Exhibit
10.44


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND
FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
WITH RESPECT TO THE OMITTED PORTIONS.


 


FIRST
ADDENDUM TO THE TERMS & CONDITIONS DATED FEBRUARY 17, 2004


THERAVANCE, INC. AND BEN VENUE
LABORATORIES, INC.


 


This First Addendum (the “Addendum”) to the Terms
& Conditions Agreement dated on or about February 17, 2004 between Ben
Venue Laboratories, Inc., with its office at 300 Northfield Road, Bedford, Ohio
44146 (“BVL”) and Theravance, Inc., 901 Gateway Blvd., South San Francisco, CA
94080 (“Theravance”).  BVL and Theravance
may be referenced herein individually as a “Party” and jointly and the “Parties.”


 


1.     RECITALS


 


                WHEREAS, on or about February 17, 2004, the Parties entered
into a certain Terms & Conditions Agreement relating to BVL’s manufacturing
of TD-6424, a copy of which is attached and incorporated by reference as
Exhibit “A” (the “Agreement”); and


 


WHEREAS, the Parties mutually desire to amend
the Agreement to include a quality agreement, a copy of which is attached and
incorporated by reference as Attachment “A” (the “Quality Agreement”).


 


NOW THEREFORE, for good and valuable consideration,
the receipt and legal sufficiency of which is hereby acknowledged, the Parties
agree as follows:


 


1.               Additional Section


 


1.1.           A new Section 23.3 shall be added to the Agreement
which shall state:


 


 


23.3. 
Quality Agreement. Certain quality matters relating
to Product are included in the Quality Agreement which is attached and incorporated
herein by reference as Attachment “A” (the “Quality Agreement”).  If any provision of the Quality Agreement is
irreconcilably inconsistent with the terms of this Agreement, the terms of this
Agreement shall prevail.  Unless defined to the contrary within the
Quality Agreement, the terms defined in this Agreement shall have the same
meaning in the Quality Agreement.


 


1.2.           All other terms and conditions of the Agreement shall
remain in full force and effect.


 


 


2.               Execution


 


FOR:      BEN VENUE LABORATORIES, INC.


 


 


 




	
  Signature:

  	
  /s/[*]

  	
  Date: September 19, 2007

  
	
   

  	
  [*]

  	
   

  
	
   

  	
  Vice President, Contract Manufacturing Services

  	
   

  
				






 


 


 


FOR:      THERAVANCE, INC.


 


 


 




	
  Signature:

  	
  /s/ A.L. Campbell

  	
  Date: September 21, 2007

  
	
   

  	
  Name: Arthur Campbell

  	
   

  
	
   

  	
  Title:Senior Vice President, Technical Operations,
  Process R&D

  






 


 

















CONFIDENTIAL


[COPY]


 


Terms and Conditions for the
Manufacture of Products by Ben Venue Laboratories, Inc


 


This signed agreement is required to provide services and manufacture
your Product, TD-6424, at Ben Venue Laboratories, Inc. This agreement covers
all Products & services for the development and manufacture of TD-6424 for
Theravance, Inc. at Ben Venue and remains in place until superceded by a formal
supply agreement.


 


By:


 


Ben Venue Laboratories, Inc.


300 Northfield Road


Bedford, Ohio 44146


 


Hereinafter referred to as BVL, and


 


Theravance, Inc.


901 Gateway Blvd.


South San Francisco, CA 94080


 


Hereinafter referred to as Customer,


 


agree to the following terms and conditions in reference to the
development and manufacture of Customer’s Products at BVL.


 


1. Facilities


 


1.1 BVL will provide manufacturing facilities that conform to current
Good Manufacturing Practices established by the FDA and will perform its
obligations hereunder and supply Product in accordance with all applicable laws
and regulations and in accordance with written documentation provided to
Customer.


 


1.2 All services will be performed at BVL facilities unless otherwise
agreed to in writing by BVL and Customer.


 


2. Audits


 


2.1 Customer and any third-party consultant appointed by Customer shall
have reasonable access to observe manufacturing activities, as needed and
inspect BVL’s facilities and procedures with respect to the Products including
all analytical and manufacturing documentation directly related to the Products
upon scheduling in advance with BVL’s compliance manager. Any such Customer
appointed third-party consultant must be pre-approved by BVL and be bound in
writing to the Confidentiality Agreement signed by Customer and BVL. Customer
shall have the right to one annual compliance audit each year to (i) observe,
inspect and audit the manner in which BVL, conducts quality control of Customer
Products, (ii) inspect BVL’s plant and records relating to BVL’s quality and
other controls related to its manufacture of the Products For cause audits will
be scheduled as mutually agreed to by the parties.


 


2.2 Customer’s employees and/or representatives including consultants
who inspect BVL facilities shall comply with all BVL policies and procedures.
Customer assumes all liability resulting from presence of Customer’s employees
at BVL facilities.


 


3. Materials & Documentation


 


3.1 Customer will provide active drug substance and any other mutually
agreed to Customer supplied components [*] in advance of scheduled
manufacturing date in accordance with BVL’s procedures.


 


3.2 BVL will, at a minimum, perform [*] test to verify active drug
substance as incoming material.


 


3.3 BVL will release all materials provided by BVL.


 


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS. 


 

















CONFIDENTIAL


[COPY]


 


3.4 Customer will provide materials and manufacturing information
necessary for the development and manufacturing of Products.


 


 


3.5 Customer will specify samples to be sent for testing and provide
address for shipment on the purchase order for all sample request not included
in the Master Production Record.


 


 


3.6 BVL will provide, at Customer’s request, a copy of the BVL Drug
Master File (DMF) and authorization for FDA to access the DMF. This may be used
by the Customer to prepare a Regulatory filing.


 


 


3.7 BVL shall deliver Product and/or Services to Customer in compliance
with quotations provided to Customer which shall be referenced by quotation
number on Customer’s purchase order, which shall include by reference
specifications mutually agreed upon by the Customer and BVL. For manufacturing
services said specifications must be incorporated in the master batch record or
in a special instruction to a specific batch record.


 


 


3.8 BVL will submit to Customer a Certificate of Compliance, a
Certificate of Analysis listing results of testing, and a BVL QA approved
completed batch record for each lot of Product manufactured.


 


 


3.9 Customer will provide written QC testing requirements, methods,
specifications and reference standard for the drug Product. Customer will
provide a Certificate of Analysis for the Active Pharmaceutical Ingredient and
reference standard. Customer will approve initial testing documents, the Master
Production Record, Packaging Record, Master Labels and any revisions of the
documents thereafter. Revisions of approved documents requested within eight
weeks of scheduled manufacturing or other services may cause a delay or
postponement of manufacturing and/or other services requested by the Customer.


 


3.10 Customer is responsible for notifying BVL with instruction for
disposition of tailings and rejects, which will be incorporated into the Master
Batch Record and include a shipment address for tailing and rejects if Customer
requests return of tailings and rejects.


 


3.11 Customer will evaluate BVL Certificate of Analysis 3.12 Customer
will provide written authorization to BVL prior to shipment of Product.


 


3.12 Customer will be financially responsible for all materials
purchased by BVL on Customer’s behalf based on requirements communicated by
Customer to BVL in [*] Purchase Orders, [*].


 


4. Purchase Orders


 


4.1 Customer will provide Purchase Orders with information defined in
Item 4.2 at least [*] in advance of the requested manufacturing date or [*] in
advance of the requested delivery date. Purchase Orders for other services will
be issued by the Customer on a mutually agreed upon timeline with BVL. All
purchase orders will reference the BVL quotation number(s) provided to
Customer.


 


4.2 The following information must be included on all Purchase Orders


 


4.2.1 BVL end item number or description of service
outlined in the Quotation provided to Customer


4.2.2 BVL Product description or service description


4.2.3 Batch Size in vials from Quotation


4.2.4 Number of Batches


4.2.5 Delivery Date (Date for BVL, to release the lot
and deliver Product & batch record)


4.2.6 BVL Quotation Number for Product/Service


4.2.7 Delivery Address


4.2.8 Shipping requirements & Instructions
(temperature, dedicated trucks, preferred carrier, overnight etc.) Contact name
for Preferred Carrier, Temperature Monitors, Ship on BVL Release or Hold for
Customer Authorization to Ship or Ship in Quarantine.


4.2.9 Billing Address


 


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS. 

















