt or
equity securities by Buyer in connection with any financing transaction.


 


25

















 


8.10                        Nature of Agreement. In performing
this Agreement, each Party shall act independently and this Agreement shall not
be construed as creating any partnership, joint venture or incorporated
business entity. Neither Party shall have any authority to incur any liability
or obligation whatsoever on behalf of the other Party.


 


8.11                        Notices. All communications,
notices and consents provided for herein shall be in writing and be given in
person or by means of telex, facsimile or other means of wire transmission
(with request for assurance of receipt in a manner typical with respect to
communications of that type), by overnight courier or by mail, and shall become
effective: (a) on delivery if given in person; (b) on the date of transmission
if sent by telex, facsimile or other means of wire transmission; (c) one (1)
Business Day after delivery to the overnight service; or (d) four (4) Business
Days after being deposited in the United States mail, with proper postage and
documentation, for first-class registered or certified mail, prepaid. Notices
shall be addressed as follows:


 


If to Buyer, to:


 


Reliant Pharmaceuticals,
LLC


110
Allen Road


Liberty
Corner, NJ 07938


Attn:
Chief Executive Officer


Facsimile:
(908) 542-9405


 


with copies sent
simultaneously to:


 


Reliant Pharmaceuticals,
LLC


110
Allen Road 


Liberty
Corner, NJ 07938 


Attn:
General Counsel


Facsimile:
(908) 542-9405


 


Latham
& Watkins LLP


Sears
Tower, Suite 5800


Chicago,
IL  60606


Attn:
Michael A. Pucker


Facsimile:
(312) 993-9767


 


26

















 


If to Seller, to:


 


Abbott GmbH & Co. KG


Postfach 21085


D-67008 Ludwigshafen


Attn: General Manager


 


Abbott Laboratories


100 Abbott Park Road


Building AP6D, Department
364


Abbott Park,
Illinois  60064-6020


Attn:  Senior Vice President, Secretary and General
Counsel


Facsimile Number: (847)
938-6277


 


Abbott Laboratories


Dept. 50C, Bldg. J23


200 Abbott Park Road


Abbott Park,
Illinois  60064-6162


Attn:  Manager, Contract Manufacturing


Facsimile Number:  (847) 938-9319


 


provided,
however, that if either Party shall have designated a different address
by notice to the other Party pursuant to this Section 8.11 then to the
last address so designated.


 


8.12                        Construction. The language in all parts of this
Agreement shall be construed, in all cases, according to its fair meaning. Seller
and Buyer acknowledge that each Party and its counsel have reviewed and revised
this Agreement and that any rule of construction to the effect that any
ambiguities are to be resolved against the drafting Party shall not be employed
in the interpretation of this Agreement. The words “hereof,” “herein,” “hereto”
and “hereunder” and words of similar import, when used in this Agreement, shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement. The terms defined in the singular shall have a comparable meaning
when used in the plural, and vice versa. The terms “dollars” and “$” shall mean
United States dollars. Whenever used herein, the words “include,” “includes”
and “including” shall mean “include, without limitation,” “includes, without
limitation” and “including, without limitation,” respectively. The masculine,
feminine or neuter gender and the singular or plural number shall each be
deemed to include the others whenever the context so indicates. With respect to
any particular action or agreement, the use of the words “Seller shall” or “Seller
will” herein shall also mean “Seller shall cause” the particular action to be
performed.


 


8.13                        Agent for Service of Process. By
its execution hereof, Seller hereby appoints Parent, and Parent hereby accepts
such appointment, as Seller’s agent for service of process in respect of all
matters arising hereunder.


 


27

















 


IN WITNESS WHEREOF, the Parties have affixed hereunto
their authorized signature as follows:


 


	
  RELIANT
  PHARMACEUTICALS, LLC

  	
   

  	
  ABBOTT
  GMBH & CO. KG

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
  Name:

  
	
   

  	
  Title:

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  



 


 


Abbott Laboratories, an
Illinois corporation and the parent of Seller, hereby (i) guarantees
payment and performance of all of Seller’s and its Affiliates obligations under
this Agreement, and (ii) agrees to its appointment as Seller’s agent for
service of process pursuant to Section 8.13:


 


ABBOTT LABORATORIES


 


 


	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  



 


 


28

















 


EXHIBIT 1.16


 


Products and Product Prices


 


See
attached.


 

















 


Reliant Supply Agreement


Exhibit 1.16 - For 2005


 


Commerical Product Pricing


 


	
  Product

  	
   

  	
  List-Label-

  Size

  	
   

  	
  List-

  Tuc-

  Sales

  Size

  	
   

  	
  SAP

  Product

  #

  	
   

  	
  Package

  	
   

  	
  Standard

  Mfg Lot

  Size (units)

  	
   

  	
  Standard

  Finished

  Lot Size

  (units)

  	
   

  	
  2005

  Selling

  Price

  	
   

  
	
  Rythmol SR225Mg 100 Tab Btl (A)

  	
   

  	
  6134-04-13

  	
   

  	
   

  	
   

  	
  259524

  	
   

  	
  100 Tab Btl

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol SR225Mg Sample

  	
   

  	
  6134-48-06

  	
   

  	
   

  	
   

  	
  259530

  	
   

  	
  1x6

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol SR225Mg 100 Tab HUD (A)

  	
   

  	
  6134-04-11

  	
   

  	
   

  	
   

  	
  259527

  	
   

  	
  100 Tab HUD

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol SR325Mg 100 Tab Btl (A)

  	
   

  	
  6135-04-13

  	
   

  	
   

  	
   

  	
  259525

  	
   

  	
  100 Tab Btl

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol SR325Mg Sample

  	
   

  	
  6135-48-06

  	
   

  	
   

  	
   

  	
  259531

  	
   

  	
  1x6

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol SR325Mg 100 Tab HUD (A)

  	
   

  	
  6135-04-11

  	
   

  	
   

  	
   

  	
  259528

  	
   

  	
  100 Tab HUD

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol SR425Mg 100 Tab Btl (A)

  	
   

  	
  6136-04-13

  	
   

  	
   

  	
   

  	
  259526

  	
   

  	
  100 Tab Btl

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol SR425Mg Sample

  	
   

