Exhibit 10.22


 


Certain portions of this
Exhibit have been omitted pursuant to a request for confidentiality. Such
omitted portions, which are marked with brackets [   ] and an asterisk*, have been separately filed with the Commission.


 


EXECUTION COPY


 


 


COLLABORATION AGREEMENT


 


 


by and between


 


 


TEVA PHARMACEUTICAL INDUSTRIES LTD.


 


 


and


 


 


ACORDA THERAPEUTICS, INC.


 

















 


COLLABORATION AGREEMENT


 


THIS
COLLABORATION AGREEMENT (this “Agreement”) is made as of
September 23, 2003, by and between TEVA PHARMACEUTICAL INDUSTRIES LTD., a
limited liability company organized under the laws of Israel, with its
principal place of business located at 5 Basel Street, Petah Tiqva 49131,
Israel (“Teva”),
and ACORDA
THERAPEUTICS, INC., a corporation organized under the laws of Delaware,
with its principal place of business located at 15 Skyline Drive, Hawthorne,
New York 10532 U.S.A. (“Acorda”).


 


WHEREAS,
Teva possesses certain rights to develop the chemical compound known under its
project name TV-1901, and more commonly referred to as Valrocemide and further
described in Annex A to this Agreement (the “Compound”), and to
manufacture, market, promote, distribute, sell and otherwise commercially
exploit pharmaceutical products that contain the Compound;


 


WHEREAS, Teva and Acorda desire
to enter into a collaborative arrangement to Develop one or more finished
pharmaceutical products that contain the Compound (with the initial intention
that such products contain the Compound as the sole active ingredient), for the
treatment of any appropriate indication, except Multiple Sclerosis unless as
otherwise provided herein, all in accordance with the terms and conditions of
this Agreement; and


 


WHEREAS, Teva and Acorda further
desire that (i) Teva exclusively manufacture and supply all Collaboration
Products for sale in the Territory, (ii) Teva and Acorda copromote all
Collaboration Products in the Territory, and (iii) Teva exclusively
Commercializes all Collaboration Products in the Territory, all in accordance
with the terms and conditions of this Agreement.


 


NOW, THEREFORE, in
consideration of the foregoing premises, and the mutual representations,
warranties and covenants contained in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:


 


ARTICLE 1


 


DEFINED
TERMS


 


For purposes of this Agreement, the following
initially capitalized terms, whether used in the singular or plural form, have
the following respective meanings:


 


Section 1.1            “Act” means the United
States Federal Food, Drug and Cosmetic Act of 1938, as amended from time to
time, and all rules, regulations and guidance promulgated thereunder.


 


Section 1.2            “Account Manager”
means a person engaged by a Party (or a Party’s subcontractor) to Promote
Collaboration Products with Managed Care Organizations and Target Prescribers
in accordance with the Marketing Plan for such Collaboration Products.


 

















 


Section 1.3            “Acorda
Background Technology” means the tangible or intangible
know-how, trade secrets, inventions (whether patentable or unpatentable),
discoveries, technical and other information (including preclinical data and
clinical results), formulas, processes, data, patent rights and other
intellectual property, if any, that (i) is owned or controlled by or licensed
to (with the right to assign or sublicense by) Acorda in the Territory
immediately prior to the Effective Date, and (ii) relates to the Compound or
any Collaboration Product (including, without limitation, related to any interactions,
contra-indications or use thereof, improvements or new combination therapies or
new delivery systems suited thereto).


 


Section 1.4            “Additional Compound”
has the meaning ascribed to it in Section 8.3 of this Agreement.


 


Section 1.5            “Additional Indication Review Period”
has the meaning ascribed to it in Section 3.5(b) of this Agreement.


 


Section 1.6            “Affiliate” means any
person, corporation, company, partnership or other entity (each, a “Person”)
that directly or indirectly Controls, is Controlled by or is under common
Control with Acorda or Teva, as the case may be, but only for so long as said
Control continues.  As used in this
Agreement, the term “Control” means possession of the power to direct or cause
the direction of the management and policies of a Person whether by ownership
of voting securities, contract or otherwise. 
For the avoidance of doubt, neither Acorda, on the one hand, nor Teva,
on the other hand, is considered an Affiliate of the other.


 


Section 1.7            “Agreement” means this
Agreement, together with all annexes, exhibits and schedules attached hereto,
all of which are hereby incorporated into this Agreement.


 


Section 1.8            “AMA Guidelines” means
the American Medical Association Gifts to Physicians from Industry Guidelines,
as revised from time to time.


 


Section 1.9            “Arbitration” has the
meaning ascribed to it in Annex B of this Agreement.


 


Section 1.10         “Arbitration Request”
has the meaning ascribed to it in Annex B of this Agreement.


 


Section 1.11         “Arbitration Tribunal”
has the meaning ascribed to it in Section 14.12(a) of this Agreement.


 


Section 1.12         “Arbitrator” has the
meaning ascribed to it in Annex B of this Agreement.


 


Section 1.13         “Approvable Letter”
means a letter issued by the FDA as described in 21 C.F.R.
Section 314.110, as amended from time to time.


 


Section 1.14         “Bankruptcy Code” has
the meaning ascribed to it in Section 12.2(c) of this Agreement.


 


Section 1.15         “Bankruptcy Party” has
the meaning ascribed to it in Section 12.2(c) of this Agreement.


 


2

















 


Section 1.16         “Business Day” means
any calendar day, except that if an activity to be performed or an event to
occur falls on a Friday, Saturday, Sunday or a nationally recognized holiday in
the United States or Israel, then the activity may be performed or the event
may occur on the next day that is not a Friday, Saturday, Sunday or nationally
recognized holiday.


 


Section 1.17         “Certificate of Analysis”
means a written document describing the analyses and the results performed with
respect to a Collaboration Product, in the form attached hereto as Annex C,
as such form may be modified from time to time.


 


Section 1.18         “Certificate of Release”
means a written document with respect to a particular batch of Collaboration
Product indicating that such Collaboration Product has met the applicable
specifications. Such certificate shall be in the form attached hereto as Annex
C and may be modified from time to time.


 


Section 1.19         “Change of Control”
means (i) the sale, lease, or other disposition of all or substantially all of
the business or assets of a Party (whether by way of merger, sale of stock,
sale of assets or otherwise); or (ii) an acquisition of a Party by a Third
Party by consolidation, merger, or other reorganization in which the holders of
the outstanding voting stock of the Party immediately prior to such transaction
own, immediately after such transaction, securities representing less than
fifty percent (50%) of the corporation or other entity surviving such
transaction.  The Third Party acquiring
the Party or its assets shall be referred to as the “Acquiring Party” for purposes
of this Agreement.  For clarity, neither
the consummation of a public offering of newly issued securities by a Party
pursuant to an effective registration statement under the United States
Securities Act of 1933, as amended, nor an equity financing by a Party
involving the sale and issuance of newly issued securities of the Party to
purchasers in such equity financing, shall be deemed a “Change of Control,”
even if such offering or financing results in such purchasers owning more than
fifty percent (50%) of the total issued and outstanding securities of such
Party; provided that no one purchaser (or group of affiliated purchasers) owns
or controls more than thirty (30%) of the corporation or other entity as a
result of such offering or financing.


 


Section 1.20         “Claims” has the
meaning ascribed to it in Section 11.1(a) of this Agreement.


 


Section 1.21         “Collaboration Product”
means a product intended for human pharmaceutical use containing the Compound
as an active ingredient, in any formulation and dosage form and for any
indication (except (i) Multiple Sclerosis, unless included in joint Development
under this Agreement in accordance with Section 3.4, and (ii) an
Independent Use).


 


Section 1.22         “Commercialization” or
“Commercialize” means
the activities carried out by Teva and/or its Affiliates and/or duly appointed
Third Parties in distributing Collaboration Products within the Territory
(including importing, transporting, customs clearance, warehousing, packing,
handling and delivering the Collaboration Products to customers) and all sales
related activities, including taking orders for and booking and fulfilling
sales of Collaboration Products within the Territory.


 


3

















 


Section 1.23         “Common Cost
Per Account Manager,” “Common Cost Per Professional Education Manager,”
“Common Cost Per Sales Representative,”  and  “Common Cost Per Scientific Manager”  have
the respective meanings ascribed to them in Section 4.4(a) of this
Agreement.


 


Section 1.24         “Competitive Product”
means a finished human pharmaceutical product containing as an active
ingredient a valproic acid-based compound that is intended for use, or that
reasonably could be used, in the Territory for treating, preventing or curing a
disease or condition that is the same or substantially the same as a labeled
indication of a Collaboration Product in the Territory.


 


Section 1.25         “Complaining Party”
has the meaning ascribed to it in Annex B of this Agreement.


 


Section 1.26         “Compliance Committee”
has the meaning ascribed to it in Section 2.1(b)(iii) of this Agreement.


 


Section 1.27         “Compound” has the
meaning ascribed to it in the first Whereas clause of this Agreement.


 


Section 1.28         “Confidential Information”
has the meaning ascribed to it in Section 10.1 of this Agreement.


 


Section 1.29         “Confidentiality Agreement”
means the Confidentiality Agreement by and between Teva and Acorda dated as of
August 6, 2002.


 


Section 1.30         “Copromotion Expenses”
means all costs and expenses expended by the Parties in Promoting Collaboration
Products in the Territory pursuant to and in accordance with the applicable
Marketing Plan and the budget therein, calculated in accordance with GAAP and
pursuant to Annex D attached hereto.


 


Section 1.31         “Copromotion Profit”
means, with respect to sales of a Collaboration Product in the Territory for
the applicable period, an amount equal to the Net Sales for such Collaboration
Product during such period, minus the (i) Production Costs, (ii) Distribution
Costs, and (iii) Copromotion Expenses (subject to Section 4.5(e)) with
respect thereto.


 


Section 1.32         “CSC”
means the Central Steering Committee formed by the Parties in accordance with
Section 2.1(a) of this Agreement.


 


Section 1.33         “Detail” means a
face-to-face interactive meeting, in an individual or group practice setting,
between a member of the Target Prescribers and a Sales Representative, during
which Collaboration Product information is communicated to such Target
Prescriber.  When used as a verb,
“Detail” shall mean to engage in a Detail.


 


Section 1.34         “Develop or Development”
means all activities undertaken by or on behalf of a Party under this Agreement
(whether inside or outside the Territory) to develop a Collaboration Product
(including, without limitation, line extensions) in order to achieve Regulatory
Approval or enhancements to product labeling of such Collaboration Product for
the


 


4

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


Territory, as approved by the CSC and in accordance with the applicable
Development Program, including such clinical studies and other activities
conducted by the Parties with the intent of, and as are necessary to, generate
data for submission to regulatory authorities in support of an application for
Regulatory Approval necessary to permit the Commercialization of the
Collaboration Product (including, without limitation,  line extensions) for the Territory.  For clarity, Teva shall have the right to use any data generated
from the Development of a Collaboration Product to support Regulatory Approval
or enhancements to product labeling of such Collaboration Product outside of
the Territory.  When used as a verb,
“Develop” means to engage in Development. 
For clarity, the term “Development” may include research on new
formulations (such as extended-release formulations) and new indications, to
the extent such work is included in a Development Program.


 


Section 1.35         “Development Committee”
has the meaning ascribed to it in Section 2.1(b)(i) of this Agreement.


 


Section 1.36         “Development Costs”
means all costs incurred by each of the Parties in the Development of a
Collaboration Product in accordance with its Development Program, including
such costs (i) for clinical supplies at an amount equal [***] of the Market
Price thereof in the Territory, or [***] of the anticipated Market Price
thereof in the Territory if the actual market price is not available; (ii)
associated with conducting the clinical studies for seeking Regulatory Approval
in the Territory; and (iii) for labor (at the actual cost for such labor); but
excluding, however, any costs incurred by Teva related directly to (A)
achieving Regulatory Approval for a Collaboration Product outside the
Territory, and (B) supplying the Collaboration Product to Acorda for the Next
Trial, which, as discussed in Section 3.2(b), Teva is responsible for
supplying at no cost to Acorda.  For
clarity, the term “Development Costs” shall not include any costs relating to
(1) any clinical trials or other Development work on a Collaboration Product
where the results of such trials or other work are not materially used in
seeking Regulatory Approval or enhancements to product labeling of such
Collaboration Product for the Territory, (2) any manufacturing scale-up or related
manufacturing development work for an immediate release tablet (or similar
form) of Collaboration Product, or (3) any efforts by Teva in relation to
preparation of the Chemistry, Manufacturing and Controls Section for any
Collaboration Product for submission to the FDA, unless otherwise agreed to by
the Parties.


 


Section 1.37         “Development Program”
has the meaning ascribed to it in Section 2.1(b)(i) of this Agreement.


 


Section 1.38         “Dispute” has the
meaning ascribed to it in Section 14.12(a) of this Agreement.


 


Section 1.39         “Distribution Costs”
means, with respect to a Collaboration Product in a particular period, the
lesser of:  (a) the actual costs and
expenses (including labor) incurred by Teva and its Affiliates in performing
the Commercialization activities in the Territory for such Collaboration
Product in such period, including, without limitation, expenses associated with
fulfilling orders for the Collaboration Product placed by Third Parties,
handling, warehousing, refrigeration, insurance, transportation, and
wholesaler’s fees (for avoidance of doubt, Distribution Costs also include any
costs or expenses (including labor) incurred by Teva or its


 


5

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


Affiliates to perform quality control and quality assurance necessary
to release the Collaboration Product for distribution in the Territory, whether
performed during or prior to the time the Collaboration Product is in Teva’s
warehouse in the Territory) to the extent allocable to such activities relating
directly to the Collaboration Product; or (b) [***] of Gross Sales for such
Collaboration Product in such period. 
For clarity, the term “Distribution Costs” shall not include any costs,
expenses or amounts that are deducted from Gross Sales in calculating Net Sales
under Section 1.70.


 


Section 1.40         “Drug Interaction Study”
has the meaning ascribed to it in Section 3.2(b) of this Agreement.


 


Section 1.41         “Effective Date” means
the date first set forth above in the introductory paragraph of this Agreement.


 


Section 1.42         “FDA” means the Food
and Drug Administration of the United States of America, or any successor
entity.


 


Section 1.43         “Forecast” has the
meaning ascribed to it in Section 6.2(c) of this Agreement.


 


Section 1.44         “Free Products” means
those quantities of Collaboration Products given free of charge to patients,
including through an indigent patient program, such as the National
Organization for Rare Diseases, or similar not-for-profit organizations, as
included in a Marketing Plan and approved by the CSC.  The cost associated with such Collaboration Products shall, for
the purposes of calculating Copromotion Expenses, be an amount equal to [***]
of the Market Price thereof, or, if the actual Market Price is not available at
the time the products are given, [***] of the anticipated Market Price.


 


Section 1.45         “GAAP” means United
States generally accepted accounting principles, as then in effect,
consistently applied.


 


Section 1.46         “Good Manufacturing Practices”
means the then-current good manufacturing practices required by the FDA, as set
forth in the Act and the regulations, promulgated thereunder, for the
manufacture and testing of pharmaceutical materials, and comparable laws or
regulations applicable to the manufacture and testing of pharmaceutical
materials in jurisdictions outside the United States.