CONFIDENTIAL


[COPY]


 


4.2.10 Special Instructions for Specific Batch


 (Examples)


 “Annual
Stability Batch”


  “Process
Validation Batch”


“Special Sampling Instructions” mutually agreed to in
advance


4.2.11 Customer Lot# and Expiration Date if Applicable


 


5. Forecast & Planning


 


5.1 Customer shall submit at least [*] before the start of each [*] an
updated estimate for both volumes and delivery dates of its requirement for
Product for the following [*]. The estimated requirements for the first of
these [*] shall be considered firm orders for which Customer will issue
purchase orders pursuant to Section 4 of this agreement. In addition a [*]
forecast will be submitted by the Customer to BVL on [*] for the following [*].
Ben Venue shall provide Customer with a forecast template to be used for all
forecasts. All forecasts provided shall be non binding on either party, unless
agreed to in writing by both parties and shall be subject to acceptance of a
purchase order which will be confirmed in writing by BVL.


 


6. Insurance and Liability Limits


 


6.1 Customer will retain title to and risk of loss of the bulk active
drug substance, in process and in finished Product, except if BVL damages the
material while in storage at BVL’s facility, [*]. BVL will maintain general
liability insurance in an amount sufficient to cover the replacement cost of
Customer supplied raw materials [*], and will include Customer as an additional
insured under the relevant policies. For Process related losses see BVL 6.2.


 


6.2 After such time as all Production and Testing Procedures have been fully
developed and validated and a complete and successful technical transfer to BVL’s
production department has occurred, BVL will [*] Customer [*] per batch for any
[*] of customer supplied raw materials and/or components and will [*] the
manufacturing fee, if an invoice for the manufacturing fee has been issued for
the production, for any batch of Product which does not meet the specifications
contained in the master batch record, [*] portion of the batch if applicable.
The monetary values of all Customer supplied raw materials and components must
be disclosed to BVL prior to production in the questionnaire provided by BVL to
Customer. The Customer is responsible for notifying BVL in writing of any
changes in the value of the raw material or components supplied to BVL.
Further, any such [*] must be due to [*] or to [*] on their part.


 


6.3 BVL [*] for Customer’s consequential damages, including but not
limited too loss of sales, profit, clinical trial costs, regardless of the
reason for such consequential damages.


 


7. Safety


 


7.1 BVL and Customer shall mutually develop safety procedures for the
handling and manufacture of Product and treatment and disposal of waste
relating thereto that comply with all federal and state environmental and
occupational safety and health requirements. Such procedures shall be included
in a separate document and shall be followed by BVL and Customer in performing
services under this agreement.


 


7.2 Customer will provide Material Safety Data Sheets and other
handling information required by law, to be provided prior to shipment of any
material to BVL. BVL will not receive any material until all required
information has been provided.


 


7.3 Customer will provide BVL with [*] regarding safety of biological
and drug Products [*].


 


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS. 

















CONFIDENTIAL


[COPY]


 


8. Payment and Pricing


 


8.1 Customer acknowledges that all invoices must be paid to BVL no
later than [*] after the Acceptance Period. The Acceptance Period is defined as
the time when the Customer receives the Certificate of Analysis, Certificate of
Compliance and BVL QA approved completed batch record for review and approval
for accepting the Product, . Customer must notify BVL within [*] after receipt
of COA, COC, and BVL QA approved, completed batch record, if invoice is to be
disputed. For manufacturing services an invoice will be issued after BVL’s
Documentation Department has issued a Certificate of Compliance or, if
applicable, at the time a Quarantine shipment is made, for non production
services invoices will be sent in accordance with the terms outlined in
Proposals / Quotations provided to Customer as work is performed for those
services


 


Any invoice(s) remaining to be paid after [*] from the date of the
Acceptance Period), unless such invoice(s) are in dispute, will result in [*].


 


8.3 Customer acknowledges that all prices of Product shall be on the
basis of F.O.B. on the dock at BVL plant, Bedford, Ohio.


 


8.4 Customer may be asked to [*] the Purchase Order [*].


 


8.4 BVL will consider that the Product has been accepted by Customer,
unless BVL is notified in writing within [*] after shipment of the completed
batch record that the Product fails to conform to applicable specifications or
cGMP.


 


8.5 Pricing will be established in Proposal/Quotations provided to
Customer by BVL.


 


9. Cancellation or Postponement


 


9.1 Customer will pay a cancellation fee of [*] if cancellation or
postponement is within [*] of the scheduled manufacturing date. If cancellation
occurs within [*] of the scheduled fill date, Customer is responsible for
paying [*].


 


10. Storage


 


10.1 Customer is responsible for storage charges for Products stored more
than [*] beyond BVL’s release. A formal quotation for these charges may be
obtained from BVL’s Contract Service Department. These charges are reviewed
annually. Short term storage of Product in BVL’s warehousing facilities beyond
one month must receive prior approval from BVL. Such approval will be granted
on a space-available basis.


 


11. Stability Program


 


11.1 Customer is responsible for stability testing program. Customer
may contract with BVL to perform stability testing under separate proposals
provided to Customer by BVL based on a mutually agreed to protocol.


 


12. Retention Samples


 


12.1 Customer is responsible for maintaining retention samples of all
finished Product shipped to Customer.


 


13. Release for Sale and/or Distribution


 


13.1 Customer is responsible for release of the final Product for sale
or distribution.


 


14. Complaints


 


14.1 Customer is responsible for maintaining complaint file and
notifying BVL of complaints relating to manufacturing defects.


 


15. Regulatory


 


15.1 Customer is responsible for securing the necessary regulatory
approvals for the Product.


 


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS. 

















CONFIDENTIAL


[COPY]


 


15.2 Customer is responsible for Drug Listing of Product and providing
a copy of Drug Establishment Regulatory Form 2656 to BVL once Product is
approved by U.S. FDA for marketing.


 


15.3 Customer will certify that the Product to be manufactured by BVL
shall not be processed, packed, or distributed in violation of any provision of
the Federal Food, Drug and Cosmetic Act.


 


15.4 Customer is responsible for all Product specific Agency(s) filings
including the Annual Report filing with the FDA.


 


15.5 Customer is responsible to insure that all filings with any agency
are consistent with the specifications for the Product contained in [*].


 


15.6 Customer will provide BVL with copies of all regulatory approvals
for both clinical and commercial use of the Product and in addition provide BVL
with [*] filings in all countries for both clinical and commercial use, BVL
requires this information to be on file at BVL for regulatory agencies.


 


16. Confidentiality


 


16.1Unless otherwise stated, the terms of this Confidentiality section
are mutual between BVL and Customer as either a Disclosing Party or Receiving
Party as the case may be.


 


16.2 Information including but not limited to, data, reports, patents,
patent applications, trade secrets, or the like concerning any scientific,
technical, financial, trade, or business information applicable to the
specifically agreed to project shall be referred to herein as. “Confidential
Information”. The Customer shall provide such Confidential Information to BVL
as Customer, in consultation with BVL, believes is necessary for BVL to perform
the services the parties have mutually agreed to. BVL shall provide to Customer
such BVL Confidential Information as is necessary for Customer to evaluate the
services and the Product. The Receiving party agrees to protect and keep
confidential all Confidential Information and all notes of information obtained
pursuant to this Agreement. BVL agrees that it shall limit its use of the
Customer Confidential Information to performing certain services as mutually
agreed to in writing by the Parties. The Receiving Party also agrees that it
shall not use any Confidential Information, directly or indirectly, for its own
benefit or that of any person, firm or corporation other than the Disclosing
Party; provided, however, Customer shall be entitled to use any data or other
information necessary to prepare the Product. All information exchanged
regardless of format shall be considered Confidential Information.


 


16.3 Subject to Paragraph 16.2, the Receiving Party agrees and
acknowledges that the Confidential Information to be disclosed to it pursuant
to this Agreement constitutes unique and valuable commercial and proprietary
information of the Disclosing Party. Accordingly, the Receiving Party shall not
duplicate, disclose, or discuss any such Confidential Information to or with
third parties, without the prior written consent of the Disclosing Party.
Except that the Receiving Party may disclose Confidential Information received
by it under this Agreement only to those of its directors, officers, employees,
agents, and consultants who have a need to know such Confidential Information
in the course of the performance of their duties with respect to the purposes
of this Agreement and who are bound by written agreement to protect the
confidentiality of such Confidential Information in accordance with the terms
hereof.


 


16.4 Notwithstanding anything to the contrary herein, the Receiving
Party shall not be obligated to maintain the confidentiality of any information
provided to it under this Agreement which:


 


a.             Is already in the
public domain at the time of disclosure to it, or


b.             at any time after
disclosure to the Receiving Party becomes public knowledge through no fault of
the Receiving Party;


c.             is disclosed to the
Receiving Party by any third party who is free to make such disclosure; or


d.             is disclosed by the
Receiving Party with the prior written consent of the Disclosing Party, or


e.             is information
which the Receiving Party can establish was in its possession prior to
disclosure or was subsequently and independently developed by employees of or
on behalf of the Receiving Party without use, direct or indirect, of
Confidential Information protected by this Agreement.


 


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS. 

















CONFIDENTIAL


[COPY]


 


f.              is required to be
disclosed pursuant to a requirement of law, subject to provisions outlined in
Item 16.8 of Section 16 of this agreement.