  	
  6136-48-06

  	
   

  	
   

  	
   

  	
  259532

  	
   

  	
  1x6

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol SR425Mg 100 Tab HUD (A)

  	
   

  	
  6136-04-11

  	
   

  	
   

  	
   

  	
  259529

  	
   

  	
  100 Tab HUD

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol 150Mg 100 Tab Bill (A)

  	
   

  	
  1628-04-13

  	
   

  	
   

  	
   

  	
  259284

  	
   

  	
  100 Tab Bottle

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol 150Mg 100 Tab HUD (A)

  	
   

  	
  1628-04-11

  	
   

  	
   

  	
   

  	
  259287

  	
   

  	
  100 Tab HUD

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol 225Mg 100 Tab Btl (A)

  	
   

  	
  1732-04-13

  	
   

  	
   

  	
   

  	
  259285

  	
   

  	
  100 Tab Bottle

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol 225Mg 100 Tab HUD (A)

  	
   

  	
  1732-04-11

  	
   

  	
   

  	
   

  	
  259288

  	
   

  	
  100 Tab HUD

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol 300Mg 100 Tab Btl (A)

  	
   

  	
  1831-04-13

  	
   

  	
   

  	
   

  	
  259286

  	
   

  	
  100 Tab Bottle

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Rythmol 300Mg 100 Tab HUD (A)

  	
   

  	
  1831-04-11

  	
   

  	
   

  	
   

  	
  259289

  	
   

  	
  100 Tab HUD

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  



 






[***]:  Certain
information on this page has been omitted and filed separately with the
Commission.  Confidential treatment has
been requested with respect to the omitted portions.


 

















 


Hourly Rates for Resources Not in Standard


 


	
  Area

  	
   

  	
  Charge Rate

  	
   

  	
  Billing

  Rate

  	
   

  
	
  Analytical Laboratories

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Analytical Research

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Document Center

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Engineering

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Label Control

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Product Development

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Regulatory Affairs

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Stability Admin

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Technical Operations

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  



 


	
  Accepted By:

  	
   

  	
   

  
	
    /    /     

  	
   

  	
  Accepted by:

  
	
  Abbott Laboratories

  	
  Dated

  	
   

  	
   

  
	
  Michael L. McGibbon

  	
   

  	
    /    /

  	
   

  
	
  General Manager, Pharma

  	
   

  	
  Reliant Pharmaceuticals

  
					



 






[***]:  Certain information on this page has been
omitted and filed separately with the Commission.  Confidential treatment has been requested
with respect to the omitted portions.


 

















 


EXHIBIT 2.2(a)


 


Initial Forecast


 


[To be attached prior to Effective Date]


 


32

















 


	
  Rythmol IR

  SKU

  	
   

  	
  Initial

  Inventory

  	
   

  	
  Dec-03

  	
   

  	
  Jan-04

  	
   

  	
  Feb-04

  	
   

  	
  Mar-04

  	
   

  	
  Apr-04

  	
   

  	
  May-04

  	
   

  	
  Jun-04

  	
   

  	
  Jul-04

  	
   

  	
  Aug-04

  	
   

  	
  Sep-04

  	
   

  	
  Oct-04

  	
   

  	
  Nov-04

  	
   

  	
  Dec-04

  	
   

  	
  Jan-05

  	
   

  	
  Feb-05

  	
   

  	
  Mar-05

  	
   

  	
  Apr-05

  	
   

  	
  May-05

  	
   

  	
  June-05

  	
   

  
	
  100ct 150mg Bottle

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  18,509

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  12,600

  	
   

  	
   

  	
   

  	
  12,600

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  11,600

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  11,600

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  12,600

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  11,600

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100ct 150mg HUD

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  2,188

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


	
  Rythmol IR 

  SKU

  	
   

  	
  Initial

  Inventory

  	
   

  	
  Dec-

  03

  	
   

  	
  Jan-

  04

  	
   

  	
  Feb-

  04

  	
   

  	
  Mar-

  04

  	
   

  	
  Apr-

  04

  	
   

  	
  May-

  04

  	
   

  	
  Jun-

  04

  	
   

  	
  Jul-

  04

  	
   

  	
  Aug-

  04

  	
   

  	
  Sep-

  04

  	
   

  	
  Oct-

  04

  	
   

  	
  Nov-

  04

  	
   

  	
  Dec-

  04

  	
   

  	
  Jan-

  05

  	
   

  	
  Feb-

  05

  	
   

  	
  Mar-

  05

  	
   

  	
  Apr-

  05

  	
   

  	
  May-

  05

  	
   

  	
  June-

  05

  	
   

  
	
  100ct 225mg Bottle

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  11,793

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  8,400

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  7,900

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  8,400

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100ct 225mg HUD

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


 


33

















 


	
  Rythmol IR

  SKU

  	
   

  	
  Initial

  Inventory

  	
   

  	
  Dec-03

  	
   

  	
  Jan-04

  	
   

  	
  Feb-04

  	
   

  	
  Mar-04

  	
   

  	
  Apr-04

  	
   

  	
  May-04

  	
   

  	
  Jun-04

  	
   

  	
  Jul-04

  	
   

  	
  Aug-04

  	
   

  	
  Sep-04

  	
   

  	
  Oct-04

  	
   

  	
  Nov-04

  	
   

  	
  Dec-04

  	
   

  	
  Jan-05

  	
   

  	
  Feb-05

  	
   

  	
  Mar-05

  	
   

  	
  Apr-05

  	
   

  	
  May-05

  	
   

  	
  June-05

  	
   

  
	
  100ct 300mg Bottle

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  5,718

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  6,100

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  6,300

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100ct 300mg HUD

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  337

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  200

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


 

















 


	
  Rythmol SR

  SKU

  	
   

  	
  Dec-03

  	
   

  	
  Jan-04

  	
   

  	
  Feb-04

  	
   

  	
  Mar-04

  	
   

  	
  Apr-04

  	
   

  	
  May-04

  	
   

  	
  Jun-04

  	
   

  	
  Jul-04

  	
   

  	
  Aug-04

  	
   

  	
  Sep-04

  	
   

  	
  Oct-04

  	
   