 


Section 1.47         “Gross Sales” means
the total gross amount invoiced for a Collaboration Product sold in a
particular period to Third Parties in the Territory in bona fide arms length
transactions.


 


Section 1.48         “GSC” has the meaning
ascribed to it in Section 2.2(a) of this Agreement.


 


Section 1.49         “GSC Party” has the
meaning ascribed to it in Section 2.2(b) of this Agreement.


 


Section 1.50         “Hearing” has the
meaning ascribed to it in Annex B of this Agreement.


 


6

















 


Section 1.51         “IND” means, with
respect to the Territory, an investigational new drug application, as defined
in the Act.


 


Section 1.52         “Indemnity Claim” has
the meaning ascribed to it in Section 11.1(d) of this Agreement.


 


Section 1.53         “Indemnified Party”
and “Indemnifying Party”
have the respective meanings ascribed thereto in Section 11.1(a) of this
Agreement.


 


Section 1.54         “Independent Development”
means all activities undertaken by or on behalf of an Independent Party pursuant
to, and as permitted in, Section 3.5(b) of this Agreement to develop a
Collaboration Product for a Proposed Use that has not been selected under such
Section for Development jointly by the Parties, in order to achieve
Regulatory Approval or enhancements to product labeling of such Collaboration
Product in the Territory, including such clinical trials and other activities
conducted with the intent to, and as are necessary to, generate data for
submission to regulatory authorities in support of an application for
Regulatory Approval necessary to permit the commercialization of the
Collaboration Product for such Proposed Use in the Territory.


 


Section 1.55         “Independent Development Costs”
means the actual costs and expenses incurred by the Independent Party in
conducting Independent Development of a Collaboration Product for a particular
Proposed Use.


 


Section 1.56         “Independent Party”  means the Party that
is conducting Independent Development of a Collaboration Product for a Proposed
Use that has not been selected for Development jointly by the Parties, as
provided in Section 3.5(b).


 


Section 1.57         “Independent
Use” means a use in treating a particular indication that was
the subject of Independent Development as a Proposed Use and for which the
Re-Engagement Option expired unexercised as discussed in Section 3.5.


 


Section 1.58         “Indication Termination”
has the meaning ascribed to it in Section 12.2(b) of this Agreement.


 


Section 1.59         “Infringement Claim”
has the meaning ascribed to it in Section 9.2(a) of this Agreement.


 


Section 1.60         “Know-How” means all
tangible or intangible know-how, trade secrets, inventions (whether patentable
or unpatentable), discoveries, technical and other information (including
preclinical data and clinical results), formulas, processes, data and other
intellectual property owned, controlled or licensed by, or to, (with the right
to assign or sublicense by) Teva or any Affiliate of Teva to the extent that
any of the foregoing incorporates, uses or otherwise relates to, directly or
indirectly, the Compound or any Collaboration Product (including, without
limitation, related to any interactions, contra-indications or use thereof,
improvements or new combination therapies or new delivery systems suited
thereto) existing as of the Effective Date or that comes into existence during
the Term of this Agreement, but excluding Patent Rights.


 


7

















 


Section 1.61         “Launch Date” means
the date that a Collaboration Product is first commercially launched by or on
behalf of Teva for Promotion and Commercialization in the Territory after
having obtained the applicable Regulatory Approval.


 


Section 1.62         “Lead Indication” has
the meaning ascribed to it in Section 3.2(a) of this Agreement.


 


Section 1.63         “Managed Care Organizations”
has the meaning ascribed to it in Section 2.1(b)(ii) of this Agreement.


 


Section 1.64         “Marketing Committee”
has the meaning ascribed to it in Section 2.1(b)(ii) of this Agreement.


 


Section 1.65         “Marketing Materials”
means all written, printed, electronic or graphic materials developed by Teva
and/or Acorda, their respective Affiliates, and/or with, or on their behalf by,
any Third Party, in connection with the Promotion of Collaboration Products
pursuant to a Marketing Plan, which may include scientific education materials,
professional education materials, patient lists, physician references,
Detailing reports, Detailing pieces (such as visual aids and file cards),
premium articles, reprints, market surveys, training materials and other reports
and related data or programs.


 


Section 1.66         “Market Price” means
the quotient obtained by dividing the Gross Sales of a Collaboration Product in
a certain period as determined by the CSC, in the Territory, by the unit
quantities of such Collaboration Product sold to Third Parties in the Territory
in such period.


 


Section 1.67         “Marketing Plan” has
the meaning ascribed to it in Section 2.1(b)(ii) of this Agreement.


 


Section 1.68         “Monthly Report” has
the meaning ascribed to it in Section 4.3(a)(i) of this Agreement.


 


Section 1.69         “NDA” means, with
respect to the Territory, a new drug application filed with the FDA in
conformance with applicable laws and regulations.


 


Section 1.70         “Net Sales” means the
total Gross Sales for a Collaboration Product, less the following deductions to
the extent actually allowed or incurred with respect to such sales:  (i) quantity and/or cash discounts, but
provided that such discounts are not given to a particular customer, within a
reasonable sales cycle, disproportionately between the Collaboration Product
and other Teva products reasonably similarly situated; (ii) customs, duties,
sales and similar taxes, if any; (iii) amounts allowed or credited by reason of
rejections, return of goods (including as a result of recalls), and retroactive
price reductions or allowances specifically identifiable as relating to the
Collaboration Product; (iv) amounts incurred resulting from government (or any
agency thereof) mandated rebate programs in the Territory; (v) chargebacks or
similar price concessions related to the sale of the Collaboration Product;
(vi) bad debts, when and as such debts are recognized for accounting purposes
as not collectible; (vii) freight, packing, shipping and similar charges
separately stated on the invoices, and (viii) as agreed by the Parties, any
other specifically identifiable amounts included in a Collaboration Product’s
Gross Sales that were or ultimately will be credited and that are substantially
similar to those listed above.  All of


 


8

















 


the foregoing shall be calculated by Teva in accordance with GAAP, and
no amount in clauses (i) through (viii) above shall be included in Distribution
Costs, Production Costs, or Copromotion Expenses.  For the purposes of this provision, the transfer of a
Collaboration Product by Teva or one of its Affiliates to another Affiliate of
Teva is not a sale; in such cases, Net Sales will be determined based on the
sale of the Collaboration Product by the Affiliate to independent, Third-Party
customers in bona fide arms length transactions.


 


Section 1.71         “Next Trial” means,
after the Effective Date, the first adequate well controlled, clinical trial,
in accordance with the standards promulgated by the FDA for a Pivotal Trial, of
a Collaboration Product for the Lead Indication, which trial shall be
pre-approved by the CSC (such approval not to be unreasonably withheld).


 


Section 1.72         “Non-Participating Party”
has the meaning ascribed to it in Section 3.5(c) of this Agreement.


 


Section 1.73         “Option Study”
has the meaning ascribed to it in Section 3.6 of this Agreement.


 


Section 1.74         “Parties” or “Party” means,
collectively or individually, as the case may be, Teva and/or Acorda.


 


Section 1.75         “Patent Rights” means
all present and future patent applications and issued patents, owned,
controlled or licensed by, or to, Teva or any Affiliate of Teva to the extent
necessary or useful for the manufacture, use or sale of the Compound or any
Collaboration Product, including any provisionals, divisionals, continuations,
continuations-in-part, reissues, reexaminations or extensions derived
therefrom, as well as all foreign patent applications, granted patents and all
counterparts thereof including substitutions, confirmations, registrations,
revalidations, supplemental protection certificates, administrative protection
certificates or other governmental actions that provide exclusive rights to the
patent holders in the patented subject matter that incorporates, uses or
otherwise relates to, directly or indirectly, the Compound or any Collaboration
Product.


 


Section 1.76         “PDMA” means the
Prescription Drug Marketing Act of 1987, as amended, and the regulations
promulgated thereunder.


 


Section 1.77         “PhRMA Code” means the
PhRMA Code on Interactions with Healthcare Professionals promulgated and
adopted by the Pharmaceutical Research and Manufacturers of America, which
became effective July 1, 2002, as amended from time to time.


 


Section 1.78         “Phase I Trials” means
the human clinical trials conducted on normal volunteers or patients designed
to evaluate the safety, tolerability and/or pharmacokinetic profile of the
relevant Collaboration Product, and in accordance with the relevant Development
Program.


 


Section 1.79         “Phase II Trials”
means the human clinical trials conducted on patients and designed to indicate
a statistically significant level of efficacy, safety or tolerability for the
relevant Collaboration Product in the desired indication, as well as to obtain
some indication of dosage regimen required, and in accordance with the relevant
Development Program.


 


9

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


Section 1.80         “Phase III Trials”
means the human clinical trials conducted on patients and designed to establish
a Collaboration Product’s safety and efficacy, and which are required to obtain
Regulatory Approval of the Collaboration Product with the FDA and other
relevant regulatory authorities, and in accordance with the relevant
Development Program.


 


Section 1.81         “Pivotal Trial” means
a human clinical trial(s) designed to provide registration quality data that
the FDA has agreed (in a pre-IND, IND or other setting) will be sufficient, if
successful, to complete the efficacy data package for submission of an
NDA.  For the purposes of clarity, the
reference in the preceding sentence to “if successful” is not intended to imply
that the results of the subject trial must, in fact, be successful in order to
be considered a Pivotal Trial under this Agreement.


 


Section 1.82         “Primary Detail” means
a Detail that has a Collaboration Product as the first product discussion a
Sales Representative has with a Target Prescriber.


 


Section 1.83         “Production Costs”
means [***] of Net Sales of the relevant Collaboration Product sold for use in
the Territory; provided that the Production Costs (per 1000 tablets (or
similar form) of an immediate release formulation of Collaboration Product)
shall never be less than [***], adjusted on an annual basis to reflect the
increase, if any, during such annual period in the consumer price index (with
2002 as the base year), as published by the U.S. Department of Labor on any
successor entity.


 


Section 1.84         “Product Samples”
means those quantities of Collaboration Products given to Target Prescribers by
Teva or Acorda (as the case may be) for marketing purposes as determined by the
Marketing Committee and approved by the CSC, which is to be provided by such
Target Prescribers to patients without charge and the cost of which, for the
purposes of calculating Copromotion Expenses, is [***] of the Market Price, or,
if the actual Market Price is not available at the time the products are given,
[***] of the anticipated Market Price.


 


Section 1.85         “Professional Education Manager”
means a person engaged by a Party (or a Party’s subcontractors) to provide
professional education to healthcare professionals in accordance with the
applicable Marketing Plan for Collaboration Products.


 


Section 1.86         “Program Intellectual Property”
means any invention, discovery, know-how, trade secrets or information (whether
or not patentable) resulting from the Independent Development or joint
Development of Collaboration Products under this Agreement, together with all
intellectual property rights relating thereto, but excluding Patent Rights and
Know-How, in each case.


 


Section 1.87         “Promotion” means
those activities conducted by a Party or its Affiliates to promote and market a
Collaboration Product in the Territory in accordance with the applicable
Marketing Plan.  When used as a verb,
“Promote” means to engage in Promotion.


 


Section 1.88         “Proof of Concept Trial”
has the meaning ascribed to it in Section 3.3(a) of this Agreement.


 


10

















 


Section 1.89         “Proposed Use” has the
meaning ascribed to it in Section 3.5(a) of this Agreement.


 


Section 1.90         “Quarterly Copromotion Expenses”
has the meaning ascribed to it in Section 4.3(a)(iv) of this Agreement


 


Section 1.91         “Quarterly Participation Costs”
has the meaning ascribed to it in Section 4.3(b)(ii) of this Agreement.


 


Section 1.92         “Quarterly Reconciliation Date”
has the meaning ascribed to it in Section 4.3(a)(iv) of this Agreement.


 


Section 1.93         “Quarterly Report” has
the meaning ascribed to it in Section 4.3(a)(ii) of this Agreement.


 


Section 1.94         “Re-Engagement Fee”
has the meaning ascribed to it in Section 3.5(c)(i) of this Agreement.


 


Section 1.95         “Re-Engagement Option”
has the meaning ascribed to it in Section 3.5(c) of this Agreement.


 


Section 1.96         “Regulatory Approval”
means all necessary governmental approvals, including FDA approval of an NDA
and any applicable price and reimbursement approvals, and any other necessary
governmental licenses, registrations, authorizations and permits for the
manufacture, use, storage, import, transport, promotion, marketing and sale of
a Collaboration Product in a regulatory jurisdiction.


 


Section 1.97         “Residual Payments”
has the meaning ascribed to it in Section 12.4 of this Agreement.


 


Section 1.98         “Sales Representative”
means a person engaged by a Party (or a Party’s subcontractor) to Detail
Collaboration Products in accordance with the applicable Marketing Plan under
this Agreement.


 


Section 1.99         “Scientific Manager”
means a person engaged by a Party (or a Party’s subcontractor) to provide
professional scientific educational support to healthcare professionals in accordance
with the applicable Marketing Plan for Collaboration Products.


 


Section 1.100       “Secondary Detail”
means a Detail during which a Collaboration Product is the second product
discussed by the Sales Representative with the Target Prescriber.


 


Section 1.101       “Secondary Indications”
has the meaning ascribed to it in Section 3.3(a) of this Agreement.


 


Section 1.102       “Supply Disruption”
has the meaning ascribed to it in Section 6.2(d) of this Agreement.


 


11

















 


Section 1.103       “Target Labeling”
means the Collaboration Product labeling(s) desired to be achieved under this
Agreement, as determined by the CSC.


 


Section 1.104       “Target Prescribers”
means selected groups of healthcare professionals, who are authorized by applicable
law to prescribe a Collaboration Product in the Territory, that are to be
Detailed on the Collaboration Products by Sales Representatives as designated
in the applicable Marketing Plan.


 


Section 1.105       “Term” has the meaning
ascribed to it in Section 12.1 of this Agreement.


 


Section 1.106       “Territory” means the
United States of America and its territories and possessions.


 


Section 1.107       “Third Party” means
any Person who is not a Party or an Affiliate of any Party.


 


Section 1.108       “Third Party Agreements”
means the agreements with Third Parties listed on Annex E attached
hereto.


 


Section 1.109       “Third Party Infringement”
has the meaning ascribed to it in Section 9.3(b) of this Agreement.


 


Section 1.110       “Trademark” has the
meaning ascribed to it in Section 9.5 of this Agreement.


 


Section 1.111       “USD” or “$” means the lawful
currency of the United States of America, (i.e., the U.S. Dollar).


 


Section 1.112       “Weighted Average Details”
means, with respect to a Collaboration Product, the sum of (i) the product of the
total number of Primary Details (as determined by the respective Party’s call
reporting system, which shall comply with reporting standards established by
the CSC) performed by a Party’s Sales Representatives on Detailing such
Collaboration Product for the applicable reporting or reconciliation period,
times the percentage weight assigned to Primary Details (taking into account
whether such Sales Representatives are detailing two (2) Collaboration Products
or more, if applicable) in the Marketing Plan approved by the CSC for such
period, and (ii) the product of the total number of Secondary Details (as
determined by the respective Party’s call reporting system, which shall comply
with reporting standards established by the CSC) performed by a Party’s Sales
Representatives on Detailing such Collaboration Product for the applicable
reporting or reconciliation period, times the percentage weight assigned to
Secondary Details (taking into account whether such Sales Representatives are
detailing two (2) Collaboration Products or more, if applicable) in the
Marketing Plan approved by the CSC for such period.


