Exhibit 10.9 to Form 10-Q






	





EXHIBIT 10.9 



CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT PURSUANT TO 17
C.F.R.ss.ss.200.80(b)(4), 200.83, 230.406 and 240.24b-2.  



     THIS
TERMINATION AGREEMENT(the “Agreement”), dated as of September 21, 2001 (the
“Effective Date”), is hereby entered into by and between BIOCRYST PHARMACEUTICALS, INC.,
a Delaware corporation having its principal place of business at 2190 Parkway Lake Drive,
Birmingham, Alabama 35244 (hereinafter referred to as “BIOCRYST”) and ORTHO-McNEIL
PHARMACEUTICAL, INC., a Delaware corporation having its principal office at U.S. Route
202, Raritan, NJ 08869 and THE R. W. JOHNSON PHARMACEUTICAL RESEARCH INSTITUTE, a
division of ORTHO-McNEIL PHARMACEUTICAL, INC., having its principal place of business at
U.S. Route 202, Raritan, NJ 08869 (hereinafter collectively referred to as “ORTHO”).
BIOCRYST and ORTHO are sometimes referred to herein individually as a “Party” and
collectively as the “Parties” and all references to BIOCRYST and ORTHO shall include
their respective Affiliates (hereinafter defined), where appropriate under the terms of
this Agreement.  



W I T N E S S E T H 



     WHEREAS,
BIOCRYST and ORTHO previously entered into a license agreement dated September 14, 1998
(the “License Agreement”);  



     WHEREAS,
On April 27, 2001 pursuant to Section 12.1 of the License Agreement, ORTHO provided
notice to BIOCRYST of its election to terminate the License Agreement, with such
termination effective as of the August 27, 2001, and the parties, by letter agreement,
subsequently extended the effective date of termination until the Effective Date; and,  



     WHEREAS,
the Parties desire to clarify the rights and responsibilities of each Party in respect of
such termination in order to facilitate and expedite the transfer to BIOCRYST of all
activities under the License Agreement related to the development, manufacture and
marketing of a Neuraminidase Inhibitor Product (collectively, the “Development Program”).  



     NOW,
THEREFORE, in consideration of the foregoing premises, and the mutual promises, covenants
and agreement hereinafter set forth, the receipt and sufficiency of which is hereby
acknowledged, both Parties to this Agreement hereby mutually agree as follows:  



SECTION 1.
DEFINITIONS 



     Capitalized
terms used in this Agreement shall have the meanings set forth in the License Agreement
unless otherwise defined in this Agreement or unless the context clearly indicates to the
contrary:  




     1.1      
“Agreement” shall mean this Termination Agreement.  




     1.2      “Clinical and Clinical
Support Studies” shall mean any and all scientific
evaluations of neuraminidase inhibitors, including Neuraminidase
Inhibitor Products, performed in connection with the Development
Program, and all related contracts, data and materials arising in
connection therewith, including but not limited to the clinical
trials, clinical support studies and the other items set forth on
Schedule A, attached hereto. 



     1.3      “Contracts”
shall mean the contracts set forth on Schedule B, attached hereto.  



20  
















	




     1.4      
“Data” shall mean all data, notes, databases and information in any tangible or
intangible form, including but not limited to paper, electronic and magnetic media,
arising out of or related to the Development Program, including but not limited to that
(i) arising out of or related to Clinical and Clinical Support Studies, (ii) underlying
or supporting the Regulatory Filings; (iii) required in order to maintain the integrity
of New Drug Application files as required by law, rule or regulation, and (iv) which is
set forth on Schedule D, attached hereto.   



     1.5      “Domain
Names” shall mean the Internet domain names set forth in the Trademark Assignment
Agreement, attached hereto as Schedule F.   



     1.6      “Drug
Substance” shall mean the approximately [***](1) of GMP grade neuraminidase
inhibitor drug substance (manufactured and maintained in accordance with GMP
requirements), approximately [***] of which has been manufactured according to the final
synthesis method, all of which has been manufactured by ORTHO during the term of the
License Agreement and which is being stored at ORTHO’s facilities in Spring House,
Pennsylvania as of the Effective Date.   



