exv10w2






Exhibit 10.2




MASTER SERVICE AGREEMENT




by and between



Genentech, Inc.,



F. Hoffmann-La Roche, Ltd.



and



SurModics, Inc.


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MASTER SERVICE AGREEMENT




by and between



Genentech, Inc. and SurModics.


THIS MASTER SERVICE AGREEMENT (the “MSA”) is entered into as of the 5th day of October
2009 (“Effective Date”) by and between Genentech, Inc., a Delaware corporation, with offices
located at 1 DNA Way, South San Francisco, CA 94080 (“GNE”) and F. Hoffmann-La Roche, Ltd.,
Grenzacherstrasse 124, CH 4070 Basel, Switzerland (“Roche”) (GNE and Roche together
referred to as “Genentech”) and SurModics, Inc. a Minnesota corporation with a principal place of
business at 9924 West 74th Street, Eden Prairie, MN 55344 (SurModics, Inc. together with
its Affiliates hereinafter referred to as “SurModics”) (each individually a “Party” and
collectively, the “Parties”).




RECITALS



WHEREAS, the Parties have entered into a License and Development Agreement effective as of the date
hereof (the “License Agreement”); and



WHEREAS, as part of the License Agreement, Genentech desires to purchase from SurModics, and
SurModics desires to supply to Genentech, Product and Raw Materials (as hereinafter defined) in the
Territory (as hereinafter defined) pursuant to the terms set forth herein.



NOW, THEREFORE, in consideration of the premises and the undertakings of the Parties hereinafter
set forth, the Parties agree as follows:




ARTICLE 1

DEFINITIONS




     Capitalized terms used but not defined herein shall have the meanings set forth in the License
Agreement. As used in this MSA, the following terms, whether used in the singular or the plural,
shall have the meanings set forth in this Article:


1.1 “Acceptance Criteria” shall be defined in the applicable SOW.



1.2 “Acquisition Cost” is defined in Section 13.3.4(b).



1.3 “Approved Suppliers” is defined in Section 5.5.2.



1.4 “BLA” means a Biologics License Application and amendments thereto filed pursuant to the
requirements of the FDA, as defined in 21 C.F.R. § 600 et seq., for FDA approval of a therapeutic
biological product.



1.5 “Decommissioning” is defined in Section 13.3.4.



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1.6 “EMEA” means the European Union European Medicines Evaluation Agency, or any successor agency.



1.7 “European Union” means the countries of Austria, Belgium, Cyprus, Czech Republic, Denmark,
Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg,
Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Switzerland, Sweden,
United Kingdom and any additional countries that may subsequently become members of the European
Union.



1.8 “Facility” means the SurModics’ manufacturing facility at the location specified under the
applicable SOW, or such other manufacturing facility of SurModics as Genentech may approve in
writing.



1.9 “FDA” means the United States Food and Drug Administration, or any successor agency thereto.



1.10 “GNE Materials” means any physical embodiments, supplies or materials provided to SurModics by
or on behalf of GNE in connection with the Services, including the Compounds.



1.11 “Good Manufacturing Practices”, “GMP” or “cGMP” means current Good Manufacturing Practices
pursuant to the U.S. Food, Drug and Cosmetic Act and any U.S. regulations found in Title 21 of the
U.S. Code of Federal Regulations (including Parts 11, 210 and 211) and other regulations, policies,
or guidelines, as applicable to the Manufacture of Products hereunder.



1.12 “Joint Management Team” or “JMT” is defined in Section 3.2.



1.13 “Manufacture,” “Manufactured” or “Manufacturing” means, except as otherwise provided in a SOW,
the manufacture, inspection, storage and/or packaging of Product.



1.14 “Manufacturing Documentation” means all data, documents and records describing or otherwise
related to the Manufacturing Process (or any part thereof) provided to SurModics by or on behalf of
GNE or provided to GNE by or on behalf of SurModics as required by, and in connection with, this
MSA or the Quality Agreement [*].



1.15 “Manufacturing Process” means the process for the Manufacture of Product pursuant to this MSA,
the Quality Agreement and the Manufacturing Documentation, as such process may be changed from time
to time in accordance with this MSA.



1.16 “Manufacturing Joint Steering Committee” or “Manufacturing JSC” is defined in Section 3.3.



1.17 “Non-Conforming” means, (a) with respect to a Product, a Product Manufactured by SurModics
pursuant to this MSA that (i) fails to conform to the Specifications or Acceptance Criteria; or
(ii) was not Manufactured in compliance with the Specifications,



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cGMPs, the Manufacturing Documentation, the Quality Agreement, the Standard Operating Procedures
and all applicable laws and (b) with respect to any other deliverable, a deliverable that fails to
conform to the requirements of this MSA or the Quality Agreement.



1.18 “PFSB” means the Japan Pharmaceutical and Food Safety Bureau of the Ministry of Health,
Labour, and Welfare and its review agency, the Pharmaceutical and Medical Devices Agency, or any
successor agency thereto.



1.19 “Product” means the Licensed Product or the SurModics Raw Material specified in the applicable
SOW.



1.20 “Quality Agreement” means that certain quality agreement entered into by the Parties, as the
same may be amended from time to time by the Parties.



1.21 “Raw Materials” means the materials used in the Manufacturing Process, including, but not
limited to, chemicals, reagents, chromatography resins, and filters; and any materials used for
testing, validation, qualification or other activities required to implement and support the
Manufacturing Process at the Facility. Raw Materials include the SurModics Raw Materials.



1.22 “Regulatory Authority” means any national (e.g., the FDA), supra-national (e.g., the EMEA),
regional, state or local regulatory agency, department, bureau, commission, council or other
governmental entity, in any jurisdiction of the world, involved in the granting of Regulatory
Approval.



1.23 “Services” means the activities in support of GXP compliant Development and/or Manufacturing
of a Product, including: manufacturing, process development and scale-up, bulk production and
fill/finish work associated with the supply of such Product for research, preclinical and clinical
studies and related quality assurance and quality control activities, packaging, storage,
stability, release testing, and/or quality control services and other related services provided by
SurModics to GNE with respect to such Product under this MSA, as further defined in the applicable
SOW.



1.24 “Specifications” are defined in the applicable SOW and/or Quality Agreement.



1.25 “Standard Operating Procedures” or “SOPs” means the standard operating procedures established
by SurModics generally.



1.26 “Term” is defined in Section 13.1.



1.27 “United States” means the United States of America, its territories and possessions, Guam and
the Commonwealth of Puerto Rico.



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ARTICLE 2

RELATED AGREEMENTS AND EXHIBITS




2.1 Statements of Work.




     2.1.1 In General. A description of the Services to be performed and the Product to be
Developed and/or Manufactured and supplied by SurModics for each project agreed upon by the Parties
(each, a “Project”) shall be contained in individual appendices to this MSA (each, a “SOW”, a form
of which is attached hereto as Exhibit A), executed by a duly authorized officer of each Party.
Each SOW shall include all applicable process requirements, a list of any deliverables, regulatory
compliance requirements, the anticipated period of performance, a Program Budget for Services [*],
delivery schedules, [*], and quantity requirements. The Parties agree to negotiate, in good faith,
payment criteria for each task in a SOW under a Program Budget [*]. Each SOW shall be subject to
and deemed a part of this MSA. No SOW, or any modification thereto, shall be attached to or made a
part of this MSA without first being executed by the Parties hereto in a writing which specifically
references this MSA. To the extent any terms set forth in a SOW conflict with the terms set forth
in this MSA, the terms of this MSA shall control unless otherwise expressly agreed by the Parties
in such SOW.



     2.1.2 Changes to a SOW. Except as otherwise provided in Section 5.8 below for changes related
to regulatory requirements, if GNE reasonably determines that modifications to a SOW are required,
GNE shall communicate those proposed modifications to SurModics and the reasons therefore in
writing, and the Parties shall negotiate in good faith to implement mutually acceptable
modifications in an amended SOW, including any change in the timelines, budget and fees.



     2.1.3 Change Order Process.



          (a) Any change in the scope of work, timeline, the corresponding Program Budget, and/or the
Project specific compensation terms or payment schedule for an individual Project will require a
written amendment to the applicable SOW (“Change Order”). For clarity, Change Orders amend only
the applicable SOW and not the terms and conditions of this MSA. Each Change Order will detail the
requested changes to the applicable scope of work, timeline, corresponding Program Budget, Project
specific compensation terms, or payment schedule. Both Parties agree to act in good faith and
promptly when considering a Change Order requested by the other Party.




          (b) If the scope of a Project does not change but SurModics must perform additional work in
order to perform the Services for the Project in accordance with the applicable SOW (i.e. in
compliance with the Manufacturing Process), and such additional work is due to circumstances
primarily within SurModics’ control, SurModics will perform the additional work at no charge to
GNE. For clarity, and except as set forth in Section 6.2.2 below, Genentech will be responsible
for the cost of any additional GNE Material required in the performance of such additional work,.
The Parties agree that termination of either a Project or some of the Services to be performed in
furtherance of the completion of a Project, in each case before the completion of



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the Project, are changes in Project scope, and the affected Project budget and payment
schedule shall be modified accordingly.



2.2 Quality Agreement. The Parties have entered into a Quality Agreement effective as of the date
hereof (attached hereto as Exhibit B) that governs the responsibilities related to quality systems
and defines quality requirements for the Product, including quality control, testing and release of
the Product.




ARTICLE 3

MANAGEMENT OF PROJECT



3.1 In General. Each Party will be responsible for its internal decision making process and for
reasonably informing the other Party of decisions made affecting the Services in a regular and
timely manner. Without limiting the foregoing, the Parties shall establish the joint team set
forth herein to advise the Parties and execute on certain matters relating to the Services under
this MSA.




3.2 Joint Management Team (JMT)




     3.2.1 Formation. Within thirty (30) days of the Effective Date, the Parties will establish a
joint management team (the “Joint Management Team” or “JMT”) to oversee and manage the Services
under each SOW. If there are multiple SOWs hereunder the Parties may specify separate JMT’s in the
applicable SOW’s, and each reference herein to “the JMT” or “the Joint Management Team” shall be a
reference to the JMT applicable to each SOW. The Joint Management Team shall consist of such
number of representatives of each Party as are reasonably necessary to accomplish the goals of the
SOW. Each Party shall promptly notify the other Party of its initial appointees to each JMT.
Subject to Section 3.2.2 (a), each Party shall be free to change its JMT representatives effective
upon written notice to the other Party.



     3.2.2 Management Team Leader.



          (a) Appointment. Within thirty (30) days of the Effective Date, each Party shall appoint an
employee to act as a primary contact for such Party in connection with this MSA, including without
limitation, all SOWs and any Services and other activities conducted under any Project (each, a
“Management Team Leader”). The GNE Management Team Leader will be responsible for overall
leadership of the Joint Management Team. A Party may replace its Management Team Leader at any
time by providing written notice of the change to the other Party: provided, SurModics shall have
good faith consultation with GNE prior to the change and provided further, any such new
representative shall be no less qualified than the representative being replaced and shall be
mutually agreed to by the Parties. GNE shall not unreasonably withhold its agreement to any such
new representative proposed by SurModics.