 


12

















 


ARTICLE 2


 


GOVERNANCE
OF DEVELOPMENT AND COMMERCIALIZATION OF

COLLABORATION PRODUCTS


 


Section 2.1            Central
Steering Committee.


 


(a)           Formation.  The Parties shall promptly form a central
steering committee (the “CSC”) to oversee the Development, Promotion
and Commercialization of Collaboration Products for the Territory.  The CSC shall have an equal number of
representatives from each Party, not to exceed three (3) from each, including
one (1) co-chairperson appointed by each Party.  Either Party may replace any of its representatives at any time,
and from time to time, by giving written notice to the other Party.  Each Party must promptly fill any vacancy on
the CSC caused by the death, resignation or other physical or mental incapacity
of any of its representatives.  Each
Party shall be responsible for its own expenses of participating on the
CSC.  Each Party shall, within thirty
(30) Business Days following the Effective Date, appoint the initial members of
the CSC and provide to the other Party written notice setting forth the names
of the representatives so appointed.


 


(b)           Subcommittees.  The CSC shall organize subcommittees to
oversee activities of the Parties in the areas of Development and Promotion of
Collaboration Products in accordance with this Section 2.1(b).  Each subcommittee shall have an equal number
of representatives from each Party, not to exceed three (3) from each,
including one (1) co-chairperson appointed by each Party.  Either Party may replace any of its
representatives at any time, and from time to time, by giving written notice to
the other Party.  Each Party must
promptly fill any vacancy on a subcommittee caused by the death, resignation or
other physical or mental incapacity of any of its representatives.  Each Party shall be responsible for its own
expenses of participating in any subcommittee. 
The CSC shall prescribe rules of procedure for the subcommittees,
including but not limited to frequency of meetings and responsibility for
meeting agendas.  All decisions of a
subcommittee are subject to approval by the CSC.  In the event that any subcommittee fails to reach agreement on an
issue within its respective area of oversight, the matter shall be referred to
the CSC.  The CSC shall organize the
following subcommittees:


 


(i)            The
“Development
Committee,” which shall be responsible for planning, overseeing and
implementing the Development of Collaboration Products for the Territory.  The Development Committee shall establish a
program and plan (a “Development Program”) for each
Collaboration Product, or for each different indication for which a
Collaboration Product is being developed, as applicable, that shall, among
other things, (A) set forth a plan for achieving the Target Labeling as
approved by the CSC, (B) set forth detailed budgets for the Development Costs
to be incurred, for approval by the CSC, (C) in consultation with the Marketing
Committee, as appropriate, prescribe the non-clinical and clinical activities,
studies and trials to be conducted by the Parties, (D) specify the timing,
finalization and reporting of each such activity, study and trial, and (E)
otherwise specify all other Development activities to be conducted by the
Parties required to obtain Regulatory Approval for the Territory.   The Development Committee shall coordinate
and manage the Development activities as set forth in the Development Program
for each Collaboration Product and if necessary, shall propose amendments to
such Development Program for consideration and approval by the CSC.


 


(ii)           The
“Marketing
Committee,” which shall be responsible for planning, overseeing and
implementing the Promotion of Collaboration Products in the Territory, and for
overseeing the Commercialization of Collaboration Products in the
Territory.  The


 


13

















 


Marketing Committee shall create an annual plan for approval by the
CSC, which shall contain the elements set forth in Annex F attached
hereto, a budget for Promotion activities and an allocation of responsibility
between Teva and Acorda for the Promotion of each Collaboration Product in the
Territory, taking into account the relative strength and capabilities of each
Party in the target market (the “Marketing Plan”).  In particular, the Marketing Committee shall address issues
arising in the context of, and create a plan with a detailed budget for each
expense category and an allocation of responsibility between Teva and Acorda
for, the Promotion of Collaboration Products to: (A) managed care
organizations, pharmacy benefit managers, group purchasing organizations,
specialty pharmaceutical organizations, institutional buyers, long-term care
facilities, consulting pharmacy entities, governmental entities and other
managed care organizations in the Territory (collectively, the “Managed Care
Organizations”); and (B) Target Prescribers.  The Marketing Committee shall also set the
recommended list pricing for Collaboration Products in the Territory and shall
establish guidelines for any discount, rebate, price reduction or chargeback
programs or policies applicable to Commercialization of Collaboration Products
in the Territory.


 


(iii)         The
“Compliance
Committee,” which shall be responsible for (A) ensuring that all
Marketing Materials and Promotion of Collaboration Products comply with
applicable laws and regulations of all regulatory authorities, (B) formulating
policies regarding Promotional guidelines and grants to Target Prescribers in
respect of Collaboration Products in the Territory, and (C) such other related
compliance matters as are assigned by the CSC.


 


(iv)          Such
other subcommittee(s) within the areas of Development and Promotion as the CSC
deems necessary.


 


(c)           Rules
of Procedure, Delegation, and Binding Power of CSC.


 


(i)            In
addition to the subcommittees to be appointed pursuant to Section 2.1(b),
the CSC may prescribe such rules of procedure and may delegate such of its
oversight and responsibilities to one or more subcommittees (in each case to be
equally represented by the Parties).


 


(ii)           The
CSC shall (A) select treatment uses of a Collaboration Product for Development
by the Parties under this Agreement, as applicable;  (B) approve or disapprove all budget(s) for a Development Program
and the Development Costs associated therewith; (C) supervise and coordinate
all Development activities of the Development Committee, including, without
limitation, re-scheduling non-clinical studies and clinical trials;
establishing milestones for the completion of Development Program objectives,
including those relating to anticipated filing dates of NDAs, INDs, regulatory
filings required to initiate clinical trials, and/or similar regulatory submissions;
(D) evaluate the progress of Development Programs; (E) recommend to end the
Development of any Collaboration Product; and (F) generally supervise the
efforts of each Party to ensure that it exercises commercially reasonable
efforts to undertake and complete those portions of a Development Program for
which it is responsible.


 


(iii)         All
decisions of the CSC within its scope of oversight and made in accordance with
this Agreement, shall be binding on the Parties.


 


14

















 


(d)           Deadlock.  In the event that the CSC cannot agree on an
issue within its area of oversight or an issue properly referred to it by any
subcommittee within twenty (20) Business Days of the initial referral to it (or
such longer period as the CSC may agree), the matter shall be deemed a Dispute
that the CSC cannot resolve and it shall be resolved in accordance with the
Dispute resolution procedure set forth in Section 14.12.  Notwithstanding anything contained in this
Agreement to the contrary, with regard to any Dispute as to those matters set
forth on Annex G attached hereto, the Parties understand and agree that
such Disputes shall not be referred to binding arbitration after the above
process, but rather, Teva shall have the ultimate decision making authority in
respect of each such Dispute, which decision shall be made in good faith taking
into account the interests of Acorda under this Agreement.


 


(e)           Further
Responsibilities of the CSC.


 


(i)            The
CSC shall convene at least four (4) times annually or more frequently as it
deems necessary.  The location of the
meetings shall alternate between each Party’s facilities, or at such locations
as the Parties may otherwise agree. 
Meetings may be held by audio or video teleconference, with the consent
of each Party; provided that at least one (1) meeting per calendar year
shall be held in person.  Special
meetings of the CSC may be called on at least fifteen (15) Business Days prior
written notice by either of the co-chairpersons. Each Party shall be
responsible for all of its own expenses of participating in the CSC.


 


(ii)           Each
Party will have one (1) vote on CSC matters, which will be delivered by its
co-chairperson.  The CSC shall at all
times make decisions by unanimous vote of the two (2) co-chairpersons and may
act by unanimous written consent in lieu of a meeting.  The CSC shall keep a written record of all
its proceedings, which record shall be confirmed in writing by the two (2)
co-chairpersons.


 


(iii)         The
CSC shall manage and oversee (A) all activities of the Development Committee,
the Marketing Committee, the Compliance Committee and any other subcommittees
formed by the CSC, and (B) the implementation of the Marketing Plans,
Development Programs and other plans created by any other subcommittees formed
by the CSC.


 


(iv)          During
the period of Development of a Collaboration Product, the CSC shall keep the
Parties informed of the activities required under the Development Program(s)
and each Party shall ensure that the activities of the Development Program(s)
assigned to such Party are diligently carried out in due time.  The CSC shall establish, periodically
review, and modify (as may be necessary and advisable), all draft protocols and
draft reports (non-clinical and clinical), draft expert reports, draft
summaries and final versions of the same, and the commercial objectives and
activities set forth as part of the Development Program(s).  In connection therewith, the CSC shall
review and evaluate the Development Program for each Collaboration Product,
including any proposed amendments thereto submitted by the Development
Committee, on a calendar quarter basis. 
Any changes to a Development Program must be in writing and approved by
the CSC pursuant to the provisions hereof.


 


(v)            The
CSC shall oversee the planning and Promotion efforts of the Marketing
Committee, as well as  market support initiatives, overall marketing and brand
strategy for each Collaboration Product, and other related Promotion activities
in the Territory in


 


15

















 


accordance with the relevant annual Marketing Plan, such as
conferences, training materials and branding; provided that the CSC may amend
in writing the relevant annual Marketing Plan to deviate from the marketing strategy
set forth therein from time-to-time if and to the extent it reasonably believes
that such deviation will maximize the Parties’ profits from the Promotion
activities of the Collaboration Product in the Territory.


 


(vi)          The
CSC shall use its best efforts to timely agree on and approve all Marketing
Plans, with the expectation that such approval shall occur no later than sixty
(60) Business Days prior to the commencement of each calendar year during the
Term of this Agreement.  The CSC shall
also have final approval, exercisable through its approval of the relevant
Marketing Plan, over the allocation of Promotional responsibilities between
Teva and Acorda in the Territory with the goal of splitting such
responsibilities on a 50/50 basis.  The
CSC shall be responsible for reviewing and approving the payments to either
Party pursuant to Sections 4.2 and 4.3 with respect to Promotion activities.


 


Section 2.2            Global
Strategic Committee.


 


(a)           Without
in any manner expanding the rights provided hereunder to Acorda beyond the
Territory, the Parties shall, at Teva’s request, promptly form a global
strategic committee (the “GSC”) to oversee coordination of the global
development and global strategic promotion of Collaboration Products; provided,
however, that the GSC will not have oversight over the Development and
Promotion of Collaboration Products in the Territory, which shall be within the
sole purview of the CSC.


 


(b)           The
GSC shall be comprised of an equal number of representatives, not to exceed
three (3) representatives, from each of the following parties:  Teva, one or more Third Parties authorized
by Teva, and Acorda (each, a “GSC Party”), including one (1)
co-chairperson appointed by each GSC Party. 
Each GSC Party may replace any of its representatives at any time, and
from time to time, by giving written notice to the other GSC Parties.  Each GSC Party must promptly fill any
vacancy to the GSC caused by the death, resignation or other incapacity of any
of its representatives.  Each GSC Party
shall be responsible for its own expenses of participating on the GSC.


 


(c)           At
its initial meeting, the GSC will, in good faith, promulgate a reasonable
meeting schedule and rules of procedure.


 


Section 2.3            Nature
of Obligations Between Parties. 
Unless otherwise expressly stated, nothing contained in this Agreement
may be deemed to make any Party, or member of the CSC or GSC, or any
subcommittee formed thereunder, a partner, agent or legal representative of the
other Party.  No Party, or any member of
the CSC or GSC, or any subcommittee formed thereunder, shall have any authority
to act for, or to assume any obligation or responsibility on behalf of any
other member of such committee, or the other Party.


 


16

















 


ARTICLE 3


 


DEVELOPMENT
OF PRODUCTS


 


Section 3.1            General


 


(a)           The
Parties agree (i) unless otherwise set forth to the contrary in this Agreement
or as may otherwise be decided by the CSC, to conduct and perform jointly (on a
50/50 basis) the Development Programs for the purpose of furthering the
Development of each Collaboration Product, as those programs are promulgated by
the Development Committee and approved by the CSC, and (ii) regardless of which
Party is responsible for the performance of any specific Development activity,
to take into account, in good faith, the comments, if any, made by the other
Party in respect of such activity.


 


(b)           The
Party that is responsible for the performance of a specific activity under a
Development Program shall use commercially reasonable efforts to complete such
activity within the time frame set forth in the Development Program and to
ensure that the actual costs of such activity do not exceed the budgeted costs
therein as approved by the CSC.  If the
responsible Party believes that the actual costs in relation to a particular
activity will exceed the budgeted costs, that Party shall promptly notify the
CSC and must obtain the CSC’s approval in order to incur such excess costs,
which approval shall not be unreasonably withheld, conditioned or delayed.  The Parties agree that all costs incurred
and reported in the Development, manufacture, Commercialization and Promotion
of Collaboration Products for the Territory shall reflect each Party’s actual
costs of performing such activities and shall not include any additional cost
mark-up by, or overhead of, such Party.


 


(c)           The Parties agree to Develop the
Collaboration Products as selected by the CSC diligently and collaboratively,
using good pharmaceutical practices with the goal of maximization of profits
from the sale of Collaboration Products in the Territory.  Each Party shall use reasonable and diligent
efforts consistent with good pharmaceutical practices to perform the tasks
assigned to it under the Development Program. 
Subject to confidentiality, non-disclosure and similar undertakings,
each Party shall provide the CSC, or any duly authorized representatives of the
CSC, with reasonable access during regular business hours to all of its records
and documents that are specific to the Development of any Collaboration Product
that the CSC may reasonably require in order to perform its obligations
hereunder.  In addition, each Party
shall report to the CSC in writing, in a format and on a schedule established
by the CSC, summarizing the results of such Party’s Development work and
efforts and identifying any significant matters, developments or issues.


 


(d)           Upon
successful completion of a Development Program, or earlier as reasonably
determined by Teva, Teva, in consultation with Acorda, shall use commercially
reasonable efforts to seek Regulatory Approval for the relevant Collaboration
Product in the Territory.  As between
Teva and Acorda, Teva shall be the sole owner of all Regulatory Approvals (as well
as applications, including without limitation, INDs and NDAs) (all of which
shall be applied for in the name of Teva or one of its Affiliates) received
with respect to all Collaboration Products. 
Teva shall also be responsible for and perform all activities relating
to the maintenance of such Regulatory Approvals in the Territory during the
Term of this Agreement.  With respect to
Teva seeking and maintaining Regulatory Approval for a Collaboration Product in
the Territory, Teva shall provide copies to Acorda of any proposed filings and
material correspondence related thereto in sufficient time for Acorda to
provide its comments, if any, prior to submission.  Teva shall consider Acorda’s comments in good faith and shall, to
the extent practicable, otherwise consult with Acorda in such activities.  If there are any


 


17

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have been
separately filed with the Commission.


 


meetings with the FDA concerning such Regulatory Approvals, Teva shall,
to the extent practicable, provide sufficient notice to Acorda to enable Acorda
to attend such meetings.


 


(e)           The
Parties understand and agree to conduct all pre-clinical and clinical research
and studies involving Collaboration Products in accordance with then-current
good laboratory practices and good clinical practices, as specified by the
applicable laws and regulations in the country where such research and studies
are performed.


 


Section 3.2            Development
of the Lead Indication.


