Exhibit 10.2


 


Confidential Treatment Requested.


Confidential portions of this document have been redacted and have been
separately filed with the Commission.


 


SECOND AMENDMENT TO LICENSE,
DEVELOPMENT AND COMMERCIALIZATION AGREEMENT


 


THIS
SECOND AMENDMENT (this “Amendment”)
is made and entered into as of July 30, 2009 (the
“Amendment Date”) by and between Vertex Pharmaceuticals
Incorporated (“VERTEX”) and
Mitsubishi Tanabe Pharma Corporation, as successor-in-interest to Mitsubishi
Pharma Corporation (the successor, “MITSUBISHI”):


 


WHEREAS,
VERTEX and MITSUBISHI are the parties to that
certain License, Development and Commercialization Agreement dated effective as
of June 11, 2004, as amended by the First
Amendment dated July 27, 2004 and the letter dated December 9, 2004
(collectively the “Agreement”), with respect to, among
other things, development and commercialization of VERTEX’s hepatitis C
protease inhibitor known as VX-950, or telaprevir (hereinafter, “telaprevir”);
and


 


WHEREAS,
the Parties wish to amend the Agreement to reflect the matters that have arisen
in the conduct of discussions between them;


 


NOW,
THEREFORE, the Parties hereto hereby agree as set forth below.


 


1.  Definitions.


 


The terms defined in this Section 1 and
parenthetically elsewhere, including in the “whereas” clauses, shall have the
same meaning throughout in this Amendment. 
Capitalized terms used in this Amendment without specific definition
shall have the same meaning set forth in the Agreement.


 


1.1 “Drug Product” for purposes of this
Amendment shall mean Drug Product incorporating telaprevir.


 


1.2  “Drug
Substance” shall mean telaprevir manufactured in bulk form [***].


 


1.3 “Raw Materials” shall mean the materials
incorporated into Drug Substance [***], which
are set forth on Exhibit A.


 


1.4 [***].


 


2.  Payments to VERTEX.


 


2.1 Initial Payment by MITSUBISHI.  In consideration of the agreements between
the Parties set forth in this Amendment, including but not limited to the
agreement by VERTEX to provide clinical and CMC data as set forth in Articles 3
and 5 of this Amendment, MITSUBISHI shall pay to VERTEX  (i) One Hundred and Five Million
U.S. Dollars ($105,000,000) (“Initial Amount”) on August 12, 2009, and (ii) an


 

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


additional payment, if any, in the amount and at the time set forth in Section 2.2
below, in each case by wire transfer to VERTEX’s
designated bank account.


 


2.2  Additional
Payment by MITSUBISHI.  MITSUBISHI shall make an additional payment to VERTEX in the amount as set forth in the table below [***].  MITSUBISHI shall make this additional
payment to VERTEX, if required, within [***].  [***], MITSUBISHI shall make an
additional payment to VERTEX in the amount
of the difference between the amount of any payment
previously made under this paragraph 2.2, and the amount set forth opposite [***], in such case within [***].


 


	
  [***]

  	
   

  	
  Payment to VERTEX

  (in U.S. dollars)

  	
   

  
	
  [***]

  	
   

  	
  $15 million

  	
   

  
	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  [***]

  	
   

  	
  $65 million

  	
   

  



 


2.3 MITSUBISHI’s Audit Right.


 


(a) VERTEX shall keep accurate records of the
telaprevir development costs in the VERTEX Territory and shall permit
MITSUBISHI to verify the amounts of such costs as provided in this Section 2.3.  MITSUBISHI may exercise, at its option, such
right of inspection and audit by giving VERTEX a written notice any time after
the Amendment Date, provided that any such audit and inspection shall be completed
in their entirety on or before July 30, 2010 and any payment to MITSUBISHI
under Section 2.3(d) below shall be made on or before October 31,
2010.  This right of inspection and audit
may be exercised by MITSUBISHI one time only.


 


(b) Upon such notice from MITSUBISHI provided at
least [***] before commencement of an audit
under Section 2.3(a) above, VERTEX shall permit an independent
accounting firm of national prominence selected by MITSUBISHI and approved by
VERTEX, which approval shall not be unreasonably withheld or delayed, to have
such access, during normal business hours and for not more than [***], to VERTEX records as is reasonably necessary to
verify the accuracy of VERTEX’s costs to develop telaprevir for combination
therapy incurred on or before December 31, 2008 (the “Cost Measurement
Date”) set forth on Exhibit B attached
hereto.  The records to be provided
hereunder shall be limited to VERTEX records that are not subject to
confidentiality obligations to Third Parties. 
The Parties acknowledge and agree that the amounts payable by MITSUBISHI
under this Section 2 have been determined taking into 


 


2

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


consideration VERTEX’s costs to develop telaprevir for
combination therapy set forth on Exhibit B
attached hereto.