     1.7     “Drug
Tablets” shall mean the drug tablets specified in Schedule C, attached hereto,
including both placebos and tablets comprised of the neuraminidase inhibitor manufactured
by ORTHO or its Affiliates.   



     1.8     “License
Agreement Effective Date” shall mean the effective date of the License Agreement,
September 14, 1998.   



     1.9     “Materials” shall
mean those tangible materials generated by, purchased by or allocated to the Development
Program by ORTHO, its contractors and agents as set forth on Schedule C.   



     1.10
"Purchase Order" shall have the meaning set forth in Section 9.2.  



     1.11     “Regulatory
Filings” shall mean all filings with regulatory agencies, departments,
bureaus or other government entities, made in connection with the Development
Program by ORTHO, its agent and contractors in order to allow ORTHO to market or
sell a Neuraminidase Inhibitor Product anywhere in the world, including but not
limited to those regulatory filings set forth on Schedule E, attached hereto.  



     1.12     “Trademarks” shall mean the trademarks set forth in the Trademark Assignment
Agreement, attached hereto as Schedule F.   



SECTION 2.
TERMINATION OF LICENSE AGREEMENT 



     2.1     The
Parties hereby confirm that the License Agreement is hereby terminated in its entirety
pursuant to Section 12.1 of the License Agreement, with such termination effective as of
the Effective Date.   



     2.2     The
Parties hereby confirm and agree that all provisions, rights and obligations which
survive termination of the License Agreement pursuant to the terms of the License
Agreement shall continue to survive, except for Article 26 of the License Agreement which
the Parties hereby agree shall not survive. All surviving provisions in the License
Agreement are hereby supplemented by the terms of this Agreement.   







(1)*** Information omitted
and filed separately with the Commission pursuant to 17 C.F.R. §§ 200.80(b)(4), 200.83,
230.406, and 240.24b-2.  




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SECTION 3.
PATENTS AND INVENTIONS 



     3.1     
ORTHO hereby acknowledges and agrees that (i) all of its rights to the Existing Know-How,
Improvements, Existing Patents, and Improvement Patents which arose by virtue of the
License Agreement are terminated; and (ii) BIOCRYST is and shall be the exclusive owner
of all right, title and interest in and to the Existing Know-How, Improvements, Existing
Patents, and Improvement Patents. To the extent necessary to effectuate the foregoing,
ORTHO hereby assigns to BIOCRYST any and all right, title and interest throughout the
world that ORTHO may have in and to the Existing Know-How, Improvements, Existing
Patents, and Improvement Patents.  



     3.2     
ORTHO hereby acknowledges and agrees that (i) all of its rights to the Joint Inventions
and Joint Patents by virtue of the License Agreement are terminated; and (ii) BIOCRYST is
and shall be the exclusive owner of all right, title and interest in and to the Joint
Inventions and Joint Patents. To the extent necessary to effectuate the foregoing, ORTHO
hereby assigns to BIOCRYST all of ORTHO’s right, title and interest throughout the world
in and to the Joint Inventions and the Joint Patents, including but not limited to the
Joint Inventions and Joint Patents set forth on Schedule G, attached hereto.  



     3.3     
BIOCRYST hereby grants to ORTHO a royalty-free, perpetual, non-sublicenseable,
non-transferable, fully paid-up limited license to use the manufacturing process claimed
in the patent application PCT/US00/15969, all national filings thereof, and any
continuations or divisionals reissues or re-examinations of the foregoing, solely for
ORTHO’s internal business purposes. For purposes of clarity, internal business purposes
shall not include performance of such processes for any third party or supply of the
product of the process to any third party; however, internal purposes shall include sale
of ORTHO products which are derived from the use of the processes, but which are
materially changed from the product of the process.  