 


(a)           Acorda
shall perform all activities related to the Development of a Collaboration
Product as an adjunct therapy for the treatment of epilepsy (the “Lead
Indication”) as required to obtain and maintain (for and in the name
of Teva) the necessary Regulatory Approvals in the Territory, all in accordance
with the Development Program for the Lead Indication and the provisions of this
Section 3.2.  Teva will have the right
to participate and be involved actively in all such Development activities
undertaken by Acorda.


 


(b)           Without
limiting any of Acorda’s other obligations hereunder, and notwithstanding any
other provision of this Agreement to the contrary, Acorda shall bear [***] of
the Development Costs, as incurred, for the Next Trial and the carcinogenicity
study to be conducted for a Collaboration Product for the Lead Indication, each
as more particularly described in Annex H attached hereto, and any
pre-clinical studies, drug interaction studies or other testing that the FDA
requires or the CSC desires to conduct for a Collaboration Product for the Lead
Indication.  Teva shall supply
Collaboration Product [***] for conducting the Next Trial.  Acorda shall use commercially reasonable
efforts to complete the Next Trial by the first quarter of 2006, subject to any
unexpected delays caused by matters outside of Acorda’s control (such as
FDA-required additional studies or delays). 
[***] of the Development Costs (as approved by the Development Committee
or the CSC) expended by Acorda for the carcinogenicity study, or the
aforementioned pre-clinical studies, drug interaction or other testing
(excluding the Next Trial) for the Collaboration Product for the Lead
Indication will be credited against and deducted from the payment due Teva
pursuant to Section 4.1(c).


 


(c)           After
completion of the Next Trial, if the FDA requires further clinical trials or
other studies (in addition to those referred to in Section 3.2(b) hereof)
to obtain Regulatory Approval of the Collaboration Product for the Lead
Indication in the Territory, then the Parties shall perform such trials and
studies only if the CSC desires to perform same.  In the event the CSC so desires to perform such additional trials
or studies, then the Parties shall share the Development Costs thereof on a
50/50 basis in accordance with the applicable Development Program.  If on the other hand the CSC does not desire
to perform same, such lack of desire shall be considered a decision by the CSC
and, accordingly, not subject to the provisions of Section 2.1(d) hereof.


 


Section 3.3            Development
of Secondary Indications.


 


(a)           The
CSC shall, promptly after the Effective Date, decide whether it is commercially
desirable to develop a Collaboration Product for use in the treatment of
bipolar


 


18

















 


disorder or neuropathic pain (such indications, the “Secondary
Indications”), in addition to the Lead Indication.  Following the CSC’s decision, the
Development Committee (with the approval of the CSC) shall establish a human
clinical trial to be implemented by the Parties for the chosen indication (the
“Proof of
Concept Trial”), which the Parties agree shall be tailored in scope
and size to provide only the necessary information to determine whether such
Collaboration Product achieves the proof of concept criteria established by the
Development Committee and approved by the CSC for such indication.  Such clinical trial shall be conducted by
the Parties contemporaneously, or as close in time as is commercially
practical, with the Next Trial for the Lead Indication (as discussed in
Section 3.2(b) above).  The Parties
shall use commercially reasonable efforts to complete such Proof of Concept
Trial by the first quarter of 2006, subject to any unexpected delays caused by
matters outside of Acorda’s control (such as FDA-required additional studies or
delays).  The costs of such Proof of
Concept Trial shall be deemed Development Costs, which the Parties shall share
on a 50/50 basis.


 


(b)           The
Secondary Indication not chosen by the CSC to be the subject of the Proof of
Concept Trial under Section 3.3(a), will be subject to further Development
by the Parties, if at all, only as permitted in, and in accordance with, the
provisions of Section 3.5.


 


(c)           Within
sixty (60) Business Days of the code opening of the Proof of Concept Trial, the
CSC shall decide whether it is commercially desirable to further pursue the
Development of the Collaboration Product for the applicable indication.  If the CSC timely decides to pursue such
further Development, then the Collaboration Product will be Developed for such
indication pursuant to the terms and conditions of this Agreement under a Development
Program to obtain and maintain the necessary Regulatory Approvals in the
Territory, and such Development shall be funded by the Parties on a 50/50 basis
and overseen by the CSC.


 


(d)           Notwithstanding
anything contained herein to the contrary, if the CSC does not choose within
sixty (60) Business Days of the code opening of the Proof of Concept Trial to
further pursue the Development of the Collaboration Product for either or both
of the Secondary Indications, then either Party may conduct the further
development of the Collaboration Product for such indication as an Independent
Party only as permitted in, and in accordance with, the provisions of
Section 3.5 applicable to Independent Development.


 


Section 3.4            Development
of a Multiple Sclerosis Indication.


 


(a)           Except
as expressly provided in this Section 3.4, and for the avoidance of doubt,
the Development, Commercialization, Promotion and sale of a Collaboration
Product for the treatment of Multiple Sclerosis is excluded from the scope of
this Agreement.  Teva and/or its
Affiliates may develop, promote, market, sell and commercialize a product
containing the Compound specifically to treat Multiple Sclerosis (the “MS
Product”).  In the event that Teva
and/or any of its Affiliates elects to undertake such activities with respect
to the MS Product in the Territory, alone rather than in collaboration with a
Third Party, it shall provide Acorda with written notice thereof [prior to commencing Phase III trials on
the MS Product].  Following such notice, the Parties shall
meet (at a time and place mutually convenient) to discuss the impact, if any,
that any potential off-label sales of the MS Product in the Territory or of
Collaboration Products in the Territory may have on the sales of the other and
the resulting impact on Copromotion Profits yielded therefrom or Teva sales of
the MS Product in the Territory,


 


19

















 


respectively.  The Parties shall
then negotiate in good faith and agree on an amendment to this Agreement to
provide for an annual adjustment and reconciliation, based on a reasonable and
mutually agreed procedure, for addressing in a fair manner any such impact on
Copromotion Profits, and/or on Teva’s sales of MS Products, based on any such
off-label sales, with the understanding that the Parties will employ, in such
procedure, the best available resources for determining actual sales of
Collaboration Products and MS Products, respectively, for uses for treatment of
Multiple Sclerosis, as distinct from sales for all other uses developed hereunder,
and with the further understanding that such adjustment or reconciliation for
the first year of sales of the MS Product, after regulatory approval in the
Territory of such product, would necessarily involve an agreed approximation of
expected sales, with a reconciliation after the end of such year, based on
actual results from such year (as determined using such available
resources).  If the Parties are unable
to reach agreement on such amendment within sixty (60) Business Days, of
Acorda’s receipt of Teva’s notice, the matter shall be resolved pursuant to
Section 14.12.


 


(b)           Further,
notwithstanding the foregoing, if Teva desires to license a Third Party to
develop and commercialize an MS Product (alone or in collaboration with Teva)
in the Territory, then prior to entering into any bona fide negotiations with
such a Third Party, Teva shall provide written notice thereof to Acorda.  If within sixty (60)  Business Days of Acorda’s
receipt of Teva’s notice under this subsection (b), Acorda provides written
notification to Teva of its desire to Develop a Collaboration Product for the
treatment of Multiple Sclerosis under this Agreement with Teva, then the
Collaboration Product will be Developed for Multiple Sclerosis pursuant to the
terms and conditions of this Agreement under a Development Program to obtain
and maintain the necessary Regulatory Approvals in the Territory, and such
Development shall be funded by the Parties on a 50/50 basis and overseen by the
CSC in accordance with the applicable provisions of this Agreement.  If Acorda declines to pursue such
Development, or does not respond to such Teva notice, by the end of such sixty
(60) Business Day period, Teva shall no longer have any obligation under this
Agreement or otherwise to further negotiate or proceed with Acorda with respect
to the Development of a Collaboration Product for the treatment of Multiple
Sclerosis and shall thereafter be free to develop, commercialize, promote and
sell the Compound for the treatment of Multiple Sclerosis in the Territory
outside the scope of this Agreement, itself or with any Third Party.


 


(c)           For
the avoidance of doubt, Acorda has no rights whatsoever under this Agreement or
otherwise with respect to the Compound for the treatment of Multiple Sclerosis
outside the Territory (including, without limitation, the right to receive
royalties in respect thereof, unless a Collaboration Product is Developed under
this Agreement for treatment of Multiple Sclerosis in the Territory, and
Section 4.2(a)(iii) applies to Teva’s (or its Affiliate’s or licensee’s)
use of the results of such Development work outside the Territory).  Neither Party has any obligation whatsoever
to collaborate with the other to develop the Compound for a Multiple Sclerosis
indication outside the Territory and Teva is free to collaborate at any time
with a Third Party to develop, or to develop on its own, the Compound for the
treatment of Multiple Sclerosis outside the Territory.  For clarity, as used in this section,
“Collaboration Product (or Compound) for the treatment of Multiple Sclerosis”
means a Collaboration Product (or Compound) or an MS Product with Multiple
Sclerosis as a labeled treatment indication, and any use of a Collaboration
Product (or Compound) to treat any secondary condition associated with Multiple
Sclerosis (e.g., neuropathic pain or muscle weakness) that is not already being
Developed pursuant to Section


 


20

















 


3.3, will be deemed a Proposed Use, subject to the provisions of
Section 3.5 and not the provisions of this Section 3.4.


 


Section 3.5            Development
of Other Indications and/or Dosage Forms.


 


(a)           At
any time after the Effective Date, either Party may make a written proposal to
the CSC regarding the Development of a Collaboration Product for any
indication, and/or dosage form, and/or other formulation (such as an
extended-release formulation), that is not then being Developed or
Commercialized, for Commercialization within the Territory under this Agreement
(a “Proposed
Use”), including any Secondary Indication not selected or pursued
under Section 3.3, but excluding a Multiple Sclerosis indication, which
may only be proposed by Teva to Acorda in accordance with Section 3.4
above.  Such proposal shall include (i)
any data and other information in its possession that may be relevant to the
use of a Collaboration Product for such Proposed Use, (ii) a reasonably
detailed outline for the major Development activities required to obtain
Regulatory Approval for such Proposed Use in the Territory, including a
timeline for performing such activities, (iii) an estimated budget for the
expected Development Costs, Copromotion Expenses, Production Costs and
Distribution Costs for the Development and Copromotion of a Collaboration
Product for such Proposed Use, (iv) an appropriate market analysis of such
Proposed Use, including, without limitation, expected market size and
competitive analysis, and (v) preliminary sales forecasts for the Collaboration
Product for such Proposed Use. 
Thereafter, the CSC shall meet in order to review such proposal.


 


(b)           The
CSC will have ninety (90) Business Days, or such longer period as the Parties
may mutually agree, from receipt of such proposal (the “Additional Indication Review Period”)
to decide whether the Development of a Collaboration Product for such Proposed
Use is commercially desirable to both Parties. 
If such proposal is accepted by the CSC, then the Parties will jointly
Develop the appropriate Collaboration Product for such Proposed Use pursuant to
the terms and conditions of this Agreement, including establishing a
Development Program for such Proposed Use by the CSC and funding by the Parties
on a 50/50 basis.  If the CSC rejects a
proposal for a Proposed Use, or does not make a decision within the applicable
Additional Indication Review Period, a Collaboration Product for such Proposed
Use may be developed independently by either Party (an “Independent Party”), at the
Independent Party’s sole cost and expense, but otherwise subject to the
applicable terms and conditions of this Agreement (such independent development
for such Proposed Use, “Independent Development”), by providing
written notice thereof to the other Party. 
Notwithstanding the foregoing, if Acorda decides to pursue such
Independent Development and provides written notice thereof to Teva, Acorda
shall not be permitted to engage in any such Independent Development without
Teva’s prior written consent, which shall not be unreasonably withheld or
delayed.  Teva shall include in any such
written consent a determination as to whether it has the intention and
commitment to manufacture and supply the Collaboration Product for such
Proposed Use to Acorda, in the event that Teva does not exercise the
Re-Engagement Option for such Proposed Use in accordance with
Section 3.5(c).  If Teva determines
that it shall not manufacture and supply to Acorda the Collaboration Product
for such Proposed Use hereunder, Acorda shall be prohibited from undertaking
Independent Development for such Proposed Use. 
Upon receipt of Teva’s written consent, Acorda may commence such
Independent Development and shall provide Teva with written notice of the
commencement thereof.  Notwithstanding
the foregoing, if, at any time during Independent Development of a
Collaboration Product for a


 


21

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


Proposed Use, Teva determines, in its reasonable business and/or
scientific judgment, that the continuation of such Independent Development
activities could reasonably be anticipated to have a material detrimental
impact upon Teva, the Compound, any Collaboration Product or any of Teva’s
other rights or obligations, than such Independent Development activities shall
cease.  If Teva makes such a
determination, it shall reimburse Acorda for the actual direct out-of-pocket
costs incurred by Acorda as a result of such Independent Development
activities, but such reimbursement shall not include the payment of any
interest thereon.


 


(c)           If
a Party undertakes the Independent Development of a Collaboration Product for a
Proposed Use pursuant to Section 3.5(b), then such Independent Party, with
respect to such Proposed Use, shall: 
(i) provide the CSC with a summary of its development plans and
accommodate any reasonable comments of the CSC, to ensure that such development
efforts are coordinated with and not contrary to the joint Development efforts
of the Parties on Collaboration Products; (ii) provide the other Party (the “Non-Participating
Party” as to such development) with quarterly written summaries of
the data and results of such development efforts as to such Proposed Use; and
(iii) provide written notices to the Non-Participating Party promptly after
completion of each stage, including the proof of concept clinical trial, the
first Pivotal Trial and the second Pivotal Trial, for the relevant Proposed Use
of a Collaboration Product.  Such
Non-Participating Party shall have the exclusive option to re-engage after the
completion of each stage in the joint Development and Promotion of the Collaboration
Product for such Proposed Use (a “Re-Engagement Option”), which shall be
exercisable by the Non-Participating Party, by notifying the Independent Party
in writing of its election, promptly after the completion of each stage for
such Proposed Use and before the Independent Party’s receipt of an Approvable
Letter for such Proposed Use, or, absent such Approvable Letter, before the
Independent Party’s receipt of Regulatory Approval in the Territory for such
Proposed Use of a Collaboration Product. 
Exercise of a Re-Engagement Option shall be subject to the following
terms and conditions:


 


(i)            Within
fifteen (15) Business Days of exercise of the Re-Engagement Option as to a
particular Proposed Use, the Non-Participating Party shall pay to the
Independent Party an amount (the “Re-Engagement Fee”) equal to the sum
of:  (A) [***] of all Independent
Development Costs incurred by the Independent Party through the date of payment
(the “Development
Share”), plus (B) the following additional amount, as applicable:
(1) if the Non-Participating Party exercises the Re-Engagement Option after the
completion of the proof of concept clinical trial but before the completion of
the first Pivotal Trial for the relevant Proposed Use, a risk factor mark-up of
an additional [***] of such Development Share; 
(2) if the Non-Participating Party exercises the Re-Engagement Option
after completion of the first Pivotal Trial but before the completion of the
second Pivotal Trial for the relevant Proposed Use, a risk factor mark-up of an
additional [***] of such Development Share; or (3) if the Non-Participating
Party exercises the Re-Engagement Option after the completion of the second
Pivotal Trial but before the Independent Party’s receipt of an Approvable
Letter for such Proposed Use, or, absent such Approvable Letter, before the
Independent Party’s receipt of Regulatory Approval in the Territory for such
Proposed Use, a risk factor mark-up of [***] of such Development Share; provided
that, the Non-Participating Party may, at its discretion, satisfy
any such payment due under subsection 3.5(c)(i)(B)(3) in two equal
quarterly installments, each of which shall be due on the last day of the
following two (2) calendar quarters, respectively, after exercise of the
Re-Engagement


 


22

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


Option.  As used in this
Section, the phrase “completion of” a particular Clinical Trial means
completion of conducting the trial, analyzing all data and results of the
trial, preparing the final and complete report of such analyzed data, and
delivering all such data, analysis and report to the Non-Participating Party.


