Agreement by and between Pisgah Labs, Inc. and Medivation, Inc.



 Exhibit 10.9(a) 
  
 February 17, 2004 
  
 Mr. Patrick Machado 
 Medivation, Inc. 
 501 Second Street 
 Suite 211 
 San Francisco, CA 94107 
  
 Tel: 415-543-3470, x201 
 Fax: 415-543-3113 
  
 Re: GLP and cGMP Preparation of Dimebon, API 
  

Dear Pat: 
  
 Based on correspondences from Dr. Berlin (Hoyle Consulting) pertaining to the synthesis of Dimebon, API, and the subsequent telephone conversations that you and I have had on the subject, I am writing to
confirm the mutual agreement of Pisgah Labs and Medivation, Inc. for the manufacture of an estimated eight kilos of non-GMP dimebon API, and one kilo of GMP dimebon API. This Agreement also covers certain additional work, including development of
HPLC assay and impurities test procedures, that are optional at Medivation’s discretion. 
  
 The synthesis documentation that Medivation has previously provided to Pisgah Labs is very helpful and there does not appear to be any unusual or atypical processing steps. I recognize certain precautions will have to
be maintained to prevent the undesired polymerization of the vinylpyridine during its purification and for its subsequent reaction with the carboline. 
  
 The project will consist of three phases. Phase 1 will involve synthesis of one kilo of non-GMP material, with a target delivery date of April 29, 2004. Phase 2 will
involve synthesis of an estimated seven kilos of non-GMP material, with a target delivery date of September 1, 2004, it being understood that the actual quantity of material required in Phase 2 will not be known definitively until after the pre-IND
meeting is held with FDA. Phase 3 will involve synthesis of one kilo of cGMP material, with a target delivery date of December 1, 2004. 
  

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 Phase 1 will begin upon execution of this Agreement. Phase 2 and Phase 3 will begin on the dates on which Medivation
authorizes Pisgah Labs in writing to begin those phases. 
  
 The specification and
stability protocols for the material to be delivered are attached as Attachment 1) and incorporated into this Agreement. 
  
 Pisgah Labs will start the project immediately with delivery of the materials in accordance with the target delivery dates specified above. It is recognized that
“time is of the essence” and pending raw material lead times or unforeseen circumstances, Pisgah Labs will make reasonable commercial efforts to meet the desired project delivery dates. Pisgah Labs will confirm the synthetic process on a
convenient scale while identifying process monitoring methodologies. With the final product, Pisgah Labs will, at the discretion of Medivation, either a) identify an acceptable HPLC assay and impurities methodology or b) transfer such assay and
methodologies developed elsewhere and provided by Medivation. 
  
 Attached as
Attachment 2) is a top-level spreadsheet for initiating and executing the project. The amounts quoted include the costs of obtaining all starting materials required to produce dimebon according to the synthesis used for commercial manufacture in the
Russian market, which has been provided previously. It is understood that the charges set forth on Attachment 2) are Pisgah Labs’ good faith estimates based on its current understanding of the relevant facts. Should changes in those facts occur
which would impact the estimated charges (e.g., change in the synthesis used for dimebon API, change in quantity of API required, etc.), the parties will discuss those changes and agree in good faith to reasonable revisions to the charges, it being
understood that no increases in charge levels shall become binding until approved in writing by Medivation. 
  
 Attachment 2) also sets forth the prices for various additional items of work that Pisgah Labs will perform if requested to do so by Medivation, in Medivation’s discretion. Such additional work includes
validation of HPLC assay and impurities methods, development of a stability indicating HPLC assay and execution of a stability testing protocol. 
  
 Payment terms for work covered by this Agreement will be as set forth in Attachment 2). 
  
 Any additional work required by Medivation, including the synthesis / purification / characterization of a reference standard and the
potential synthesis of related foreign substances needed to validate the method, are not included in the estimated charges and, if requested by Medivation, will be charged separately. 
  
 If this letter correctly reflects the agreement between Pisgah Labs and Medivation, Inc. regarding the manufacture of dimebon API, please
countersign this Agreement and return it to me. Upon your signature, this Agreement will be binding on both Pisgah Labs and Medivation. This Agreement will also include the terms and conditions listed in Attachment 3), which are incorporated herein.

  

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 I look forward to working with you on this interesting project. 
  
 Sincerely, 
  
 PISGAH LABS, INC. 
  

			
	 By:
	 	 Cliff R. King, Ph.D.

	 Its:
	 	 Vice President


  
 APPROVED AND AGREED TO: 
  
 MEDIVATION, INC. 
  