  	
  Nov-04

  	
   

  	
  Dec-04

  	
   

  	
  Jan-05

  	
   

  	
  Feb-05

  	
   

  	
  Mar-05

  	
   

  	
  Apr-05

  	
   

  	
  May-05

  	
   

  	
  June-05

  	
   

  
	
  100ct 225mg Bottle

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  10,000

  	
   

  	
  3,000

  	
   

  	
   

  	
   

  	
  19,400

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  18,400

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  18,400

  	
   

  	
   

  	
   

  	
  17,400

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  18,400

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100ct 225mg HUD

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6ct 225mg Sample

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  125,000

  	
   

  	
   

  	
   

  	
  147,623

  	
   

  	
  323,333

  	
   

  	
  323,333

  	
   

  	
   

  	
   

  	
  323,333

  	
   

  	
   

  	
   

  	
  323,333

  	
   

  	
   

  	
   

  	
  323,333

  	
   

  	
   

  	
   

  	
  323,333

  	
   

  	
   

  	
   

  	
  323,333

  	
   

  	
   

  	
   

  	
  323,333

  	
   

  	
   

  	
   

  	
  323,333

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


	
  Rythmol SR

  SKU

  	
   

  	
  Dec-03

  	
   

  	
  Jan-04

  	
   

  	
  Feb-04

  	
   

  	
  Mar-04

  	
   

  	
  Apr-04

  	
   

  	
  May-04

  	
   

  	
  Jun-04

  	
   

  	
  Jul-04

  	
   

  	
  Aug-04

  	
   

  	
  Sep-04

  	
   

  	
  Oct-04

  	
   

  	
  Nov-04

  	
   

  	
  Dec-04

  	
   

  	
  Jan-05

  	
   

  	
  Feb-05

  	
   

  	
  Mar-05

  	
   

  	
  Apr-

  05

  	
   

  	
  May-05

  	
   

  	
  June

  -05

  	
   

  
	
  100ct 325mg Bottle

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  7,500

  	
   

  	
   

  	
   

  	
  15,730

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  13,430

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  12,430

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  13,430

  	
   

  	
   

  	
   

  	
  12,430

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100ct 325mg HUD

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6ct 325mg Sample

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
   

  	
   

  	
  87,342

  	
   

  	
  300,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  173,833

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  223,833

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  223,833

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


 

















 


	
  Rythmol

  SR SKU

  	
   

  	
  Dec-03

  	
   

  	
  Jan-04

  	
   

  	
  Feb-04

  	
   

  	
  Mar-04

  	
   

  	
  Apr-04

  	
   

  	
  May-04

  	
   

  	
  Jun-04

  	
   

  	
  Jul-04

  	
   

  	
  Aug-04

  	
   

  	
  Sep-04

  	
   

  	
  Oct-04

  	
   

  	
  Nov-04

  	
   

  	
  Dec-04

  	
   

  	
  Jan-05

  	
   

  	
  Feb-05

  	
   

  	
  Mar-05

  	
   

  	
  Apr-05

  	
   

  	
  May-05

  	
   

  	
  June-05

  	
   

  
	
  100ct 425mg
  Bottle

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  2,000

  	
   

  	
   

  	
   

  	
  6,412

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  9,270

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  9,270

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100ct 425mg HUD

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,000

  	
   

  	
   

  	
   

  
	
  PO #

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6ct 425mg Sample

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deliveries

  	
   

  	
   

  	
   

  	
  42,000

  	
   

  	
  167,666

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  171,167

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  171,167

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


 

















 


 


 


 


 


 


 


QUALITY
AGREEMENT


 


 


Between


 





 


 


 


 


 


And


 


 


Abbott
Laboratories


 


 


 


 


 


 


 


For the
manufacture of:


 


 


Rythmol®
(Propafenone) Tablets 150 mg, 225 mg, and 300 mg


                   Rythmol SR (Propafenone) Capsules 225
mg, 325 mg and 425 mg


 


 


 


 

















 


TABLE OF
CONTENTS


 


                                                                                                                                                                                                               Page


 


I           QUALITY
AGREEMENT AND TERM                                                                                                                                      1


II         PRODUCTS                                                                                                                                                                                    1


III        CONTACT
INFORMATION                                                                                                                                                       1


IV        MANUFACTURING
COMPLIANCE                                                                                                                                         1


1.         Premises                                                                                                                                                                              1


2.         Equipment                                                                                                                                                                           1


3.         Personnel                                                                                                                                                                            1


4.         Materials                                                                                                                                                                             1


5.         Documentation                                                                                                                                                                   1


6.         Lot Numbers and Expiration                                                                                                                                             1


7.         Product Storage and Shipment                                                                                                                                        1


V         QUALITY
CONTROL                                                                                                                                                                   1


1.         Premises                                                                                                                                                                              1


2.         Equipment                                                                                                                                                                           1


3.         Personnel                                                                                                                                                                            1


4.         Out-of-Specification (OOS) Investigations                                                                                                                   1


5.         Reference Standards                                                                                                                                                         8


6.         Product Release                                                                                                                                                                 1


7.         Stability                                                                                                                                                                               1


VI        QUALITY
ASSURANCE                                                                                                                                                              1


1.         Documentation                                                                                                                                                                   1


2.         Samples                                                                                                                                                                               1


3.         Investigations                                                                                                                                                                  10


4.         Product Complaints or Adverse Events                                                                                                                         1


5.         Annual Product Review                                                                                                                                                    1


6.         Product Recalls                                                                                                                                                                11


7.         Audits by Reliant Pharmaceuticals                                                                                                                               11


VII       REGULATORY                                                                                                                                                                             12


1.         Inspections by Regulatory Agencies                                                                                                                           12


2.         Annual Reports                                                                                                                                                                12


3.         Drug Listing                                                                                                                                                                      12


VIII     VALIDATION                                                                                                                                                                              13


1.       Process                                                                                                                                                                                13


2.       Equipment Cleaning Validation                                                                                                                                       13


3.       Computer                                                                                                                                                                             13


4.       Analytical Test Methods                                                                                                                                                 13


 


i

















 


I               QUALITY AGREEMENT AND TERM


 


1.     It is deemed necessary by Reliant
Pharmaceuticals (“Reliant”) and Abbott Laboratories (“Abbott” or
“Manufacturer”) to allocate the responsibilities of current good manufacturing
practice (cGMP), as defined in 21 CFR part 210-211, by which Rythmolâ
(Propafenone)Tablets 150 mg, 225 mg and 325 mg and Rythmol  SRâ (Propafenone)
Capsules 225 mg, 325 mg and 425 mg (the Products) shall be manufactured and
provided to Reliant.