 


(ii)           Effective
upon the exercise of the Re-Engagement Option and satisfaction by the
Non-Participating Party of the payment conditions set forth under, and in
accordance with, Section 3.5(c)(i) above, the relevant Proposed Use for
the appropriate Collaboration Product will be Developed and Promoted by the
Parties jointly pursuant to the terms and conditions of this Agreement, which
shall include establishing a Development Program for such Proposed Use by the
CSC for such Collaboration Product and funding of any Development and Promotion
activities by the Parties for such Proposed Use on a 50/50 basis, and the
Independent Development of such Proposed Use shall terminate.  The Independent Party that had been
conducting Independent Development of such Proposed Use shall disclose to the
Non-Participating Party all data and results of such development.


 


(iii)         The
Parties will share, on a 50/50 basis, any Development Costs that are incurred
by either Party following the date of exercise of the Re-Engagement Option, in
accordance with a Development Program approved by the CSC, for the Proposed Use
of such Collaboration Product (which shall include any such costs of the
Independent Party that were committed but not yet incurred under its
development of such Proposed Use).


 


(iv)          If
the Non-Participating Party does not exercise the Re-Engagement Option prior to
the Independent Party’s receipt of an Approvable Letter in respect of the
relevant Proposed Use of the appropriate Collaboration Product, or, absent such
Approvable Letter, before the Independent Party’s receipt of Regulatory
Approval in the Territory for such Proposed Use, then the Non-Participating
Party shall be barred from re-engaging in the joint Development and Promotion
of the Collaboration Product for such Proposed Use, and the Independent Party
shall thereafter be entitled to commercialize, promote and sell such
Collaboration Product (in the Territory only, in the case in which Acorda is
the Independent Party), independently at its own cost and expense, subject to
the following:


 


(1)           Promptly
after receipt of such Approvable Letter or Regulatory Approval (as applicable)
in the Territory for the Independent Use, Teva and Acorda shall meet and
discuss in good faith and agree on an amendment to the Agreement to provide for
an annual adjustment, based on a reasonable and mutually agreed procedure, to
the sharing of the Copromotion Profits such that the Independent Party (as to
such Independent Use) shall receive [***] of the Copromotion Profits resulting
from its commercialization and promotion activities with respect to sales of
the applicable Collaboration Product in the Territory for the Independent Use,
with the understanding that the Parties will employ, in such procedure, the
best available resources for determining actual sales of Collaboration Product
for such Independent Use, as distinct from sales for uses that are Developed
jointly by the Parties hereunder, and with the further understanding that such
adjustment for the first year of sales of the Collaboration Product for the
Independent Use after Regulatory Approval would necessarily involve an agreed
approximation of expected sales, with a reconciliation after the end of such
year, based on actual results from such year (as determined using such
available resources).


 


23

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


(2)           In
addition, if the Non-Participating Party is Teva, then Teva or its designee
will have the right to be the exclusive manufacturer and supplier of the
subject Collaboration Product for the Independent Use, and the Parties shall
enter into a detailed manufacturing, supply and license agreement, to be
negotiated in good faith, which agreement shall incorporate the applicable
terms and conditions of this Agreement, and where the supply of the
Collaboration Product for such Independent Use shall be on commercially
reasonable terms typical for similar Third Party manufacturing and supply
agreements.


 


Section 3.6            Option
Studies.  The Parties may, from time
to time, consider whether to undertake any particular Option Study proposed by
either Party with respect to a Collaboration Product for the Lead
Indication.  For the purposes of this
provision, an “Option Study” shall mean a Phase IV human clinical trial
initiated after receipt of initial Regulatory Approval in the Territory.  If, within ninety (90) days of any such
Option Study proposal by a Party, (i) the Parties consider such proposed Option
Study to be commercially viable, then such Option Study shall be performed
under this Agreement, and it shall be funded by the Parties on a 50/50 basis,
or (ii) either Party does not approve of, or wish to undertake such proposal,
then the other Party may, upon written notice to the other Party, undertake
such Option Study at its sole cost and expense; provided that,
notwithstanding the foregoing, if the Option Study is successful, then the
Party that undertook the Option Study will be reimbursed for an amount equal to
the sum of [***] of all costs and expenses incurred or committed by such Party
in connection with conducting such Option Study, plus a risk factor mark-up of
an additional [***] of the [***] share. 
For the purposes of this provision an Option Study shall be considered
to be successful if the study end points or if the study goals are substantially
achieved.


 


ARTICLE 4

FINANCIAL
PROVISIONS


 


Section 4.1            Milestone
and Other Payments.  Acorda shall
make each of the following payments to Teva upon achievement of the respective
milestones indicated below:


 


(a)           $2,000,000
upon Acorda's execution of this Agreement; plus


 


(b)           [***]
upon the code break of the last Pivotal Trial approved by the CSC for the first
Collaboration Product in the Territory; plus


 


(c)           [***]
upon the first filings of an NDA for the first Collaboration Product in the
Territory; plus


 


(d)           [***]
upon the approval by the FDA of the NDA for the first Collaboration Product in
the Territory.


 


24

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


Section 4.2            Co-Promotion
Profit Sharing.


 


(a)           Payments.


 


(i)            If,
within any calendar quarter during the Term of this Agreement, the Copromotion
Profit is a positive number, Teva shall, pursuant to the provisions of
Section 4.2(b), pay to Acorda a fee in an amount equal to [***] of the
Copromotion Profit.


 


(ii)           If,
within any calendar quarter during the Term of this Agreement, the Copromotion
Profit is a negative number, Acorda shall, pursuant to the provisions of
Section 4.2(b), pay to Teva a fee in an amount equal to [***] of the
absolute value of the Copromotion Profit.


 


(iii)         During
the Term of this Agreement, Teva shall pay to Acorda, on a country-by-country
basis, a fee based on sales by Teva or Teva’s Affiliates of Collaboration
Product(s) outside the Territory, if any, in an amount equal to [***] of Net
Sales in each country outside of the Territory, where, in each such instance,
clinical data developed jointly by the Parties or independently by Acorda under
this Agreement is used to obtain Regulatory Approval in such country and
provided that such clinical data constitutes a material part of the clinical
data used for such approvals.  For the
purposes of this Section 4.2(a)(iii), the term “Net Sales,” as defined in
Section 1.70, will be deemed to mean the total gross amount invoiced for
sales of the aforementioned Collaboration Products in such countries outside of
the Territory less the deductions as described in Section 1.70, to the
extent actually allowed or incurred with respect to such sales, as
applicable.  For clarity, the above
royalty obligation shall not apply to any Net Sales of Collaboration Product(s)
for indications or uses that are not jointly developed by the Parties under
this Agreement, or after an Indication Termination as to an indication or use
under this Agreement in accordance with Section 12.2(b).


 


(b)           Payment
Date.  Each Party shall, within
seven (7) Business Days after each Quarterly Reconciliation Date, pay to the
other Party any amounts owed under this Section 4.2 and Section 4.3,
as applicable; provided that the Party required to make the payment shall have
received an invoice covering such amount at least ten (10) Business  days
prior to the Quarterly Reconciliation Date.


 


Section 4.3            Reporting;
Reconciliation of Accounts and Reimbursement.


 


(a)           Teva
and Acorda shall conduct an accounting of Net Sales and Gross Sales, and a
reconciliation of Copromotion Expenses, all on a Collaboration
Product-by-Collaboration Product basis, as follows:


 


(i)            Within
ten (10) Business Days after the end of each month, each Party shall submit to
the other Party and the CSC (or its authorized subcommittee) a monthly itemized
report (the “Monthly Report”), in reasonable detail, of all Copromotion
Expenses incurred by it during the preceding month, together with such
information as further described in Section 4.3(b)(i) with respect to
Development Costs.  Teva’s Monthly
Report shall also include all Gross Sales and calculation of Net Sales,
including details on the basis for any deductions, during the preceding month.


 


(ii)           Within
thirty (30) Business Days after the end of each calendar quarter, each Party
shall submit to the other Party and the CSC (or its authorized subcommittee) a
quarterly itemized report (a “Quarterly Report”) in reasonable detail of
all Copromotion


 


25

















 


Expenses incurred by it during the preceding calendar quarter, together
with such information as is required by the CSC to reconcile such Copromotion
Expenses and such information as further described in Section 4.3(b)(ii)
with respect to Development Costs.


 


(iii)         In
addition to the information required under Section 4.3(a)(ii), Teva’s
Quarterly Report shall specify:  (A) the
total Gross Sales and calculation of Net Sales of such Collaboration Product,
including details on the basis for any deductions, during the preceding
calendar quarter in the Territory, including all information required for
calculation of such quarterly period Net Sales and Gross Sales, respectively,
as required by the CSC, and (B) the total Distribution Costs in the Territory
during such calendar quarter, including all information required for
calculation of such quarterly Distribution Costs, as agreed upon by the CSC.


 


(iv)          Prior
to the date that is sixty (60) Business Days after the end of each calendar
quarter (the “Quarterly Reconciliation Date”), the CSC shall (A) reconcile
for such calendar quarter, the Parties’ respective Copromotion Expenses (the “Quarterly
Copromotion Expenses”) and (B) determine the aggregate Gross Sales
for such calendar quarter with regard to applicable Collaboration Product.  Issues arising in the context of any such
reconciliation shall be resolved by the CSC, which shall be required to sign
off on any reconciliation as promptly as possible, but, in any event, by no
later than the applicable Quarterly Reconciliation Date.


 


(v)            Teva
shall, pursuant to Section 4.2(b), reimburse Acorda for the Quarterly
Copromotion Expenses, if any, incurred by Acorda.


 


(b)           Teva
and Acorda shall conduct a reconciliation of the Development Costs, on a
Collaboration Product-by-Collaboration Product basis, as follows:


 


(i)            The
Parties’ Monthly Report shall also include an itemized report in reasonable
detail of the total Development Costs incurred by each Party during the
preceding month, as well as that portion of such Development Costs as to which
this Agreement provides for the sharing on a 50/50 basis by the Parties.


 


(ii)           The
Parties’ Quarterly Report shall also include an itemized report in reasonable
detail of the total Development Costs incurred by each Party during the
preceding calendar quarter, as well as that portion of such Development Costs
as to which this Agreement provides for the sharing on a 50/50 basis by the
Parties (such portion, the “Quarterly Participation Costs”), together
with such information as is required by the CSC to reconcile such Quarterly
Participation Costs.


 


(iii)         Prior
to the Quarterly Reconciliation Date, the CSC shall reconcile for such calendar
quarter the Quarterly Participation Costs. 
Issues arising in the context of any such reconciliation shall be
resolved by the CSC, which shall be required to sign off on any such
reconciliation as promptly as possible, but, in any event, by no later than the
applicable Quarterly Reconciliation Date.


 


(iv)          If
the Quarterly Participation Costs of one Party are higher than the Quarterly
Participation Costs of the other Party, then the Party with lower Quarterly
Participation


 


26

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with brackets
[   ] and an asterisk*, have been
separately filed with the Commission.


 


Costs shall, pursuant to Section 4.2(b), pay to the other Party
the reimbursement amount calculated pursuant to the following formula:


 


	
   

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Where

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  RA = reimbursement amount

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [***]

  	
   

  



 


Section 4.4            Mechanics
of Reconciliation.  The following
applies to reconciliation of Copromotion Expenses:


 


(a)           The
CSC shall agree on a common cost per Sales Representative, Professional
Education Manager, Scientific Manager and Account Manager (each, the “Common Cost
Per Sales Representative,” “Common Cost Per Professional Education Manager,”
“Common
Cost Per Scientific Manager,” and “Common Cost Per Account Manager,”
respectively), which cost shall be based upon actual commercially reasonable
costs for each such function, and shall be used by the Parties for purposes of
preparing the joint profit and loss statements required hereunder and for
billing Copromotion Expenses, on a Collaboration Product-by-Collaboration
Product basis, and updated annually. 
For purposes of calculating costs under this Section 4.4(a), each
Party shall only allocate those costs that are directly attributable to such
functions for Collaboration Products and shall not include costs relating to
each respective Party’s other products (i.e., other than Collaboration Products)
in such calculation of Copromotion Expenses. 
To the extent that a cost is attributable to both Collaboration Products
and other products of a Party, only that portion of the cost attributable to
Collaboration Products shall be included in the calculation.  The aforementioned common costs shall, in
every year in which determined by the CSC, take into account the factors set
forth on Annex D attached hereto.


 


(i)            The
Parties’ sales force costs for Promoting Collaboration Products in the
applicable period shall be determined by multiplying the Common Cost Per Sales
Representative by (A) the number of Sales Representatives that are Detailing
one or more Collaboration Products, in accordance with an approved Marketing
Plan and their field-based management, on a full-time basis, and (B) a
fraction, the numerator of which is the Weighted Average Details and the
denominator of which is the total number of Details (as determined by the
respective Party’s call reporting system, which shall comply with reporting
standards established by the CSC) delivered by the Sales Representatives
included in the Weighted Average Details for all Collaboration Products
Detailed by such Sales Representatives.


 


(ii)           The
Parties’ Professional Education Manager costs for Promoting Collaboration
Products in the applicable period, shall be determined by multiplying the
Common Cost Per Professional Education Manager by an amount equal to the sum
of: (A) the number of Professional Education Managers working with one or more
Collaboration Products, in accordance with an approved Marketing Plan and their
field-based management, on a full-time


 


27

















 


basis, plus (B) that number equal to (1) the number of Professional
Education Managers working with one or more Collaboration Products, in
accordance with an approved Marketing Plan and their field-based management, on
a part-time basis, multiplied by (2) a fraction that is agreed upon annually by
the CSC, to reasonably reflect the average percentage of time that such
part-time managers dedicate to working with Collaboration Products.


 


(iii)         The
Parties’ Scientific Manager costs for Promoting Collaboration Products in the
applicable period, shall be determined by multiplying the Common Cost Per
Scientific Manager by an amount equal to the sum of:  (A) the number of Scientific Managers working with one or more
Collaboration Products in accordance with an approved Marketing Plan and their
field-based management, on a full-time basis, plus (B) that number equal to (1)
the number of Scientific Managers working with one or more Collaboration
Products in accordance with an approved Marketing Plan and their field-based management,
on a part-time basis, multiplied by (2) a fraction that is agreed upon annually
by the CSC, to reasonably reflect the average percentage of time that such
part-time managers dedicate to working with Collaboration Products.


 


(iv)          The
Parties’ Account Manager costs for Promoting Collaboration Products in the
applicable period shall be determined by multiplying the Common Cost Per
Account Manager by an amount equal to the sum of:  (A) the number of Account Managers working with one or more
Collaboration Products in accordance with an approved Marketing Plan and their
field-based management, on a full-time basis, plus (B) that number equal to (1)
the number of Account Managers working with one or more Collaboration Products
in accordance with an approved Marketing Plan and their field-based management,
on a part-time basis, multiplied by (2) a fraction that is agreed upon annually
by the CSC, to reasonably reflect the average percentage of time that such
part-time managers dedicate to working with Collaboration Products.