			
	 By:
	 	 C. Patrick Machado

	 Its:
	 	 Senior VP & Chief Financial Officer


  
 Attachments 
  
 1) Specification and stability protocols 
 2) Charges 
 3) Terms and Conditions 
  

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 Attachment 1) 
  
 Specification and Stability Protocols 
  
 The following specification and stability protocols apply to the GMP dimebon di-hydrochloride API to be manufactured under this Agreement. Non-GMP batches may be release
and stability tested to alternate protocols. The parties expect that the specification will evolve prior to IND filing, especially with respect to the related substances. 
  
 Table 1: Specification for Dimebon di-Hydrochloride 
  

					
	 Test

	 	 Method

	 	 Acceptance Criteria


	 Appearance
	 	Visual	 	White to off-white powder
			
	 Identification
	 	USP<197R> (IR)	 	Sample spectrum comparable to reference spectrum
			
	 Identification (Chloride)
	 	USP<191>	 	Conforms to USP
			
	 Assay
	 	HPLC	 	97.0 to 103.0% (anhydrous)
			
	 Related Substances
     Single Largest
     Total
	 	HPLC	 	 NMT 0.2%
 NMT 2.5%

			
	 Residual Solvents
     $$List Each
	 	GC	 	ICH Values
			
	 Moisture
	 	 USP<921>
 (Karl Fisher)
	 	NMT 2.5%
			
	 Residue on Ignition
	 	USP<281>	 	NMT 0.02%
			
	 Heavy Metals
	 	USP<231>	 	NMT 0.002%

  
 During the course of development it
may also be necessary to evaluate particle size distribution, microbial quality, and crystalline form, as well. However, such tests can be performed under a process development protocol. 
  
 Table 2: Stability Protocol for GMP Dimebon di-Hydrochloride 
  

															
	 Test

	    	 1

	    	3

	    	6

	    	9

	    	12

	    	18

	    	24


	 Appearance
	    	x, xx	    	x, xx	    	x, xx	    	x	    	x	    	x	    	x
								
	 Assay
	    	x, xx	    	x, xx	    	x, xx	    	x	    	x	    	x	    	x
								
	 Related Substances
	    	x, xx	    	x, xx	    	x, xx	    	x	    	x	    	x	    	x
								
	 Water
	    	x, xx	    	x, xx	    	x, xx	    	x	    	x	    	x	    	x


 x = 25 ± 2°C/60 ± 5%RH; xx = 40
± 2°C/75 ± 5% RH 
  

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 Attachment 2) 
  
 Charges 
  

										
	 No.

	  	 Project Phase

	  	 Description

	  	Cost

	  	 Due


	 1
	  	Initiation: Phase 1	  	Secure raw materials, document raw material specifications; set-up analytical methods, begin process chemistry development	  	$	100,000	  	50% w/in 10 days of signing this Agreement; 50% 30 days later
					
	 2
	  	Development	  	Confirm syntheses for API and final intermediates; Unexpected events charged at a Full Time Equivalent basis (FTE) of $18,000 / month + other pre-approved expenses	  	$	32,000	  	50% w/in 10 days of signing this Agreement; 50% 30 days later
					
	 3
	  	 Non-GMP Batch:
 Phase 1
	  	Establish synthetic, isolation and purification parameters consistent with meeting the API specifications	  	$	22,000	  	W/in 10 days after delivery of first 1kg of non-GMP material
					
	 4
	  	Initiation: Phase 2	  	Secure raw materials	  	$	37,500	  	W/in 10 days after initiation of Phase 2
					
	 5
	  	 Non-GMP Batch:
 Phase 2
	  	Establish synthetic, isolation and purification parameters consistent with meeting the API specifications	  	$	60,500	  	W/in 10 days after delivery of 7kg of non-GMP material
					
	 6
	  	cGMP Batch (<1kg)	  	Prepare approx. 1 kg API according to a batch sheet and perform the in-process and release tests.	  	$	51,700	  	W/in 10 days after delivery of 1kg of cGMP material
					
	 7
	  	HPLC Assay and Impurities	  	Optional: Develop an assay and impurities method (not validated)	  	$	10,700	  	Net 30 days invoice
					
	 8
	  	HPLC Assay (Stability Indicating)	  	Optional; develop stability indicating assay; perform stress tests on API and demonstrate no degradants interfere with the main peak.	  	$	13,200	  	Net 30 days invoice
					
	 9
	  	HPLC Methods Validation	  	Optional; validate HPLC assay; reference standard and related foreign substances syntheses excluded.	  	$	16,000	  	Net 30 days invoice
					
	 10
	  	Cross-over Cleaning Verification	  	For cGMP batch, document and demonstrate cleaning verification by appropriate analytical methodology	  	$	4,500	  	Net 30 days invoice

  

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 Attachment 3) 
  
 Terms and Conditions 
  
 1. Significant changes, unexpected expenses, or costs incurred associated with unexpected development, scale-up or validation activities will be assessed to Medivation,
Inc. Medivation, Inc. will be advised, in advance, of charges outside this range and Medivation, Inc. may direct Pisgah Labs as to how to proceed. 
  