          (b) Responsibilities. The Joint Management Team, led by the Management Team Leaders, will be
responsible for [*]. The Management Team Leaders will dialog regularly
about the progress of the Services and use good faith efforts to resolve any difficult issues



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regarding the Services addressed by the Joint Management Team as well as facilitate expeditious
resolution of any issues escalated to the Manufacturing JSC.



3.3 Manufacturing Joint Steering Committee (Manufacturing JSC).




     3.3.1 Formation. Within thirty (30) days of the Effective Date, the Parties will establish a
Manufacturing Joint Steering Committee (the “Manufacturing Joint Steering Committee” or
“Manufacturing JSC”) to give direction and advice to the Joint Management Team (or Teams if more
than one Project is being worked on by SurModics) relating to the Services. The Manufacturing
Joint Steering Committee will be made up of at least two senior level members from each Party,
representing functions within each Party directly involved in the Services; provided, however, that
no Party’s representative will serve on both the Manufacturing JSC and either a JMT or JSC
established under the License Agreement. Either Party may replace any or all of its
representatives at any time by providing written notice to the other Party.



     3.3.2 Responsibilities. The Manufacturing Joint Steering Committee will be responsible for
[*].


3.4 Meetings.




     3.4.1 JMT Meetings. The JMT shall meet at least monthly during the course of any SOW. These
meetings may be called on a more frequent basis as reasonably determined by the GNE Management Team
Leader. These meetings may be held via teleconference or videoconference but should be held face
to face at least two times per year, alternating between the Parties facilities or at such other
location as the Parties may otherwise agree. Each Party shall be responsible for all of its own
expenses of traveling to and participating in any of the JMT meetings. SurModics will assume the
project management responsibility for each Project; documenting meetings, maintaining a project
timeline, enabling risk management planning and resource forecasting, and otherwise tracking the
progress of the Services under each Project for the Joint Management Team.



     3.4.2 Manufacturing JSC Meetings. The Manufacturing JSC shall meet at least two (2) times per
year during the term of this MSA. These meetings shall be held face to face, alternating between
the Parties facilities or at such other location as the Parties may otherwise agree. By mutual
agreement of the Parties, meetings may also be held via teleconference or videoconference. Each
Party shall be responsible for all of its own expenses associated with travel to and participating
in any of Manufacturing JSC meetings.



3.5 Decisions.




     3.5.1 In General. The Management Team Leaders will be responsible for making all decisions on
day to day activities that do not materially impact critical milestones, Program Budgets, or supply
of materials. These decisions may be made in the context of discussion at the Joint Management Team; [*].
Notwithstanding the foregoing, either Management Team Leader may
escalate material issues and disputes to the Manufacturing JSC.


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     3.5.2 GNE Decisions. Notwithstanding anything to the contrary in the License Agreement, this
MSA and/or the Quality Agreement, with respect to issues relating to: (i) interpretation of quality
or cGMPs, (ii) acceptability of validation results, (iii) acceptability of Product testing
(including in-process testing), results or procedures, (iv) disposition of any Product (including
Non-Conforming Product) and/or (v) changes to a Manufacturing Process and/or Specifications, in
each case, [*]. SurModics shall use Commercially Reasonable Efforts to effect any such
implementation in accordance with a timeline approved by GNE. [*]


3.6 Disputes. If the Manufacturing JSC is unable to resolve a material issue or dispute presented
to it, then either Party’s Manufacturing JSC representative may escalate such Dispute to the JSC
established under the License Agreement, and such dispute shall be resolved in accordance with
ARTICLE 3 of the License Agreement.



3.7 Committee Term Limits. Either Party may, at its sole discretion, terminate its participation
on the JMT or the Manufacturing JSC at any time [*] of the Effective Date by providing [*] written
notice to the other Party. Should either Party elect to terminate its JMT or Manufacturing JSC
participation, the Parties will amend the respective decision making and disclosure rights and
obligations enumerated in this Agreement to preserve the Parties’ respective decision making and
disclosure rights and obligations in the absence of participation through the JMT or Manufacturing
JSC.



3.8 No Deliverables. The Parties acknowledge and agree that the Manufacturing JSC under this
Agreement is strictly for the purposes of decision making and governance of the activities
conducted under a SOW to this MSA, and does not in any way include any significant deliverable of
either Party.




ARTICLE 4

SERVICES



4.1 General Obligations. Subject to the terms and conditions set forth in this MSA and the License
Agreement, during the Term, GNE hereby retains SurModics to perform the Services specified in the
SOW(s).



4.2 Compliance with Law; Facility Permits and Licenses. SurModics shall, and shall ensure that its
Project Personnel, perform the Services in accordance with all applicable laws and regulations,
including, without limitation applicable GXPs. SurModics shall be responsible for obtaining and
maintaining all applicable licenses and permits required for it to perform the Services hereunder.



4.3 Manufacturing Facility. Unless otherwise expressly agreed by the Parties in writing (including
in a SOW), all Services shall be performed by SurModics at the Facility or by other SurModics’
personnel at SurModics’ locations. [*]



4.4 Project Personnel. It is understood that GNE is entering into this MSA, each SOW and the
Quality Agreement in reliance on the commitment by SurModics to staff the Facility



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with managers,
supervisors, engineers, technicians, inspectors, and other personnel including, but not limited to,
temporary employees, consultants and sub-contractors (in accordance with Section 4.5 below), as
SurModics deems necessary, in each case having sufficient technical expertise to perform its
obligations under this MSA and the Quality Agreement (collectively, “Project Personnel”). Without
limiting any other provision of this MSA, so long as such Project Personnel remain employed by
SurModics, SurModics will ensure that such individuals (not specific individuals but individuals
with similar functional expertise) are available to perform the obligations, as appropriate, to be
provided by SurModics hereunder. In addition, SurModics shall ensure that the Management Team
Leader and Project Personnel have read, understood and agreed to be bound by obligations of
confidentiality and non-use at least as restrictive as those applicable to this MSA.



4.5 Subcontracting. SurModics shall not subcontract all or any portion of its obligations under
this MSA without GNE’s prior written approval and in accordance with the Quality Agreement. In the
event of such approval, the applicable subcontract shall be consistent with the terms and
conditions of this MSA. [*]For the avoidance of doubt, SurModics may [*] to the extent such [*]
are under the general supervision of SurModics’ Project Personnel, and have sufficient technical
expertise, and SurModics is responsible to Genentech for their performance.



4.6 [*]




ARTICLE 5

FACILITY MODIFICATIONS, EQUIPMENT, MATERIALS, DOCUMENTATION AND

IMPLEMENTATION



5.1 In General. Modification of the Facility and/or transfer of equipment, materials and/or
processes to be carried out in order to perform the Services at the Facility, are summarized below
and may be further described in detail in a SOW, if applicable.



5.2 [*]



5.3 [*]



5.4 GNE Materials. GNE shall transfer to SurModics the GNE Materials and any Manufacturing
Documentation in Genentech’s Control necessary to perform the Services as specified in the
applicable SOW. Such transfer will be in accordance with the applicable SOW. GNE and SurModics
will make their personnel available at the Facility and/or other facilities to enable the transfer
and implementation of each of the foregoing. Prior to delivery of GNE
Materials to SurModics, GNE shall provide documentation similar to that described in the Quality
Agreement and a Certificate of Analysis or other documentation (i.e. certificate of testing, etc)
as appropriate for the development stage of the GNE Material for SurModics’ review and approval.
SurModics shall approve or reject such documents not more than [*] after receipt thereof, and may
reject such documents only as specifically set forth in the applicable Quality Agreement. Upon
SurModics’ approval of such documents, SurModics shall release GNE Material for delivery to
SurModics and GNE shall deliver the GNE Material to SurModics



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in accordance with the terms and
conditions of this MSA. The provisions set forth in the Quality Agreement regarding release shall
control the procedures and standards for release. For purposes hereof, “Certificate of Analysis”
means, as further specified in the Quality Agreement, for each shipment of GNE Material, a document
prepared by GNE: (a) listing the Manufacturing date(s) of such GNE Material, and (b) certifying
that all GNE Material in the shipment conform to the specifications and were Manufactured in
compliance with specifications, cGMPs, the Quality Agreement, standard operating procedures and all
applicable laws. The Parties shall from time to time agree upon a format or formats for the
Certificate of Analysis to be used under this MSA.



5.5 Raw Materials & Change Parts.




     5.5.1 Raw Materials. [*] Specifications for the Raw Materials shall be set forth in the
SOW(s).



     5.5.2 [*]



     5.5.3 Testing and Evaluation of Raw Materials. SurModics shall perform all testing and
evaluation of the Raw Materials as required by the applicable SOW, Specifications, Manufacturing
Documentation, cGMPs, the Quality Agreement and Standard Operating Procedures.



     5.5.4 [*]


5.6 Product Documentation. SurModics will maintain and retain true and accurate books, records,
test and laboratory data, validation data, reports and copies of all other information related to
the Services, including all information required to be maintained and retained under the License
Agreement, this MSA, the Quality Agreement or applicable law (including cGMPs) (the “Records”).
SurModics will maintain all Records in separate forms and notebooks to the extent reasonably
possible (i.e., not commingled with other information) and will maintain Records for at least that
period specified in the License Agreement and the Quality Agreement (or longer if required by law).
GNE shall have the right to review the Records at the Facility during the time such Records are
required to be maintained, as part of any audit conducted pursuant to Section 7.2.



5.7 Changes to the Manufacturing Process. Except as otherwise expressly set forth in the Quality
Agreement, in the event that GNE is required by a Regulatory Authority to change the Manufacturing
Process, SurModics shall use Commercially Reasonable Efforts to accommodate such required change,
provided, that if any such change to the Manufacturing
Process renders obsolete or unusable any Raw Materials used to manufacture the Product, and to the
extent such Raw Materials can not be utilized by SurModics for its other manufacturing operations,
GNE shall reimburse SurModics for the documented costs of such materials and disposal costs, if
any.



5.8 Regulatory Requirements for the Manufacturing Process and the Product. In accordance with the
terms of this MSA and the License Agreement, GNE shall be responsible



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for obtaining and maintaining
all Regulatory Approvals required to Develop and Manufacture Product at the Facility; provided that
SurModics shall use Commercially Reasonable Efforts to timely prepare, assist and enable GNE with
obtaining and maintaining such Regulatory Approvals, including, without limitation, by preparing,
filing and maintaining IND amendments to any existing FDA licenses held by SurModics.




ARTICLE 6

SUPPLY



6.1 In General. During the Term, and subject to the terms and conditions of this MSA and the
License Agreement (including, without limitation, for supply of Licensed Product [*], SurModics
agrees to supply to GNE, and GNE agrees to purchase from SurModics, such amounts of Product and
other deliverables as set forth in the applicable SOW.