SECTION 4. TRADEMARKS,
DOMAIN NAMES AND GENERIC NAME 



     4.1     
The Parties hereby acknowledge that as of the Effective Date and pursuant to the
assignment agreement attached hereto as Schedule F (the “Trademark Assignment”), ORTHO
has assigned to BIOCRYST, at BIOCRYST’s expense, all right, title and interest in and to
the Trademarks and Domain Names and the applications or registrations therefor, together
with the goodwill of the business symbolized by the Trademarks and Domain Names. The
Trademark Assignment includes the right to sue and recover damages for past and future
infringements of ORTHO’s rights in the Trademarks and the Domain Names and to bring any
proceeding in the United States Patent and Trademark Office or any equivalent agency in
any other country for cancellation or opposition or other proceeding in connection with
the Trademarks and the Domain Names. The right, title and interest is to be held and
enjoyed by BIOCRYST and BIOCRYST’s successors and assigns as fully and exclusively as it
would have been held and enjoyed by ORTHO had this assignment not been made.  



     4.2     
The Parties acknowledge that the USAN Council has adopted [***](1) as
the United States Adopted Name for the neuraminidase inhibitor RWJ-270201 for publication
in the USP Dictionary of USAN and International Nonproprietary Names. ORTHO agrees to
provide BIOCRYST with reasonable assistance in updating such publication, or as other
otherwise reasonably requested by BIOCRYST in relation to the use and maintenance of
[***] as a nonproprietary name. BIOCRYST agrees to bear ORTHO’s reasonable and
actual out-of-pocket costs related thereto.   







(1)*** Information omitted
and filed separately with the Commission pursuant to 17 C.F.R. §§ 200.80(b)(4), 200.83,
230.406 and 240.24b-2.  



22  

















	




SECTION 5.
CONTRACTS 



     Excepting
only the Excluded Contract Liabilities (defined below), ORTHO hereby assigns and
transfers to BIOCRYST all of ORTHO’s right, title and interest in and to, and obligations
under, the Contracts. BIOCRYST hereby assumes all of the obligations of ORTHO under the
Contracts arising from and after the Effective Date, and agrees to make any payments,
perform all covenants, stipulations, agreements, and obligations under the Contracts
accruing after the Effective Date. In no event, however, shall BIOCRYST be deemed to have
assumed, with respect to the Contracts, (i) any obligation to perform which accrued prior
to the Effective Date, (ii) any financial obligations, including obligations to make
payments or reimburse expenses, which accrued prior to the Effective Date; (iii) any
liabilities arising out of the actions or inactions of ORTHO, its agents and contractors;
or (iv) any liability or obligation attributable to ORTHO’s (or its agents’ or
contractors’) breach of any provision of the Contracts or any other agreements with any
third parties, ((i) through (iv) shall be collectively referred to as the “Excluded
Contract Liabilities”).  



SECTION 6. CLINICAL
AND CLINICAL SUPPORT STUDIES, DATA AND MATERIALS 



     Excepting
only the Excluded Development Program Liabilities (defined below), ORTHO hereby assigns
to BIOCRYST any and all right, title and interest throughout the world that ORTHO may
have in and to the Clinical and Clinical Support Studies, Data and Materials. In no
event, however, shall BIOCRYST be deemed to have assumed, with respect to the Clinical
and Clinical Support Studies, Data and Materials, (i) any obligation to perform which
accrued prior to the Effective Date, (ii) any financial obligations, including
obligations to make payments or reimburse expenses, which accrued prior to the Effective
Date; (iii) any liabilities arising out of the actions or inactions of ORTHO its agents
and contractors or arising out of the infringement of any third party intellectual
property rights by ORTHO, its agents and contractors; or (iv) any liability or obligation
attributable to ORTHO’s (or its agents’ or contractors’) breach of any agreements with
any third parties, ((i) through (iv) shall be collectively referred to as the “Excluded
Development Program Liabilities”).  