 


16.5 The confidential undertakings and agreements of the Receiving
Party shall survive termination of this Agreement. Promptly upon termination of
this Agreement and request of the Disclosing Party, the Receiving Party shall
return to the Disclosing Party all notes of information obtained pursuant
hereto and summaries thereof and any copies of documents of the Disclosing
Party, personnel interviews, or other Confidential Information in its
possession. This Agreement shall not be construed as a grant of any right or
license to the Receiving Party with respect to Confidential Information or the
Customer’s Product or as a requirement to either party to enter into any
further arrangement with respect to Confidential Information the Customer’s
Product or BVL’s services. The foregoing is subject to the provisions of
Paragraph 16.2.


 


16.6 The confidentiality obligations of this Agreement shall be
maintained for a period of [*] beyond the expiration or termination of this
Agreement.


 


16.7 Provided all obligations of this Agreement are maintained, the
parties understand and acknowledge that the other may now market or have under
development products which are competitive with products now offered or which
may be offered by the other, and the parties’ communications hereunder will not
serve to impair the right of other to develop, make, use, procure, or market
products or services now or in the future which may be competitive to those
offered by the other party nor for the parties to disclose any planning or
other information to the other.


 


16.8 Notwithstanding any provision herein to the contrary, in the event
that any Receiving Party hereafter becomes obligated by mandatory applicable
law, regulatory rule or judicial or administrative order to disclose
Confidential Information or any portion thereof, to any third party,
governmental authority or court, the Receiving Party shall immediately notify
the Disclosing Party thereof of each such requirement and identify the
Confidential Information so required thereby, so that the Disclosing Party may
seek an appropriate protective order or other remedy with respect to narrowing
the scope of such requirement and/or waive Receiving Party’s compliance with
the provisions of this Agreement.


 


16.9 Both parties agree that should this Agreement be breached, money
damages would be inadequate to remedy such a breach. As a result, the
non-breaching party shall be entitled to seek, and a court of competent
jurisdiction may grant, specific performance and injunctive or other equitable
relief as a remedy for any such breach of this Agreement. Such remedy shall be
in addition to all other remedies, including money damages, available to a
non-breaching party at Law or in equity.


 


16.10 Upon request and subject to the other provisions of this
Agreement, each party shall return all copies of the Confidential Information
to the other party, except for a single copy to be kept by it’s legal counsel
in its confidential file for the purpose of determining compliance with its obligations
of this Agreement.


 


16.11 Neither party will issue any press release or other public
announcement relating to any activities involving the other party without the
prior written consent of the other party, except where such announcements are
required by law or regulation. The parties will use all reasonable efforts to
consult with the other and cooperate with respect to wording of any such
announcement.


 


16.12 New techniques, inventions, processes and know-how (hereinafter “New
Developments”) that are useful in the Manufacturing, using or selling of the
Product may be developed by BVL during the performance of this Agreement. To
the extent Customer’s Confidential Information is used to make any such New
Development, then Customer shall have ownership of such New Development, and
BVL shall have a non-transferable, non-exclusive, royalty-free, worldwide,
perpetual, license to make, use New Development such license shall not include
BVL’S use of Customer’s Confidential Information or use of New Development to
make Product. Notwithstanding the grant of such license, BVL shall not use such
New Development or Customer’s Confidential Information to make, or assist third
parties to make Product. BVL agrees to cooperate in the filing and prosecution
of all New Development patent applications owned by Customer, but Customer
shall bear all associated expenses. As to New Developments that may be
developed by BVL during the performance of this Agreement and do not use
Customer’s Confidential Information, BVL grants Customer a non-transferable,
royalty-free, irrevocable, worldwide, non-exclusive license to make, have made,
use or sell the New Development in connection with Product.


 


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS. 

















CONFIDENTIAL


[COPY]


 


17. Batch Rejections


 


17.1 BVL will reserve the right to sample and retest Product per
defined SOP if, prior to Customer’s release, Customer claims that Product fails
to meet applicable specifications.


 


17.2 Customer will provide an approved rework procedure (if Product can
be reworked).


 


17.3 In the event of a rejection of a batch of Product, BVL will cease
further production of Product until such time as the results of the
investigation have been communicated to Customer and Customer has confirmed the
corrective action. Should Customer desire to have Product manufactured while
the investigation is in process, Customer will be responsible for the fees for service
performed by BVL whether the batch is accepted or rejected by Customer or BVL.
Customer will provide a written statement of financial responsibility upon
requesting BVL to perform additional production while investigations and
corrective actions are being determined by BVL and Customer.


 


17.4 Customer may reject any commercial, developmental or clinical
Products manufactured for Customer if such Products fail to comply with
Manufacturing Instructions and Specifications, incorporated in the master batch
record, previously agreed upon by Customer and Ben Venue. However, until such
time as all manufacturing processes and/or analytical procedures are validated,
Customer will be financially responsible for all BVL fees for services for each
batch of Product provided by BVL, at prices confirmed by quotation(s) and
purchase orders, unless such batch is rejected due to [*] of BVL. Customer
acknowledges that until all processes and methods are [*] that additional cost
may be incurred for unanticipated developmental issues.


 


18. Term and Termination


 


18.1 This agreement remains in effect until superceded by a future
agreement or upon termination by either party.


 


18.2 This agreement may be terminated by either party by giving [*]
written notice to the other.


 


19. Notices


 


19.1All notices required or permitted hereunder shall be given in
writing and sent by mailed postage prepaid, certified or registered mail,
return receipt requested, or sent by a nationally recognized express courier
service, or hand-delivered at the following addresses:


 


	
   

  	
  If to Ben Venue:

  	
  Ben Venue Laboratories, Inc.

  
	
   

  	
   

  	
  A Boehringer–Ingelheim Company

  
	
   

  	
   

  	
  Attn: General Manager

  
	
   

  	
   

  	
  Contract Manufacturing Services

  
	
   

  	
   

  	
  300 Northfield Road

  
	
   

  	
   

  	
  Bedford, Ohio 44 146

  
	
   

  	
   

  	
  Fax:[*]

  
	
   

  	
   

  	
   

  
	
   

  	
  If to Theravance:

  	
  Theravance, Inc.

  
	
   

  	
   

  	
  Attn: General Counsel

  
	
   

  	
   

  	
  901 Gateway Blvd.

  
	
   

  	
   

  	
  South San Francisco, CA 94080,

  
	
   

  	
   

  	
  Fax: [*]

  



 


Notices shall be effective upon receipt. A party may change its address
listed above by written notice to the other party.


 


20. Amendments and Waiver of Provision


 


20.1 This Agreement may only be amended by a written instrument duly
executed by both parties.


 


20.2 No waiver of any provision of this Agreement shall be effective
unless the party whose rights are being waived duly executes it. No waiver with
respect to any one occurrence, action, or inaction shall be effective with
respect to any subsequent or other occurrence, action or inaction, similar or
otherwise.


 


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS. 

















CONFIDENTIAL


[COPY]


 


21. Assignment


 


21.1 This Agreement may not be assigned by either party hereto EXCEPT
to an affiliate or a purchaser of all or substantially all of the stock or
assets of either one of the parties without the prior written consent of the
other and shall be binding upon and inure to the benefit of the successors and
permitted assigns of each party.


 


22. Governing Law


 


22.1 This Agreement and the rights, duties and obligations of the
parties hereunder shall be governed by and construed in accordance with the
laws of the State of Delaware, USA.


 


23. Miscellaneous


 


23.1 Customer will provide the name and phone numbers of a contact
person(s) who may he called at any hour during the times when BVL is
manufacturing the Product.


 


23.2 Nothing contained in this Agreement shall be construed, by
implication or otherwise, as an obligation to enter into any further agreement
relating to any of the Confidential Information or as the grant of a license to
either party to use the other’s Confidential Information other than for the
purpose herein.


 


These terms and conditions supersede any
conflicting Terms and Conditions contained with the Customer’s Purchase Orders
or on BVL’s Purchase Order acknowledgment. Customer acknowledges that these
terms and conditions are incorporated by reference on every purchase order.


 


THIS DOCUMENT SUPERSEDES ALL
OTHER DOCUMENTS AND AGREEMENTS.


 


For BEN VENUE LABORATORIES, INC. (BVL)


 


 


	
  BY

  	
   /s/[*]

  	
   

  
	
   

  	
  [*]

  
	
   

  	
  General Manager,Contract Manufacturing Services

  	
  Date: 2-17-2004

  
	
   

  	
   

  
				



 


 


For: THERAVANCE, INC.


 


	
  BY

  	
   /s/ A.L.
  Campbell

  	
   

  
	
   

  	
  Arthur Campbell

  	
   

  
	
   

  	
  Senior Vice President, Technical Operations, Process
  R&D

  	
  Date: Feb 13, 04

  
	
   

  	
   

  	
   

  
				



 


 


[*]=CERTAIN INFORMATION HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS. 

