6.2 Acceptance of Product and Other Deliverables.




     6.2.1 Acceptance.



          (a) Product. Prior to delivery of Product to GNE, SurModics shall provide Genentech with [*].
Upon GNE’s approval of such documents, GNE shall release the Product for delivery in accordance
with the Quality Agreement, and SurModics shall deliver the Product in accordance with the terms
and conditions of this MSA. The provisions set forth in the Quality Agreement regarding release
shall control the procedures and standards for release. For purposes hereof, “Certificate of
Analysis” means, as further specified in the Quality Agreement, for each shipment of Product, a
document prepared by SurModics: [*]. The Parties shall from time to time agree upon a format or
formats for the Certificate of Analysis to be used under this MSA.




          (b) Other Deliverables. Upon receipt of any deliverable specified in an SOW other than
Products, GNE (or its designee) shall, as appropriate, perform any testing and review required for
such deliverable per any Acceptance Criteria in the SOW, and for the requirements of the Quality
Agreement. Such testing and review will be completed within [*] of its receipt or such other
period of time specified in a SOW.




     6.2.2 Non-Conforming Product. In accordance with Section 7.1 of the Quality Agreement, GNE
will notify SurModics of any claim that Product is Non-Conforming upon GNE discovering such Product
is Non-Conforming, but no later than [*] after receipt of such Product and its associated
Manufacturing Documentation by GNE from SurModics. [*]



     6.2.3 Replacement Product. [*]


6.3 Delivery of Product.




     6.3.1 Shipping; Title.


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          (a) SurModics shall ship the Product (and any other deliverables) to such destinations chosen
by GNE to the extent that such shipments are permitted by law for SurModics given the regulatory
requirements of the exporting and the importing countries. Unless otherwise requested by GNE,
SurModics shall arrange for the delivery of Product (or such other deliverables) from the Facility
to such permitted destinations by carriers acceptable to, and in accordance with, GNE’s shipping
instructions on [*].




          (b) SurModics will provide customary export documentation, as specified by GNE or by separate
delivery and shipment documentation instructions, together with each shipment of Product (or such
other deliverables). At SurModics’ request, GNE shall assist SurModics with export consultant
expertise regarding shipment of Product. SurModics shall also provide GNE with all relevant
shipping information (e.g., carrier, shipment details, scheduled arrival date, quantity) prior to
or coincident with shipping any Product (or such other deliverables) to GNE. SurModics shall also
provide GNE with all relevant storage and handling instructions for such Product with each shipment
and GNE agrees to comply with such instructions.




          (c) GNE shall be the importer of record of each shipment of Product (or such other
deliverables) shipped to GNE. In conjunction therewith, prior to shipping any Product (or such
other deliverables), GNE shall obtain all appropriate approvals and consents of any governmental
authority necessary for the import, transportation or shipment of such Product (or such other
deliverables).




          (d) Any customs, freight, insurance and other shipping expenses, as well as any special
packaging expense incurred by SurModics prior to delivery to GNE shall be paid by GNE upon delivery
to GNE (or its designee) at the Facility. GNE shall also bear all applicable taxes, duties and
similar charges that may be assessed against the Product (or such other deliverables) after
delivery to GNE (or its designee) at the Facility.




     6.3.2 Storing, Packaging and Shipping Containers. SurModics shall provide sufficient and
suitable cGMP storage facilities that meet the Specifications for storage of Product for a period
of up [*] after release thereof. SurModics shall store, package, label and ship the Product
according to the Specifications, the Quality Agreement, and according to procedures and using
storage containers mutually agreed upon by GNE and SurModics in writing. [*]



ARTICLE 7

QUALITY COMPLIANCE



7.1 Quality Agreement. Both Parties are obligated to adhere to the provisions of the Quality
Agreement and agree that all elements of quality assurance, quality control and the like shall be
governed by the terms and conditions of the Quality Agreement. In the event of a conflict between
this MSA and the Quality Agreement, this MSA shall prevail over those of the Quality Agreement,
with the exception of quality-related matters and provisions that are in violation of cGMPs.



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7.2 Compliance Audits. Genentech will have the right to perform compliance audits as set forth in
Section 8.1 of the Quality Agreement.



7.3 Responsibility for Recalled Products. GNE shall notify SurModics promptly if any Product
manufactured by SurModics is the subject of a threatened or actual recall, market withdrawal or
correction attributable to any activities conducted by of SurModics. The responsibility for any
such recall shall be as set forth in the Quality Agreement.




ARTICLE 8

CONSIDERATION



8.1 Pricing. [*]



8.2 Invoices. SurModics shall invoice GNE for Services performed under this MSA in accordance with
Section 7.2 of the License Agreement or the applicable SOW. [*]



8.3 Payment Terms. The provisions contained in Section 7.2 and Article 8 of the License Agreement
are hereby incorporated by reference as if set forth herein in full




ARTICLE 9

OWNERSHIP OF INTELLECTUAL PROPERTY, MATERIALS AND EQUIPMENT



9.1 Equipment and Materials. [*]



9.2 Intellectual Property. The provisions contained in Articles 10 and 11 of the License Agreement
are hereby incorporated by reference as if set forth herein in full.




ARTICLE 10

CONFIDENTIALITY



The provisions contained in Article 9 of the License Agreement are hereby incorporated by reference
as if set forth herein in full.




ARTICLE 11

REPRESENTATIONS AND WARRANTIES



11.1 General Representations and Warranties. The provisions contained in Article 13 of the License
Agreement are hereby incorporated by reference as if set forth herein in full. In addition:




     11.1.1 SurModics Representations and Warranties. SurModics represents and warrants that all
Product, at the time of delivery to GNE’s designated carrier, shall: [*].


CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
WITH RESPECT TO THE OMITTED PORTIONS.




12









 








     11.1.2 GNE Manufacturing Representations and Warranties. GNE represents and warrants to
SurModics that: [*].



     11.1.3 Services Warranties SurModics represents and warrants that: (a) the Services shall be
performed and completed in a good and workmanlike manner; and (b) SurModics, and SurModics’
employees and/or subcontractors assigned to perform the Services, are qualified and equipped
therefor, have the requisite expertise and have all rights, licenses, permits and consents
necessary to perform the Services hereunder.



     11.1.4 Compliance with Anti-Corruption Practices. SurModics represents and warrants that
SurModics and its directors, officers, employees and permitted subcontractors will not, directly or
indirectly, pay, promise to pay, or authorize the payment of any money, or give, promise to give,
or authorize the giving of anything of value to any official or employee of any government, or of
any agency or instrumentality of any government (including any official or employee of any
government-controlled hospital or other healthcare organization) in connection with any Services
except in exchange for legitimate services provided by such official, employee, agency, or
instrumentality to achieve the purposes of this MSA. In the event that SurModics learns of any
activities in violation of this Section 11.1.4, it shall immediately notify GNE and provide
detailed information about the nature and extent of such activities.



ARTICLE 12

INDEMNIFICATION, INSURANCE, LIMITATION OF LIABILITY



The provisions contained in Article 14 of the License Agreement are hereby incorporated by
reference as if set forth herein in full.




ARTICLE 13

TERM AND TERMINATION



13.1 Term. This MSA shall commence on the Effective Date and, unless earlier terminated in
accordance with the provisions of this Article 13, shall continue in full force and effect until
terminated by mutual agreement of the Parties (the
“Term”).



13.2 Termination. This MSA may be terminated in accordance with Article 12 of the License Agreement
(in its entirety or as to any SOW). In addition, either Party may terminate any SOW for any
material breach of the MSA or such SOW by the other Party, provided, however, that the nonbreaching
Party shall give the breaching Party written notice detailing such
breach and indicating its intent to terminate, and, if the breaching Party fails to cure or dispute
in good faith, that breach within (a) [*] after receipt of written notice of breach of an
obligation to make a payment under this MSA and (b) [*] after receipt of written notice of any
other breach, or a longer period of time not to exceed [*] if the breaching Party is working
diligently to cure such breach.



13.3 Effect of Expiration or Termination.



CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
WITH RESPECT TO THE OMITTED PORTIONS.




13









 








     13.3.1 In General. In the event of any termination of this MSA, or any SOW to the MSA, the
terms of Sections 12.6, 12.7, and 12.8 of the License Agreement shall apply (as applicable). In
addition:



     13.3.2 Effect of Termination. Following any termination of this MSA, Product or other
deliverables that has been, or is in the process of being, Manufactured as of the date of notice of
such termination (or which result from Manufacturing initiated prior to delivery of such notice),
shall remain subject to the terms and conditions of this MSA, and such terms and conditions shall
continue to survive with respect to such Product.



     13.3.3 Return of Materials. In the event of termination of this MSA or any SOW to this MSA
for any reason, SurModics agrees promptly to surrender and deliver to GNE (a) all applicable GNE
Materials, Product and deliverables, and (b) records, materials, equipment, drawings, documents,
data and any work product of any nature in each case directly pertaining to applicable GNE
Confidential Information, Product, deliverables and/or Genentech Project IP Rights, or Joint
Project IP Rights, excluding original notebooks, and all other materials belonging to GNE, in
SurModics’ possession. Notwithstanding the foregoing, (i) SurModics may retain and continue to use
copies of such records, as required to comply with all applicable laws, and (ii) SurModics’ legal
department may retain one (1) copy of the foregoing, in each case, subject to its continuing
obligation of confidentiality related to this MSA.



     13.3.4 Decommissioning. Upon termination of the License Agreement, this MSA or any SOW for
any reason, unless otherwise provided in this Section 13.3.4, SurModics shall promptly perform the
Decommissioning, taking into account that such actions may be delayed to the extent necessary for
SurModics to fulfill any obligations continuing as of the date of such termination. As used
herein, “Decommissioning” means the process of verifying that all GNE contractual commitments
applicable to such termination have been met, including the requirements related to the return of
information and material set forth in Section 13.3.3. In addition, Decommissioning shall include
the following actions by SurModics:



          (a) Cease and refrain from all Services for GNE applicable to the termination;




          (b) [*]




          (c) Any GNE equipment in SurModics’ possession shall, at GNE’s election and cost, either be
(i) removed and returned to GNE, (ii) removed and destroyed, or (iii) rendered inoperable. In the
event GNE does not elect to have GNE equipment removed and returned to
GNE under 13.3.4(c)(i) herein, at SurModics’ election, SurModics may request GNE enter
negotiations for the sale of such GNE equipment to SurModics prior to GNE making an election under
13.3.4(c)(ii) or 13.3.4(c)(iii).




     13.3.5 Costs Incurred in Decommissioning. Prior to Decommissioning, and during the period of
any Decommissioning, the JMT shall meet, discuss in good faith and agree upon a plan and budget for
such Decommissioning. The actual costs and expenses incurred by SurModics in performing the
activities identified in Section 13.3.4 shall be borne by the Parties as follows:


CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
WITH RESPECT TO THE OMITTED PORTIONS.




14









 








          (a) [*]




          (b) [*]




          (c) [*]




     13.3.6 No Conflict. The foregoing rights and obligations are not meant to limit any rights or
obligations (including other payments or reimbursements due to SurModics) of either Party set forth
in Article 12 of the License Agreement.