 


(c) Any report prepared by such independent
accounting firm, a copy of which shall be sent or otherwise provided to VERTEX
at the same time it is provided to MITSUBISHI, shall contain the conclusions of
such independent accounting firm regarding the audit and will specify in detail
the discrepancies between the costs set forth on Exhibit B, and those
determined in the audit.


 


(d) If the independent accounting firm’s report
shows that VERTEX’s costs to develop telaprevir for combination therapy
incurred on or before the Cost Measurement Date were [***],
VERTEX shall refund to MITSUBISHI [***].  This adjustment to be repaid to MITSUBISHI,
if any, pursuant to this Section 2.3(d) shall be the sole remedy for
breach by VERTEX of the representation set forth in Section 13(a) of
this Amendment.


 


(e) The costs incurred in the conduct of any
audit under this Section 2.3 shall be borne exclusively by MITSUBISHI,
provided that, if the adjustment is made as a result of the audit findings
pursuant to subsection (d) above, VERTEX shall reimburse MITSUBISHI for
the reasonable costs and expenses of the audit.


 


3.  MITSUBISHI Use of VERTEX Combination
Therapy Clinical Data.  On
the Amendment Date, VERTEX shall provide to MITSUBISHI the clinical study
reports for any telaprevir combination clinical trials that are complete[***].  VERTEX shall provide MITSUBISHI with any and all data to be provided
pursuant to Sections 3.5.1(b) and 3.5.2(b) of the Agreement,
including clinical data from VERTEX’s or VERTEX Licensees’ clinical
investigation of telaprevir combination therapy, to the extent required or useful for or
in connection with obtaining and
maintaining the Regulatory Approval in the
Territory  [***], provided that
VERTEX shall not be required to provide clinical data generated on or after the
date that the first Regulatory Approval for telaprevir in Japan is obtained[***], as of the Amendment Date.  Subject to the provisions of Section 3.7
of the Agreement and the terms of this Amendment, MITSUBISHI shall be
entitled to receive, use, handle or refer to, for any and all purposes permitted under the
Agreement, in the Territory, any and all such data at any time.  Such
data provided to MITSUBISHI by VERTEX shall include, but not be limited to,
data and information derived from the clinical trials listed in Exhibit C attached hereto.  VERTEX’s obligations under
Sections 3.5.1(b) and 3.5.2(b) of the Agreement shall be satisfied in full upon delivery of the data
described in this Section 3.  Notwithstanding the foregoing, (i) VERTEX
shall not be required to provide data or information deriving from [***]; and (ii) VERTEX shall not be required under any
circumstances to provide data or information from any studies [***].


 


4.  Supply
of Telaprevir.


 


4.1 VERTEX Supply Agreements.  The commercial supply
agreement and quality agreements of even date herewith between the Parties
satisfy the obligations of the Parties related to entering into the Commercial
Supply Agreement set forth in Section 4.2 of and referred to
elsewhere in the Agreement.  The
commercial supply agreement and 


 


3

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


quality
agreements, together with the
Development Supply Agreement dated April 28, 2005 between the Parties (collectively “VERTEX
Supply Agreements”), shall reflect VERTEX’s only
obligations to supply Bulk Drug Substance[***], or Drug Product (or any other material incorporating
telaprevir as the active pharmaceutical ingredient) to MITSUBISHI, at any time and for any purpose from and after the
Amendment Date.


 


4.2   MITSUBISHI
to Supply after Termination of VERTEX Supply Agreements.  Upon the termination of all
of the VERTEX Supply Agreements, MITSUBISHI shall have the
sole responsibility under the Agreement, at its expense, for the manufacture of
all Raw Materials, Drug Substance [***] to meet its, its Affiliates’ and its
sublicensees’ requirements in connection with the development and commercial
sale of the Drug Product in the Territory and VERTEX shall have no
further obligation to provide information or notice or copies of regulatory
correspondence or filings under Section 3.6.2 of
the Agreement or otherwise, to the extent that such information,
correspondence or filings pertain to drug substance or formulation of Drug
Product other than in the form currently being supplied by VERTEX under the VERTEX Supply
Agreements.


 


4.3   Manufacturing
License under the VERTEX Technology.   VERTEX hereby grants to MITSUBISHI a nonexclusive license (or sublicense, as
appropriate) under the VERTEX Technology,
with the right to sublicense, to manufacture and have manufactured Drug
Substance, Raw Materials [***]
in and outside of the Territory to the extent required for
MITSUBISHI to use, sell, have sold, offer to sell and import Drug Products in
the Territory in the Field of Use.


