Unassociated Document


    Assignment
Contract

    


    Contract
Object: Entecavir

    Entecavir
Capsules

    Entecavir
Tablets

    Category:
Chemical Medicine Class VI

     

    Assignor
(hereinafter referred as Party A): Hainan Zhonghe Peptide Drugs Research &
Development Co., Ltd.

    
      Address:
Free Trade Zone, No.168 Nanhai Avenue, Haikou City, Hainan Province,
China

    

    
      Legal
Representative: Zongzhen Zhou

    

    
      Reference:
Zongzhen Zhou

    

    
      Tell:
+86898 6680 2208   Fax: +86898 6680 2211

    

    
      Email:
Sunny@zhonghe.net

    

    


    Assignee
(hereinafter referred as Party B): Hainan Zhonghe Pharmaceutical Co.,
Ltd.

    
      Address:
Free Trade Zone, No.168 Nanhai Avenue, Haikou City, Hainan Province,
China

    

    
      Legal
Representative: Xueyun Cui

    

    
      Reference:
Zhuo Lin

    

    
      Tell:
+86898 6680 2833   Fax: +86898 6680 2833

    

    
      Email:
Lingel_2000@yahoo.com

    

    


    Date:
March 23, 2009

    Signed
at: Haikou City, Hainan Province

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    In
accordance with “Contract Law of the People’s Republic of China”, “Provisions
for Drug Registration” issued by State Food and Drug Administration (herein
after referred as SFDA), PRC, both the assignor and the assignee (hereinafter
referred as “the Parties”) have, based on the real, fully express of their
wishes, through equal consultation, entered into the contract (hereinafter
referred as “the Contract”) concerning issues related to technical materials and
achievement, rights and interest, payment, default liabilities of the technology
as stated in this Contract, both Parties have agreed as follows:

    


    Article
1 Object of Assignment (Technological Secret)

    
      
        	
                1.1

              	
                Content
      of technology transferred to Party B by Party
A

              


      

    

    
       

      Name of Object: Entecavir,
Entecavir Capsules (0.5mg; 1mg), Entecavir Tablets (0.5mg; 1mg) (hereinafter
referred as “the Contract Object”)

    

    


    
      Technical Specification and
Parameter: Party A shall finish all researching and developing work
(except for clinical trial) before applying for production in accordance with
“Provisions for Drug Registration” issued by SFDA and related technical
guidelines and requirements. Party A ensures to deliver all of its technical
materials used for applying for clinical trial and product, manufacturing
process of drug substance, as well as formula and manufacturing process of
pharmaceutical preparations of the Contract Object to Party B, until Party B
obtains the Drug Approval Number (Letter of Approval for Drug Registration) and
successfully trial-manufactures 3 batches of eligible products in a row
independently.

    

    


    
      Industrialization level of
Technological Secret: Party A ensures that the formula and manufacturing
process of the Contract Object reach industrialization level and ensure that the
formula of pharmaceutical preparations and manufacturing process of drug
substance and pharmaceutical preparations used for applying for drug
registration are the same with those are entering into
market.

    

    


    Technical Service and Technical
Guidance: Party A shall give the Party B’s personnel free technical
training to ensure Party B’s personnel master the formal manufacturing process
of the Contract Object; Party A shall provided free instruction to Party B’s
personnel to ensure Party B’s personnel manufacture 3 batches of the Contract
Object which meet the quality standards in a row.

    


    
      	
              1.2

            	
              New
      Medicine Certificate, Letter of Approval for Drug Registration, Drug
      Approval Number and all proprietary rights of the Contract Object shall be
      transferred to Party B exclusively.

            


    

    


    
      	
              1.3

            	
              Both
      Parties agree that the application of production to Center for Drug
      Evaluation of SFDA shall be under Party B’s
  name.

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Article
2 Obligations of Both Parties

    


    
      
        	
                2.1

              	
                Party
      B shall pay Party A assignment fee in conformity with the Contract’s
      term.

              


      

    

    


    
      	
              2.2

            	
              Party
      B has the obligation to cooperate Party A in applying for drug
      registration and clinical testing.

            


    

    


    
      	
              2.3

            	
              Party
      A ensures to provide Party B the whole, completed, up-to-requirement
      documentation including dossiers for registration application, original
      data of development, map and samples, etc. of the Contract Object in
      accordance with registration requirements within 60 days after signature
      of this Contract. Party A ensures the Contract Object pass the process
      performed by Hainan Medical Appliance Administration and SFDA including
      acceptance of drug registration, on-site inspection, review and approval
      for registration, clinical trial, and production
  approval.