 


2.     This agreement, in conjunction with the
Manufacturing Agreement between Reliant and Abbott, dated November ____, 2003
(the “Manufacturing Agreement”), shall define the responsibilities of the
parties involved, and the levels of interaction necessary for the delivery of a
compliant drug product.


 


3.     This Quality Agreement shall expire with
the termination of the Manufacturing Agreement. 
The agreement can be modified with the written approval of Reliant and
Abbott.  A revision history shall be
maintained as part of the Quality Agreement.


 


II             PRODUCTS


 


Abbott has agreed to manufacture the Products in
accordance with all cGMP’s, Product Specifications and all applicable federal,
state, and local laws and regulations.


 


Rythmol SR is manufactured at Ludwigshafen, Germany,
shipped in bulk to Abbott Whippany, where it is tested and final-packaged for
commercial release.  Rythmol â
is manufactured, tested, and final packaged for commercial release at Abbott
Whippany.  Both sites are part of
Abbott’s Global Pharmaceutical Operations (GPO).  Communications on either product will be
directed through the Abbott Whippany quality assurance group, who will direct
inquiries on Rythmol SR manufacture, as required, to the appropriate
Ludwigshafen counterpart.


 


 


 


 


 


 


 


 


* Unless otherwise indicated, all terms used herein
shall have the meaning ascribed to them in the Manufacturing Agreement to which
this agreement is annexed as Exhibit  __.


 


1

















 


III            CONTACT INFORMATION


 


                See separate attachment, QMCL.


 


 


IV            MANUFACTURING COMPLIANCE


 


The Product will be manufactured by Abbott pursuant to
the Manufacturing Agreement at the Abbott facility(s) located at 30 N.
Jefferson Road, Whippany, NJ  07981 (FDA
facility registration #2211084) and at Abbott GmbH & Co. KG, Knoll Strasse
50, Ludwigshafen, Germany 67061 (FDA facility registration #3002807401).


 


1.             Premises


 


1.1           The manufacturing facility(s) shall
comply with all aspects of 21 CFR Part 210 and 211 Subpart C, as well as all
additional requirements detailed in the Manufacturing Agreement.


2.             Equipment


 


2.1           Equipment used to manufacture the
Product shall comply with 21 CFR part 211 Subpart D, as well as all additional
requirements detailed in the NDAs or approved Supplements.


 


2.2           Abbott shall maintain written records
for usage, cleaning, maintenance, and calibration of all equipment used in the
processing of the Products to ensure that cleaning and maintenance records are
readily identifiable with equipment usage in the event of a drug product
problem that may be investigated.  Abbott
shall maintain approved written procedures including, but not limited to,
specifications for cleaning, assignment of responsibility for cleaning and
maintaining equipment.


 


2.3           Installation qualification (IQ)/
operational qualification (OQ)/ performance qualification (PQ) shall be
performed on all equipment used in analysis of the Products, and the same
equipment shall be placed on a calibration and/or preventive maintenance
schedule, as appropriate.


 


2.4           Abbott shall only use the major
equipment detailed in the NDAs or
approved NDA Supplements thereto for the processing and manufacture of
the Products.  Use of equipment other
than that stipulated in the mutually agreed to Master Batch production records
shall not be permitted without prior written consent from Reliant Quality,
irrespective of FDA guidance’s detailing equipment class and subclass
equivalencies.


 


2

















 


3.             Personnel


 


             3.1                  Abbott shall maintain a quality control unit to be
responsible for the duties relating to quality control.  The responsibilities of the quality control
unit shall be defined in written procedures.


3.2            The training of personnel used to
process the Drug Products shall be appropriately documented and available for
review. Training shall be conducted on a continuing basis by qualified
individuals.


3.3            There shall be an adequate number of
qualified personnel to perform      and
supervise the processing and manufacture of the Products.


 


4.             Materials


 


4.1           Abbott shall use only those
excipients, Active Pharmaceutical Ingredient (API), and packaging materials as
detailed in the NDAs or approved NDA Supplement.


4.2           Abbott shall sample all raw materials
and API according to approved procedures, and shall test and release those
materials according to approved analytical methodology and specifications as
filled in the NDAs or approved Supplements.


4.3           Abbott shall store all packaging
materials, excipients, API and finished product in a suitable environment so as
not to impact the materials’ quality.  A
suitable retest program shall be used to demonstrate the quality of the stored
material versus approved specifications. 
Certificates of Analysis shall be generated, as required for Reliant,
for materials used to process and manufacture the Product.


4.4      All excipients used in the manufacture of
the Products shall be tested in accordance with Abbott standard operating
procedures, using approved methods and specifications.


4.5      All printed commodities shall come from
qualified vendors.  When commodities are
sourced and provided by Abbott, such vendors will be suitably qualified by
Abbott procedures, and when commodities are sourced and provide by Reliant,
such vendors will be suitably qualified by Reliant procedures.  Any qualified vendor (Abbott or Reliant) may
be used to source printed commodities.


 


5.             Documentation


 


5.1      Abbott shall provide written
documentation in the form of a Master


        Batch
Record for all processes used in the manufacture of the Products.


 


3

















 


        5.2      Abbott shall maintain and follow all
Standard Operating Procedures


(SOPs) required to
manufacture, package, analyze, release, and store the Products as detailed in
the NDA or approved Supplements, and required by cGMP.


 


5.3           Abbott shall follow a suitable,
internal, change control procedure for all documentation.  All changes to the batch record,
manufacturing specifications, or test methods must be submitted to Reliant QA
for review and approval prior to implementation.


5.4           Original texts of labeling will be
supplied by Reliant. All artwork shall be approved by Reliant.  Abbott shall have written label control
procedures for the receipt, dispensing, and reconciliation of all labels.