 


Section 4.5            General.


 


(a)           All
applicable costs and expenses incurred by the Parties under this Agreement
shall be charged at cost (without markup or any other allocation of overhead)
for the purpose of calculating Copromotion Expenses and Development Costs, all
in accordance with GAAP.


 


(b)           Each
Party shall maintain accurate accounts and records reflecting such Party’s
actual Copromotion Expenses and Development Costs, on a Collaboration
Product-by-Collaboration Product basis, in sufficient detail to facilitate any
reconciliation required hereunder, and with regard to Teva, accounts and
records relating to Production Costs, Distribution Costs, Gross Sales and Net
Sales on a Collaboration Product-by-Collaboration Product basis.  All accounts and records evidencing
revenues, deductions, fees, expenses, costs and reconciliations relating to
Collaboration Products shall be subject to audit by an independent auditor of
recognized national standing selected by the Party requesting such audit, reasonably
acceptable to the other Party and subject to the execution of a
confidentiality/non-disclosure agreement reasonably acceptable to the other
Party; provided, however that:  (i) no
Party may require more than one such audit in any calendar year; (ii) audits
may not be conducted in a manner or at any time that would conflict with the
fiscal year end of the Party being audited or


 


28

















 


Certain portions of this Exhibit have been omitted pursuant to a request
for confidentiality. Such omitted portions, which are marked with brackets
[   ] and an asterisk*, have been
separately filed with the Commission.


 


that would fall within any “blackout” periods agreed by the Parties;
(iii) twenty (20) Business Days prior notice will be given by the Party
requiring the audit to the other Party; (iv) all audits will be completed
within a period not to exceed thirty (30) Business Days; (iv) the auditor’s
fees and expenses will be for the account of the Party requesting the audit,
provided, however, that if it is determined that such Party was underpaid or
overpaid by more than five (5%) percent of the amount properly due, then the
other Party shall reimburse such Party the fees and expenses of such audit,
together with the sum of such underpayment or overpayment plus interest at the
rate of twelve (12%) percent per annum or the maximum rate allowed by
applicable law, whichever is lower; and (v) the audits shall be conducted in a
manner that minimizes any disruption to the audited Party’s business.  The Party invoking the audit hereunder shall
ensure that any independent auditor performing the audit shall be subject to a
confidentiality agreement sufficient to comply with such the confidentiality
obligations set forth in Article 10 hereof.  The internal expenses of any Party subject to audit will be for
such Party’s account and any overage or underpayment will be promptly refunded
or paid, as the case may be.


 


(c)           Copromotion
Expenses shall include the costs of non-field based personnel as described in Annex
D attached hereto if and only to the extent included in the budget in the
applicable Marketing Plan, but not include the cost to the Parties of senior
management personnel or other overhead costs, except as otherwise expressly
provided to the contrary herein or agreed to by the CSC.


 


(d)           The
CSC (or its authorized subcommittee) will be required to approve any
reconciliation of Copromotion Expenses and Quarterly Participation Costs
amounts due by the Parties prior to the payment of any reimbursement amounts
due.


 


(e)           Sales
force costs and all other Promotion costs and expenses, to be reimbursable as
Copromotion Expenses in any year after the relevant Collaboration Product
Launch Date, shall not exceed [***] of amounts budgeted for such costs in the
relevant Marketing Plan, without the approval of the CSC not to be unreasonably
withheld.


 


(f)            Teva
shall prepare and file all sales, income (excluding Acorda income tax filings)
and use tax returns and related filings relating to the Promotion and
Commercialization of Collaboration Products in the Territory, and will pay all
taxes payable for such purposes, which payments shall be considered Quarterly
Copromotion Expenses incurred by Teva for the relevant period except to
the extent that any such tax payments have already been deducted from Gross
Sales in calculating Net Sales.


 


(g)           Any
disagreement regarding payment amounts owed to Teva or Acorda shall be
submitted to the CSC promptly for resolution.


 


(h)           Each
Party shall maintain its financial records relating to this Agreement for the
period as follows:  (i) a minimum period
of five (5) years for all tax return records and (ii) three (3) years for all
other financial records, in each case, from the date that such records were
created.


 


29

















 


(i)            All
amounts due to Teva and/or Acorda under this Agreement shall be paid by wire
transfer to such bank as Teva and/or Acorda, as the case may be, may direct
from time to time.  All bank expenses
incurred by the remitting Party in making such wire transfers will be for its
account.


 


(j)            All
payments of any amounts pursuant to this Agreement shall be made in USD.  To the extent amounts are incurred in a
currency other than USD, the applicable amount will be converted into USD on a
quarterly basis using as a rate of exchange the arithmetic average of the
applicable actual foreign currency exchange rate for the quarter in which the
income is received or expense is incurred, as quoted at the closing of each
Business Day by the Reuters News Service for the applicable quarter.


 


(k)           All
payments of any amounts pursuant to this Agreement must be in compliance with
applicable tax withholding obligations. 
Each Party shall be entitled to withhold any amounts required to be
withheld by any applicable law from the amounts payable to the other
Party.  The Party withholding any such
amounts will provide the other Party with all relevant information and
documentation with respect to the amounts so withheld.


 


ARTICLE 5


 


COPROMOTION;
PROMOTIONAL EFFORTS; PRODUCT SAMPLING


 


Section 5.1            Copromotion.  During the Term of this Agreement, Teva
hereby grants to Acorda, and Acorda hereby accepts from Teva, the co-exclusive
right to Promote the Collaboration Products in the Territory, together with
Teva and its Affiliates and their respective approved agents or
representatives, in accordance with the terms and conditions of this Agreement,
including, without limitation, the Marketing Plans.  It is agreed that either Party may use Third Party service
providers approved by the CSC in connection with such Promotion, provided that
unless expressly agreed to in a separate writing no Party may utilize a Third
Party service provider that develops, manufactures, promotes, or sells a Competitive
Product or is otherwise a competitor of such other Party.  Each Party shall participate in the planning
of Promotion activities for Collaboration Products through its membership in
the Marketing Committee and shall perform the Promotion activities allocated to
it by the Marketing Committee as set forth in the Marketing Plans.


 


Section 5.2            Promotional
Efforts.


 


(a)           Throughout
the Term of this Agreement, each Party shall devote appropriate resources and
use commercially reasonable efforts to perform the functions allocated to it
under the Marketing Plans as necessary to Promote Collaboration Products
throughout the Territory consistent with the Marketing Plans, and in a manner
that it would use efforts to market and promote products of comparable commercial
and medical significance in the Territory that are developed and/or controlled
by such Party.  Each Party shall employ
its expertise, best professional judgment and good working relationships with
Target Prescribers, as applicable, to generate maximum profits of Collaboration
Products under this Agreement.  The
Parties intend that, to the extent it is commercially feasible and not a
detriment to the successful sales of Collaboration Products, the Marketing
Plans will allocate Promotion efforts such that each Party


 


30

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


will expend about [*   *] of the
total efforts and apply [*   *] of the
total resources required to Promote the Collaboration Products in the
Territory.


 


(b)           Each
Party shall assign a total number of Sales Representatives annually as are
reasonably necessary to achieve the agreed number of Details for such Party as
determined by the Marketing Committee, and to implement its responsibilities
under the Marketing Plans for all Collaboration Products applicable with
respect to each such year, in accordance with such Marketing Plans.


 


(c)           Each
Party shall ensure that it and its respective Affiliates’ statements and claims
regarding Collaboration Products, including those as to efficacy and safety,
are consistent with the applicable product labeling and Marketing
Materials.  The Parties and their
respective Affiliates may not add, delete or modify claims of efficacy or
safety stated in the Marketing Materials of Collaboration Products nor make any
other changes in the Marketing Materials without the approval of the Compliance
Committee.  Each Party and its
respective Affiliates shall Promote Collaboration Products in strict adherence
with regulatory and professional requirements and all applicable federal, state
and local laws, guidances, rules and regulations, including the Act, the AMA
Guidelines, the PDMA and the PhRMA Code, and keep the other Party fully
informed of all compliance matters related to the Promotion of Collaboration
Products.


 


(d)           Each
Party may utilize only those Marketing Materials that have been approved by the
Compliance Committee and the Marketing Committee to Promote Collaboration
Products under this Agreement.  All
Marketing Materials used or intended to be used in the Promotion of the
Collaboration Products in the Territory shall be owned exclusively by Teva and
Teva has the sole and exclusive right to use the Marketing Materials outside
the Territory.  The Parties shall
Promote Collaboration Products in the Territory only under the Trademarks
approved for Collaboration Products in accordance with this Agreement.


 


(e)           The
use of either Party’s name and/or logo on all Marketing Materials shall be
determined by the Marketing Committee and in accordance this Agreement.  Unless prohibited by applicable laws and
regulations (as determined by the Compliance Committee), Teva’s and Acorda’s
name and logo shall appear on all product packaging, package inserts and
product labeling for Collaboration Products. 
The Marketing Committee shall have the final determination as to the use
of all other names and/or logos on such product packaging, package inserts and
product labeling.


 


Section 5.3            Product
Sampling.


 


(a)           Teva
shall ship the Product Samples and either Teva and/or Acorda, as applicable,
shall ship Marketing Materials as directed by the Marketing Committee.  Each Party shall include an allowance for
Product Samples in the forecasts that it provides to the other Party.  Acorda and Teva shall be responsible for
distributing the Product Samples to their respective sales forces in a timely
manner.  Each Party shall also be
responsible for securing the return and reconciliation of existing Product
Sample and Marketing Materials inventories from its discontinued field Sales
Representatives.  All Product Samples
provided to Acorda shall be accompanied by an appropriate Certificate of
Analysis and Certification of Release in


 


31

















 


compliance with the relevant Collaboration Product’s specifications and
an indication of expiration dating.


 


(b)           Product Samples supplied by Teva to Acorda
shall be used by Acorda solely in connection with the Promotion of the relevant
Collaboration Product in the Territory in accordance with the relevant
Marketing Plan.  Each Party shall be
responsible for following its own policies with respect to compliance with the
PDMA, and other applicable federal, state and local laws and regulations
relating to the distribution and use of Product Samples.  Each Party shall be responsible for
adherence by its sales force to such laws and regulations, and the Parties
shall establish, maintain and adhere to written procedures to assure that each
Party and its representatives comply with all requirements of the PDMA.  Such written procedures will include a
requirement that Acorda notify Teva immediately upon learning that any Product
Samples shipped to it have been lost or have not been received as
scheduled.  Acorda and Teva shall
maintain records as required by the PDMA and all other applicable laws.  Each Party shall promptly provide the other
Party with copies of all its correspondence to and from the FDA and any other
regulatory authorities relating to losses and thefts of Product Samples and
significant or consistent variances in Product Sample inventory.  Each Party will have the right to itself
audit the records and/or reports for the Product Samples, as required to be
kept by the other Party under the PDMA, during normal business hours, at
convenient times and upon no less than five (5) Business Days’ notice.


 


ARTICLE 6


 


MANUFACTURE
AND COMMERCIALIZATION OF COLLABORATION PRODUCTS


 


Section 6.1            Manufacture.  Teva and its Affiliates shall have the sole
right, authority and responsibility to manufacture all Collaboration Products
in connection with the development, promotion and commercialization of
Collaboration Products in the Territory. 
Teva shall supply (as provided under this Agreement) all of the Parties’
requirements for such development, and shall supply finished Collaboration Products
to meet all orders for sale of such Collaboration Products.  Teva shall manufacture and keep in inventory
appropriate amounts of finished Collaboration Products dedicated for sale in
the Territory, at a level as established as reasonable by the CSC.  Teva covenants that, in the event of any
inability to satisfy all open orders for Collaboration Products anywhere in the
world, Teva shall not allocate the supply of Compound or finished products to
countries outside the Territory in disproportion to orders for the
Collaboration Products in the Territory.


 


Section 6.2            Commercialization.


 


(a)           Teva
and its Affiliates shall be solely responsible for and shall possess the sole
and exclusive right and authority to Commercialize all Collaboration Products
in the Territory, in accordance with the Marketing Plans, but except as
otherwise provided in Section 3.5(c)(iv). 
Teva and its Affiliates shall use commercially reasonable efforts to
Commercialize all Collaboration Products in the Territory, including taking,
processing and fulfilling all orders for Collaboration Products in the
Territory on a timely basis and in accordance with applicable industry
standards.  Teva shall also be solely
responsible for, and shall assess and address, all Collaboration Product quality
control issues.  If Acorda receives any
Collaboration Product


 


32

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


orders, it shall use reasonable efforts to forward such orders to Teva
within one (1) Business Day after Acorda’s receipt thereof.  Teva shall provide to the CSC written
reports, in a format and on a schedule established by the CSC, summarizing
the Commercialization activities undertaken by Teva (or its Affiliate) and the
results thereof and any significant developments or results of such
Commercialization.  Teva shall consult
with Acorda regarding its Commercialization efforts and methods and shall
answer and seek to accommodate all reasonable questions and comments of Acorda.


 


(b)           All
sales of Collaboration Products shall be recorded, invoiced and collected by
Teva.  All terms regarding Collaboration
Product sales, including, without limitation, terms respecting credit, pricing,
cash discounts, rebates, chargebacks, bad debt write-offs, and other fees,
charges, returns and allowances shall be set by Teva in accordance with
applicable guidelines established by the Marketing Committee.


 


(c)           Teva
and its Affiliates shall use commercially reasonable efforts, consistent with
good pharmaceutical industry practices, to ensure that clinical trial supplies
and Collaboration Products are manufactured in accordance with the then-current
Good Manufacturing Practices, as specified by the applicable laws and
regulations in the Territory, and the relevant specifications as determined in
writing by the Parties.  Teva and its
Affiliates shall use commercially reasonable efforts, consistent with good
pharmaceutical industry practices, to conduct all manufacturing of
Collaboration Products so that Teva can supply Collaboration Products in
sufficient quantities to meet all accepted firm purchase orders for
Collaboration Products in the Territory in accordance with the then-current
Marketing Plans, as determined by the Marketing Committee, and which purchase
orders do not exceed [***]  of the
quantity of Collaboration Product that is in the relevant Forecast (as defined
below).  Not less than six (6) months
prior to any Launch Date, and thereafter on or before the first day of
September of each year, the Marketing Committee shall provide to Teva a
three (3) year forecast, with an annual breakdown, of the anticipated
Collaboration Product requirements (by quantity, NDC number and SKU) for the
next succeeding three (3) calendar years. 
Furthermore, within ten (10) Business Days of the beginning of each
calendar quarter, the Marketing Committee shall provide to Teva a forecast of
the anticipated Collaboration Product requirements (by quantity, NDC number and
SKU) for the next four (4) calendar quarters on a quarterly basis, which
quarterly forecasts will be the basis for firm orders to Teva.  (Each three (3) year forecast and quarterly
forecast, including allowances for Product Samples and Free Products, a “Forecast.”)  The Parties shall use their diligent efforts
to adjust to changes in any Forecast. 
Each Forecast shall also specify Collaboration Product quantities
required for use as Product Samples.