SECTION 7.
REGULATORY FILINGS 



     Excepting
only the Excluded Regulatory Liabilities (defined below), ORTHO hereby assigns to
BIOCRYST any and all right, title and interest throughout the world that ORTHO may have
in and to the Regulatory Filings. In no event, however, shall BIOCRYST be deemed to have
assumed, with respect to the Regulatory Filings, (i) any obligation to perform which
accrued prior to the Effective Date, (ii) any financial obligations, including
obligations to make payments or reimburse expenses, which accrued prior to the Effective
Date; (iii) any liabilities arising out of the actions or in actions of ORTHO, its agents
and contractors or arising out of the infringement of any third party intellectual
property rights by ORTHO, its agents and contractors; or (iv) any liability or obligation
attributable to ORTHO’s (or its agents’ or contractors’) breach of any agreements with
any third parties; or (v) any liabilities attributable to any failure of ORTHO (or its
agents or contractors) to comply with any applicable laws, regulations or rules,
(collectively, the “Excluded Regulatory Liabilities”).  



SECTION 8. CONFIDENTIALITY 



      8.1      
The Confidentiality provisions set forth in Article 6 of the License Agreement are hereby
incorporated into this Agreement by reference as if fully set forth herein, and are
hereby extended to cover all information transmitted by either Party to the other in
furtherance of either Party’s obligations under this Agreement. The parties hereby agree
that for confidential information transmitted pursuant to this Agreement the Parties’
confidentiality obligations shall remain in effect for five (5) years from the date of
each such transmission.  



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      8.2      
The Parties hereby understand and agree that ORTHO may keep copies of the Data, Materials
and Regulatory Filings and such items reasonably related thereto, solely for archival and
regulatory or legal compliance purposes.   



SECTION 9.
DRUG SUBSTANCE 



      9.1      ORTHO
hereby agrees to maintain the Drug Substance, as specified in Schedule C, and to sell to
BIOCRYST or its agents or designee(s) (BIOCRYST, its agents and designees shall be
collectively referred to in this Section 9 as “BIOCRYST”) Drug Substance as requested by
BIOCRYST upon the terms and conditions set forth herein. The provisions of this Section 9
shall apply until the earlier of (i) such time that all Drug Substance has been purchased
from ORTHO or (ii) August 31, 2002. ORTHO shall not otherwise use the Drug Substance for
itself or on behalf of a Third Party, nor shall it sell the Drug Substance to any Third
Party.  



      9.2      
ORTHO agrees to supply BIOCRYST with such quantities of Drug Substance as BIOCRYST may
order by issuing a “Purchase Order” to ORTHO. ORTHO shall comply with the terms set forth
on each Purchase Order. Each Purchase Order will be substantially in the form of Schedule
H, attached hereto, which further sets forth the terms and conditions that shall govern
the purchases of Drug Substance. In the event of a conflict between the terms of the
Purchase Order and the terms of this Agreement, this Agreement shall prevail. Purchase
Orders shall be delivered to ORTHO via fax, electronically or by any other mutually
agreeable method. ORTHO hereby agrees to fully cooperate with BIOCRYST in supplying such
Drug Substance to BIOCRYST, and agrees to promptly notify BIOCRYST of any deficiencies in
a Purchase Order and of any and all events that would prevent ORTHO from timely or
completely fulfilling any Purchase Order.  



      9.3      
Until the earlier of (a) such time that all Drug Substance has been purchased from ORTHO
or (b) August 31, 2002, ORTHO agrees to store the Drug Substance in its facilities
located in Springhouse, PA in a controlled environment (with respect to temperature,
humidity and otherwise) so as to prevent degradation and contamination of the Drug
Substance to the fullest extent possible and as otherwise required by the FDA or other
law, rule, regulation or standards.  



      9.4      
BIOCRYST shall pay to ORTHO [***](1) per kilogram of Drug Substance delivered by ORTHO
pursuant to a Purchase Order. ORTHO’s right to payment for delivery of Drug Substance
pursuant to a Purchase Order shall accrue upon delivery of the Drug Substance, however,
BIOCRYST shall not be required to make payment in respect of such delivered Drug
Substance unless and until BIOCRYST enters into an agreement with a third party for such
third party to develop and market a Neuraminidase Inhibitor Product, at which time all
accrued amounts shall become due and payable within 60 days. Thereafter, accrued payments
shall be due and payable within thirty (30) days of receipt by BIOCRYST of a correct and
undisputed invoice from ORTHO. BIOCRYST agrees to provide ORTHO with prompt notice of its
entering into an agreement with a third party for such third party to develop and market
a Neuraminidase Inhibitor Product.  