CONFIDENTIAL


 


Attachment “A”


Quality
Agreement


Theravance,
Inc. and Ben Venue Laboratories, Inc.


 


This Quality Agreement (the “Quality Agreement”)
is a required and integral part of the Terms & Conditions (the “Agreement”)
with an Effective Date of February 17, 2004 to which it is attached and
integrated. This Quality Agreement defines the roles and responsibilities for
BVL quality operations when providing services for Customer and further defines
how BVL and Customer will interact with each other.


 


A.1          Purpose and Term of the Quality
Agreement


Capitalized
terms used in this Quality Agreement and not otherwise defined shall have the
meanings ascribed thereto in the Agreement unless otherwise specified.  This Quality Agreement outlines the
responsibilities of Customer and BVL with respect to the quality assurance and
cGMP compliance of the Product and is the Quality Agreement referenced in the
Agreement.  In the event of any conflict
between the terms of this Quality Agreement and the Agreement, the terms of the
Agreement will control.


A
matrix of responsibilities included at the end of this document delineates the
primary responsible Party for the various aspects of this Quality Agreement.


This
Quality Agreement commences with the Effective Date of the Agreement and
remains in effect through the term of that Agreement.  In the event that the Agreement is terminated
for any reason provided for therein, the Quality Agreement will terminate on
the later of: (i) the expiration date of the last Batch of Product produced by
BVL for commercial distribution; (ii) completion of any ongoing stability
studies; or (iii) two years of the termination of the Agreement.


All
changes in this Quality Agreement must be documented in writing as an Addendum
to the original Quality Agreement and reviewed and approved in writing by
representatives from Customer and BVL.


This
Quality Agreement is between Customer and BVL.


A.1.1      Customer Quality Representatives:




	
  Name:

  	
   

  	
  [*]

  
	
  Title:

  	
   

  	
  Vice President, Quality

  
	
  Company:

  	
   

  	
  Theravance, Inc.

  
	
  Street Address:

  	
   

  	
  901 Gateway Blvd.

  
	
  City, State Zip:

  	
   

  	
  South San Francisco, CA
  94080

  
	
  Phone:

  	
   

  	
  [*]

  
	
  Fax:

  	
   

  	
  [*]

  
	
  E-mail:

  	
   

  	
  [*]

  






 


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This Quality Agreement has been reviewed and
approved by:


FOR CUSTOMER:


 


SIGNATURE: /s/ [*]                                                                            DATE:
September 24, 2007


A.1.2      BVL Quality Representatives:


	
  Name:

  	
  [*]           

  
	
  Title:

  	
  Vice
  President of Quality Operations               

  
	
  Company:

  	
  Ben
  Venue Laboratories, Inc.             

  
	
  Street
  Address:

  	
  300
  Northfield Road             

  
	
  City,
  State Zip: 

  	
  Bedford,
  OH 44146-0568     

  
	
  Phone:

  	
  [*]

  
	
  Fax:

  	
  [*]           

  
	
  E-mail:

  	
  [*]

  



 


FOR BVL:


 


SIGNATURE: /s/ [*]                                                                            DATE:
9/19/07


 


A.1.3      BVL Business Representative:


	
  Name:

  	
  [*]           

  
	
  Title:

  	
  Vice
  President, Contract Manufacturing Services          

  
	
  Company:

  	
  Ben
  Venue Laboratories, Inc.             

  
	
  Street
  Address:

  	
  300
  Northfield Road             

  
	
  City,
  State Zip: 

  	
  Bedford,
  OH 44146-0568     

  
	
  Phone:

  	
  [*]

  



 


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  Fax:

  	
  [*]

  
	
   

  	
   

  
	
  E-mail:

  	
  [*]

  



 


FOR BVL:


 


SIGNATURE: /s/ [*]                                                                            DATE:
9/17/07


A.1.4      On-Call Customer
Representative:


In addition to the foregoing contact
information, Customer will provide the name and phone numbers of a contact
person(s) who may be called at any hour during the times when BVL is
Manufacturing the Product, as follows:


	
  Name:

  	
  [*]

  
	
  Title:

  	
  Vice
  President, Pharmaceutical R&D

  
	
  Company:

  	
  Theravance,
  Inc.

  
	
  Street
  Address:

  	
  901
  Gateway Blvd.

  
	
  City,
  State Zip:

  	
  South
  San Francisco, CA 94080

  
	
  Phone:

  	
  Work)
  [*]               Cell) [*]

  
	
  Fax:

  	
  [*]

  
	
  E-mail:

  	
  [*]

  



 


A.2          Quality Responsibilities


The
activities for and associated with the manufacturing of the Product must meet
the current cGMPs as set forth in the “Code of Federal Regulations of the U.S.
Food and Drug Administration”, 21 CFR Parts 210 & 211, as well as “The
Rules Governing Medicinal Products in the European Community”, volume IV, “Guide
to good manufacturing practice for medicinal products”, as well as the
requirements of any applicable national guidelines to which the Product has
been registered. In the event of a conflict in cGMPs, the U.S. Code of Federal
Regulations shall apply.


BVL
is responsible for review and approval of all manufacturing, testing, and
support documentation executed in the Production of each Batch of the Product
as included or referenced in the Master Batch Record and for providing formal
release to Customer. Customer is responsible for further release of each Batch
of the Product for commercial and any other use.


Any
dispute between Customer and BVL with regard to acceptance of the Product shall
be subject to the procedures as set out in the Agreement between Customer and
BVL. Customer’s disposition will be independent of BVL’s review and release.


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BVL
is responsible for maintaining training records for all personnel that perform
cGMP functions relating to the Customer operations performed at the site,
including personnel in QA/QC, manufacturing, etc.


A.3          Regulatory Compliance and Product
Licensure


A.3.1           Customer is the owner of the
Product and is responsible for product licensure, annual reports, and any other
regulatory filings that are required for the marketing of Product, and is
responsible to ensure that all of such filings with regulatory authorities are
consistent with the Specification and the Master Production Record.  This includes the supplement of product
registration to update commitments, methods, records, or specifications based
upon regulatory requirements defined in 21 CFR Part 314.


A.3.2           In the event that the
Territory as defined herein includes the European Union or any member states
thereof, then in addition to all other responsibilities, Customer shall also:


A.3.2.1                                 certify in
writing to BVL that it has properly appointed one or more Qualified Person(s)
in compliance with EU Directives, standards and rules, including without
limitation, Article 49 of Directive 2001/82/EC, with respect to the Product(s)
subject to this Agreement; and further that Customer’s Qualified Person(s)
shall fully comply with all EU standards, directives and rules, including
without limitation, as set forth in Article 51 of 2001/83/EC;


A.3.2.2                                 as appropriate,
cause its Qualified Person to certify that the Facility supplying the API
complies with EU GMP;


A.3.2.3                                 cause its
Qualified Person to certify the GMP status of the manufacturing and supply of
an Active Pharmaceutical Ingredient; and


A.3.2.4                                 for each batch
of Product Manufactured by BVL, as appropriate, provide a Certificate of
Analysis.


A.4          Change Control 


BVL
will utilize a documented system of procedures for the control of changes to
raw materials, packaging materials, utilities, facilities, equipment,
manufacturing methods, and Product specifications and requirements, sampling,
test methods, and release requirements. 
BVL will be responsible for contacting Customer to discuss changes which
impact the Manufacturing license for any Territory.  Product-specific changes will not be made
without mutual approval.  Customer will
be responsible for applying for any necessary variation to the Manufacturing
license(s) to allow production of the Product(s).


A.4.1      Master Production Records


Master Production Records (MPRs) are
documents that specify or reference the manufacturing instructions, related
bills of material, in process testing, and production specifications used in
the production process.  These documents
are developed and approved by BVL and Customer. 
Customer’s approval of the MPR must be received at least eight (8) weeks
prior to the start of manufacture.


 


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A.4.2      Specification


Specification initiation or revision that
affects the scientific or technical content requires approval in writing by BVL
and Customer before proposed changes are implemented.  This applies to manufacturing, testing,
storage, and labeling of the Product, as well as any changes to the
specifications for raw materials and Product. 
Editorial or format changes to applicable specifications not affecting
the scientific/technical content or intent of the specification will not
require approval by Customer.  Those
documents requiring Customer approval are as follows:


Product Specification


Master Production Records


Raw Material Specifications


When Customer initiates a change request on
all applicable specifications, the appropriate BVL department shall be provided
the proposed specification and appropriate documentation that summarizes and
justifies each change.