 


 


6.             Lot Numbers and Expiration


 


6.1           Reliant will provide unique lot
numbers for the finished packaged product.


6.1.1        The bulk product lot number will be
assigned according to Abbott lot numbering system.  The Abbott Whippany bulk lot number is
assigned in accordance with the Abbott Whippany lot numbering system.


6.1.2        Once all QC testing has completed,
Abbott will forward Bulk Product C of A to Reliant.  The C of A will detail Product Name/Number,
Lot Number, Date of Manufacturing, tests, specifications, and results from all
release testing performed.


6.1.3        Reliant will provide Abbott with the
product packaging lot number and expiration date via an approved “Packaging Lot
Number Request Form” (QA # 6, see Exhibit __). 
If a single lot of bulk Product is to be packaged into multiple
packaging configurations, Reliant must supply the expiration date and unique
lot number for each packaged product.


6.1.4        The Reliant lot number is a seven digit
alpha/numeric sequence.  The first
character is numeric, the second and third characters are alpha, and the
remaining 4 characters are numeric. 
Printed text will appear as follows: 
LOT  #AA####.


6.1.5        The Reliant expiration date will consist
of 3 alpha characters corresponding to the month of expiry (i.e. JUN for June)
and the 4 digit year (i.e. 2005).


6.1.6        Product labeling shall contain the word
“Lot” (followed by a space) above the word “Exp.” (followed by a space) to
accommodate Whippany equipment needs.


 


4

















 


6.2           Product lot expiration dating will
start on the first day API is blended with excipients, and will be based on the
approved expiration dating in the approved NDA or Supplement.


 


7.             Product
Storage and Shipment


 


7.1           Abbott shall store all finished
product in suitable containers, labeled with lot specific information, as detailed
in the Manufacturing Agreement, and in a controlled environment under cGMP
conditions.


7.2           Product shall be labeled with all
D.O.T. and O.S.H.A. information, as required, and suitably packaged to minimize
damage during transit.


7.3           Only finished Product having an
approved Certificate of Analysis may be shipped by Abbott to a Reliant
specified address.  Reliant QA is the
only agent authorized to release the finished product into commercial
distribution.  Materials may be shipped
under Quarantine from time-to-time as warranted, but only upon the request of
Reliant and with the prior written consent from the Quality Departments from
Reliant and Abbott.  It is anticipated
that Quarantine shipments will have a low frequency of occurrence.


7.4           Abbott shall segregate product by lot
number prior to shipment.


 


5

















 


V             QUALITY CONTROL


All testing shall be
done in accordance with the approved NDA and approved Supplements.    Any changes to laboratory test sites will
be reviewed and approved by Reliant QA. 
Labs currently used to test raw material and finished product, for
example microbial testing, will be considered acceptable.


 


1.             Premises


 


1.1           The quality control laboratory shall
comply with all aspects of 21 CFR Part 210 and 211, as well as all additional
requirements detailed in the NDAs or approved Supplements.


 


2.             Equipment


 


2.1           Installation qualification (IQ)/
operational qualification (OQ)/ performance qualification (PQ) shall be
performed on all equipment used in analysis of the Product, and the same
equipment shall be placed on a calibration and/or preventive maintenance
schedule, as appropriate.


 


2.2           Abbott shall maintain written records
for equipment usage, maintenance and calibration.


3.     Vendor Approval


 


3.1     Abbott shall suitably qualify all vendors
from which materials are sourced for use in the finished drug product.  This includes, but is not limited to
excipients, API, container closure systems, printed commodities, etc.  For those materials provided to Abbott by
Reliant (i.e. labels, cartons, and package inserts), Reliant shall have the
responsibility for qualification, if these vendors are not already approved
Abbott vendors.


 


4.             Personnel


 


4.1           Personnel used to test and release
the Product shall be appropriately trained in cGMP’s, as well as the methods
and techniques they utilize.  Training
shall be documented and available for review. Training shall be conducted on a
continuing basis by qualified individuals.


 


5.             Out-of-Specification (OOS) Investigations


 


5.1      Abbott is responsible for following its
SOP to investigate any test results that fail to meet specifications.  A confirmed OOS failure should be conveyed to
Reliant Quality within 2 business days. 
These OOS investigations are open to review by Reliant during an audit.


 


6

















 


          
6.      Reference Standards


 


6.1      All testing shall use primary reference
standards, or appropriately qualified secondary reference standards.  Qualification of secondary reference
standards must comply with current ICH guidelines.


 


7.             Product Release


 


 7.1      
Reliant shall only accept finished product that complies with the NDA or
approved Supplement, and with the Manufacturing Agreement.


 


     7.2              Significant occurrences of Dissolution Stage
II product releases will result in investigations when such investigations are
agreed-to by Reliant QA and Abbott QA.


 


8.     Stability


 


8.1      The
stability program will be conducted in accordance with Abbott Standard
Operating Procedures.  The currently
approved Regulatory stability protocols will be followed as written.  Changes to the protocols will be approved by
Reliant QA.


 


 


7

















 


VI            QUALITY ASSURANCE


 


Abbott shall assure that
the Product was manufactured, tested, released, and stored in accordance with
cGMP’s, and all requirements as detailed in the NDA, approved Supplement and
Manufacturing Agreement.


 


1.             Documentation


 


1.1           Abbott will provide a Certificate of
Analysis indicating all regulatory test results and their specifications, and a
Certificate of Compliance indicating the drug product has been manufactured,
tested, and stored according to cGMP’s and all requirements as detailed in the
NDA or approved Supplement.  These two
documents can be combined into one, per current Abbott format.


1.2           Abbott shall retain all executed
master batch production records and all other applicable records defined in 21
CFR 211.80(a) and (b) for the Product for a period of not less than one year
past the product expiration date.


2.             Samples


 


 


2.1           Abbott’s Quality Control Unit shall
assure that all test samples are taken in accordance with approved SOP’s and as
detailed in the approved NDA Supplement.


2.2           Abbott shall maintain finished
Product Reserve samples for a period of not less than one year past the
expiration date of finished Products. 
Abbott shall retain Active Compound reserve samples for one year after
the expiration date on the last finished Product drug lot containing it.  At least twice as much material shall be
retained as is needed to conduct all specification release testing.