(1)*** Information omitted
and filed separately with the Commission pursuant to 17 C.F.R. §§ 200.80(b)(4), 200.83,
230.406 and 240.24b-2.  





24  
















	





      9.5      
BIOCRYST shall have the right to credit its out-of-pocket expenses related to testing of
the Drug Substance transferred or to be transferred to BIOCRYST pursuant to this
Agreement against the amounts payable to ORTHO pursuant to Section 9.4, above.  



      9.6      
BIOCRYST agrees to bear the reasonable costs of shipping Drug Substance from storage to
BIOCRYST. BIOCRYST agrees to pay any sales tax or other state, city or Federal taxes
related to the purchase of Drug Substance, other than taxes based on the income or real
property of ORTHO. Such shipping costs and taxes shall be set forth on each invoice and
shall be due and payable as set forth in Section 9.4, above.  



      9.7      
Notwithstanding anything to the Contrary in this Agreement, ORTHO agrees to provide
BIOCRYST, free of charge and promptly upon BIOCRYST’s request with:  



      (a)      
such amounts of Drug Substance as BIOCRYST deems reasonably necessary in order to
complete the clinical studies with the designations PHI 026, PHI 030, and TX003 and such
amounts of the Drug Substance for carcinogenicity studies, animal studies and QA as
referred to in item number 19 of Schedule C-5: and, 

      (b)      reasonable amount of Drug
Substance for BIOCRYST’S own use as laboratory reference material and for BIOCRYST’S
internal research purposes.  



SECTION 10.
PAYMENT PROVISIONS 



     The
parties acknowledge and agree that as of the Effective Date, each Party is in complete
satisfaction of all of its financial obligations to the other in connection with the
termination of the License Agreement and the transfer to BIOCRYST of the Development
Program. Except as explicitly provided for in this Agreement, neither Party shall be
entitled to seek any further fees, expenses or reimbursements from the other in
connection with the termination of the License Agreement and the transfer to BIOCRYST of
the Development Program including, but not limited to, all inventions, patents,
trademarks, clinical trials and support studies, data, materials, contracts and
regulatory filings.  



SECTION 11. REPRESENTATIONS
AND WARRANTIES 



      11.1      
Each Party hereby represents and warrants that it is a corporation duly organized,
validly existing and in good standing under the laws of the state of Delaware and has
full organizational power and authority to enter into and perform this Agreement, and to
carry out the transactions contemplated under this Agreement.  



      11.2      
ORTHO hereby represents and warrants that (i) the execution, delivery and performance by
ORTHO of this Agreement, and the consummation by ORTHO of the transactions contemplated
herein, have been duly authorized by all requisite organizational action; (ii) this
Agreement and all of the obligations entered into and undertaken in connection with the
transactions contemplated herein to which ORTHO is a party constitute, or will constitute
upon the execution of such agreements, the valid and binding obligations of ORTHO
enforceable in accordance with their respective terms, and (iii) the execution of and
performance of the transactions contemplated by this Agreement and compliance with its
provisions by ORTHO will not violate any provision of applicable law and will not
conflict with or result in any breach of any of the terms, conditions or provisions of,
or constitute a default under, or require a consent or waiver under, ORTHO’s
organizational documents or any indenture, lease, agreement or other instrument to which
ORTHO is a party or by which it or any of its properties is bound, or any decree,
judgment, order, statute, rule or regulation applicable to ORTHO.  



25  
















	




      11.3      
ORTHO hereby represents and warrants that: (i) it has made diligent efforts to transfer
to BIOCRYST (and will in the future) all Regulatory Filings, Clinical and Clinical
Support Studies, Data and Materials, according to the time schedules set forth in
Schedules E, A, D and C, respectively and should additional items related to the
foregoing be discovered by ORTHO or otherwise, ORTHO will use diligent efforts to
transfer such items to BIOCRYST and otherwise assist BIOCRYST in connection therewith;
(ii) it has filed all letters and other documents with the FDA (and all foreign
equivalents) in order to effect a transfer of the Regulatory Filings to BIOCRYST; (iii)
the Regulatory Filings, Clinical and Clinical Support Studies, Data and Materials
transferred to BIOCRYST include all Regulatory Filings, Clinical and Clinical Support
Studies, Data and Materials initiated, conducted or generated in the Development Program;
and, (iv) it has or will otherwise fully comply with Article 14 of the License Agreement
together with all related time schedules set forth in this Agreement and the Schedules
hereto.  