A.4.3      Packaging and Labeling Specifications


The packaging and labeling specifications are
documents that describe the labeling artwork, container/closure, Product
packaging for shipment, shipper specifications and drawings used in the
packaging of the Product.  These
packaging and labeling specifications are Developed and approved by BVL and
Customer.  This information will be
incorporated into the MPR, associated Product Specific SOPs, and raw material
specifications, as appropriate.


A.4.4      Product Changeover


BVL will follow its validated cleaning
protocols based on product classifications per BVL SOP’s.


A.4.5      Changes to the Plant


BVL will notify Customer in advance of any
changes of utilities, in the layout or structure of the equipment or in the
operation and structure of the plant, which could have an adverse impact on the
manufacturing of the Product or the quality of the Product.  BVL shall not be obligated to obtain prior
approval for changes required as a result of an Agency’s order, provided BVL
promptly notifies Customer of any such proposed change and consults with
Customer before implementation of such changes and its potential impact on
Customer Product.


A.5          Documentation Retention


Batch
specific documentation (e.g., executed
batch records, investigation reports, Certificates of Analysis) will be
retained by BVL for one (1) year beyond the expiration date of the Agreement,
or in the event the Agreement is ongoing, then for not more than seven (7)
years from the Manufacturing date  BVL
will notify Customer prior to destruction of the records and customer must provide
a response to BVL as to the disposition of the documents within thirty (30)
calendar days or the record will be destroyed. 
Customer may request that such records be transferred to Customer at
Customer’s expense.


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For
the basic product specific documentation (e.g., master
production records, SOPs, validation documentation) the retention should be for
the life of the product, i.e., until the
registration for the product has been withdrawn and the responsibility of
Customer with support from BVL.  Such
documents will be returned to the Customer in the event of termination of the
Agreement, withdrawal of all registrations for the Product, or upon cessation of
the business relationship between Customer and BVL and completion of BVL’s
compliance with Applicable Laws.


A.6          Materials


A.6.1       BVL
is responsible for performing raw material and supplies procurement, QC
testing, and material handling and submission of samples to outside testing
laboratories (as applicable).  BVL will
obtain approval from Customer if BVL needs to subcontract the analytical
release testing of raw materials provided by Customer.


A.6.2       BVL
shall maintain an approved suppliers list in accordance with BVL’s
procedures.  BVL will provide the
material name and supplier name upon request. 
Changes to non-compendial raw materials, such as a new supplier or
process changes, shall be approved by Customer.


A.6.3       All
materials purchased for use in the manufacture, storage and shipping of product
will be purchased, received, inspected as appropriate, tested as appropriate,
stored, and handled in accordance with BVL’s SOP’s.  BVL agrees to sample and retain sufficient
amounts of all raw materials, except water, compressed gases and any highly
volatile compounds.  The amount of
retained samples is specified in BVL’s raw material specifications.  All materials shall be in accordance with the
approved specifications.


A.6.4       BVL
will qualify primary vendors of all raw materials and components.  Vendor qualification will be in accordance
with BVL SOP’s.


A.6.5 BVL will provide, at Customer’s
request, a copy of the BVL Drug Master File (DMF) and authorization for FDA to
access the DMF. This may be used by the Customer to prepare a regulatory
filing.  BVL shall, upon Customer’s
request, assist Customer with all other applicable filings for the non-US
market in accordance with proposals submitted to Customer and confirmed by
Purchase Order.


A.7          Product Specification


The
Product must be manufactured, packaged, labeled, and handled according to the
Specifications and procedures mutually agreed to in writing between Customer
and BVL.  Customer and BVL shall develop
all in-process and Product release specifications, including acceptance limits
for each required test.  Establishment of
appropriate test methods and supporting test method validation will be
performed by BVL and approved by Customer. 
Each lot of Product manufactured by BVL for Customer will be sampled and
tested in accordance with the Specification.


A.8          Manufacturing and Packaging of the
Product


A.8.1       The
manufacturing of the Product will be done under cGMP and in accordance with
specific procedures and instructions mutually agreed upon between Customer and
BVL, and documented in the MPR.  The Date
of Manufacture will be as specified in the Product Specification.


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A.8.2       Any
regulations regarding storage of different types of products shall be adhered
to.


A.8.3       The
manufacturing of Customer’s Product by BVL must be in adherence to the
Specification as mutually agreed upon, and in compliance with all cGMPs and any
other applicable regulatory requirements. 
BVL will provide documentation for each Batch as agreed upon between
Customer and BVL.


A.9          Testing of the Product


A.9.1       The
testing of the Product is carried out by BVL according to the
Specification.  For those procedures
which appear in the current USP/NF or other recognized standard references,
qualification of the method for the Product and a statement indicating the
reference shall suffice.  For all
Product-specific test methods utilized by BVL, documentation supporting the
validation of the test method shall be available for review during annual
audits by Customer, or be provided at other times as reasonably requested by
customer.


A.9.2      
If any Third Party is utilized to perform testing of raw materials or
release/stability testing the vendor(s) must be qualified by BVL as required by
BVL SOPs and approved for use by Customer. 
The Third Party vendor must utilize validated or qualified test methods
and provide complete documentation and copies of associated raw data upon
request.


A.9.3       Customer
will provide BVL a reference standard in accordance with BVL procedures for use
in Product testing, as needed, and BVL will maintain the reference standard
under appropriate storage conditions with appropriate controls.  Customer is responsible for
performing qualification of the reference standard in accordance with approved
validated protocols.


A.9.4       BVL
will provide to Customer a Certificate of Analysis and any other associated
testing documentation for each Batch of Product manufactured as agreed upon
between Customer and BVL.  Customer
reserves the right to inspect and/or test all Batches of the Product produced
by BVL prior to Customer’s acceptance and distribution.


A.10       Notification and Approval of
Deviations


BVL
must notify Customer within three (3) business days from the initiation of the
investigation, whenever there is a significant deviation from stated procedures
or specifications.  A significant
deviation is defined as any Out Of Specification (OOS) result and/or any
manufacturing, packaging, labeling, or testing deviation that may affect the
quality, safety or efficacy of the Product. 
BVL will only release/reject a Product Batch as an outcome of a BVL and
Customer approved investigation report. 
In the event of conflict, BVL may release or reject any Product Batch at
its sole discretion.  Customer is
responsible for the final product disposition of a product released by BVL.


All
deviations will be investigated and fully documented by BVL in accordance to
BVL procedures.  This documentation will
be retained as part of the batch documentation for the Batch affected.  When deemed necessary, Customer reserves the
right to request the need for a more in-depth investigation of the deviation by
BVL.  BVL and Customer will work together
in determining the need for additional investigational work.  Customer approval shall be obtained in writing
(fax or PDF electronic document confirmation is acceptable) for any significant
deviation.  Customer approval shall not
be unreasonably withheld.  Customer and
BVL will


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CONFIDENTIAL


 


jointly
provide the documented product impact assessment for all deviations that impact
the Product.  The documented assessment
must be received within 5 (five) business days of the completion of the
investigation.  In cases where Customer
requests a deviation, the request must be submitted in writing.  Customer is responsible for notifying the FDA
regarding any required Field Alert Report according to 21 CFR 314.81. BVL shall
be notified by the Customer of any Field Alerts filed for Product.


The
Investigation Report for significant deviations will be approved by both BVL
and Customer as stated below.  The
approved document will become part of the batch record of that specific lot of
material.  Any resulting corrective and
preventative actions shall be followed through timely closure in accordance to
BVL procedure.  Approval by the
appropriate Quality Assurance functions is solicited and may be obtained via
fax or electronic copy.


 




	
  Failure

  	
  Approval
  Requirements

  
	
  Product

  	
  Customer
  and BVL

  
	
  Raw Materials sourced and used by BVL

  	
  BVL

  






 


In
the event of a dispute regarding the failure of Product, an independent,
mutually acceptable qualified Third Party may be engaged to determine
failure.  The Third Party’s decision will
determine acceptance of the Product and shall be subject to the procedures as
set out in the Agreement.


Reprocessing
would always be considered a significant deviation, and would only be performed
if validated by BVL and approved by BVL and Customer.


A.11       Release and Shipment of the Product


A.11.1     A
Certificate of Compliance (COC), a Certificate of Analysis (COA), copies of
executed batch records, deviations and investigation reports, and any
applicable documentation, as agreed upon between Customer and BVL, shall be
provided to Customer by BVL within one (1) week after the Batch is released by
BVL QA.


A.11.2     Customer
is responsible for acceptance and disposition of the Product after review of
BVL’s test results and supporting data, COC, COA and batch records as required.


A.11.3     The
disposition of the Product, which is defined as the release for clinical or
commercial distribution, is the responsibility of Customer.  BVL has the responsibility to release the
Product to Customer.  BVL will not ship
any of Customer’s Product to any destination until the final disposition by
Customer, unless prior approval has been received in writing from Customer to
perform such shipments.  Such receipt of
written shipping approval will not exceed thirty (30) days beyond BVL’s release
to Customer unless Customer provides written notice disputing the release of
the Batch.