     13.3.7 [*]



     13.3.8 Transition of Manufacturing and Supply. Notwithstanding any provision of this MSA to
the contrary, upon an early termination by GNE pursuant to Sections 12.3 or 12.5 of the License
Agreement, or Section 13.2 of this MSA (for SurModics’ material breach or bankruptcy), SurModics
agrees to extend the term of any SOW at GNE’s written request (which shall be at least [*] prior to
the date that this MSA with respect to such SOW would terminate or expire) in order to continue
Manufacturing and Supply of Product to GNE under such SOW for a reasonable period after the date
the MSA as to such SOW would have terminated. If, in connection with a termination of this MSA as
to a SOW, the Parties enter into arbitration in accordance with Article 15 of the License
Agreement, then the effective date of termination for purposes of this Section shall not be earlier
than the final resolution thereof, unless expressly agreed otherwise in writing by the Parties.
GNE shall give SurModics at least [*] prior written notice of the date after which Genentech will
no longer require SurModics to perform the Manufacturing and Supply of Product under such SOW.


13.4 Survival. In addition to provisions that survive pursuant to the License Agreement, the
following provisions shall survive termination of this MSA: Articles 1, 9, 10, 12, 14, and Sections
13.3 and 13.4.




ARTICLE 14




DISPUTE RESOLUTION


The provisions contained in Article 15 of the License Agreement are hereby incorporated by
reference as if set forth herein in full.




ARTICLE 15

MISCELLANEOUS



15.1 In General. The provisions contained in Article 16 of the License Agreement are hereby
incorporated by reference as if set forth herein in full, except that Section 16.3 of the License
Agreement shall not apply and instead the terms of Section 15.2 shall govern this Agreement.



CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
WITH RESPECT TO THE OMITTED PORTIONS.




15









 







15.2 Force Majeure.




     15.2.1 Effect of Force Majeure Event. Neither Party shall be deemed to have breached this
Agreement for failure to perform its obligations under this Agreement to the extent such failure
results from acts of God, earthquakes, fires, floods, embargoes, wars, acts of terrorism,
insurrections, riots, civil commotions or similar events (each a “Force Majeure Event”).



     15.2.2 Notice of Force Majeure. If a Force Majeure Event occurs, the Party unable to perform
shall promptly notify the other Party of the occurrence of such event, and the JMT shall meet (in
person or telephonically) promptly thereafter to discuss in good faith the circumstances relating
thereto and possible ways to mitigate any adverse consequences arising out of the Party’s failure
to perform. The Party unable to perform shall (a) provide reasonable status updates to the other
Party from time to time, (b) use Commercially Reasonable Efforts to mitigate any adverse
consequences arising out of its failure to perform and (c) resume performance as promptly as
possible.



     15.2.3 Recovery from Force Majeure. If a Force Majeure Event prevents SurModics from
Manufacturing or supplying Product under this Agreement, the Parties shall in good faith discuss
changes to scheduling and production to so as to remedy any shortfall, shortage or delay.
SurModics shall use Commercially Reasonable Efforts to accommodate any such changes to scheduling
and production. Notwithstanding the foregoing, in the event the Force Majeure Events affects
SurModics’ other customers, the changes to scheduling and production agreed upon by GNE and
SurModics shall be no less favorable to GNE than those arrangements provided by SurModics to any
other of its customers.



**********



CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
WITH RESPECT TO THE OMITTED PORTIONS.





16











 




IN WITNESS WHEREOF, the Parties hereto have caused this MSA to be executed by their duly
authorized representatives as set forth below.




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SurModics, Inc.	 	 	 	Genentech, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:	 	/s/ Bruce J Barclay	 	 	 	By:	 	[*]	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	Bruce J Barclay
	 	 
	 	 	 	Name:
	 	[*]
	 	 
	 

	 	Title:
	 	President and CEO
	 	 	 	 	 	Title:
	 	[*]	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	F. Hoffmann-La Roche Ltd	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	By:	 	[*]	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	Name:
	 	[*]	 	 
	 

	 	 	 	 	 	 	 	 	 	Title:
	 	[*]	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	By:	 	[*]	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	Name:
	 	[*]	 	 
	 

	 	 	 	 	 	 	 	 	 	Title:
	 	[*]	 	 





CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.





 









 








EXHIBIT A




FORM OF SOW



     This statement of work (the “Exhibit”) is entered into pursuant to the Master Service
Agreement by and between Genentech, Inc. (“Genentech”) and SurModics, Inc. (“SurModics”) dated
<Insert Date> (the “Agreement”), and is effective as of <Insert Date> (the “Exhibit
Effective Date”). Capitalized terms used in this Exhibit and not otherwise defined will have the
same meaning as set forth in the Agreement.



     The parties hereby agree as follows:




     1. Exhibit. This document constitutes an Exhibit to the Agreement, and the Services to be
provided hereunder are subject to the terms and conditions of the Master Service Agreement.



     2. Services and Payments of Fees and Expenses. The specific Services contemplated by this
Exhibit are set forth on the following attachments, which are incorporated herein by reference.
[*]



	 	 	 
	Scope of Work, Timeline and Budget

	 	ATTACHMENT I
	 
	 	 
	Project Specific Compensation Terms

	 	ATTACHMENT II
	 
	 	 
	Change Order Process

	 	ATTACHMENT III






     3. Term. The term of this Exhibit will commence on the Exhibit Effective Date set forth above
and will continue until the Services described on Attachment II are complete or this Exhibit is
terminated in accordance with the Agreement.



     4. Affiliates and Subcontractors. Genentech agrees that SurModics may use the services of its
Affiliates or subcontractors to fulfill SurModics’s obligations under this Exhibit. SurModics will
be responsible to Genentech for the performance of such Affiliates and subcontractors, and all such
performance will be in accordance with the terms and conditions of the Agreement and this Exhibit.



     Subcontractors: [List as needed]




     5. Contact Information



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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.






 









 








     SurModics Pharmaceuticals




	 	 	 	 	 	 	 	 	 
	Contact Name	 	Site	 	Department	 	Telephone	 	Email
	 

	 	 	 	Proposal Administration	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Project Management	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Business Development	 	 	 	 






     Genentech




	 	 	 	 	 	 	 
	Contact Name	 	Address	 	Telephone	 	Email
	<Manufacturing 

Collaborations Site 

Manager>

	 	1 DNA Way

South San Francisco

CA 94080	 	 	 	 






     6. Amendments. No modification, amendment, or waiver of this Exhibit shall be effective
unless in writing and signed by a duly authorized representative of each party, in accordance with
the Change Order process described in ATTACHMENT III to this Exhibit.



     ACCEPTED AND AGREED:




	 	 	 	 	 
	SurModics Pharmaceuticals:

	 	Genentech, Inc.:	 	 
	 
	 	 	 	 
	 

	 	[Insert Signature Blocks]	 	 





CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.




 









 








Attachment I: SOW Scope & Budget




INSERT PROPOSAL TASKS HERE




INSERT PROPOSAL TIMELINE HERE



Attachment II: Project Specific Compensation & Terms





	1)	 	Project Budget and Total Compensation




[*]





	2)	 	Payments





     SURMODICS shall submit (email) all invoices for this contract as follows:


Send Attn:




<Genentech Project Contact>




1 DNA Way, MS <#>




South San Francisco, CA 94080




Email / Carbon Copy: <Genentech Relationship Manager>




     All invoices must reference the PO number assigned to this contract. The purchase
order number will be sent via email after the contract is executed.



     Genentech shall forward payment to SurModics as follows:


CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.





 









 






          Attachment III: Change Order Process




15.3 Scope Change Form (SCF)









Genentech / SurModics Exhibit #______



SOW #______



Change Order Form







          (a)









Change Order Number: [#________]




 





(i) Description of Change(s) and Assumptions




          (b)




           





[*]






          (c)





Total Contract Budget Summary




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Document	 	Effective Date	 	Labor Amount	 	Expenses Amount	 	Total Contract
	Exhibit [#]
	 	 	 	 	 	$	 —	 	 	$	 —	 	 	$	 —	 
	Change Order #1
	 	 	 	 	 	$	—	 	 	$	—	 	 	$	—	 
	Change Order #2
	 	 	 	 	 	$	—	 	 	$	—	 	 	$	—	 
	Change Order #3, etc.
	 	 	 	 	 	$	—	 	 	$	—	 	 	$	—	 
	Total Revised Contract:
	 	 	 	 	 	 	 	 	 	 	 	 	 	$	—	 












          (d) Payment Schedule Revision




     Is
a revised payment schedule required? o YES, It is included as an Attachment.
o NO



     If NO, please explain:






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15.3.2 CHANGE ORDER APPROVAL




	 	 	 
	SurModics

	 	Genentech, Inc.






	 	 	 	 	 	 	 	 	 	 	 
	Print Name:

	 	 
	 	 	Print Name:
	 	 	 	 
	 

	 	 

	 	 
	 	 	 	 

	 	 






	 	 	 	 	 	 	 	 	 	 	 
	Signature:

	 	 	 	 	 	Signature:
	 	 	 	 
	 

	 	 

	 	 
	 	 	 	 

	 	 






	 	 	 
	Approval Date: __/__/_____

	 	Approval Date: __/__/_____





CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.





 








 








EXHIBIT B




QUALITY AGREEMENT


CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.





 











 





GOOD MANUFACTURING PRACTICE

TECHNICAL QUALITY AGREEMENT




Between



Genentech, Inc.



(Contract Giver)



and



SurModics, Inc.



(Contract Acceptor)


We the undersigned, agree to the terms, conditions, roles and responsibilities described in
this Quality Agreement and its appendices.




	 	 	 	 	 	 	 
	Genentech, Inc.

	 	 	 	SurModics, Inc.	 	 
	 
	 	 	 	 	 	 
	[*]

	 	9/30/09
	 	/s/ Michael Shoup
	 	10/1/09
	 

	 	 	 	 	 	 
	[*]

	 	DATE
	 	Michael Shoup,
	 	DATE
	[*]

	 	 	 	Vice President Quality, Regulatory and	 	 
	[*].