            


    

    


    
      	
              2.4

            	
              Party
      A shall be responsible for applying for registration and answering all
      technical questions likely to be posed by SFDA’s Center for Drug
      Evaluation during process of application and ensures to complete relevant
      test and supplement new technical dossiers within the specified timeline
      without compensation till conform to registration
      requirements.

            


    

    


    
      	
              2.5

            	
              Party
      A ensures all dossiers for registration application, original data of
      development, map and samples conformed with the regulation of active
      Provisions for Drug Registration and relevant regulations, related
      technical guidelines and requirements as well. Party A ensures the
      authenticity, standardization, dependability and integrity of technical
      information delivered thereby.

            


    

    


    
      	
              2.6

            	
              Party
      A ensures the Contract Object having obtained Drug Clinical Trial Approval
      before the signing date of this
Contract.

            


    

    


    
      	
              2.7

            	
              Party
      A shall provide Party B free instruction in time to hand over
      manufacturing process of the Contract Object before and during Party A’s
      manufacturing samples for clinical trial and on-site examination of
      production for drug registration to ensure Party B’s ability of
      trial-manufacturing 3 batches of the Contract Object in a row. Party A has
      the responsibility to cooperate Party B in solving problems about formula
      and manufacturing process in production of Contract
  Object.

            


    

    


    
      	
              2.8

            	
              Party
      B shall, under Party A’s direction, manufacture samples for clinical trial
      and 3 batches of samples for registration inspection at Party A’s expense.
      Party B shall give Party A at least 10 day’s advance notice for Party A’s
      personnel to hand over the
technology.

            


    

    


    
      	
              2.9

            	
              Party
      B has the right to carry out further improvement on the Technology Secret
      after assignment, any new technological achievements with substantive or
      productive progress accomplished thus shall remain the property of Party
      B.

            


    

    


    
      	
              2.10

            	
              Party
      A shall provide Party B all technological dossiers of any further
      improvement or development of the Technology Secret in writing in a timely
      manner. All improvement on Technology Secret accomplished thereby shall
      remain property of Party B and may not transferred by Party A to any other
      party without the written approval of Party
B.

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
              2.11

            	
              Party
      A ensures that the Technology Secret is practicable and reliable and does
      not encroach the third party’ legal rights. In case of accusation by third
      party of encroachment upon their legal right, Party A shall bear full
      responsibility for all consequences arisen therefrom and compensate for
      Party B’s economical losses.

            


    

    


    
      	
              2.12

            	
              Party
      A shall not, during the term of this Contract, apply for patent for the
      Technology Secret or make the Technology Secret public in other way
      without Party B’s written consent. Party A shall be responsible for
      preparation of the Contract related patent in time pursuant to developing
      progress of the Contract Object and delivery to Party B who shall be in
      charge of related application and expenses incurred thereby. Party B shall
      be applicant and patentee thereafter and Party A’s personnel inventors.
      Party B has the right to use the patent without compensation, however
      shall pay Party A’s inventors for preparation of the patent, the actual
      fee will be negotiated separately depending on content of patent
      declared.

            


    

    


    Article
3 Terms of Payment

    The total
assignment fee under this Contract is RMB 60 million paid in installments
according to project progress as below:

    


    
      	
               
      

            	
              
                o

              

            	
              Eighty
      percent (80%) of total price, namely RMB 48 million shall be paid to Party
      A within 30 working days after obtaining Drug Clinical Trial Approval
      issued by SFDA.

            


    

    
      	
               
      

            	
              
                o

              

            	
              Ten
      percent (10%) of total price, namely RMB 6 million shall be paid to Party
      A within 20 working days after filing a registration application to Center
      for Drug Evaluation of SFDA.

            


    

    
      	
               
      

            	
              
                o

              

            	
              Ten
      percent (10%) of total price, namely RMB 6 million shall be paid to Party
      A within 20 working days after obtaining production approval (Drug
      Approval Number).