A.11.4     BVL
will control and coordinate all shipping activity unless specified by
Customer.  Shipping instructions will be
provided in the associated Batch Purchase Order (PO).


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Shipping validation will be Customer’s
responsibility, but will be performed in collaboration with BVL and appropriate
qualified contractors.


A.12       Retained Samples of the Product


BVL
agrees to store retained samples for all BVL composition used in the Product(s)
in accordance with BVL SOP’s.


Final
Product retains shall be the responsibility of Customer.


A.13       Storage of Product


BVL will store Product prior to final Customer disposition and shipment
in accordance with the Specification and BVL SOPs.


A.14       Stability Activities


The
responsibility for stability testing and reporting shall belong to BVL so long
as Customer contracts such activities with BVL. 
Stability protocols will be prepared by BVL and jointly reviewed and
approved by BVL and Customer.  BVL will
provide stability reports to Customer in accordance with specifications
contained in stability proposals.  Data
interpretation and the updating of stability information to regulatory
documents for the Product is the responsibility of Customer.  All stability related activities under the
responsibility of BVL shall be completed in accordance with BVL SOPs.


A.15       Process Validation 


A.15.1     The
Manufacturing Process and control procedures (including, but not limited to
cleaning procedures; aseptic procedures, process hold times, in-process
stability, and development and justification of all processing parameters)
shall be validated and qualified by BVL according to the Manufacturing Process
Validation (MPV) plan for Product in the facility and using the equipment BVL
intends to employ to make Customer’s Product, as further defined in Section
15.2.


A.15.2     The
MPV will be created with input from both BVL and Customer for Customer’s
process.  The MPV will be jointly
generated and approved by BVL and Customer. 
The MPV will contain all of the required activities and the acceptance
criteria and is approved and documented. 
The MPV is executed on at least three (3) consecutive Batches of Product
produced by BVL for Customer as mutually agreed to between Customer and
BVL.  If there are any problems during
the execution of the MPV, then, upon discovery shall be communicated to
Customer.  If the problems cannot be
resolved, the MPV must be repeated on additional Batches until at least three
(3) consecutive Batches of Customer’s Product meet all specification
requirements.  Any problems encountered
during the execution of the MPV must be documented by BVL.


A.15.3     All
related validation/qualification documents will be assembled in a process
validation summary report and reviewed and approved by BVL and Customer.  Customer will retain copies of the approved
protocols and final reports.


A.16       Product Complaints


A.16.1     Customer,
or their agent, will receive complaints and communicate with their Customers
and close all complaints related to the Product.  Customer will inform BVL


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within 5 business days of registration of a
complaint, or sooner as required, of complaints involving potential Product
issues that may be related to Manufacturing. 
Upon written request by Customer, BVL will investigate the complaints as
required and provide a written report on the results of the investigation to
Customer in no more than thirty (30) working days, or sooner if agreed to by
the Parties.  Customer will communicate
with the Customers and/or regulatory authorities the results of the complaint
investigation, if necessary.


A.16.2     In
the event of a notification by Customer to BVL of a serious adverse event (SAE)
potentially related to Manufacturing of the Product, BVL will provide all
necessary support and assistance in the relevant phase of the investigation and
provide a written response within an agreed upon time frame, usually no longer
than 10 days, that allows Customer to respond to the applicable regulatory
agency within 15 days of their notification.


A.16.3     Customer
shall provide complaint files to BVL onsite, or via fax or other electronic
means, within one (1) business day if they are required during a FDA inspection.


A.17       Returned Goods


Customer
will be responsible for returned goods. 
The specific handling of returned goods will be specified and documented
by Customer, as required.  BVL will not
have responsibility for returned goods.


A.18       Recall of the Marketed Product


In
the event of recall, withdrawal, or field correction of Product, i.e., if the Product violates applicable laws, regulations,
agreed upon specifications, or is deemed unacceptable for some other reason,
whether or not such action is requested by any governmental agency, Customer
shall immediately notify BVL Quality Assurance in writing.  During a Product recall, withdrawal, or field
correction, BVL shall fully cooperate with Customer in conducting the necessary
investigational activities when appropriate.


A.19       Audits and Inspections of Facilities
and Product


A.19.1     Upon
scheduling in advance, Customer shall have the right to one annual audit per
Contract Year and at such other times as mutually agreed upon by the Parties
for cause to: (i) observe, inspect, and audit the manner in which BVL conducts
Manufacture of Customer Product(s); (ii) inspect BVL’S Facilities and records
relating to BVL’S quality and other controls related to its Manufacture of the
Product(s); or (iii) observe and audit the books and records of BVL relating to
the existence, safeguard, use and maintenance by BVL of the Customer
Composition.  Customer annual audits will
be limited to 2 auditors for 2 days.  BVL
shall make such books and records available to Customer for review.  Customer and any third-Party consultant
appointed by Customer shall have reasonable access to observe and inspect BVL’S
Facilities and SOPs with respect to the Product, including all analytical and
Manufacturing documentation related to the Product upon reasonable prior notice
to and scheduling in advance by BVL.  Any
such Customer appointed third-Party consultant must be pre-approved by BVL,
although such approval shall not be unreasonably or untimely withheld.  Information provided during audits will be
limited to technical information related to the Manufacture of Product.  No financial information is provided for
auditing.


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A.19.2     Customer
employees and Customer’s consultants who inspect BVL’S Facilities shall at all
times comply with BVL’s rules, regulations and SOPs relating to their
inspection, and Customer assumes responsibility for the presence and actions of
its employees and consultants on BVL’s premises.


A.19.3     BVL
will notify Customer of any inspections or actions by regulatory agencies or
other enforcement bodies which impact Product. 
BVL will provide Customer with the applicable or redacted written
observations of all such Product Specific regulatory audits in no more than 5 business
days.  If the inspection is specific to
Product, Customer will have up to 2 representatives on site during the
inspection to address product specific questions, and these representatives
will be permitted to participate in the inspection when required.  Customer shall provide to BVL any requested
documents if they are required for a regulatory inspection.  Customer must notify BVL immediately of any
activities or communications that may result in an inspection of BVL.  BVL will respond to regulatory authority PAI
observations within 15 days if possible and all other Product-specific
inspection observations within 30 days or the time specified by that agency,
which ever is less.


A.19.4     Customer
reserves the right to be on-site at BVL during the manufacture of Product,
and/or during the inspection of Product by any regulatory agencies.  Customer shall provide at least two (2) weeks
advance notice to be on site at BVL during manufacture.


A.20       Reprocessing


Reprocessing
can only be performed per written agreement between both BVL and Customer.  Reprocessing directions must be established
to define the process.  If the Product is
registered, reprocessing parameters must be validated, submitted, and approved
prior to implementation and batch release. 
Reprocessing of material or product must be documented to state
rationale and justification.


A.21       Annual Product Review (APR)


Customer
will be responsible for the Annual Product Review (APR).


A.22       Annual Quality Agreement Review


Not
less than once per Contract Year during the term of the Agreement, the Parties
shall meet and confer in good faith to review the Quality Agreement and make
such changes as may be mutually agreed upon in writing by the Parties.


(Quality Matrix begins on
following page)


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CONFIDENTIAL


 


Quality Agreement Distribution of
Responsibility Matrix:


	
   

  	
   

  	
  Responsible
  Party

  
	
  Item

  	
  Activity

  	
  Customer

  	
  BVL

  
	
  1. Purpose and Term of the
  Quality Agreement

  	
   

  	
   

  	
   

  
	
   

  	
  Define purpose and term of
  the Quality Agreement

  	
  X

  	
  X

  
	
  2. Quality Responsibility

  	
   

  	
   

  	
   

  
	
   

  	
  Assure that all activities
  associated with production of Customer’s Product are performed in compliance
  with cGMP as set forth in 21 CFR part 211, the European GMPs, and any other
  regulatory region the drug is for distribution for clinical or commercial
  use.

  	
  X

  	
  X

  
	
   

  	
  Review all batch
  documentation and test results, approve, and release Product to Customer.

  	
   

  	
  X

  
	
   

  	
  Review appropriate batch
  documentation and test results, and release and disposition Product for
  clinical or commercial use

  	
  X

  	
   

  
	
   

  	
  Maintain training records
  for all BVL personnel that perform cGMP functions relating to the Product.

  	
   

  	
  X

  
	
  3. Regulatory Compliance and
  Product Licensure

  	
   

  	
   

  	
   

  
	
   

  	
  Responsible for product
  licensure, annual reports, and other regulatory filings as defined in 21 CFR
  314 or other regulatory agencies for the Territory.