	 	 	 	Clinical Affairs SurModics, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	[*]
	 	10/1/09
	 

	 	 	 	 	 	 
	 

	 	 	 	[*]
	 	DATE
	 

	 	 	 	[*]	 	 
	 

	 	 	 	[*]	 	 





CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
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Confidential and Proprietary — Handle Accordingly





 









 








Quality Agreement Number- QAC-SUR-01/01

Page 2 of 21 





TABLE OF CONTENTS




	 	 	 	 	 	 	 	 	 	 	 
	1.0	 	 	GENERAL INFORMATION	 	 	3	 
	 

	 	 	1.1	 	 	Introduction
	 	 	3	 
	 

	 	 	1.2	 	 	Parties to Agreement
	 	 	3	 
	 

	 	 	1.3	 	 	Scope
	 	 	3	 
	 

	 	 	1.4	 	 	Duration, Review and Changes to this Agreement
	 	 	4	 
	 

	 	 	1.5	 	 	Ultimate Quality Responsibility
	 	 	4	 
	 

	 	 	1.6	 	 	Quality Oversight and Person-in-Plant (PIP)
	 	 	5	 
	 

	 	 	1.7	 	 	GMP Commissioning
	 	 	5	 
	 

	 	 	1.8	 	 	Execution of Responsibilities
	 	 	6	 
	2.0	 	 	LICENSES	 	 	6	 
	 

	 	 	2.1	 	 	Establishment License
	 	 	6	 
	 

	 	 	2.2	 	 	Product Licenses
	 	 	6	 
	3.0	 	 	GOVERNING REGULATIONS, RULES AND PROCEDURES	 	 	6	 
	 

	 	 	3.1	 	 	Governing Regulations and Rules
	 	 	6	 
	 

	 	 	3.2	 	 	SurModics Procedures
	 	 	7	 
	4.0	 	 	MATERIALS	 	 	7	 
	 

	 	 	4.1	 	 	Sources
	 	 	7	 
	 

	 	 	4.2	 	 	Suppliers
	 	 	7	 
	 

	 	 	4.3	 	 	Receipt, Testing, Control and Release
	 	 	8	 
	5.0	 	 	PROCESSING OF PRODUCT	 	 	8	 
	 

	 	 	5.1	 	 	Batch Numbering
	 	 	8	 
	 

	 	 	5.2	 	 	Holding, Shipping, and Destruction of Samples
	 	 	8	 
	 

	 	 	5.3	 	 	Reprocessing and Reworking
	 	 	9	 
	6.0	 	 	QUALITY CONTROL TESTING	 	 	9	 
	 

	 	 	6.1	 	 	Analytical Methods
	 	 	9	 
	 

	 	 	6.2	 	 	Quality Control Testing and Approval
	 	 	9	 
	 

	 	 	6.3	 	 	Stability Testing
	 	 	10	 
	 

	 	 	6.4	 	 	Out of Specification (OOS) Quality Control Testing Results
	 	 	10	 
	7.0	 	 	GENERAL QUALITY SYSTEMS	 	 	10	 
	 

	 	 	7.1	 	 	Disposition of Product
	 	 	10	 
	 

	 	 	7.2	 	 	Deviations
	 	 	11	 
	 

	 	 	7.3	 	 	Validation
	 	 	13	 
	 

	 	 	7.4	 	 	Change Control
	 	 	13	 
	 

	 	 	7.5	 	 	New Product Introduction
	 	 	14	 
	 

	 	 	7.6	 	 	Product Complaints, Adverse Events, and other Post-Release Issues
	 	 	14	 
	 

	 	 	7.7	 	 	Document Retention
	 	 	15	 
	 

	 	 	7.8	 	 	Sub-contracting
	 	 	15	 
	 

	 	 	7.9	 	 	QA Reserve Samples
	 	 	15	 
	8.0	 	 	COMPLIANCE AUDITS AND INSPECTIONS	 	 	16	 
	 

	 	 	8.1	 	 	Compliance Audits
	 	 	16	 
	 

	 	 	8.2	 	 	Regulatory Authority Inspections
	 	 	16	 
	 

	 	 	8.3	 	 	Regulatory Agency Contacts
	 	 	17	 
	Appendix I — Glossary	 	 	22	 
	Appendix II — Change History Log	 	 	25	 





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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.




			
	 	 	 
	Version 01
	 	Confidential and Proprietary — Handle Accordingly







 











 




Quality Agreement Number- QAC-SUR-01/01

Page 3 of 21 






	1.0	 	GENERAL INFORMATION
	 
	1.1	 	Introduction






	 	1.1.1	 	Genentech, Inc. is a leading biotechnology company engaged in the manufacture,
marketing and sales of pharmaceutical products. It operates under one common quality
management system in compliance with current Good Manufacturing Practices (cGMP).
	 
	 	1.1.2	 	SurModics, Inc. is a leading pharmaceutical and biotechnology company engaged
in the contractual manufacture of pharmaceutical and medical device products. It
operates under one common quality management system in compliance with cGMP.
	 
	 	1.1.3	 	Genentech Inc. (“GNE”) desires to entrust SurModics, Inc. (“SurModics”) to
perform activities related to the manufacture of GNE Products. GNE and SurModics are to
define their roles and responsibilities hereunder according to the intentions of the
GMP regulations. The manufacturing arrangements relating to the manufacture of the
Product are governed under the Master Service Agreement between GNE and SurModics
effective September 30, 2009 (the “Master Service Agreement”).
	 
	 	1.1.4	 	Capitalized terms not defined in the Glossary attached as Appendix I shall
have the meaning set forth in the Master Services Agreement.






	1.2	 	Parties to Agreement






	 	1.2.1	 	This GMP Technical Quality Agreement (the “Quality Agreement”) is hereby
entered into by and between GNE, a Delaware corporation, and SurModics, a Minnesota
corporation, and must be adhered to in the processing of the Product for GNE governed
by the Master Service Agreement. SurModics and Genentech are each referred to herein
individually as a “Party” and collectively as the “Parties.” The addresses of the
Parties are:





	 	 	 
	GENENTECH, Inc.

	 	SurModics, Inc.
	1 DNA Way

	 	9924 West 74th Street
	South San Francisco, CA 94080

	 	 Eden Prairie, MN 55344







	1.3	 	Scope






	 	1.3.1	 	Subject to Section 1.3.4, this Quality Agreement is applicable to the
manufacturing, processing, testing, and storage of the Product by SurModics for GNE.
	 
	 	1.3.2	 	The appendices and enclosures to this Quality Agreement are an integral part
of this Quality Agreement and are incorporated into this Quality Agreement by this
reference.
	 
	 	1.3.3	 	In addition to this Quality Agreement, SurModics and GNE shall create,
approve, and maintain a document that details Product specific requirements
(hereinafter referred to as the “PSR Document”) for each Product. This





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Quality Agreement Number- QAC-SUR-01/01

Page 4 of 21 






	 	 	 	document shall,
at a minimum, contain contact information for designated
representatives from SurModics and GNE who shall oversee the respective obligations
regarding the Product and this Agreement, a process overview of the Product, a list
of raw materials and suppliers required to produce the Product, disposition cycle
times, list of batch documentation, any special shipping and handling requirements,
and any additional applicable information as required per this Quality Agreement or
deemed necessary by both parties.
	 
	 	1.3.4	 	This Quality Agreement pertains to the processing of the Products for
administration to humans as governed by clinical trial authorizations and marketing
authorizations (e.g. Investigational New Drug applications and Biologics License
applications). It does not pertain to the supply of Products for research and
development use. The mutual roles and responsibilities between GNE and SurModics
related to the Quality system requirements for, as well as the Product-specific Quality
requirements are defined.






	1.4	 	Duration, Review and Changes to this Agreement






	 	1.4.1	 	This Quality Agreement shall be effective as of the last date all required
signatures are appended above (the “Effective Date”) and shall expire at the
termination of the Master Service Agreement for the Product. The following sections
shall survive termination of the Master Service Agreement until such time as defined in
this Quality Agreement: sections 7.6, 7.7, 7.8, 7.9, 8.2, 8.3, and such other sections
that by their terms are understood to survive the termination of the Master Service
Agreement. The Parties acknowledge and agree that a similar quality agreement will be
executed upon termination of the Master Service Agreement in the event an agreement for
the manufacture of Phase III/IV material or commercial Product is negotiated between
the Parties.
	 
	 	1.4.2	 	This Quality Agreement shall be reviewed for accuracy and compliance with the
GMP regulations by both parties on at least a biennial cycle. Changes or supplements to
this Quality Agreement or to the appendices and enclosures can only be made by mutual
consent of amendments in writing. Such amendments to the Quality Agreement will be
recorded and filed in APPENDIX II: — Change History Log, with each subsequent revision.
	 
	 	1.4.3	 	It is the responsibility of both parties to replace a superseded provision
with an approved amendment. Superseded copies may be retained for historical records,
but should be marked to appropriately indicate the historical status of the document.
	 
	 	1.4.4	 	It is the responsibility of both parties to ensure that their staff is
adequately informed and any procedural or documentary changes resulting from an
amendment are implemented in the areas affected by the changes.






	1.5	 	Ultimate Quality Responsibility






	 	1.5.1	 	In the event of a conflict between this Quality Agreement and the Master
Service Agreement, the Master Service Agreement shall govern, except to the extent such
provisions are in violation of the GMP regulations. Notwithstanding the foregoing, this
Quality Agreement shall govern with respect to the assignment of responsibilities and
obligations of each party to




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	 	 	 	undertake those measures to assure the Quality of the Products and with respect to
determinations of ability for release.
	 
	 	1.5.2	 	GNE’s Quality Unit has sole authority for final disposition of Product for
clinical use.
	 
	 	1.5.3	 	SurModics has the responsibility to implement and operate all quality systems
as required by GMP regulations where the Product will be distributed. SurModics shall
ensure that all quality systems operated by SurModics are compliant for GMP production
and that they operate to a standard mutually agreed upon by both parties.
	 
	 	1.5.4	 	If not otherwise defined in this Quality Agreement, the provisions of
SurModics’ Quality management systems and Standard Operating Procedures shall be
applied to these operations.






	1.6	 	Quality Oversight and Person-in-Plant (PIP)






	 	1.6.1	 	GNE shall have the right to provide GNE employees on SurModics’ premises (the
GNE employees hereinafter referred to as the “PIP”) for the purpose of providing advice
and coordinating reviews, approvals or other actions required by this Quality Agreement
upon reasonable notice and as mutually agreed upon. Such GNE employees shall conduct
themselves in accordance with SurModics’ visitor policy. The GNE PIP activities, at
the discretion of GNE, can also be performed remotely.
	 
	 	1.6.2	 	SurModics shall provide adequate space for the PIP when on site and shall
ensure that the PIP is kept fully informed of all issues that arise that may affect the
Quality of the Product. The PIP shall act as a single liaison between SurModics and GNE
for Quality issues.
	 
	 	1.6.3	 	[*]






	1.7	 	GMP Commissioning






	 	1.7.1	 	GMP Commissioning is a process for approving the initiation of GMP activities
at SurModics for a new manufacturing facility or a new manufacturing process related to
the Product.
	 
	 	1.7.2	 	Prior to the initiation of GMP production, SurModics shall allow the GNE
Quality Unit to perform GMP commissioning activities. This commissioning exercise is
to document that the facility, process, procedures and personnel are ready to initiate
GMP production as it relates to the Product.
	 
	 	1.7.3	 	The commissioning checklist and acceptance criteria shall be drafted by GNE
and approved by both SurModics and GNE prior to execution.
	 
	 	1.7.4	 	SurModics shall not perform new GMP activities for the Product until the GMP
Commissioning is complete and approved by the GNE and SurModics Quality Units.




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	1.8	 	Execution of Responsibilities






	 	1.8.1	 	In the execution of their relevant responsibilities, both Parties agree to
conduct the necessary reviews, approvals, rejections and consents in a timely manner
and within the time limits specified. Where any party requires the consent of the
other, such consent will not be unreasonably withheld or delayed.
	 
	 	1.8.2	 	In this Agreement, “approval,” “authorization,” or “written communication”
shall mean on official letterhead or approved forms, and signed by the authoring
party’s Quality Assurance (QA) representative. Transmission of such written
documentation may be by mail or electronic system (i.e., facsimile, scan).