 2. The project consists of multiple phases as described in the Agreement and in Attachment 2). 
  
 3. Accordingly, Medivation, Inc. will pay Pisgah Labs in advance for initiating the project in accordance with Attachment 2), lines 1 and 2
(the “Advanced Payment”). 
  
 4. The Advanced Payment is
non-refundable and represents Medivation, Inc.’s and Pisgah Labs’ commitment to resources in the time period requested. 
  
 5. Pisgah Labs will make reasonable commercial efforts to meet schedules and performance metrics notwithstanding schedule delays resulting from generally accepted force
majeur cause(s) or delays. 
  
 6. Pisgah Labs understands that projects of this
nature require flexibility and will negotiate in good faith additional payments for unexpected project events or changes in the work described. 
  
 7. EXCEPT AS PROVIDED IN ITEM 11 BELOW, PISGAH LABS HEREBY DISCLAIMS, AND PISGAH LABS HEREBY WAIVES, ALL EXPRESS WARRANTIES, AND ALL IMPLIED WARRANTIES, INCLUDING BUT NOT
LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE AND/OR USE (INCLUDING MEDIVATION, INC.’S AND MEDIVATION, INC.’S CLIENTS’ REQUIREMENTS). 
  
 8. This Agreement may be terminated by Medivation upon thirty (30) days notice. In the
unlikely event of termination, all further work on the project will stop and the parties will cooperate in good faith on a reasonable wind-down plan that will minimize project wind-down costs. It is understood that the Advance Payment shall be
non-refundable notwithstanding any termination of this Agreement. 
  
 9. Pisgah
Labs acknowledges and agrees that all technology related to Medivation’s dimebon dihydrochloride project, in general, and more specifically, to the manufacture, testing and/or use of dimebon dihydrochloride is the sole and exclusive property of
Medivation, and further agrees that Pisgah Labs will fully cooperate with Medivation in the preparation, execution and submission of any and all documents reasonably required by Medivation to commercially exploit the value of the technology
including, but not limited to, the assignment of all patent rights to Medivation. 
  

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 10. So long as Pisgah Labs continues to perform in compliance with this agreement and all other agreements that may
subsequently be entered into between the parties: (a) Medivation agrees that it will not take all or any portion of the work set forth in Attachment 2) away from Pisgah Labs and give such work to a third party (it being understood that this
provision does not apply to the work labeled ‘optional” in Attachment 2), and (b) Medivation also agrees that, should it require any further supplies of dimebon API beyond those set forth in Attachment 2), whether non-GMP or GMP, it will
give Pisgah Labs the opportunity to bid on such work and will consider any such bid from Pisgah Labs in good faith, provided that the agreement clause (b) will terminate automatically upon the closing of a merger or acquisition of Medivation, or
upon the closing of any transaction in which Medivation licenses or otherwise transfers the dimebon project to a third party. 
  
 11. Pisgah Labs acknowledges that the dimebon API produced by it will be used in animal and human testing that will be submitted to FDA, the EMEA and potentially other
regulatory agencies in support of applications to sell dimebon to treat Alzheimer’s disease and potential other future indications. Accordingly, Pisgah Labs represents and warrants that all work hereunder shall be performed in compliance with
all applicable laws, rules and regulations, including without limitation FDA current good manufacturing practices, in the case of the GMP material, and good laboratory practices, in the case of the non-GMP material. Pisgah Labs will furnish all
certificates and other documentation required to confirm such compliance. 
  
 12.
This Agreement represents the entire understanding of the parties, and supersedes any prior agreements or understandings between them, whether written or oral. This Agreement may be amended only in a written document signed by both parties. This
Agreement will be interpreted pursuant to the laws of the State of Delaware, without regard to its conflict of law principles. 
  

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 CONTRACT ADDENDUM A 
  
 Replacement of Attachment 2 
  

Effective March 18, 2004, this Contract Addendum A supercedes “Attachment 2” of the original contract dated February 17, 2004 between Medivation, Inc. and
Pisgah Labs, Inc. Reference is made to another document, “Pisgah Labs; Dimebon Project Report; March 12, 2004” that delineates the motivation for this Contract Addendum. Project milestones require that Phase 2 of the project be re-defined.