  	
  X

  	
   

  
	
   

  	
  Provide Customer with
  information required for regulatory filings pursuant to written proposals
  provided by BVL

  	
   

  	
  X

  
	
   

  	
  Prepare and submit
  regulatory filings to the appropriate authorities

  	
  X

  	
   

  
	
  4. Change Control

  	
   

  	
   

  	
   

  
	
   

  	
  Establish and maintain
  appropriate change control procedures, including but not limited to
  revisions, changes or modifications to documentation, processes, equipment,
  utilities or facilities that affect the defined operation and processes or
  have the potential to affect the quality, purity, safety, or efficacy of the
  Product.

  	
   

  	
  X

  
	
   

  	
  Prepare and submit a
  change request or notification to Customer for all proposed changes to
  documentation, facilities/equipment, manufacturing process, test methods, and
  specifications that affect Customer manufacturing process.

  	
   

  	
  X

  
	
   

  	
  Review proposed changes,
  assess the impact on regulatory filings, and approve changes.

  	
  X

  	
  X

  



 


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CONFIDENTIAL


 


	
   

  	
   

  	
  Responsible
  Party

  
	
  Item

  	
  Activity

  	
  Customer

  	
  BVL

  
	
  4.1 Master Production Record

  	
   

  	
   

  	
   

  
	
   

  	
  Draft and maintain MPR

  	
   

  	
  X

  
	
   

  	
  Review and approve MPR

  	
  X

  	
  X

  
	
  4.2 Specifications

  	
   

  	
   

  	
   

  
	
   

  	
  Draft and approve
  non-compendial raw material specifications

  	
  X

  	
  X

  
	
   

  	
  Draft and approve API
  specification

  	
  X

  	
  X

  
	
   

  	
  Draft and approve Product
  Specification

  	
  X

  	
  X

  
	
  4.3 Packaging and Labeling
  Specifications

  	
   

  	
   

  	
   

  
	
   

  	
  Prepare draft packaging
  and labeling specifications

  	
  X

  	
  X

  
	
   

  	
  Approve label and
  packaging specifications

  	
  X

  	
  X

  
	
   

  	
  Implement packaging and
  labeling procedures

  	
   

  	
  X

  
	
  4.4 Product Changeover

  	
   

  	
   

  	
   

  
	
   

  	
  Perform cleaning
  validation studies as necessary to demonstrate and document suitable
  clearance of other products for the equipment used for Customer per BVL SOPs.

  	
   

  	
  X

  
	
  4.5 Changes to the Plant

  	
   

  	
   

  	
   

  
	
   

  	
  Notification to Customer
  of all changes to the facility that could impact Customer’s Product

  	
   

  	
  X

  
	
  5. Documentation

  	
   

  	
   

  	
   

  
	
   

  	
  Retain Batch production
  documentation for 7 years after a batch is manufactured.

  	
   

  	
  X

  
	
   

  	
  Mutually agree upon
  disposition of documentation following the 7 year retention period.

  	
  X

  	
  X

  
	
   

  	
  Maintain product specific
  documentation (e.g., master batch records,
  SOPs, validation documentation, etc.) in accordance with BVL SOPs.

  	
   

  	
  X

  
	
  6. Materials

  	
   

  	
   

  	
   

  
	
   

  	
  Establish quality
  requirements for raw materials, process components, and packaging material.

  	
  X

  	
  X

  
	
   

  	
  Establish raw material
  specifications.

  	
  X

  	
  X

  
	
   

  	
  Establish a vendor
  qualification program for vendors of all raw materials to be used in GMP
  manufacturing (excluding API).

  	
   

  	
  X

  



 


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CONFIDENTIAL


 


	
   

  	
   

  	
  Responsible
  Party

  
	
  Item

  	
  Activity

  	
  Customer

  	
  BVL

  
	
   

  	
  Qualify API vendor

  	
  X

  	
   

  
	
   

  	
  Promptly provide vendor
  change notifications

  	
  X

  	
  X

  
	
   

  	
  Approve vendor changes

  	
  X

  	
  X

  
	
   

  	
  Ensure that all raw
  materials (excluding API), consumables, and packaging component suppliers are
  qualified or reviewed according to defined requirements and procedures, and
  to maintain file of vendor qualifications

  	
   

  	
  X

  
	
   

  	
  Prepare and maintain a
  bill of materials that includes specifications and acceptable grades for
  required raw materials and consumables.

  	
  X

  	
  X

  
	
   

  	
  Perform raw material and
  supplies procurement, QC testing, and material handling and submission of
  samples to outside testing laboratories (as applicable) for BVL Supplied
  Composition.

  	
   

  	
  X

  
	
   

  	
  Perform API procurement,
  QC testing, and material handling

  	
  X

  	
   

  
	
   

  	
  Maintain programs and
  procedures for returning unused or damaged goods.

  	
  X

  	
  X

  
	
   

  	
  Maintain and archive raw
  material C of A’s for final release.

  	
   

  	
  X

  
	
   

  	
  Maintain and archive API C
  of A’s

  	
  X

  	
   

  
	
   

  	
  Obtain approval from
  Customer if BVL needs to subcontract the analytical release testing of raw
  materials

  	
   

  	
  X

  
	
   

  	
  Approve BVL subcontracted
  analytical testing facility per BVL SOP

  	
  X

  	
   

  
	
  7. Product Specification

  	
   

  	
   

  	
   

  
	
   

  	
  Establish and approve
  Specification

  	
  X

  	
  X

  
	
   

  	
  Perform Product testing
  according to validated procedures and approved Specification

  	
   

  	
  X

  
	
  8. Manufacturing and Packaging
  of the Product

  	
   

  	
   

  	
   

  
	
   

  	
  Ensure all manufacturing
  operations are conducted in compliance with cGMPs, SOPs, and the Master
  Production Record

  	
   

  	
  X

  
	
  9. Testing of Product

  	
   

  	
   

  	
   

  
	
   

  	
  Review and approve all
  test methods and validation protocols and reports.

  	
  X

  	
  X

  
	
   

  	
  Validate all test methods,
  as appropriate

  	
  X

  	
  X

  
	
   

  	
  Maintain Reference
  Standard according to BVL SOP’s and specifications

  	
   

  	
  X

  



 


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CONFIDENTIAL


 


	
   

  	
   

  	
  Responsible
  Party

  
	
  Item

  	
  Activity

  	
  Customer

  	
  BVL

  
	
   

  	
  Store QC stability samples
  for specified time period

  	
   

  	
  X

  
	
   

  	
  Qualify and approve any
  contract lab used for product testing

  	
  X

  	
  X

  
	
  10. Notification and Approval
  of Deviations

  	
   

  	
   

  	
   

  
	
   

  	
  Ensure a thorough
  investigation and justification of any deviation to stated procedures or out
  of specification (OOS) result

  	
   

  	
  X

  
	
   

  	
  Ensure all investigation
  reports are reviewed and completed prior to completion of the batch
  production record review

  	
   

  	
  X

  
	
   

  	
  Promptly notify Customer
  within 3 business days of initiation of investigation of any deviation or OOS
  that affects the material or Product being tested per BVL SOP.

  	
   

  	
  X

  
	
   

  	
  Provide technical,
  compliance, and regulatory oversight in support of the investigation

  	
  X

  	
   

  
	
   

  	
  Hold and segregate
  material or Product that does not conform to in-process or release
  specifications.

  	
   

  	
  X

  
	
   

  	
  Prepare and approve
  investigation report

  	
   

  	
  X

  
	
   

  	
  Review and release/reject
  material or Product Batch as an outcome of an approved investigation report.

  	
  X

  	
  X

  
	
   

  	
  Disposition Product as an
  outcome of the approved investigation

  	
  X

  	
   

  
	
   

  	
  Establish procedures for
  the releasing/rejecting failed Batches of raw material or Product.

  	
   

  	
  X

  
	
   

  	
  Promptly notify Customer
  of cause for investigation and proposed action plan for raw material or
  Product failures.

  	
   

  	
  X

  
	
   

  	
  Participate in Product
  investigations, as needed.

  	
  X

  	
   

  
	
   

  	
  Generate Investigation
  Report.

  	
  X

  	
  X

  
	
   

  	
  Review and approve
  Investigation Report

  	
  X

  	
  X

  
	
  11. Release and Shipment of
  Product

  	
   

  	
   

  	
   

  
	
   

  	
  Provide a copy of executed
  Batch Records, deviations and investigation reports, and any applicable
  documentation within 1 week of BVL Batch release

  	
   

  	
  X

  
	
   

  	
  Generate BVL Certificate
  of Analysis

  	
   

  	
  X

  
	
   

  	
  Generate BVL Certificate
  of Compliance

  	
   

  	
  X

  
	
   

  	
  Perform Product
  disposition

  	
  X

  	
   

  



 


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CONFIDENTIAL


 


	
   

  	
   

  	
  Responsible
  Party

  
	
  Item

  	
  Activity

  	
  Customer

  	
  BVL

  
	
   

  	
  Establish and maintain
  shipping procedures and documentation.