 


5.  VERTEX Assistance/Technical Transfer.


 


(a) VERTEX shall complete the transfer of VERTEX
Technology relating to the manufacture [***]
(including all VERTEX Technology applicable to manufacture of Raw Materials and
Drug Substance) to MITSUBISHI immediately following the Amendment Date.  During such transfer, VERTEX shall provide
MITSUBISHI with the information and data relating to the manufacture of [***], Raw Material and Drug Substance, which information
and data shall include, but not be limited to, the information and data as of
the Amendment Date as listed in Exhibit D
attached hereto.


 


(b) From and after the Amendment Date until, at
the latest, the termination of the VERTEX Supply Agreements, VERTEX shall
facilitate discussions between MITSUBISHI and Third Party suppliers, including suppliers of Raw Materials,  Drug Substance  [***],
directed toward the establishment of a direct contractual relationship between
MITSUBISHI and such suppliers [***].  In connection therewith, VERTEX shall permit MITSUBISHI
to take a technical review at the site of each of the Third Party suppliers of
Raw Materials, in each case at a time and place that is reasonably acceptable
to MITSUBISHI and each such supplier.


 


(c) VERTEX shall provide to MITSUBISHI the technical support reasonably necessary to
enable MITSUBISHI to exploit the VERTEX
Technology in order to manufacture Raw
Materials, Drug Substance [***], provided,
however, that VERTEX’s obligation
to provide such technical support shall terminate no
later than the date of 


 


4

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


expiration or termination of the VERTEX Supply
Agreements.  MITSUBISHI
shall bear the reasonable out-of-pocket costs incurred by VERTEX for VERTEX’s
technical assistance. Such VERTEX Technology
shall be delivered to MITSUBISHI in such a way
as to communicate it to MITSUBISHI promptly,
effectively and economically.


 


(d)  During the term of the VERTEX Supply
Agreements, both Parties agree to hold meetings to exchange information
relating to manufacture and supply of Raw Materials, Drug Substance [***], at such frequency and location as the Parties may
agree.


 


(e) [***].


 


6.    [***].    MITSUBISHI agrees that it shall, and it shall cause its
suppliers to, prepare [***] strictly in
accordance with technical procedures provided to MITSUBISHI by VERTEX.  Notwithstanding the
foregoing, MITSUBISHI may make minor changes to the Drug Product formulation to
[***], bioequivalence is proven and
there is no potential material adverse effect on the market for the Drug Product.  With respect to any such
changes in Drug Product formulation permitted above, at the time any such
project is officially authorized for
development, MITSUBISHI shall deliver to VERTEX any and all relevant CMC
development and clinical plans, and any subsequently generated data and
information.  VERTEX shall have the right,
at its option, to make comments on any such plans, data and information and
MITSUBISHI shall consider VERTEX’s comments, if any, in good faith.  The technical procedures to be provided shall
be those applicable to the production of Drug Product in the form to be
supplied by VERTEX under the
Commercial Supply Agreement.


 


7.   Deletion
of Agreement Provisions.  MITSUBISHI shall not owe or pay any royalties to VERTEX for Net Sales of Drug Products in the Territory.  Sections 3.3.2, 3.3.3, 3.4, 4.1, 4.2, 4.3,
4.4, 6.3, 6.4, 6.5.1, 6.5.2 and 6.5.3, and the second and third sentences and
the last two sentences of Section 3.3.1 of the Agreement are deleted from
the Agreement in their entirety as of the Amendment Date.  Section 6.5.4 of the Agreement shall be
amended to delete “(ii) amounts due VERTEX under Sections
6.5.1 or 6.5.2 hereof with respect to such Net Sales, and the basis for
calculating those amounts due;”.   The
Parties shall have no further obligations or liabilities to one another under
any of the provisions of the Agreement that are deleted hereby, and release one
another from all claims or causes of action that may previously have arisen
under any such deleted provision or provisions.


 


8.  JDC Participation Not an Obligation; No
Breach. The appointment of any members of the JDC and participation in the
JDC at any time after MITSUBISHI
obtains Regulatory Approval in Japan is a right of VERTEX and not an obligation.  VERTEX will be free to
determine whether or not to appoint members to the JDC after MITSUBISHI obtains Regulatory Approval
in Japan.  If VERTEX does not appoint members of
the JDC, it will not be a breach of this Agreement, nor will any consideration
be required to be returned; MITSUBISHI will
keep VERTEX
reasonably informed on a timely basis of its progress and activities as if it
were providing such information to the JDC; and any matters that would
otherwise be referred to the JDC pursuant to this


 


5














 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


Agreement may be referred directly to the Joint Steering Committee
pursuant to Section 10.2.1 of the Agreement.


 


9.  Patient
Safety.  The Parties acknowledge and
agree that the Safety Data Exchange
Agreement dated July 27, 2007 among the Parties and Janssen Pharmaceutica
NV (“Safety Data Exchange Agreement”), shall remain
in full force and effect and that the provisions of this Amendment shall in no
way limit the exchange of patient safety information between the Parties.