      11.4      
ORTHO hereby represents and warrants that it has the full power and authority to assign
to BIOCRYST all right title and interest in and to, and obligations under, the Regulatory
Filings, Clinical and Clinical Support Studies, Data and Materials.  




      11.5      
ORTHO hereby represents and warrants that, to the best of its knowledge, and except for
the interests of BIOCRYST, it has the full power and authority to assign to BIOCRYST all
right title and interest in and to the Joint Inventions, Joint Patents, Existing
Know-How, Existing Patents, Improvements and Improvement Patents free and clear of all
liens, claims and encumbrances of any nature. ORTHO further represents and warrants that
it has not granted and will not grant any right to any Third Party in or to the Joint
Inventions, Joint Patents, Existing Know-How, Existing Patents, Improvements and
Improvement Patents.  



      11.6      
ORTHO hereby represents and warrants (i) that it has the full power and authority to
assign to BIOCRYST all right, title and interest in and to, and obligations under, the
Contracts, (ii) that it has satisfied all financial obligations under, and all
liabilities arising out of, the Contracts which accrued prior to the Effective Date, and
(iii) that it is not in breach of any of the Contracts.  



      11.7      
ORTHO hereby represents and warrants that it has complied and in the future will continue
to comply with all applicable laws, rules and regulations in connection with its, or its
agents and contractors, conduct of the Development Program.  



      11.8      
ORTHO hereby represents and warrants that there is no threatened or pending litigation
related to the Development Program including but not limited to the Licensed Products,
the Contracts and the Clinical and Clinical Support Studies.  



      11.9      
ORTHO hereby represents that all Drug Substance and other drug materials transferred to
BIOCRYST hereunder and in connection with the termination of the License Agreement and
the transfer to BIOCRYST of the Development Program at the time of transfer to BIOCRYST
that are labeled for use in human clinical trials, pursuant to Schedule C, and not
labeled for laboratory use or otherwise shipped under quarantine pursuant to Schedule C,
met (or will meet) all applicable FDA requirements and were approved to be administered
to humans in connection with clinical trials. However, it is understood that, pursuant to
Schedule C some Drug Substance may be shipped to BIOCRYST in quarantine status.  



      11.10      
THE EXPRESS REPRESENTATIONS AND WARRANTIES STATED IN THIS ARTICLE 11 ARE IN LIEU OF ALL
OTHER REPRESENTATIONS AND WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION,
THE WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.  



26  
















	




     SECTION
12. INDEMNIFICATION  



      12.1      
BIOCRYST agrees to indemnify, defend and hold ORTHO and its directors, officers,
employees and agents (the “ORTHO Indemnitees”) harmless from and against any losses,
costs, claims, damages, liabilities or expenses (including without limitation, fees and
disbursements of counsel incurred by ORTHO Indemnitees in any action or proceeding
between ORTHO and ORTHO Indemnitees and ORTHO Indemnitees and any third party or
otherwise) (collectively, “Liabilities”) arising out of, or in connection with Third
Party claims relating to: (i) any breach by BIOCRYST of the confidentiality provisions of
this Agreement, (ii) personal injury or other liability, which occurs after the Effective
Date, to a participant in any clinical trial conducted by BIOCRYST of a neuraminidase
inhibitor which was the subject of the Development Program; (iii) Liabilities, accruing
after the Effective Date based upon BIOCRYST’S or its agents or contractor’s, use, sale,
distribution or marketing of any neuraminidase inhibitor which was the subject of the
Development Program; (iv) BIOCRYST’s failure to comply with any law, regulation or rule;
and, (v) the gross negligence or intentional misconduct of BIOCRYST.  