  	
  X

  	
  X

  
	
   

  	
  Insure Shipping of Product
  from BVL to Customer destination is in compliance with the Specifications for
  the Product, specifically including without limitation temperature shipping
  requirements

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Approve shipping
  configuration and procedures.

  	
  X

  	
  X

  
	
   

  	
  Package Product for
  shipment to specified distributors. Store and transport Product to conform to
  label copy storage conditions.

  	
   

  	
  X

  
	
   

  	
  Request shipment of
  Product, specifying date of shipment, shipping address, lot number, quantity,
  etc.

  	
  X

  	
   

  
	
   

  	
  Ship Product as specified
  in Batch PO per SOP.

  	
   

  	
  X

  
	
  12. Retained Samples of the
  Product

  	
   

  	
   

  	
   

  
	
   

  	
  Store retain samples of
  all Product composition

  	
   

  	
  X

  
	
   

  	
  Specify the number of
  Product retains per lot, the retain period, and arrange for the appropriate
  storage of the Product retains

  	
  X

  	
   

  
	
  13. Storage of Product

  	
   

  	
   

  	
   

  
	
   

  	
  Define storage conditions
  for Product.

  	
  X

  	
   

  
	
   

  	
  Securely store Product
  under controlled temperature and storage conditions as specified in Product
  Specification.

  	
   

  	
  X

  
	
   

  	
  Establish and maintain an
  appropriate environmental monitoring program of storage conditions

  	
   

  	
  X

  
	
  14. Stability Activities

  	
   

  	
   

  	
   

  
	
   

  	
  Prepare stability
  protocols.

  	
   

  	
  X

  
	
   

  	
  Review and approve
  stability protocols

  	
  X

  	
  X

  
	
   

  	
  Conduct stability studies
  per approved protocols.

  	
   

  	
  X

  
	
   

  	
  Compile data on a regular
  basis, and provide regular updates to Customer.

  	
   

  	
  X

  
	
   

  	
  Prepare and approve final
  stability reports.

  	
  X

  	
   

  
	
   

  	
  Provide stability updates
  to Regulatory Authorities in Annual Reports or as needed.

  	
  X

  	
   

  
	
  15. Process Validation

  	
   

  	
   

  	
   

  
	
   

  	
  Prepare Manufacturing
  Process Validation

  	
   

  	
  X

  



 


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CONFIDENTIAL


 


	
   

  	
   

  	
  Responsible
  Party

  
	
  Item

  	
  Activity

  	
  Customer

  	
  BVL

  
	
   

  	
  (MPV) Plan

  	
   

  	
   

  
	
   

  	
  Review and approve MPV

  	
  X

  	
  X

  
	
   

  	
  Generate process
  validation protocols

  	
   

  	
  X

  
	
   

  	
  Review and approve process
  validation protocols

  	
  X

  	
  X

  
	
   

  	
  Perform validation studies
  per approved protocols.

  	
   

  	
  X

  
	
   

  	
  Generate validation data
  in a timely fashion and maintain raw data and supporting documentation

  	
   

  	
  X

  
	
   

  	
  Prepare validation
  reports.

  	
   

  	
  X

  
	
   

  	
  Review and approve all
  final reports.

  	
  X

  	
  X

  
	
  16. Product Complaints

  	
   

  	
   

  	
   

  
	
   

  	
  Receive notice of
  complaints

  	
  X

  	
   

  
	
   

  	
  Inform BVL within 5
  business days, or sooner as required, of complaints involving potential
  product tampering or adverse medical event

  	
  X

  	
   

  
	
   

  	
  Upon a suspected
  manufacturing issues and upon mutual agreement of the Parties, perform
  investigation and provide a written report within 30 business days, or sooner
  if mutually agreed

  	
   

  	
  X

  
	
   

  	
  Respond to Product
  complaints with respect to known adverse events related to the Product

  	
  X

  	
   

  
	
   

  	
  Support the investigation
  of a potential SAE and provide information allowing for meeting regulatory
  reporting requirements

  	
   

  	
  X

  
	
   

  	
  Maintain a record of all
  complaints, and notify Health Authorities as required.

  	
  X

  	
   

  
	
  17 Returned Goods

  	
   

  	
   

  	
   

  
	
   

  	
  Specify and document
  handling of returned goods.

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  18 Recall of Marketed Product

  	
   

  	
   

  	
   

  
	
   

  	
  Notify BVL, regulatory
  authorities, and Customers, and all relevant Parties of product recall.

  	
  X

  	
   

  
	
   

  	
  Perform investigation, as
  appropriate.

  	
  X

  	
  X

  
	
   

  	
  Maintain copies of all recall
  investigations performed on behalf of a Customer and as required by
  regulations.

  	
   

  	
  X

  
	
  19 Audits and Inspections of
  Facilities and Product

  	
   

  	
   

  	
   

  
	
   

  	
  Perform audit of BVL on an
  annual basis, as a mock PAI, or as needed on a “for cause” basis

  	
  X

  	
   

  



 


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CONFIDENTIAL


 


	
   

  	
   

  	
  Responsible
  Party

  
	
  Item

  	
  Activity

  	
  Customer

  	
  BVL

  
	
   

  	
  Conduct periodic audits of
  raw material vendor’s quality systems in accordance with BVL SOPs.

  	
   

  	
  X

  
	
   

  	
  Manage, coordinate and
  host regulatory inspections: PAI, general GMP, for-cause, MHRA, and EMEA GMP
  inspections etc.

  	
   

  	
  X

  
	
   

  	
  Support product specific
  PAI or other inspection with up to 2 Customer staff on site during the
  inspection. As appropriate, Customer staff will be permitted to respond to
  product specific questions and participate in Product-specific wrap up
  sessions.

  	
  X

  	
   

  
	
   

  	
  Notify Customer within 24
  hrs of receipt of notification of inspection by regulatory authorities for
  Customer specific inspection.

  	
   

  	
  X

  
	
   

  	
  Prepare written responses
  to regulatory actions specific to facility, operations and site specific,
  non-Customer related processes

  	
   

  	
  X

  
	
   

  	
  Prepare written responses
  to written regulatory observations specific to Product.

  	
  X

  	
  X

  
	
   

  	
  Prepare, review, and
  approve responses to agency observations issued directly to the site. Respond
  to PAI observations within 15 days and all other inspection observations
  within 30 days or the time specified by that agency, which ever is less.

  	
   

  	
  X

  
	
   

  	
  Provide a copy of redacted
  inspection observations and responses to Customer within one week of
  completion of said documents.

  	
  X

  	
  X

  
	
   

  	
  Support product specific
  regulatory inspections and participate in the Development of product specific
  responses or inquiries.

  	
  X

  	
  X

  
	
   

  	
  Support the preparation of
  regulatory responses that support inquires made to Customer by authorized
  regulatory agencies

  	
  X

  	
  X

  
	
   

  	
  Observe operations on an
  as needed basis and notify BVL in advance.

  	
  X

  	
   

  
	
  20. Reprocessing

  	
   

  	
   

  	
   

  
	
   

  	
  Initiate reprocessing
  request

  	
  X

  	
  X

  
	
   

  	
  Document rationale,
  justification, and directions for reprocessing

  	
  X

  	
  X

  
	
   

  	
  Approve reprocessing

  	
  X

  	
  X

  



 


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Page 18

















CONFIDENTIAL||


 


	
   

  	
   

  	
  Responsible
  Party

  
	
  Item

  	
  Activity

  	
  Customer

  	
  BVL

  
	
  21. Annual Product Review

  	
   

  	
   

  	
   

  
	
   

  	
  Preparation and submission of the Annual Product
  Review (APR)

  	
  X

  	
   

  
	
  22. Certifications

  	
   

  	
   

  	
   

  
	
   

  	
  Provide certification of Customer supplied
  Composition to be free from BSE/TSE

  	
  X

  	
   

  
	
   

  	
  Provide certification of QP when applicable for
  Products shipped for use in EU countries

  	
  X

  	
   

  
	
   

  	
  Provide Certification of facility which produced API
  for use in Products when applicable for Products shipped for use in the EU
  countries

  	
  X

  	
   

  
	
   

  	
  Provide Certificate of Analysis and Certification of
  each batch of API shipped to BVL for use in Product to be shipped to EU
  countries

  	
  X

  	
   

  
	
   

  	
  Customer’s Qualified Person shall generate and
  approve a Certificate of Batch Release and Certificate of Compliance to EU
  GMP for each Batch of Product Manufactured by BVL for Customer which is
  distributed for clinical or commercial use in EU countries

  	
  X

  	
   

  



 


Quality Agreement (BVL and Theravance)


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