 


10.  Parallel Importation.  The
Parties recognize that customers or other Third Parties may import Drug
Products purchased in the Territory for use outside the Territory and vice
versa.  If such activity materially
distorts the aggregate relative benefit to the Parties that otherwise would
prevail if those Drug Products were sold by VERTEX
directly outside the Territory or by MITSUBISHI
directly in the Territory, then the Parties shall establish an equitable
mechanism to offset the economic effect of any such sales, to the extent it is
possible and legally permissible to do so. 
MITSUBISHI shall use
commercially reasonable efforts to take all
legally permissible steps necessary to prevent any Drug Product manufactured for sale in
the Territory from being distributed or sold outside the Territory.  MITSUBISHI
shall notify VERTEX if it becomes aware of the exportation of Drug Product from its
Territory.  VERTEX
shall use commercially
reasonable efforts to take all legally permissible steps
necessary to prevent any Drug Product manufactured for sale in the VERTEX Territory
from being distributed or sold in the Territory.  VERTEX
shall notify MITSUBISHI if it becomes aware of the exportation of Drug Product from VERTEX
Territory.


 


11.  [***].


 


12.  [***].


 


13.  Representations and Warranties by VERTEX.  VERTEX hereby represents and warrants, in addition to those representations and warranties made in Section 8.1
of the Agreement (which were made as of the Effective Date of the Agreement,
and which expressly are not made again effective as of the Amendment Date),
that:


 


(a) Exhibit B
accurately sets forth the amount of costs and expenses incurred (with respect
to those already actually incurred up to the Cost Measurement Date) and
reasonably estimated to be incurred (with respect to those to be incurred on
and after the Cost Measurement Date) by or on behalf of VERTEX and/or VERTEX
Licensee for the development activities for Combination Therapy with telaprevir
in the VERTEX Territory;


 


(b) all the information disclosed or to be
disclosed by VERTEX to MITSUBISHI  hereunder relating to the VERTEX Technology is or will be accurate in all material respects and constitutes all
material information owned or Controlled by VERTEX with respect to the
manufacture of Raw Materials, Drug Substance [***];


 


(c) the technical support
provided or to be provided by VERTEX to MITSUBISHI pursuant to Section 5(c) of
this Amendment is all of the support that 


 


6

















 


Information
redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


is reasonably necessary to
enable MITSUBISHI to exploit the VERTEX
Technology in order to manufacture Raw
Materials, Drug Substance [***]; and


 


(d) VERTEX has provided MITSUBISHI with true,
complete and correct copies of each of the agreements between VERTEX and any
Third Party supplier in the VERTEX supply chain for telaprevir;


 


(e) as of the Amendment Date, except as disclosed
in writing between the Parties, VERTEX is not aware of any issued patents or
pending patent applications of a Third Party that, if issued, would be
infringed by the manufacture, use and import of Raw Materials, Drug Substance [***].


 


14.  Continuation of the Agreement except as
Amended.  Except as amended and
supplemented hereby, all the other terms and
conditions of the Agreement
shall remain in full force and effect and shall apply to this Amendment.


 


[Signature Page Follows]


 


7

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


IN
WITNESS WHEREOF, the Parties hereto have caused this Amendment to be executed
and delivered by their duly authorized representatives as of the day and year
first written above.


 


 


VERTEX
PHARMACEUTICALS INCORPORATED


 


 


	
  By:

  	
  /s/
  Matthew W. Emmens

  	
   

  
	
  Name:

  	
  Matthew
  W. Emmens

  	
   

  
	
  Title:

  	
  President,
  Chairman and CEO

  	
   

  



 


 


MITSUBISHI
TANABE PHARMA CORPORATION


 


 


	
  By:

  	
  /s/
  Michihiro Tsuchiya

  	
   

  
	
  Name:

  	
  Michihiro
  Tsuchiya

  	
   

  
	
  Title:

  	
  President
  and Representative Director; Chief Executive Officer

  	
   

  



 


 


Exhibit A: Raw
Materials


Exhibit B: Telaprevir
Combination Therapy Development Costs in the VERTEX Territory


Exhibit C: Clinical
Trials for which Data is to be provided to MITSUBISHI


Exhibit D: Information
and Data contained in VERTEX Technology as of Amendment Date


 


8

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


Exhibit A: Raw Materials


 


[***]


 

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


Exhibit B: Telaprevir
Combination Therapy Development Costs in the VERTEX Territory


 


[***]


 

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


Exhibit C: Clinical Trials
for which Data is to be provided to MITSUBISHI


 


[***]


 

















 


Information redacted pursuant to a confidential treatment request.  An unredacted version of this exhibit has
been filed separately with the Commission.


 


Exhibit D: List of
Information and Data contained in VERTEX Technology as of Amendment Date


 


[***]