      12.2      
ORTHO agrees to indemnify, defend and hold BIOCRYST and its directors, officers,
employees and agents (the “BIOCRYST Indemnitees”) harmless from and against any losses,
costs, claims, damages, liabilities or expense (including without limitation, fees and
disbursements of counsel incurred by BIOCRYST Indemnitees in any action or proceeding
between ORTHO and BIOCRYST Indemnitees and BIOCRYST Indemnitees and any third party or
otherwise) (collectively, “Liabilities”) arising out of, or in connection with Third
Party claims relating to: (i) the Development Program prior to the Effective Date; (ii)
any breach by ORTHO of its representations and warranties under this Agreement; (iii) any
breach by ORTHO of the confidentiality provisions of this Agreement, (iv) any breach by
ORTHO in the performance or observation of any covenant, agreement, obligation or
provision in any of the Contracts to be performed or observed by ORTHO, (v) the Clinical
and Clinical Support Studies prior to the Effective Date, (vi) ORTHO’s failure to comply
with any law, regulation or rule, (vii) the administration of Drug Tablets, Drug
Substance or any other drug tablets manufactured by ORTHO from Drug Substance, to humans,
to the extent that such Liabilities are attributable to any failure of ORTHO in properly
manufacturing or storing the foregoing, or any failure of ORTHO to meet any and all
requirements of the FDA with respect to manufacture or storage of the foregoing, and
(viii) the negligence or intentional misconduct of ORTHO.  



      12.3      
An indemnitee that intends to claim indemnification under this Agreement shall promptly
notify indemnifying party of any claim, demand, action or other proceeding for which the
Indemnitee intends to claim such indemnification, and the indemnifying party shall have
the right to participate in, and, to the extent the indemnifying party so desires, to
assume sole control of the defense thereof with counsel selected by the indemnifying
party; provided, however, that the Indemnitee shall have the absolute right to retain its
own counsel, with the fees and expenses to be paid by the Indemnitee. The indemnity
obligations under this Agreement shall not apply to amounts paid in settlement of any
loss, claim, damage, liability or action if such settlement is effected without the
consent of the indemnifying party, which consent shall not be unreasonably withheld or
delayed. The Indemnitee, its employees and agents, shall cooperate fully with the
indemnifying party and its legal representatives in the investigation of any action,
claim or liability covered by an indemnification from the indemnifying party. The
Indemnifying party shall not, without the prior written consent of the Indemnitee, effect
any settlement of any pending or threatened action, suit or proceeding in respect of
which any Indemnitee is or could have been a party and indemnity could have been sought
hereunder by such Indemnitee, unless such settlement includes an unconditional release of
such Indemnitee from all liability on claims that are the subject matter of such action,
suit or proceeding.  




27  
















	





SECTION 13. FURTHER
ASSURANCES 



      13.1      
In addition to the actions specifically provided for elsewhere in this Agreement, from
and after the Effective Date, each of the parties hereto shall take, or cause to be
taken, all actions, and to do, or cause to be done, all things reasonably necessary,
proper or advisable under applicable laws, regulations and agreements to consummate and
make effective the transactions contemplated by this Agreement and to reasonably aid
BIOCRYST in its assumption and continuation of the Development Program, including the
execution and delivery of instruments of conveyance, assignment and transfer, cooperation
in all filings with, and to obtain all consents, approvals or authorizations of, any
governmental authority or any other person under any permit, license, agreement,
indenture or other instrument, at the expense of the requesting party.  



      13.2      
In the event that following the Effective Date ORTHO discovers any document, data,
contract, invention, patent, or any other item related to the Development Program, which
has not been transferred to BIOCRYST but which ORTHO is obligated to transfer and/or
assign to BIOCRYST pursuant to the License Agreement, or makes any invention that would
be characterized as a Joint Invention under the License Agreement, ORTHO shall promptly
notify BIOCRYST and assign and transfer the foregoing to BIOCRYST.  