	2.0	 	LICENSES
	 
	2.1	 	Establishment License






	 	2.1.1	 	If applicable, SurModics shall obtain and maintain a valid manufacturer’s
license for the facilities [*].






	2.2	 	Product Licenses






	 	2.2.1	 	GNE shall, in accordance with applicable regulations, have sole authority for
applying for any Product licenses with the regulatory agencies per section 5.1 of
License and Option Agreement. GNE shall inform the appropriate regulatory authorities
of any change to the approved licenses for the Product through supplements or
amendments and informing SurModics of the same.
	 
	 	2.2.2	 	Upon request of any governmental or regulatory authority, both Parties shall
provide to each other, any data and information relating to the Product which may be
necessary for regulatory approval and maintenance efforts with respect to the licenses.






	3.0	 	GOVERNING REGULATIONS, RULES AND PROCEDURES
	 
	3.1	 	Governing Regulations and Rules






	 	3.1.1	 	SurModics shall ensure that the systems for the manufacture, processing,
testing, packing, holding and shipping of the Product at SurModics comply with:






	 	•	 	Current Good Manufacturing Practice, including but not limited to US 21 CFR
Part 11, 210, 211, and if applicable 820.
	 
	 	•	 	The requirements of this Quality Agreement.
	 
	 	•	 	The approved master documentation records (i.e., production records,
specifications).
	 
	 	•	 	Any additional regulations adopted by the regulatory authorities where the
Product will be distributed. GNE shall inform SurModics, in advance, of any
other countries where the Product will be distributed and any registration
differences.




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	 	3.1.2	 	GNE shall have the right to ensure SurModics’ compliance with Section 3.1.1
above as described per Section 1.6 (PIP) and Section 8.1 (Compliance audits).






	3.2	 	SurModics Procedures






	 	3.2.1	 	SurModics shall create and maintain Quality systems compliant with cGMP, with
associated Standard Operating Procedures that enable both Parties to execute their
roles and responsibilities under the terms and conditions as described herein.
	 
	 	3.2.2	 	SurModics shall provide GNE with copies of effective Standard Operating
Procedures related to the manufacture, processing, testing, packing and holding of the
Product upon reasonable request by GNE.






	4.0	 	MATERIALS
	 
	4.1	 	Sources






	 	4.1.1	 	SurModics and/or GNE shall supply all materials required for the Product in
accordance with the MSA and certify that their Quality is in compliance with the
current “Note for Guidance on minimizing the risk of transmitting spongiform
encephalopathy agents via human and veterinary medicinal products” EMEA/410/01, Rev. 2
or update (“TSE Guidelines”).
	 
	 	4.1.2	 	GNE shall provide the bulk drug substance to SurModics for further processing
in accordance with the MSA. GNE certifies that the provided bulk will be processed
according to GMP and the materials used in its processing will be sourced in compliance
with the TSE Guidelines.






	4.2	 	Suppliers






	 	4.2.1	 	[*]
	 
	 	4.2.2	 	SurModics shall perform, or arrange to have performed, assessments of
suppliers of raw materials and components required for GNE Products to ensure that the
supplier’s Quality and manufacturing system are compliant with cGMPs.
	 
	 	4.2.3	 	[*]
	 
	 	4.2.4	 	SurModics shall notify the GNE Quality Unit when a supplier’s qualification
status changes. Upon request by GNE, SurModics shall request from its suppliers
permission to allow GNE to review SurModics audit reports.
	 
	 	4.2.5	 	If GNE supplies any raw materials and components to SurModics for use in
processing of the Product, SurModics will rely on GNE’s certification that the
supplier’s Quality systems are adequate.




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	4.3	 	Receipt, Testing, Control and Release






	 	4.3.1	 	SurModics/GNE shall receive, sample, test, control and release components and
raw materials for the Product in accordance with the approved material specifications.
	 
	 	4.3.2	 	SurModics shall implement and maintain approved material specifications,
analytical methods, inspection methods, and sampling plans as required per each
material required for GNE Products. The GNE Quality Unit’s prior written approval of
such documentation is required. GNE’s approval of the material specifications,
analytical methods, inspection methods, and sampling plans shall be performed via
SurModics’ quality control system.






	5.0	 	PROCESSING OF PRODUCT
	 
	5.1	 	Batch Numbering






	 	5.1.1	 	SurModics shall use the GNE batch numbering system for all GMP Product
produced by SurModics.
	 
	 	5.1.2	 	GNE shall issue batch numbers to SurModics, who shall assign a batch number to
each Product batch. For purposes of tracking, SurModics may assign an internal
SurModics batch number in addition.
	 
	 	5.1.3	 	SurModics shall record the GNE batch number onto the appropriate production
records. SurModics shall keep track of GNE batch numbers to ensure batch numbers are
assigned appropriately.
	 
	 	5.1.4	 	SurModics shall record the GNE batch number on the appropriate Product Batch
labeling (i.e., vial label, shippers)






	5.2	 	Holding, Shipping, and Destruction of Samples






	 	5.2.1	 	SurModics shall hold the Product and raw materials in storage according to the
PSR and cGMP requirements. SurModics shall ensure that appropriate cGMP controls are
in place to prevent cross-contamination, theft, interference, or mix-up with any other
materials.
	 
	 	5.2.2	 	SurModics shall ship the Product according to GNE shipping requirements per
approved procedures. GNE shall communicate the shipping requirements to SurModics in
writing.
	 
	 	5.2.3	 	Upon receipt of the Product from GNE for further processing, SurModics shall
read the temperature monitors and report any temperature Deviations to the GNE Quality
Unit within [*].
	 
	 	5.2.4	 	Any temperature Deviations observed during shipment and/or holding of the
Product at SurModics will be handled per Section 7.2. SurModics shall investigate the
root cause and identify appropriate corrective actions for Deviations that occur while
the Product is under SurModics’ control.




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	 	5.2.5	 	GNE shall be responsible for assessing the impact on Product as a result of
temperature Deviations either during Product shipment and/or during holding of the
Product at SurModics.
	 
	 	5.2.6	 	SurModics shall destroy Product rejects (for example, inspection rejects, bulk
waste, and rejected batches) per SurModics’ procedures. SurModics shall ensure that
proper handling, segregation, and documentation of any destruction is performed.






	5.3	 	Reprocessing and Reworking






	 	5.3.1	 	Prior to any Product batch being reprocessed or reworked, SurModics must
obtain approval of the GNE Quality Unit in advance. Reprocessing and reworking are
considered Significant Deviations and shall be handled in accordance to Section 7.2.
[*]
	 
	 	5.3.2	 	[*]






	6.0	 	QUALITY CONTROL TESTING
	 
	6.1	 	Analytical Methods






	 	6.1.1	 	SurModics shall implement and maintain in-process material and final Product
analytical methods.
	 
	 	6.1.2	 	The GNE Quality Unit’s prior written approval for all Product-specific
analytical methods is required.






	6.2	 	Quality Control Testing and Approval






	 	6.2.1	 	SurModics shall sample and test in-process and final Product batches according
to the approved specifications, sampling plans and analytical methods.
	 
	 	6.2.2	 	SurModics shall report all quality control results on a “Certificate of
Analysis” (COA). SurModics shall include all in-process results with the batch
records.
	 
	 	6.2.3	 	SurModics shall not destroy any QC retain samples until the Product batch has
been dispositioned by GNE.
	 
	 	6.2.4	 	GNE shall provide reference materials and critical reagents to SurModics to be
used in the testing of the Product.
	 
	 	6.2.5	 	For testing performed at GNE, SurModics shall collect the samples,
appropriately label and store the samples, and ship the samples per the current
validated shipping procedure to GNE within [*] of collecting the samples.
	 
	 	6.2.6	 	GNE QC shall perform a review of raw quality control data for in-process and
final Product batches to ensure quality standards are being maintained until such time
that GNE can qualify SurModics to perform independent data review as defined per GNE
procedure.




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	6.3	 	Stability Testing






	 	6.3.1	 	SurModics shall be responsible for maintaining a routine stability testing
program for the Product per approved procedures.
	 
	 	6.3.2	 	SurModics shall write, approve and submit stability protocols for the Product
to GNE for approval.
	 
	 	6.3.3	 	SurModics shall provide GNE with the results of stability testing in support
of the approved shelf life within [*] of completion of the stability testing.
	 
	 	6.3.4	 	SurModics shall communicate any out of specification results obtained during
stability testing of the Product to the GNE Quality Unit in accordance with Section
7.2.
	 
	 	6.3.5	 	GNE shall determine and approve the expiry and/or retest period, storage, and
shipping conditions based on formal stability studies conducted for the Product.






	6.4	 	Out of Specification (OOS) Quality Control Testing Results






	 	6.4.1	 	In the event that SurModics obtains an initial OOS result, a preliminary lab
assessment shall be conducted per SurModics’ approved procedures. This assessment will
include at a minimum, a review of all equipment used, sample and reagent preparation,
and documentation associated with the test session. No additional testing of the
Product shall be conducted during this preliminary lab assessment.
	 
	 	6.4.2	 	If no determinate error is identified in the assessment conducted pursuant to
Section 6.4.1, then SurModics shall notify the GNE Quality Unit per the Section 7.2.
No additional analysis shall be conducted on the Product prior to notifying the GNE
Quality Unit.
	 
	 	6.4.3	 	The GNE Quality Unit shall approve OOS investigations and associated
corrective and preventative actions, unless an analytical error is identified in the
assessment as described in section 6.4.1 and the results are invalidated and testing is
repeated on a new sample






	7.0	 	GENERAL QUALITY SYSTEMS
	 
	7.1	 	Disposition of Product






	 	7.1.1	 	The SurModics Quality Unit must certify in writing that each batch of Product
has been manufactured, tested, packaged and stored in accordance with cGMPs, the Master
Batch Production Record (MBPR) and applicable SOPs.
	 
	 	7.1.2	 	The SurModics Quality Unit shall review and approve all batch documentation
according to SurModics’ approved procedures prior to release of the Product batch to
GNE.
	 
	 	7.1.3	 	All Deviations must be clearly identified in batch records, and must be fully
investigated and completed prior to the approval of batch records. SurModics




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	 	 	 	shall perform a cumulative assessment of all Deviations that occurred during the
manufacturing, holding, and testing of the Product.
	 
	 	7.1.4	 	GNE has the sole authority for final disposition of the Product. SurModics
shall notify the GNE Quality Unit of any Product batch being considered for rejection
by SurModics prior to any formal reject disposition. For Product assigned a reject
disposition by SurModics, GNE shall have the right to take possession of the Product.
GNE shall authorize the destruction of any rejected Product batches.
	 
	 	7.1.5	 	SurModics shall not release any batches with open Major Changes or validations
that are lot-release impacting.
	 
	 	7.1.6	 	Any problem discovered by GNE that would result in the rejection of a Product
batch shall be communicated to SurModics as soon as practical, but in all cases within
[*] following receipt of the release documentation.