 


(d)           If
Teva and its Affiliates (i) fail to manufacture and supply Collaboration
Products in accordance with the provisions of Section 6.2(c), or (ii) are
otherwise unwilling or unable to manufacture Collaboration Products or
experiencing difficulties with manufacturing Collaboration Products such that
it may be unable to meet Collaboration Product requirements as provided under
Section 6.2(c) (in either case, a “Supply Disruption”), Teva shall provide
prompt written notice of such situation to Acorda.  Teva shall, in any event, use its reasonable commercial efforts
to resolve any Supply Disruption and avoid any inability to supply the market
demands for the Collaboration Products in the Territory, and shall keep Acorda
fully informed of all such efforts.


 


33

















 


ARTICLE 7


 


REGULATORY
COMPLIANCE; MEDICAL COMPLAINTS; MANAGED CARE AND

GOVERNMENT CONTRACTING


 


Section 7.1            Regulatory Affairs and
Compliance.  Teva shall have the
sole authority and responsibility for (a) filing, maintaining and updating any
INDs and NDAs for Collaboration Products, (b) reporting Adverse Drug Experience
Reports and Serious Adverse Drug Experience Reports to the FDA and/or other
governmental or regulatory authorities, (c) submitting or filing Marketing
Materials with the FDA and (d) handling medical and technical complaints and
disputes with the FDA, patients and physicians in respect of any Collaboration
Product.  Notwithstanding the foregoing,
Teva shall consult with Acorda in all planning for seeking Regulatory Approval
and in preparing NDAs for the Collaboration Products in the Territory.  Acorda shall provide Teva with such
assistance as is reasonably requested by Teva from time to time to perform its
responsibilities under this Section 7.1, provided that the costs associated
with such assistance shall be considered Development Costs.  Such assistance and actions shall include,
among other things, keeping Teva informed, commencing within two (2) Business
Days of notification of any action by, or notification or other information
that Acorda receives (directly or indirectly) from the FDA or any other
governmental or regulatory authority that (i) raises any material concerns
regarding the safety or efficacy of any Collaboration Product, (ii) indicates
or suggests a potential material liability for either Party to Third Parties
arising in connection with any Collaboration Product or (iii) is reasonably
likely to lead to a recall or market withdrawal of any Collaboration Product.  Teva shall consult with Acorda with regard
to, and prior to implementation of any changes in Collaboration Product
labeling.  With respect to reports and
communications described in this Article 7, the Parties shall establish a
protocol for timely handling of such items in accordance with FDA and relevant
global regulatory requirements and appoint a primary liaison with whom the
other Party is to principally communicate.


 


Section 7.2            Adverse
Drug Experience Reports.


 


(a)           Teva
shall maintain a global safety database recording information on any adverse
drug experience during clinical trials and post-marketing.  Subject to the Act and ICH Guidelines on
safety reporting (ICH-E2A and ICH-E2C), Teva shall be responsible for
submitting to the FDA any Serious Adverse Drug Experience Reports and Adverse
Drug Experience Reports relating to Collaboration Products for both INDs and
NDAs as required.  Acorda shall, in
respect of a Collaboration Product:  (i)
notify Teva of all Serious Adverse Drug Experience Reports as soon as
practicable, but in no event later than two (2) calendar days, after any
Serious Adverse Drug Experience Report becomes known to it; and (ii) notify
Teva of all Adverse Drug Experience Reports as soon as practicable, but in no
event later than four (4) Business Days, after any Adverse Drug Experience
Report becomes known to it.  Each Party
shall keep the other Party informed of all significant safety issues to its
knowledge regarding any Collaboration Product. 
Teva will provide to Acorda copies of all Serious Adverse Drug
Experience Reports, Adverse Drug Experience Reports and periodic safety update
reports submitted to the FDA or any other regulatory authority related to a
Collaboration Product.


 


34

















 


(b)           With
regard to a Collaboration Product, (i) Teva has the right to determine whether
any complaint, Adverse Drug Experience Report or Serious Adverse Drug
Experience Report must be reported to the FDA or any other governmental or
regulatory authority and (ii) Acorda may not disclose any information
concerning Adverse Drug Experience Reports or Serious Adverse Drug Experience
Reports to a Person or any governmental or regulatory authority without Teva’s
prior written consent, except (A) as may be otherwise required by law, in which
case Acorda shall provide prompt written notice thereof in sufficient detail to
Teva and the Parties shall in good faith decide upon and effect an appropriate
response thereto, or (B) in connection with Acorda’s conduct of clinical trials
and other activities in accordance with the applicable Development Program,
provided, however, that such disclosure is limited to sites participating in
the study.


 


(c)           Teva
shall provide Acorda with periodic summary reports (as outlined in the regulatory
protocol) of all fifteen (15) day “Alert Reports” relating to the relevant
Collaboration Product and submitted to the FDA in accordance with 21 C.F.R.
314.80(c)(1).  Within ten (10) Business
Days after submission, Teva shall provide Acorda with copies of all FDA
periodic and annual Adverse Drug Experience Reports relating to the relevant
Collaboration Product and submitted in accordance with 21 C.F.R.
314.80(c)(2).  Acorda agrees to (i)
provide Teva with all reasonable assistance, including assisting Teva in
meeting its reporting and other obligations as required by applicable law and
(ii) take all actions required by law or regulation under the Act to the extent
that such law or regulation is applicable to Acorda with respect to any
Collaboration Product.


 


(d)           Within five (5) Business Days after
submission or receipt, as applicable, Teva shall provide Acorda with copies of
all correspondence submitted to or received from any governmental or regulatory
authority in the Territory related to Collaboration Product safety.


 


Section 7.3            Medical Inquiries.  Each Party shall comply with the directions
and policies formulated by the Compliance Committee concerning responses to be
made to medical questions or inquiries from members of the medical and paramedical
professions and consumers regarding a Collaboration Product.  Each Party shall keep records as necessary
to document inquiries of health care professionals in compliance with
applicable regulatory requirements and the Parties shall make those records available
to each other promptly upon request, except that each Party shall provide the
other Party with copies of all documentation and information pertaining to
medical emergencies promptly, without need for request by the other Party.  The Parties shall cooperate to develop form
response letters containing responses to the most frequently asked medical and
any routine questions received regarding each Collaboration Product, which
materials shall be used by both Parties in responding to medical inquiries directed
to their respective personnel.  The
Parties shall bear their respective costs for maintaining personnel and
facilities to receive, review, forward and/or (as applicable) respond to
Collaboration Product medical inquiries, which costs shall be Promotion Costs
to the extent directly allocable to efforts related to Collaboration Products
in the Territory.  The Parties shall
develop mutually acceptable guidelines for receipt, recordation and
communication (as between the Parties) of medical inquiry information, and the
maintenance and the appropriate period reconciliation of records pertaining
thereto.


 


35

















 


Section 7.4            Complaints.  Acorda shall refer any complaint that it
receives concerning any Collaboration Product, including, without limitation,
complaints regarding physical or pharmacologic properties of a Collaboration
Product, unexpected increase or decrease in the expected dose-effectiveness of
an agent, and changes or alterations of expected appearance, count color or
consistency, to Teva as soon as practicable, but in no event later than four
(4) Business Days after its receipt of the same; provided, that Acorda must
notify Teva of all complaints concerning suspected or actual Collaboration
Product tampering, damage, contamination or mix-up (e.g., wrong ingredients or
incorrect labeling) as soon as practicable, but in no event later than one (1)
Business Day after its receipt of the same. 
Teva shall provide to Acorda on a monthly basis a summary report of all
known complaints in respect of any Collaboration Product.


 


Section 7.5            Recalls.  Each Party shall notify the other promptly
of any material facts or circumstances that it becomes aware of and believes
may necessitate or be the basis for a recall, removal, market withdrawal or any
other corrective action regarding Collaboration Products in the Territory.  Teva shall promptly notify Acorda of any
material actions to be taken by Teva with respect to any recall, removal,
market withdrawal or any other corrective action regarding Collaboration
Products prior to such action so as to permit Acorda a reasonable opportunity
to consult with Teva with respect thereto. 
Teva shall consider Acorda’s consultation and recommendations in good
faith; provided, however, that nothing in this Section 7.5 is intended to
limit Teva’s ability to recall, remove, withdraw or take any other corrective
action relating to any Collaboration Products to the extent reasonably
necessary to comply with applicable laws. 
Upon Teva’s request, Acorda shall assist Teva in conducting any such
recall, removal, market withdrawal or other corrective action.  Any documented out-of-pocket costs incurred
by a Party with respect to participating in any such recall, removal,
withdrawal or other corrective action shall be shared by the Parties on a 50/50
basis as Copromotion Expenses; except that a Party shall be responsible
for all such costs if such recall, market withdrawal or other corrective action
results from the negligence or willful misconduct of such Party or a Third
Party engaged by such Party.


 


Section 7.6            Managed Care and
Government Contracting.  Teva and
Acorda agree that the Marketing Committee (under the supervision of the CSC)
shall be responsible for Promotion of Collaboration Products to Managed Care
Organizations in accordance with the then-current Marketing Plans.  Teva shall, in accordance with the
applicable Marketing Plan, be responsible for entering into contracts with the
Managed Care Organizations for the distribution and sale of Collaboration
Products and the payment of applicable rebates and other similar discounts and
payments.  Such contracts shall be on
commercially reasonable terms and require prior approval by the Marketing Committee.  The Marketing Committee shall designate a
primary contact, as between Acorda and Teva, for each, and/or a group of,
Managed Care Organizations taking into consideration factors such as each
Party’s expertise and existing working relationships with Target Prescribers to
maximize the successful sales of Collaboration Products.  The Party not designated as the primary
contact for a given Managed Care Organization may continue to participate in
Promotion efforts to such Managed Care Organization in collaboration with the
designated primary contact.


 


36

















 


ARTICLE
8


 


GRANT
OF RIGHTS AND NONCOMPETITION


 


Section
8.1            License Grants.


 


(a)           Teva
hereby grants to Acorda, subject to, and in accordance with, the terms and
conditions of this Agreement, a co-exclusive license (together with Teva and
its Affiliates) under the Patent Rights and Know-How to, and only to, Develop
and Promote Collaboration Products under this Agreement solely for the
Territory during the Term of this Agreement.


 


(b)           Acorda
hereby grants Teva, subject to, and in accordance with, the terms and
conditions of this Agreement, a co-exclusive, worldwide license (together with
Acorda and its Affiliates) under Acorda Background Technology solely to
develop, manufacture, commercialize and promote Collaboration Products during
the Term of this Agreement.


 


(c)           Teva
hereby grants to Acorda a non-exclusive, worldwide, royalty-free, fully
paid-up, perpetual, irrevocable license, with full rights to sublicense, under
that portion of the Program Intellectual Property either developed solely by
Acorda or jointly by Teva and Acorda to develop, make, have made, use, offer
for sale, sell and import, one or more products, excluding, however, any
products or service that are directly or indirectly competitive with any of
Teva’s, or any of its Affiliates’, products or services (excluding the
provisions of this Agreement).


 


(d)           Except
as expressly provided in this Agreement (including without limitation
Section 9.1), no right, title or interest is provided, licensed, granted
or otherwise conveyed by one Party to the other Party with respect to such
Party’s know-how, patent rights, trade secrets or any other intellectual
property right, owned, controlled, licensed or developed by such Party.


 


Section
8.2            Exchange of
Information.  From time to time
during the Term of this Agreement, upon the request of Acorda, Teva shall,
subject to all legal requirements and contractual obligations, promptly
disclose to Acorda any and all of its Know-How and Patent Rights as necessary
or reasonably useful for Acorda to perform its obligations and exercise its
rights under this Agreement.  From time
to time during the Term of this Agreement, upon the request of Teva, Acorda
shall, subject to all legal requirements and contractual obligations, promptly
disclose to Teva any and all of the Acorda Background Technology as necessary
or reasonably useful for Teva to perform its obligations and exercise its
rights under this Agreement.  Further, from
time to time during the Term of this Agreement, as provided herein and at any
time upon the request of the other Party, each Party shall disclose to the
other Party the results, data and information resulting from such Party’s
Development and Promotion efforts.


 


Section
8.3            Right of First Negotiation
for Additional Compounds.  Subject
to the terms and conditions of this Agreement, during the Term of this
Agreement, each Party hereby grants to the other Party the following right of
first negotiation to obtain from such Party the co-exclusive right, together
with the Party and its Affiliates, to develop and promote in the Territory


 


37

















 


any analogues, derivatives or metabolites based upon the Compound, or
any other valproic acid related compound similar to the Compound that such
Party has or may hereafter acquire (each, an “Additional Compound”).  If a Party has or obtains rights to any
Additional Compound and intends to develop or license such compound in the
Territory, then such Party shall promptly issue to the other Party a written
notice to this effect and provide to such other Party all material information
in its possession relating to the development or commercialization of such
compound.  If the other Party notifies
such Party within thirty (30) Business Days after receiving the notice and all
such information that it desires to negotiate an agreement to jointly develop
and promote such Additional Compound, then Teva and Acorda shall in good faith
proceed to negotiate such an agreement over the period up to sixty (60)
Business Days from the date of such other Party’s timely notice.  If the Parties are not able to agree upon
the terms of a development and promotion agreement (including terms respecting
adequate financial resources and security) within the aforementioned sixty (60)
Business Day negotiation period (or such longer period as may be agreed by the
Parties), or if such other Party does not provide notice to the Party of its
interest in such Additional Compound within the aforementioned thirty (30)
Business Day notice period, then such right of first negotiation as to such
compound shall expire and be of no further force or effect.  Notwithstanding anything to the contrary set
forth in this Section 8.3, neither Party shall have a right of first
negotiation for, nor shall either Party otherwise be entitled to receive any
rights from the other Party to develop and/or promote, any Additional Compound
for the Multiple Sclerosis indication or any generic version of any
Collaboration Product.


 


ARTICLE
9


 


INTELLECTUAL
PROPERTY


 


Section
9.1            Ownership Rights.  Regardless of whether developed solely by
Teva or Acorda, or jointly by Teva and Acorda, or on the behalf of either of
them, Teva, or its designee, shall own all right, title and interest in and to
all Program Intellectual Property.  Any
and all patents issued or issuable in respect of such Program Intellectual
Property shall be issued in the name of Teva or its designee.  Acorda hereby assigns and transfers to Teva
all of its right, title and interest in and to all Program Intellectual
Property and agrees, as may reasonably be requested by Teva, to perform those
acts necessary to confer upon and to perfect Teva’s full and complete ownership
rights in and to the Program Intellectual Property as contemplated under this
Section 9.1, including, without limitation, freely sharing with Teva any
and all information related to Acorda’s development of any Collaboration
Product.  In furtherance of the foregoing,
at any time during or after the Term of this Agreement, Acorda shall (a)
preserve the confidentiality of all Program Intellectual Property that may form
the basis of a patent application and (b) at Teva’s sole cost, fully support
Teva’s efforts to obtain patent protection on such potentially patentable
subject matter, including participating in the preparation, execution and
filing of appropriate formal documents in national and international patent
offices and obtaining the cooperation of the inventors in supporting said
patent application.  Acorda shall retain
the exclusive right, title and interest in and to all Acorda Background
Technology, subject only to the license rights granted under this Agreement.