      13.3      
In the event that ORTHO is contacted by any third party (including for example, the FDA),
in any fashion regarding the subject matter of the Development Program, ORTHO shall
promptly notify BIOCRYST of the of the nature and substance of such contact or inquiry
and shall comply with its confidentiality obligations set forth herein.  



SECTION 14.
INTERPRETATION 



     The
construction, validity and performance of this Agreement shall be governed in all
respects by the laws of the State of New York, without giving effect to principles of
conflict of laws.  



SECTION 15. DISPUTE
RESOLUTION 



     The
Dispute Resolution provisions set forth in Article 19 of the License Agreement are hereby
incorporated into this Agreement by reference, and shall apply to this Agreement as if
fully set forth herein.  



SECTION 16.
NOTICES 



      16.1      
Any notice required or permitted to be given under this Agreement shall be mailed by
registered or certified mail, postage prepaid, addressed to the Party to be notified at
its address stated below, or at such other address as may hereafter be furnished in
writing to the notifying Party or by telefax (with confirmation sent by mail) to the
numbers set forth below or to such changed telefax numbers as may thereafter be furnished.  










	 	If
to BIOCRYST: 






	 	BIOCRYST
Pharmaceuticals, Inc.
2190 Parkway Lake Drive
Birmingham, Alabama 35244
Telefax No.:
(205) 444-4640
Attention: Chief Executive Officer 






	


28  
















	












	 	If
to ORTHO: 






	 	President

ORTHO-McNeil Pharmaceutical, Inc.
U.S. Route 202 South
Raritan, NJ 08869-0602
Telefax
No.: (908) 218-1416 






	


Any such notice shall be
deemed to have been received when it has been delivered in the ordinary course
of post or received by telefax.  



SECTION 17.
WAIVER 



     The
failure on the part of BIOCRYST or ORTHO to exercise or enforce any rights conferred upon
it hereunder shall not be deemed to be a waiver of any such rights nor operate to bar the
exercise or enforcement thereof at any time or times thereafter.  



SECTION 18. ENTIRE
AGREEMENT 



     This
Agreement constitutes the entire agreement between the Parties hereto concerning the
subject matter hereof and any representation, promise or condition in connection
therewith, not incorporated herein, shall not be binding upon either Party.  



SECTION 19.
ASSIGNMENT 



     This
Agreement, and all rights and obligations hereunder, is personal to ORTHO and shall not
be assigned in whole or in part by ORTHO to any other person or company (other than
Affiliates of ORTHO) without the prior written consent of BIOCRYST. When assigned as
permitted herein this Agreement shall be binding on each Party’s successors and assigns.  



SECTION 20. TITLES 



     It is
agreed that the marginal headings appearing at the beginning of the numbered Articles
hereof have been inserted for convenience only and do not constitute any part of this
Agreement.  



SECTION 21. UNENFORCEABLE
PROVISIONS 



     Any
provision hereof which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or affecting the
validity or enforceability of such provisions in any other jurisdiction.  



SECTION 22.
OTHERS 



     As
used in this Agreement, singular includes the plural and plural includes the singular,
wherever so required by fact or context.  




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SECTION 23. EXECUTION 



     This
Agreement shall be executed in two (2) counterparts each of which shall for all purposes
be deemed an original.  



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












	 	 	 	BIOCRYST PHARMACEUTICALS, INC. 
	 
	WITNESS 	              	 	By: 	
                
                
                
                
 
	  	 	 	Title: 	
                
                
                
                
 
	  	 	 	Date: 	
                
                
                
                
 







	 	 	 	ORTHO-McNEIL PHARMACEUTICAL, INC. 
	 
	WITNESS 	              	 	By: 	
                
                
                
                
 
	  	 	 	Title: 	
                
                
                
                
 
	  	 	 	Date: 	
                
                
                
                
 









	 	 	 	
R.W. JOHNSON PHARMACEUTICAL RESEARCH INSTITUTE, DIVISION
OF ORTHO-McNEIL PHARMACEUTICAL, INC. 
	 
	WITNESS 	              	 	By: 	
                
                
                
                
 
	  	 	 	Title: 	
                
                
                
                
 
	  	 	 	Date: 	
                
                
                
                
 














	


30