	7.2	 	Deviations






	 	7.2.1	 	Any Deviation shall be documented and approved by personnel designated by
SurModics from each of the relevant departments and by the SurModics Quality Unit, in
accordance with SurModics’ approved procedure for Deviation management.
	 
	 	7.2.2	 	Significant Deviations require notification of the GNE Quality Unit within [*]
of discovery.






	 	•	 	Significant Deviations are defined as events that are observed during
production, quality control testing including out-of-specification (OOS)
results as described in section 6.4.2 above, and/or batch record review that
may reasonably result in a Deviation from Product specifications, that may
adversely impact the safety, identity, strength, purity or quality of the
Product, and/or violate cGMPs or the Product license that could impact the
releasability of the Product. Examples of Significant Deviations include:






	 	•	 	Failure of Product to meet certificate of analysis (COA) specifications
	 
	 	•	 	Operations outside of validated limits
	 
	 	•	 	Suspected introduction of adventitious agents/contaminants in the
Product
	 
	 	•	 	Excursions to environmental conditions (EM) in the primary filling area
	 
	 	•	 	Incorrect or unsuitable raw materials, components, or equipment used
during the manufacturing of the Product
	 
	 	•	 	Reprocessing and reworking of the Product, [*]
	 
	 	•	 	Process discrepancies that adversely impact other Product process
steps, lots, or Products batches whether distributed or not
	 
	 	•	 	Media fill and sterility positives/failures






	 	7.2.3	 	SurModics shall obtain GNE Quality Unit approval for all Significant Deviations.




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	 	7.2.4	 	SurModics shall inform the GNE Quality Unit within [*] of any Significant
Deviation relating to other products, produced using the same equipment train as that
used for the Product, if the Deviation could have an impact on the Product. SurModics
will provide as much detail as possible regarding the Deviation. In the event that
customer confidentiality agreements regarding other products prevent SurModics from
providing certain documentation or detail, SurModics may provide redacted copies of
documentation or a summary of the Deviation.
	 
	 	7.2.5	 	SurModics shall be responsible for investigating all Deviations per its
approved procedures. SurModics will allow the GNE Quality Unit to actively participate
in the development of investigation action plans related to Significant Deviations
related directly to the Product or that could have impact on the Product. All
investigation plans should be approved prior to implementation and should include at
minimum:






	 	•	 	Lots impacted
	 
	 	•	 	Description of action to be taken
	 
	 	•	 	Rationale for this action
	 
	 	•	 	Individual/department responsible for the action
	 
	 	•	 	Target completion date
	 
	 	•	 	Pre-approval by SurModics’ QA






	 	7.2.6	 	SurModics shall submit investigation plans before their implementation for all
Significant Deviations. Those plans shall be evaluated by the GNE Quality Unit. Any
additional testing required to support an investigation, including OOS investigations,
must be pre-approved by the GNE Quality Unit.
	 
	 	7.2.7	 	When necessary, GNE shall provide a technical assessment or other data to
support the investigation.
	 
	 	7.2.8	 	Significant Deviation reports shall include a description of the event,
impacted lots, determination of cause, quality impact assessment, and identification of
corrective and preventive actions. Quality impact assessments should determine the
impact of the event on the safety, Quality, identify, potency and purity of the
Product, other lots of the Product, validation, and GMP compliance.
	 
	 	7.2.9	 	After completion of the report related to Significant Deviations, SurModics
shall submit to GNE a copy of a completed report. This report shall be reviewed by the
GNE Quality Unit. Within [*], the GNE Quality Unit will either approve the Significant
Deviation, or notify SurModics of additional information or actions required before
approval of the Significant Deviation report.
	 
	 	7.2.10	 	SurModics shall [*] notify the GNE Quality Unit of any problems that are discovered
that may have impact to Product batches previously shipped to GNE. Notice shall be made
within [*] of the discovery of a potential quality problem with a released batch of
Product.




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	7.3	 	Validation






	 	7.3.1	 	SurModics shall maintain systems that demonstrate manufacturing processes,
facilities, utilities, equipment, and automation will reliably and repeatedly perform
their intended function in the manufacture and testing of the Product.
	 
	 	7.3.2	 	As applicable, SurModics shall maintain a Validation Master Plan (VMP), which
includes the validation program overview and requirements for the facility and
equipment required to manufacture and test the Product. This VMP must be acceptable to
GNE.
	 
	 	7.3.3	 	SurModics shall periodically re-validate, as appropriate, facilities,
utilities, equipment, and automation per the VMP and other approved procedures.
	 
	 	7.3.4	 	GNE shall have the right to review all validation reports related to the
manufacturing and testing of the Product. These validations must be acceptable to GNE.
[*]






	7.4	 	Change Control






	 	7.4.1	 	SurModics shall utilize a change control system to ensure appropriate review
of all changes.
	 
	 	7.4.2	 	The GNE Quality Unit shall approve any change to the following master
documentation maintained by SurModics for GNE Products:
	 
	 	 	 	[*]
	 
	 	7.4.3	 	SurModics shall review all changes to determine if the change is a Major Change
(as defined in the Glossary). If there is any doubt regarding whether a change is a
Major Change, SurModics shall contact the GNE Quality Unit, and the parties shall
jointly make this determination. It is understood between parties that changes as a
result of pharmacopoeia test methods updates are not Major Changes.
	 
	 	7.4.4	 	In addition to Major Changes, SurModics shall notify the GNE Quality Unit in
writing of any Minor Changes that affect GNE specific documents, equipment or
processes, on at a minimum quarterly basis. Such notification shall contain a
description of the change, the implementation date of the change, and the status of the
change. Minor changes may be implemented by SurModics prior to such notification to
GNE.
	 
	 	7.4.5	 	SurModics shall notify the GNE Quality Unit in writing of any Major Changes
that may impact the Product Quality, validated status and/or have regulatory impact to:
	 
	 	 	 	[*]
	 
	 	7.4.6	 	Such notifications shall be communicated in writing in a timely manner so as to
allow GNE to evaluate the affect of the change on Product Quality and/or obtain
appropriate regulatory approvals prior to implementation.
	 
	 	7.4.7	 	At a minimum, such notification will contain a description of the change, the
rationale for the change, the proposed implementation date, the qualification,




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	 	 	 	validation, and/or comparability testing and acceptance criteria to prove that the
Major Change does not adversely affect Product Quality.
	 
	 	7.4.8	 	SurModics shall provide all documentation of a Major Change to GNE for review
and approval. This includes, but is not limited to, the description and rationale of
the change and supporting documentation such as validations or technical assessments.
	 
	 	7.4.9	 	GNE’s review and approval/rejection of Major Changes prior to implementation
is required. Within [*], GNE shall approve the change, request additional information,
or provide justification for the rejection of a change.
	 
	 	7.4.10	 	After completion of a Major Change, SurModics shall provide the GNE Quality Unit in
writing with supporting data and reports that demonstrate the Major Change is valid and
have been found acceptable by SurModics.
	 
	 	7.4.11	 	Emergency changes are changes that must be performed prior to the receipt of GNE
approval in order to avoid Product loss or to eliminate a safety hazard. Emergency
changes must be categorized and documented as previously described and notification
must be provided to the GNE Quality Unit for evaluation within [*] of the change
implementation.
	 
	 	7.4.12	 	For changes proposed by GNE, GNE shall notify SurModics in writing of any
Product-related changes. SurModics shall implement these changes in a timely manner
and in accordance with SurModics procedures and the Master Service Agreement.






	7.5	 	New Product Introduction






	 	7.5.1	 	SurModics shall not use the same facilities and/or equipment used for
processing the Product for the processing of beta-lactams, e.g. penicillin or
cephalosporins.
	 
	 	7.5.2	 	SurModics shall inform the GNE Quality Unit in writing per the change control
Section 7.4, when [*]. For confidentiality reasons, SurModics shall only be required
to provide detail to the level of the class of product.
	 
	 	7.5.3	 	Prior to introduction of a new product into the line, SurModics shall perform
a cleaning verification/validation according to SurModics’ procedures in order to
exclude cross contamination of the Product from other product campaigns.






	7.6	 	Product Complaints, Adverse Events, and other Post-Release Issues






	 	7.6.1	 	GNE shall have sole authority for resolving all customer complaints and
adverse events, related to the Product.
	 
	 	7.6.2	 	It is expected that most product complaints and adverse events for the Product
shall be received by GNE. Any reports received by SurModics shall be forwarded to the
GNE Quality Unit within [*].
	 
	 	7.6.3	 	If GNE requests a technical evaluation, documentation review, or sample
inspection from SurModics to support a Product complaint/adverse event,




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	 	 	 	SurModics shall report any findings to GNE in writing, signed, within [*] of
notification by GNE, or as required per section 8.3.6. SurModics shall provide GNE
with an update as to the progress of the investigation within [*] of notification by
GNE.
	 
	 	7.6.4	 	SurModics shall notify the GNE Quality Unit within [*] of any other complaint
with any other products manufactured by SurModics that by nature of similarity of
material or manufacturing, that has reasonable potential to adversely impact the
Product.
	 
	 	7.6.5	 	If the Product in any batch fails to comply with the agreed Quality standards,
either upon receipt or during the shelf-life of the Product (i.e., during stability
testing), as a result of operations conducted at SurModics, GNE will contact SurModics
in writing to assist with the investigation.






	7.7	 	Document Retention






	 	7.7.1	 	SurModics shall maintain the original Batch records consisting of
manufacturing, packaging, Quality Control, release, storage and delivery documentation,
Raw Data and records for each Batch of Product in a secure location for a period of
[*].
	 
	 	7.7.2	 	Prior to the destruction of any Product records at SurModics, SurModics shall
notify the GNE Quality Unit and the records shall be sent to GNE, unless otherwise
directed in writing by the GNE Quality Unit.






	7.8	 	Sub-contracting






	 	7.8.1	 	Consistent with Section 4.5 of the Master Services Agreement, SurModics shall
not subcontract to a Third Party any of the work entrusted under this Quality
Agreement, without the GNE Quality Unit’s prior written approval.
	 
	 	7.8.2	 	In the event that SurModics, with the written permission of the GNE Quality
Unit, sub-contracts any operation under this Quality Agreement to a Third Party,
SurModics shall ensure that it enters into a written agreement with the sub-contractor
that sets out the respective technical and quality responsibilities of each party [*].
	 
	 	7.8.3	 	SurModics may use contract laboratory testing facilities to support the
testing of the Product. SurModics shall only use testing facilities that have been
approved by the SurModics Quality Unit per SurModics’ procedures. Quality Agreements
between SurModics and those facilities must be in place.






	7.9	 	QA Reserve Samples






	 	7.9.1	 	SurModics shall maintain and inspect the reserve samples as required per cGMP
regulations.
	 
	 	7.9.2	 	SurModics shall provide GNE with a summary of the results of the annual
inspection of the reserve samples within [*] of completion. In the event any
deterioration is observed during this inspection, SurModics shall contact GNE in
accordance to the Deviation section 7.2.