            


    

    


    Article
4 Default Clause

    
      
        	
                4.1

              	
                Either
      of the two Parties who fail to fulfill the Contract in according to the
      terms specified herein will be deemed break the Contract and shall take
      the breach responsibilities in below
manners:

              


      

    

    


    
      	
               
      

            	
              
                o

              

            	
              If
      the Contract Object fails to get New Medicine Certificate or Drug Approval
      Number due to Party A’s reason (e.g. technology or patent violation, fails
      to hand over dossiers for registration application within the timeline
      specified by Contract, etc.), Party A shall return Party B entire already
      paid assignment fee and already paid registration inspection fee,
      evaluation and approval fee, clinical trial fee (subject to invoice)
      within 20 working days at one time, the Contract will automatically be
      terminated, the Contract Object shall be Party A ‘s property and Party B
      shall return all technical
materials.

            


    

    


    
      	
               
      

            	
              
                o

              

            	
              If
      Party B fails to obtain Drug Approval Number due to Party B’s reason (e.g.
      fails to apply for registration within specified timeline, production
      conditions fails to meet required standards, etc.), Party A shall not bear
      the responsibility and is entitled to reserve fees already paid by Party
      B. The Contract will automatically be terminated, Party B may dispose the
      Contract Object by its own means.

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              
                o

              

            	
              Under
      the circumstance that Party A fails to finish and hand over the jobs
      specified in Clause 3, 4, Article 2 or other relative terms of this
      Contract, Party B is entitled to deduct a penalty equal to 1% of total
      price from unpaid assignment fee for each day of delay. If Party A fails
      to finish and hand over the above mentioned jobs within 4 months after
      specified timeline, Party B has the right to terminate the Contract, Party
      A shall return entire already paid fee by Party B within 20 working days
      and pay Party B overdue penalty.

            


    

    


    
      	
               
      

            	
              
                o

              

            	
              Under
      the circumstance that Party B fails to pay the assignment fee within
      timeline specified by this Contract, it shall be charged a penalty equal
      to 0.01% of overdue amount for per day of
delay.

            


    

    


    
      	
               
      

            	
              
                o

              

            	
              Party
      A shall keep secret certain contents limited by this Contract and shall
      not transfer the Technology Secret to any third party, otherwise shall
      return Party B entire already paid fee by Party B at one time and pay
      Party B a penalty equal to 5% of total assignment
  fee.

            


    

    


    
      
        	
                4.2

              	
                The
      Parties shall consult whether to continue this Contract after the breaking
      party bear its default
responsibility.

              


      

    

    


    Article
5 Others

    
      
        	
                5.1

              	
                Any
      incapacity or unnecessary of executing this Contract due to force majeure
      is subject to negotiation between two Parties for
    dissolution.

              


      

    

    


    
      
        	
                5.2

              	
                During
      the period of this Contract, Party A appoints Zongzhen Zhou as its project
      reference, Party B appoints Zhuo Lin as its project reference. References
      shall be responsible for:

              


      

    

    
       

      
        	
                 

              	
                
                  o

                

              	
                Keep
      in touch and resolve problems in
time.

              


      

    

    
       

      
        	
              	
                
                  o

                

              	
                Report
      the project progress.

              


      

    

     

    Either of
the two Parties who change reference shall make the other party known in
writing, otherwise shall bear the responsibilities arisen therefrom and
compensate the losses incurred.

    


    
      
        	
                5.3

              	
                Party
      A shall deliver technological materials of the Contract Object in both
      writing and soft copy.

              


      

    

    


    
      
        	
                5.4

              	
                Change
      of this Contract or amendment of article shall be done through negotiation
      between two Parties separately in written form and taken as
      appendices.

              


      

    

    


    
      
        	
                5.5

              	
                Both
      Parties must strictly voluntarily observe the terms of this Contract. Any
      outstanding issue not stipulated under this Contract shall be subject to
      negotiation between two Parties based on the principle of sincerity. In
      case of consultation or negotiation fails, appeal to people’s
      court.

              


      

    

    


    
      
        	
                5.6

              	
                This
      Contract is in quadruplicates, with each party hold two originals with
      equal legal validity.

              


      

    

    


    
      
        	
                5.7

              	
                This
      Contract comes into force on the date of signing and ceases to be effect
      till both Parties fulfill their
  responsibilities.

              


      

    

    


    


    
      Party A:
Hainan Zhonghe Peptide Drugs Research & Development Co.,
Ltd.

    

    


    
      Legal
Representative: /s/
Authorized Representative

    

    


    


    


    Party B:
Hainan Zhonghe Pharmaceutical Co., Ltd.

    


    
      Legal
Representative: /s/
Authorized Representative