2.3           Reserve samples shall be retained and
stored under conditions consistent with product labeling.  The reserve sample shall be stored in the
same immediate container-closure system in which the Product is marketed or in
one that has essentially the same characteristics.


 


2.4           Abbott shall perform annual
inspection of the Retain Samples as per 21 CFR 211.170, and on investigation of
deterioration, if necessary, as per 21 CFR 211.170.


 


 


8

















 


 


 


3.             Investigations/Deviations 


 


3.1      Abbott shall notify Reliant Quality in
writing within one business day after confirmation of any situation that
impacts product that has already been released. 
Abbott shall also provide Reliant with verbal communication of any such
investigation prior to the confirmation so that appropriate action can be
implemented to restrict continued distribution of product until the investigation
can be finalized.


 


3.2      All results of major manufacturing or
analytical deviations shall be investigated, and copies of said investigations
shall be conveyed to Reliant Quality with the issuance of the bulk product
certificate of analysis.  Copies of minor
deviations shall be provided only upon request.


                A Major Deviation is
defined as: A departure from normal operating conditions that is determined to
have a significant or unknown impact on the identity, strength,
quality, and purity of the drug product. 
Examples include, but are not limited to: failure of a batch or lot to
meet any analytical specification that is not determined to be a laboratory
error; or, compounding errors such as dispensing incorrect quantities of
material; or processing errors such as using equipment that is outside of
approved calibration dating or processing a batch outside the tolerances set
forth in the batch record; or observation of foreign materials in a batch; or
packaging or labeling errors.


                A Minor Deviation is
defined as: A departure from normal operating conditions that is determined to
have no impact on the identity, strength, quality, and purity of the drug
product.  Examples include, but are not
limited to: low gross yields; or calculation or rounding errors that have no
impact on the batch.


3.3      All minor deviations to the manufacturing
process or analytical test methods must be documented and reviewed versus the
respective validation, and approved by Abbott’s Quality department prior to
release of the Product.


 


4.             Product Complaints or Adverse
Events


 


4.1           All individuals reporting a product
related complaint should be immediately directed to contact Reliant’s Customer
Complaints Group as directed on QMCL Reliant.


4.1.1        Reliant
shall maintain a system to receive, log, evaluate, categorize, communicate, and
follow-up each complaint received.


4.1.2        Reliant
shall report any product complaints to Abbott in writing within seven days of
receipt of the complaint.


 


9

















 


4.1.3        Upon
receiving a product complaint for which the subject bottle is still available,
Reliant shall issue a return mailer to have the complaint sample returned to
Abbott at (ADDRESS).


4.1.4        Abbott shall perform a thorough
investigation of each product complaint for operations performed at Abbott, and
shall make every reasonable effort to provide Reliant with a written report
within 45 days, unless a more urgent need is identified and mutually agreed
upon (i.e. NDA Field Alert).


4.1.5        Reliant shall be responsible for
communication and final correspondence with the complainant, and/or regulatory
authorities.


4.2           All individuals reporting an Adverse
Event (AE) should be immediately directed to contact Reliant’s Medical Affairs
Department as directed on QMCL Reliant.


4.2.1        Reliant shall maintain a system to
receive, log, evaluate, categorize, communicate, and follow-up each AE
received.


4.2.2        Reliant shall maintain all AE files and
is responsible for forwarding all appropriate information to Regulatory
Agencies.


4.3           Reliant shall be the only authorized
group to provide product related responses to the public.


4.4           Should Reliant discover a product
related problem, Reliant Quality Department shall provide a written complaint
notification to Abbott within 2 business days of the occurrence.


 


5.             Annual Product Review


 


5.1           Abbott Whippany shall perform an
annual product review for the Product detailing all drug product lots
manufactured, product investigations, stability updates, lots released or
rejected, and process or method revisions (including validation reports) for
all drug product lots manufactured in the previous Manufacturing Agreement
year.  All critical release data shall be trended to evaluate the process.


5.2           The written Annual Product Review report
for each year shall be sent to Reliant Quality Department as specified in the
table below.


(SUGGEST TABLE OUTLINING DUE DATE FOR EACH PRODUCT APR —
INFORMATION TO BE PROVIDED BY R. LENGEL)


 


6.             Product Recalls


 


6.1           It shall be the sole responsibility
of Reliant to issue a FDA Field Alert Notification pertaining to a product
quality issue discovered by Abbott or 


 


10

















 


                Reliant.  An
alert shall only be issued with substantive evidence of a quality issue, for which
Abbott shall have 5 business days from obtaining knowledge of the substantial
evidence of a quality issue to initiate an investigation report, with updates
as needed.


6.2           It shall be the sole responsibility
of Reliant to issue a product recall, and discuss with FDA the extent or type
of action that should occur.  Decisions
to initiate a product recall shall be based on product medical reviews and the
investigation report used to support the FDA Field Alert.


 


7.             Audits by Reliant
Pharmaceuticals


 


7.1           Reliant Pharmaceuticals shall have
the right to perform audits of departments responsible in the manufacture of
the Products at least annually. .  Abbott
shall provide Reliant Quality, or representative, access to all facilities and
records pertaining to the manufacture of the drug product.


7.2           Reliant Quality shall provide 20
business days notification for a routine audit, and 3 business days’
notification for a ‘for cause’ audit pertaining to product quality or safety.


7.3           Reliant Quality, or representative,
shall provide an exit meeting to Abbott management to detail significant
observations.  A written report of
observations shall be issued to Abbott QA.


7.4           Abbott shall provide a written
response to the audit observations within 20 business days.  The response shall include details of the
corrective actions to the observations, and the expected completion date of the
action.  Reliant Quality shall follow-up
on the progress of the corrective actions based on the expected completion
dates provided.


 


 


11

















 


 


 


 


 


 


 


 


 


 


VII          REGULATORY


 


All final, Regulatory assessments pertaining to the
manufacture, release, and distribution of the Products shall be the
responsibility of Reliant’s Regulatory Affairs group.


 


1.             Inspections by Regulatory
Agencies


 


1.1           Abbott shall inform Reliant
Pharmaceuticals of any Regulatory Agency performing an inspection relating to
the Product(s), or a facilities inspection affecting the Product(s) within the
same business day of notification.  Reliant
Quality Department may be present at any inspections and exit meetings specific
to the Product(s).