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	8.0	 	COMPLIANCE AUDITS AND INSPECTIONS
	 
	8.1	 	Compliance Audits






	 	8.1.1	 	SurModics shall permit GNE to conduct preparatory audits for the initiation of
GMP manufacture of the Product, pre-approval audits, for cause audits, and routine and
follow-up compliance audits upon reasonable notice and as mutually agreed upon. Such
audits are intended to assure GNE that SurModics maintains adequate premises, equipment
and staff with sufficient knowledge and experience to carry out all operations relating
to the Products. Such GNE auditors shall conduct themselves in accordance with all
applicable SurModics’ policies and procedures and in such a manner as not to disturb
SurModics operations.
	 
	 	8.1.2	 	SurModics shall allow GNE to review all relevant records required to perform
such audits during normal business hours. The start date and duration of the audits
shall be agreed upon by both Parties. [*]
	 
	 	8.1.3	 	GNE shall provide a written report to SurModics of all observations after the
completion of the audit.
	 
	 	8.1.4	 	SurModics shall provide a written response to GNE within [*] of receipt of the
audit report. Such response shall describe in detail the corrective actions to be
implemented by SurModics. SurModics may request an extension of time to provide a
written response when necessary to prepare a comprehensive corrective action plan.
Such an extension request will propose an appropriate timeframe in which to submit a
final response along with justification for the extension request.
	 
	 	8.1.5	 	For-cause audits, by nature, will require scheduling as soon as possible.
SurModics will make concerted efforts to schedule all such audits promptly.






	8.2	 	Regulatory Authority Inspections






	 	8.2.1	 	SurModics shall [*] notify the GNE Quality Unit of any regulatory authority
contact, including facility inspections, sample requests, and written contact related
to the Product.
	 
	 	8.2.2	 	[*]
	 
	 	8.2.3	 	[*]
	 
	 	8.2.4	 	SurModics shall refer any GNE submission and GNE-specific related queries from
regulatory agencies about the Product to GNE.
	 
	 	8.2.5	 	Any deficiencies noted during a GNE territory regulatory authority inspection
of SurModics premises, which relate directly or indirectly to the manufacturing,
testing, storage, or quality systems related to the Product, must be brought to the
attention of the GNE Quality Unit within [*].
	 
	 	8.2.6	 	SurModics shall secure GNE’s written agreement prior to making any commitments
to a regulatory authority regarding the Product.




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	 	8.2.7	 	SurModics shall provide GNE a redacted copy (i.e., redacted for information
pertaining to other products) of any regulatory inspection report related to the
Product and SurModics’ response to the inspection reports.






	8.3	 	Regulatory Agency Contacts






	 	8.3.1	 	[*] SurModics shall promptly provide GNE with a copy of any regulatory
correspondence relevant to the Product.
	 
	 	8.3.2	 	GNE shall notify SurModics [*] in writing of any regulatory issues that GNE
knows shall impact SurModics’ ability to manufacture the Product.
	 
	 	8.3.3	 	SurModics shall maintain a Drug Master File (DMF) for their facilities and
allow GNE to reference such files upon request. SurModics shall inform the GNE Quality
Unit in writing any time the DMF is updated (i.e., a new product introduction).
	 
	 	8.3.4	 	GNE shall have sole authority for preparing and filing any regulatory
submissions per section 5.1 of License and Option Agreement.
	 
	 	8.3.5	 	GNE shall have sole authority, as between the parties, for filing applicable
reports to regulatory agencies, such as Field Alerts and Biological Product Deviation
Reports related to the Product.
	 
	 	8.3.6	 	Regulatory reporting may be required for problems such as stability failures,
out of specification results, Significant Deviations, product complaints, or adverse
events for the Product. When requested by GNE, SurModics shall work collaboratively
with GNE for filing any such report thought to be due to operations conducted by
SurModics. Investigations at SurModics shall be conducted in accordance with
regulatory reporting requirements. GNE and SurModics shall mutually agree upon a
timeframe for completion of the investigation on a case-by-case basis.
	 
	 	8.3.7	 	Regardless of which Party receives the initial contact or inquiry from a GNE
territory regulatory authority regarding the Product, such receiving party will [*]
inform the other party. GNE and SurModics shall agree, on a case-by-case basis, which
party shall respond to such contact/inquiry. All correspondence with a GNE territory
regulatory authority regarding the Product will be shared with GNE prior to it being
sent to the GNE territory regulatory authority. Copies of all correspondence by one
party shall be provided to the other party.




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Genentech, Inc. 












APPENDIX I: — Glossary 



Capitalized terms used but not defined herein shall have the meanings set forth in the License
Agreement or the MSA. As used in this Quality Agreement, the following terms, whether used in the
singular or the plural, shall have the meanings set forth in this Article




	 	 	 
	Word/Phrase	 	Meaning
	 
	 	 
	Analytical Method:

	 	A document describing the procedure
for sample and standard
preparation, instrument parameters,
system suitability requirements (as
necessary), testing, calculation
and reporting of results.
	 
	 	 
	Annual Report:

	 	Annual Reports are annual updates
submitted to the FDA after an IND
goes into effect (ref.: 21 CFR
312.33) or a New Drug Application
or Biological License Application
is approved (ref.: 21 CFR 314.81).
	 
	 	 
	Audit:

	 	An appraisal that determines the
degree of adherence to pre-defined
criteria and results in a judgment.
Examples are audits of systems and
documentation. Audits are typically
performed by someone not involved
in the activity being audited in
order to give the audit a degree of
independence.
	 
	 	 
	Batch or Lot:

	 	A specific quantity of a drug or
other material that is intended to
have uniform character and quality,
within specified limits, and is
produced according to a single
manufacturing order during the same
cycle of manufacture.
	 
	 	 
	Quality Control Master Document
(QCMD)/Certificate of Analysis
(COA):

	 	 The Quality Control Master Document
 is equivalent to a Certificate of
Analysis is the listing of all
tests performed to release a batch
and the results.
	 
	 	 
	Deviation:

	 	Event in the manufacturing process,
testing and/or support system that
is outside of approved operating
parameters, the Product license,
approved procedures, policies,
standards, or specifications, or a
departure from accepted cGMP’s.
	 
	 	 
	Final Drug Product:

	 	A finished dosage form, for
example, tablet, capsule, solution,
etc., that contains an active drug
ingredient generally, but not
necessarily, in association with
inactive ingredients. The term also
includes a finished dosage form
that does not contain an active
ingredient but is intended to be
used as a placebo.
	 
	 	 
	Field Alert or Biological Product 

Deviation Report:

	 	 All drug manufacturers with
approved New Drug Applications or
Biological License Applications are
required to submit Field Alert
Reports or Biological Product
Deviation Reports, respectively, to
the FDA if they find any
significant problems with an
approved drug (ref.: 21 CFR 314.81
or 600.14).
	 
	 	 
	Good Manufacturing Practice (GMP)

 or  cGMP:

	 	That part of quality assurance
aimed at ensuring that products are
consistently manufactured to a
quality appropriate to their
intended use, the regulations for
which are encoded in the US Code of
Federal Regulations, Title 21,
Sections 210, 211, 600 and the EU
Commission Directive 2003/94/EC
(the ‘GMP Directive’).






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Genentech, Inc. 






	 	 	 
	Word/Phrase	 	Meaning
	 
	 	 
	In-Process Material:

	 	Any material fabricated,
compounded, blended, or derived by
chemical reaction that is produced
for, and used in, the preparation
of the Drug Product.
	 
	 	 
	Lot
Number or Batch Number:

	 	 Any distinctive combination of
letters, numbers, or symbols, or
any combination of them, from which
the complete history of the
manufacture, processing, packing,
holding, and distribution of a
Batch or Lot of Drug Product or
other material can be determined.
	 
	 	 
	Major Change:

	 	A change that may impact the
Product Quality or validated
status, and/or may require
regulatory action (for example,
changes requiring an Annual Report
or pre-approval submission).
	 
	 	 
	Minor Change:

	 	A change that does not impact the
validated status, Product Quality,
or Product License.
	 
	 	 
	Master Batch Production Record

(MBPR):

	 	 A pre-approved record that includes
the formulation and describes the
procedure to be followed when
manufacturing and/or packaging
Products. Once approved the MBPR is
reproduced in a controlled manner
and the reproduction is used to
record the actual processing of
each batch. This reproduced record
is referred to as a production or
batch record or batch ticket.
	 
	 	 
	Quality:

	 	The totality of features and
characteristics of a product or
service that affect its ability to
satisfy a given need. Essential
elements of Product quality are the
identity, strength, purity, potency
and safety. These elements are
primarily controlled by Testing
Monographs and Master Processing
Records.
	 
	 	 
	Quality Assurance (QA):

	 	The sum total of the organized
arrangements made with the purpose
of ensuring that the product meets
the specifications and is of the
quality required for its intended
use and shall specifically include,
without limitation, all activities
as set forth in this Quality
Agreement.
	 
	 	 
	Quality Control (QC):

	 	The sampling,
specification-setting, testing,
documentation and analytical
procedures that provide independent
results of required tests, which
contribute to the evaluation of the
quality of a material.
	 
	 	 
	Quality Unit

	 	The organizational entity, at
either GNE or SurModics, that has
been identified to the other party
as having responsibility for
activities or approvals described
in this Quality Agreement.
	 
	 	 
	Raw Data:

	 	Any original laboratory worksheets,
records, memoranda, note, document,
or exact copies thereof, which are
the result of original observations
that are necessary for
reconstruction and evaluation of
processing, Quality Control or
Quality Assurance activities. Raw
data may include photographs,
microfilm or microfiche copies,
computer printouts, magnetic media,
including dictated observations,
and recorded data from automated
instruments.
	 
	 	 
	Recall:

	 	Tracing and recovery, as far as
possible, of every item of a
particular batch or of several
batches of finished products after
they have left the manufacturer.






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Genentech, Inc. 






	 	 	 
	Word/Phrase	 	Meaning
	 
	 	 
	Reprocessing:

	 	The repeating of an individual
step, as identified in a relevant
SOP, in order to fulfill the
intended purpose of that step which
was either completed or not
completed originally, and to bring
the Product into conformance with
specifications.
	 
	 	 
	Reworking:

	 	The repeating of one or more step
within the process or the
performance of any additional
process steps not covered in
approved license in order to bring
the Product into conformance with
specifications.
	 
	 	 
	Shelf Life:

	 	The period of time during which the
Product is designed to meet all
registered safety, efficacy and
quality requirements if stored in
the prescribed manner. The re-test
and/or expiry date are calculated
by adding this period of time to
the date of manufacture (with or
without rounding to the end of the
calculated month).
	 
	 	 
	Specification:

	 	A formally approved document
listing the tests, Analytical
Methods and acceptance criteria
specific to material. It is used to
determine the Quality of a
material.
	 
	 	 
	Standard
Operating Procedure (SOP):

	 	  A document, approved by appropriate
management, describing stepwise
procedures for compliance with a
regulation, policy or system.
Compliance with an SOP is required,
and Deviations must be documented.






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Genentech, Inc. 






APPENDIX II: — Change History Log




	 	 	 
	Revision #	 	Description of, and Rationale for Changes
	 
	 	 
	1.0

	 	New Quality Agreement








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