  
 The original contract language is: “Phase 2 will involve synthesis of an
estimated seven kilos of non-GMP material with a target delivery date of September 1, 2004, it being understood that the actual quantity of material required in Phase 2 will not be known definitively until after the pre-IND meeting is held with
FDA”. 
  
 Phase 2 shall now be defined as: “Phase 2 will involve
synthesis of five kilograms of GMP Dimebon Dihydrochloride appropriate for clinical trials with a target delivery date of July 30, 2004”. As a consequence of this change to the Phase 2 definition, Phase 3 is eliminated from the original
contract. 
  
 Except where timing inconsistencies or other activities are directly
in conflict with the intentions described in the cited Project Report and / or contained within this Addendum, all other aspects of the original contract remain intact. 
  
 [intentionally left blank] 
  

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 Replacement Attachment 2) 
  
 Charges 
  

										
	 No.

	  	 Project Phase

	  	 Description

	  	 Estimated
 Cost

	  	 Due


	 1
	  	Initiation: Phase 1	  	Secure raw materials, document raw material specifications; set-up analytical methods, begin process chemistry development	  	$	100,000	  	50% w/in 10 days of signing this Agreement; 50% 30 days later
					
	 2
	  	Development	  	Confirm syntheses for API and final intermediates; Unexpected events charged at a Full Time Equivalent basis (FTE) of $18,000 / month + other pre-approved expenses	  	$	32,000	  	50% w/in 10 days of signing this Agreement; 50% 30 days later
					
	 3
	  	 Non-GMP Batch:
 Phase 1
	  	Establish synthetic, isolation and purification parameters consistent with meeting the API specifications	  	$	22,000	  	W/in 10 days after delivery of first 1kg of non-GMP material
					
	 4
	  	Initiation: Phase 2	  	Secure raw materials	  	$	27,500	  	W/in 10 days after initiation of Phase 2
					
	 5
	  	Non-GMP Batch	  	Optional: Establish synthetic, isolation and purification parameters consistent with meeting the API specifications	  	$	60,500	  	W/in 10 days after delivery of 7kg of non-GMP material
					
	 6
	  	 cGMP Preparation of gamma-carboline derivative
 (< 24.6kg)
	  	Prepare the carboline in fixed equipment; 25kg tolyhydrazine min. order qty.; convert all to carboline. 200/300gal equipment; cross-over cleaning; establish in-house approval testing specs and
methods	  	$	39,203	  	Net 30 days upon batch completion
					
	 7
	  	Carboline Cross-over Cleaning	  	Conduct recovery studies; identify analytical method; establish cleaning procedure + batch sheet	  	$	12,200	  	100% in 10 days

  

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	 8
	  	API
standard;
Purify and
Characterize	 	Purify and characterize an analytical standard using Russian API. Assemble documentation package containing structure confirmation information and conformance to proposed release
specifications.	  	$	11,825	  	Net 30 days invoice
					
	 9
	  	API Particle
Size /
Milling
Experiment	 	Determine particle size / distribution of Russian material; mill if necessary and re-measure; cross-over cleaning; perform recovery studies and establish appropriate analytical
methodology	  	$	16,800	  	Net 30 days invoice
					
	 10
	  	Cross-over
Cleaning
Verification	 	If item 9 above is NOT executed, the cross-over cleaning component must still be performed for the GMP batch	  	$	4,500	  	Net 30 days invoice
					
	 11
	  	HPLC
Assay and
Impurities	 	Optional: Develop an assay and impurities method (not validated)	  	$	10,700	  	Net 30 days invoice
					
	 12
	  	HPLC
Assay
(Stability
Indicating)	 	Optional; develop stability indicating assay; perform stress tests on API and demonstrate no degradants interfere with the main peak.	  	$	13,200	  	Net 30 days invoice
					
	 13
	  	5kg API for
Clinical
Trials	 	Prepare 5kg GMP Dimebon Dihydrochloride; excludes MVP cost	  	$	48,400	  	Net 30 days upon batch completion
					
	 14
	  	HPLC
Methods
Validation	 	 Optional; validate HPLC assay; reference standard and related foreign substances syntheses excluded.
 Note: Medivation may incur some cost for executing a method transfer validation protocol (from SRTL to Pisgah Labs) depending upon difficulty
	  	$	16,000	  	Net 30 days invoice

  
 CONTRACT ADDENDUM A IS APPROVED AND
AGREED TO: 
  

					
	MEDIVATION, INC.	 	PISGAH LABS, INC
			
	 By:
	  	C. Patrick Machado	 	Cliff R. King
	 Its:
	  	Senior VP and Chief Financial Officer	 	Vice President

  

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