1.2           All Product(s) specific regulatory
correspondence, or facilities correspondence affecting the manufacturing of the
Product(s) shall be conveyed to Reliant Quality Department within 2 business
days of receipt.  Abbott shall provide
written responses to all Product(s) related observations for Reliant review
prior to commitment to any regulatory authority.


1.3           Abbott shall provide copies of all
regulatory agency inspection documentation (i.e. 483’s, EIR’s, etc.) or any
other regulatory correspondence pertaining to the Product(s) to Reliant Quality
Department within two business days of receipt. 
A redacted copy may be provided to protect other customer’s products.


2.             Annual Reports


 


2.1           It shall be the sole responsibility
of Reliant Pharmaceuticals to maintain all regulatory communication and updates
(Supplements, CBE, Annual Reports, etc.) pertaining to the Products as outlined
in ICH and FDA regulatory guidance documents. 
All necessary CMC documentation updates will be conveyed to Abbott, who
shall provide the necessary documentation to Reliant Regulatory not less than
45 days prior to filing date.


 


	
  Product

  	
  Filing
  date

  
	
  Rythmol

  	
  10/31

  
	
  Rythmol
  SR

  	
  9/4

  



 


3.             Drug Listing


 


3.1           It shall be the responsibility of
Reliant Regulatory to submit FDA Form #2657 every June and December updating
the Drug Product Listing.  When no
changes have occurred since the previously submitted list, no report is
required.


 


12

















 


VIII           VALIDATION


 


Abbott shall assure that all systems used to
manufacture, test, release, and distribute the Product shall have been
appropriately transferred, qualified, and/or validated prior to using that system
to process the Product.


 


1.             Process


 


1.1           Abbott shall be responsible for
performing and documenting process validation to comply with cGMP’s and to
ensure consistency of quality Product.  A
draft process validation protocol shall be forwarded to Reliant for review and
approval prior to carrying out the validation.


 


 


2.             Equipment Cleaning Validation


 


2.1           Abbott is responsible for reviewing
toxicity and safety information for all products they manufacture to set
appropriate cleaning limits to ensure there are no cross contamination issues
between products.  Abbott shall
demonstrate, through approved protocol and final report, that cleaning
validation has been performed for the Product(s).


 


3.             Analytical Test Methods


 


3 .1          Abbott shall be responsible for demonstrating
the validity of all methodology used for in-process control, and release of all
materials, Active Compound, components and the Product.  This validation, or verification in the case
of a compendial raw material item, will be demonstrated.  This validation shall be established, through
approved protocol and final report, based on the current ICH and FDA validation
guidance documents.  Method validation
shall be performed consistent with Abbott-approved procedures.  . 
Suitability of all compendia methodology will be demonstrated, and
written in a report, prior to use for release of materials, Active Compound,
components, or the Product(s).


 


4.             Computer


 


4.1           Abbott is responsible for compliance
as it pertains to systems validation, electronic records, electronic records
retention, and electronic signatures for those systems used in the control of
the manufacturing processes, analytical testing, receipt, release and
distribution of materials, API’s, components, and Product(s) as prescribed by
21 CFR part 11, and any other current, approved FDA Guidance requirements.


 


13

















 


REVISION HISTORY


	
  Revision Date

  	
  Revision Approval (Reliant)

  	
  Revision Approval

  ([Manufacturer])

  	
  Revision Description

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 


 


 


 


 


 


 


 


 


 


 


 


[Remainder of page intentionally left blank]


 


14

















 


IN WITNESS WHEREOF, the Parties have affixed hereto
their authorized signatures as follows:


 


 


 


	
  RELIANT PHARMACEUTICALS, LLC

  	
   

  	
  ABBOTT LABORATORIES

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
   

  	
  Name: Teri Hoen

  
	
  Title:

  	
   

  	
  Title: Div.
  V.P., Quality, Finished Goods

  
	
   

  	
   

  	
  Operations, US
  and Puerto Rico

  
					



 


 


15

















 


EXHIBIT 8.8


 


ALTERNATIVE DISPUTE RESOLUTION


 


The Parties recognize
that a bona fide dispute as to certain matters may arise from time to time
during the term of this Agreement which relates to either Party’s rights and/or
obligations. To have such a dispute resolved by this Alternative Dispute
Resolution (“ADR”) provision, a Party first must send written notice of
the dispute to the other Party for attempted resolution by good faith
negotiations between the President of Company Pharmaceuticals, Inc. and the
Senior Vice President, Pharmaceutical Products Division, of Abbott (or their equivalents)
of the affected subsidiaries, divisions, or business units within thirty (30)
days after such notice is received (all references to “days” in this ADR
provision is to calendar days).


 


Any negotiations
regarding a dispute shall be treated as settlement negotiations for the
purposes of the Federal Rules of Evidence and any similar state rules of
evidence. Such negotiations shall not be admissible in any subsequent ADR
hearing.


 


If the matter has not been resolved within
thirty (30) days of the notice of dispute, or if the Parties fail to meet
within such thirty (30) days, either Party may initiate an ADR proceeding as
provided herein. The Parties shall have the right to be represented by counsel
in such a proceeding.


 


1.                                       To begin an ADR proceeding, a Party shall provide written notice
to the other Party of the issues to be resolved by ADR. Within fourteen (14)
days after its receipt of such notice, the other Party may, by written notice
to the Party initiating the ADR, add additional issues to be resolved within
the same ADR.


 


2.                                       Within twenty-one (21) days following receipt of the original ADR
notice, the Parties shall select a mutually acceptable neutral to preside in
the resolution of any disputes in this ADR proceeding. If the Parties are
unable to agree on a mutually acceptable neutral within such period, either
Party may request the President of the CPR Institute for Dispute Resolution (“CPR”),
366 Madison Avenue, 14th Floor, New York, New York 10017, to select
a neutral pursuant to the following procedures:


 


(a)                                  The CPR shall submit to the Parties a list of not less than five
(5) candidates within fourteen (14) days after receipt of the request, along
with a Curriculum Vitae for each candidate. No candidate shall be an employee,
director, or shareholder of either Party or any of their subsidiaries or
affiliates.


 


(b)                                 Such list shall include a statement of disclosure by each
candidate of any circumstances likely to affect his or her impartiality.


 


(c)                                  Each Party shall number the candidates in order of preference
(with the number one (1) signifying the greatest preference) and shall deliver
the list to the CPR within seven (7) days following receipt of the list of
candidates. If a Party believes a conflict of interest exists regarding any of
the candidates, that Party shall provide a written explanation of the conflict
to the CPR along with its list showing its order of


 


38

















 


preference for the candidates. Any Party failing to return a list
of preferences on time shall be deemed to have no order of preference.


 


(d)                                 If the Parties collectively have identified fewer than three (3)
candidates deemed to have conflicts, the CPR immediately shall designate as the
neutral the candidate for whom the Parties collectively have indicated the
greatest preference. If a tie should result between two candidates, the CPR may
designate either candidate. If the Parties collectively have identified three
(3) or more candidates deemed to have conflicts, the CPR shall review the
explanations regarding conflicts and, in its sole discretion, may either (i)
immediately designate as the neutral the candidate for whom the Parties
collectively have indicated the greatest preference, or (ii) issue a new list
of not less than five (5) candidates, in which case the procedures set forth in
subparagraphs 2(a) – 2(d) shall be repeated.


 


3.                                       No earlier than twenty-eight (28) days or later than fifty-six
(56) days after selection, the neutral shall hold a hearing to resolve each of
the issues identified by the Parties. The ADR proceeding shall take place at a
location agreed upon by the Parties. If the Parties cannot agree, the neutral
shall designate a location other than the principal place of business of either
Party or any of their subsidiaries or affiliates.


 


4.                                       At least seven (7) days prior to the hearing, each Party shall
submit the following to the other Party and the neutral:


 


(a)                                  a copy of all exhibits on which such Party intends to rely in any
oral or written presentation to the neutral;


 


(b)                                 a list of any witnesses such Party intends to call at the hearing,
and a short summary of the anticipated testimony of each witness;


 


(c)                                  a proposed ruling on each issue to be resolved, together with a
request for a specific damage award or other remedy for each issue. The
proposed rulings and remedies shall not contain any recitation of the facts or
any legal arguments and shall not exceed one (1) page per issue.


 


(d)                                 a brief in support of such Party’s proposed rulings and remedies,
provided that the brief shall not exceed twenty (20) pages. This page
limitation shall apply regardless of the number of issues raised in the ADR
proceeding.


 


Except as expressly set forth in
subparagraphs 4(a) – 4(d), no discovery shall be required or permitted by any
means, including depositions, interrogatories, requests for admissions, or
production of documents.


 


5.                                       The hearing shall be conducted on two (2) consecutive days and
shall be governed by the following rules:


 


(a)                                  Each Party shall be entitled to five (5) hours of hearing time to
present its case. The neutral shall determine whether each Party has had the
five (5) hours to which it is entitled.


 

















 


(b)                                 Each Party shall be entitled, but not required, to make an opening
statement, to present regular and rebuttal testimony, documents or other
evidence, to cross-examine witnesses, and to make a closing argument. Cross-examination
of witnesses shall occur immediately after their direct testimony, and
cross-examination time shall be charged against the Party conducting the
cross-examination.


 


(c)                                  The Party initiating the ADR shall begin the hearing and, if it
chooses to make an opening statement, shall address not only issues it raised
but also any issues raised by the responding Party. The responding Party, if it
chooses to make an opening statement, also shall address all issues raised in
the ADR. Thereafter, the presentation of regular and rebuttal testimony and
documents, other evidence, and closing arguments shall proceed in the same
sequence.


 


(d)                                 Except when testifying, witnesses shall be excluded from the
hearing until closing arguments.


 


(e)                                  Settlement negotiations, including any statements made therein,
shall not be admissible under any circumstances. Affidavits prepared for
purposes of the ADR hearing also shall not be admissible. As to all other
matters, the neutral shall have sole discretion regarding the admissibility of
any evidence.


 


6.                                       Within seven (7) days following completion of the hearing, each
Party may submit to the other Party and the neutral a post-hearing brief in
support of its proposed rulings and remedies, provided that such brief shall
not contain or discuss any new evidence and shall not exceed ten (10) pages. This
page limitation shall apply regardless of the number of issues raised in the
ADR proceeding.


 


7.                                       The neutral shall rule on each disputed issue within fourteen (14)
days following completion of the hearing. Such ruling shall adopt in its
entirety the proposed ruling and remedy of one of the Parties on each disputed
issue but may adopt one Party’s proposed rulings and remedies on some issues
and the other Party’s proposed rulings and remedies on other issues. The
neutral shall not issue any written opinion or otherwise explain the basis of
the ruling.


 


8.                                       The neutral shall be paid a reasonable fee plus expenses. These
fees and expenses, along with the reasonable legal fees and expenses of the
prevailing Party (including all expert witness fees and expenses), the fees and
expenses of a court reporter, and any expenses for a hearing room, shall be
paid as follows:


 


(a)                                  If the neutral rules in favor of one Party on all disputed issues
in the ADR, the losing Party shall pay 100% of such fees and expenses.


 


(b)                                 If the neutral rules in favor of one Party on some issues and the
other Party on other issues, the neutral shall issue with the rulings a written
determination as to how such fees and expenses shall be allocated between the
Parties. The neutral shall allocate fees and expenses in a way that bears a
reasonable relationship to the outcome of the ADR, with the Party prevailing on
more issues, or on issues of greater value or gravity, recovering a relatively
larger share of its legal fees and expenses.


 

















 


9.                                       The rulings of the neutral and the allocation of fees and expenses
shall be binding, non-reviewable, and non-appealable, and may be entered as a
final judgment in any court having jurisdiction.


 


10.                                 Except as provided in paragraph 9
or as required by Law, the existence of the dispute, any settlement
negotiations, the ADR hearing, any submissions (including exhibits, testimony,
proposed rulings, and briefs), and the rulings shall be deemed Confidential
Information. The neutral shall have the authority to impose sanctions for
unauthorized disclosure of Confidential Information.