 


38

















 


Section
9.2            Intellectual Property Litigation.


 


(a)           Notice
of Infringement Claim.  If the
developing, making, using, selling or importing of Collaboration Products or
any other activity performed by the Parties in the Territory under this
Agreement results in a claim against a Party for patent infringement or
Trademark infringement or for inducing or contributing to patent infringement
or trademark infringement of a Third Party’s rights, as applicable (an “Infringement
Claim”), the Party first having notice of an Infringement Claim
shall, within fifteen (15) days of such notice, provide written notice to the
other Party thereof.  Such notice to the
other Party shall set forth the facts of the Infringement Claim in reasonable
detail.


 


(b)           Responsibilities.  With respect to any Infringement Claim, the
Parties shall attempt to negotiate in good faith a resolution with respect
thereto.  If the Parties cannot reach an
agreeable resolution with the Third Party bringing such Infringement Claim,
then (i) Teva will have the sole right and obligation to control the defense of
any such Infringement Claim that relates to the Patent Rights, the Know-How,
the Trademarks, or the Program Intellectual Property, including any practice or
use thereof; and (ii) Acorda will have the sole right and obligation to control
the defense of any such Infringement Claim that relates to the Acorda
Background Technology, all pursuant to and consistent with the terms of this
Agreement.  The Parties shall share all
costs and expenses incurred in connection with any such Infringement Claims on
a 50/50 basis.  The controlling Party
will have the right, after consultation with the other Party, to choose legal
counsel to represent the Parties in such Infringement Claim and each of Teva
and Acorda will waive any conflict of interest that may arise from one (1)
attorney or firm representing both Parties with respect to such Infringement
Claim.  The Party not controlling the
defense will have the right, at its sole cost and expense (without any right of
reimbursement) to retain its own counsel to monitor any such proceeding.  Each Party shall keep the other Party
continually informed of all significant matters relating to all Infringement
Claims.


 


Section 9.3            Infringement
Claims Against Third Parties.


 


(a)           Protection
Against Infringement.  Each Party
agrees to take reasonable actions to protect the Trademarks, Patent Rights,
Know-How, Acorda Background Technology, Program Intellectual Property and any
related technology from infringement and from unauthorized possession or use by
Third Parties, as provided in this Section 9.3.


 


(b)           Notice
of Infringement By Third Party.  If
any Trademark, Know-How, Patent Right, Acorda Background Technology or Program
Intellectual Property under this Agreement is infringed or misappropriated or
if such infringement or misappropriation is threatened, as the case may be, by
a Third Party in the Territory during the Term of this Agreement (each, a “Third Party
Infringement”), the Party to this Agreement first having knowledge
of such Third Party Infringement, shall promptly notify the other Party in
writing.  The notice shall set forth, in
reasonable detail, the facts of such Third Party Infringement.  Teva shall have the primary right, but not
the obligation, to institute, prosecute, and control any action or proceeding,
with counsel of its choice, with respect to Third Party Infringement of
Trademarks or Program Intellectual Property, and Acorda shall have the right to
fully participate in any such action. 
If Teva chooses not to institute an action, Acorda shall then have the
right, but not the obligation, to commence, prosecute, and control the action,
with counsel of its choice, subject to the right of reasonable participation of
Teva.  Any Third Party Infringement of any
Know-How or Patent Right will be solely instituted, prosecuted and controlled,
if at all, by Teva,


 


39

















 


subject to the right of reasonable participation of Acorda.  Third Party Infringement of any Acorda
Background Technology or Acorda trademark or logo will be solely instituted,
prosecuted and controlled, if at all, by Acorda, subject to the reasonable
participation of Teva.  The parties
shall bear all costs and expenses, and retain any amounts received or payable,
as a result of any of the foregoing actions or proceedings on a 50/50
basis.  The Parties will use their good
faith reasonable efforts to consult each other on the costs associated
therewith.  For clarity, if a Party’s
intellectual property rights are infringed by an activity that does not
involved making, using, importing, offering for sale or selling a product
containing the Compound, such Party shall have the sole right to enforce its
intellectual property against such infringement, at such Party’s sole expense,
and it shall retain any and all recovery from such enforcement


 


(c)           Party’s
Failure to Institute, Prosecute and Control.  If either party fails to institute, prosecute and control such
action or prosecution of Third Party Infringement of Trademarks or Program
Intellectual Property within a period of one hundred twenty (120) Business Days
after receiving notice of such Third Party Infringement, then the other Party
shall have the right to do so at its own expense; provided however, that such
party shall first obtain the other’s consent, not to be unreasonably withheld
or delayed, to institute actions to terminate or otherwise prevent continuation
of such infringement.  If a Party so
consents, it agrees to be joined as a party plaintiff in such action, and such
Party has the right, at its own expense, to be represented in any such action
by counsel of its own choice.  Except as
otherwise agreed to by the Parties as part of a cost-sharing arrangement, any
amounts received as a result of such litigation instituted by a Party under this
Section 9.3(c), after reimbursement of one hundred (100%) of any
litigation expenses of each of Party (including the costs and expenses incurred
by a Party in providing reasonable assistance to the other), will be retained
solely by the Party instituting the action.


 


(d)           Invalidity
Claims Against Intellectual Property. 
Each Party shall promptly notify the other of any events relating to any
challenges or threatened challenges to the validity or enforceability of the
Trademarks, Know-How, Patent Rights, Acorda Background Technology or Program
Intellectual Property.


 


Section 9.4            Prosecution
and Maintenance of Patents.  Teva
shall, at its sole cost and expense, have the exclusive right and
responsibility to prepare, file, prosecute and maintain all Patent Rights, and
any patents and related applications with respect to Program Intellectual
Property that, in Teva’s opinion, are materially useful to the Development,
Promotion and/or Commercialization of Collaboration Products in the Territory.  Acorda shall, upon Teva’s request, execute
such documents and take such other actions as Teva deems necessary for Teva to
apply for, secure, and maintain such patents. 
Teva shall reimburse Acorda for any costs and expenses incurred by
Acorda in taking any such actions under this Section 9.4. 


 


Section 9.5            Use
of Trademarks.  All Collaboration
Products shall be Promoted by the Parties in the Territory only under the
trademarks, trade names and logos that are selected by the Marketing Committee
and approved by the CSC (each, a “Trademark”).  Teva shall file and prosecute trademark applications in the
Territory for each Trademark (except for the Acorda name and logo); provided
that the costs with respect thereto shall be shared by the Parties on a 50/50
basis.


 


40

















 


Section 9.6            Marking.  Teva shall mark each Collaboration Product
used or sold by it in accordance with the requirements of the country of
manufacture and sale relating to the marking of patented articles.  If a Collaboration Product incorporates
processes, products or other materials or methods covered by a pending patent
application for Patent Rights or Program Intellectual Property, Teva shall mark
the Collaboration Product with a “patent pending” or similarly appropriate
legend.


 


Section 9.7            Rights
to Trademarks.


 


(a)           Except
as otherwise provided in this Agreement, all Trademarks are Teva’s sole and
exclusive property (except the Acorda name, logo and other Acorda
trademarks).  Teva hereby grants to
Acorda a non-exclusive license to use the Trademarks in the Territory solely in
connection with the purposes of this Agreement.  The foregoing non-exclusive license shall terminate upon the
termination of this Agreement for any reason (whether by expiration of the Term
or otherwise) unless otherwise agreed by the Parties.


 


(b)           Acorda
hereby grants to Teva a non-exclusive license to use any Acorda name, logo and
other Acorda trademarks that are selected and approved as Trademarks in
accordance with Section 9.5 solely in connection with the Promotion of
Collaboration Products.  The foregoing
non-exclusive license shall terminate upon the termination of this Agreement
for any reason (whether by expiration of the Term or otherwise) unless
otherwise agreed by the Parties.


 


(c)           After
termination or expiration of this Agreement for any reason, except as otherwise
expressly provided in this Agreement, Teva remains the sole and exclusive owner
of any Trademarks (which excludes, for clarity, the Acorda name, logo and other
Acorda trademarks), and all of same shall be promptly transferred to Teva.


 


Section 9.8            Settlements.  Any Party prosecuting a Third Party
Infringement or defending an Infringement Claim has the right to settle any
such Third Party Infringement or Infringement Claim without the consent of the
other Party; provided, however, that neither Party shall have any right,
without the other Party’s express written consent, to settle any such Third
Party Infringement or Infringement Claim if such settlement could reasonably be
expected to have a material adverse impact upon the other Party’s rights under
this Agreement, or in respect of the Compound or any Collaboration Product.


 


ARTICLE 10


 


CONFIDENTIALITY


 


Section 10.1         Confidentiality.  Each Party agrees to maintain the confidentiality
and secrecy of any information provided to it by, or on behalf of, the other
Party under this Agreement, including, without limitation, pursuant to
Article 8 hereof (collectively, the “Confidential Information” of the disclosing
Party), which may include proprietary, financial, trade secret, technical,
know-how, business, marketing, data or other confidential information, such as
information relating to the Compound or any Collaboration Product, pricing,
facilities, methods, formulae, processes, strategies, corporate initiatives,
production efforts or


 


41

















 


requirements, operations, income, projections, contractual and business
arrangements, personnel data, whether in verbal, written or other tangible
form, and expressly includes Patent Rights, Know How, and Program Intellectual
Property.  Each Party agrees to maintain
the confidentiality and secrecy of, and not disclose to any Third Party, the
other Party’s Confidential Information using at least the same degree of care
that it uses to maintain its own confidential and secret information, but, in
any event, never less than a reasonable degree of care.  Neither Party shall use the other Party’s
Confidential Information for any purpose other than to exercise its rights,
and/or fulfill its duties and obligations, under this Agreement.  Each Party may, however, disclose the other
Party’s Confidential Information to its Affiliates, officers, directors,
employees and agents who have need to know or who have access to that
Confidential Information in order to exercise its rights under and/or fulfill
its duties and obligations under this Agreement or to its existing investors
and professional advisors and, with the other party’s written consent, to any
bona fide potential investor, acquirer, merger partner or other potential
financial partner, in all such cases, subject to the terms and conditions of
this Section 10.1; provided that in each case, the Party
conveying the other Party’s Confidential Information shall inform each
recipient of the confidential nature of such information and shall cause each
recipient to receive and hold such information in accordance with the terms of
this Agreement.  Each Party will also
keep in confidence and not disclose to any Third Parties the terms and
conditions of this Agreement, except to its existing investors and professional
advisors, and, with the written consent of the other party, such consent not to
be unreasonably withheld, to any bona fide potential investor, acquirer, merger
partner or other potential financial partner; provided further that the
Party disclosing such terms and conditions shall inform each recipient of the
confidential nature of such information and shall cause each recipient to
receive and hold such information as confidential in accordance with the terms
of this Agreement.  Each Party shall be
responsible for any breach of this Section 10.1 by its Affiliates,
officers, directors, employees, agents and other persons to whom the other
Party’s Confidential Information is disclosed. 
The above obligations of confidentiality and non-use do not apply to any
information received by Teva from Acorda hereunder that Teva owns pursuant to
the terms of this Agreement and to information that the receiving Party can demonstrate
by competent written evidence:


 


(a)           Is
or becomes known to the public through no fault or omission on the part of the
receiving Party;


 


(b)           As
evidenced by the receiving Party’s written records, was independently developed
by or for the receiving Party without any reference to, or reliance upon, the
disclosing Party’s Confidential Information;


 


(c)           Is
made available to the receiving Party from another source rightfully in
possession of the disclosing Party’s Confidential Information and not under an
obligation of confidentiality with respect thereto; or


 


(d)           Is
disclosed with the prior written approval of the disclosing Party.


 


Section 10.2         Permitted
Disclosure.  Notwithstanding
anything to the contrary set forth in Section 10.1, the Parties understand
and agree that Teva has existing obligations under the Third Party Agreements
and Teva shall be permitted to disclose certain Confidential Information to
such Persons as, and solely to the extent, required under such Third Party
Agreements;


 


42

















 


provided that such Persons are bound by obligations of confidentiality
that are substantially similar to those set forth in Section 10.1.  Further, the recipient Party may disclose
certain of the other Party’s Confidential Information, to the extent that such
disclosure is required in order to comply with applicable law or pursuant to an
order of the government or a court of competent jurisdiction, provided that the
recipient Party (a) provides such other Party with adequate prior notice of the
required disclosure, (b) cooperates with such other Party’s efforts to protect
its Confidential Information with respect to such disclosure and (c) takes all
reasonable measures requested by such other Party to challenge or to limit the
scope of such required disclosure.


 


Section 10.3         Confidential
Information Upon Termination or Expiration.  Each Party agrees that upon the expiration or termination of this
Agreement, upon the other Party’s request, such Party shall promptly deliver to
the other Party or otherwise dispose of in accordance with the other Party’s
directions, the other Party’s Confidential Information.  Upon an Indication Termination for a
Collaboration Product under Section 12.2(b), each Party shall continue to
maintain the other Party’s Confidential Information that relates to the
indication, dosage form or use that is the subject of such Indication
Termination, if any, in accordance with Section 10.1.


 


Section 10.4         Privacy.  Notwithstanding anything to the contrary,
the Parties agree to treat all individually-identifiable health information as
confidential in accordance with all applicable federal, state and local laws
and regulations governing the privacy of individually-identifiable health
information, including the Health Insurance Portability and Accountability Act
of 1996, as amended from time to time, and any regulations and guidance
promulgated under that Act.  The Parties
will execute those amendments to this Agreement as are necessary to ensure that
the Parties remain in compliance with such laws and regulations.


 


Section 10.5         Confidentiality
Agreement.  The confidentiality
provisions set out in this Agreement are in addition to, and do not derogate
from, the terms of the Confidentiality Agreement; provided, however, to the
extent that any discrepancy exists between the Confidentiality Agreement and
this Agreement, the confidentiality provisions of this Agreement shall govern.


 


ARTICLE 11


 


INDEMNIFICATION;
LIMITATION OF LIABILITY; WARRANTY DISCLAIMER


 


Section 11.1         Indemnification.


 


(a)           A
Party (the “Indemnifying Party”) shall defend, indemnify and hold harmless
the other Party and its Affiliates and each of their respective officers,
directors, employees, representatives, successors and assigns (collectively,
the “Indemnified
Party”), from and against all losses, liabilities, damage, costs and
expenses (including reasonable attorneys’ fees) resulting from any charges,
complaints, actions, suits, proceedings, hearings, investigations, claims and
demands of Third Parties (collectively, “Claims”), to the extent that the Claim
results from:  (i) the Indemnifying
Party’s negligence or willful misconduct in performing any of its obligations
under this Agreement, (ii) a breach by the Indemnifying Party of any of its
representations, warranties, covenants or agreements under this Agreement, or
(iii)


 


43

















 


as to Teva as the Indemnifying Party, any Claim, to the extent directly
based upon, and resulting from, Teva’s decision to act under the Agreement in a
manner contrary to Acorda’s desires (to the extent Acorda’s desires were
reasonable and in good faith) as to a matter for which Teva has, under the
terms of the Agreement, the ultimate authority to decide.


 


(b)           In
the event the negligence or willful misconduct of Acorda or Teva, as
applicable, and/or their respective Affiliates, contribute to any Claims, then
Teva or Acorda, respectively, shall be responsible for that portion of such
Claim to which its negligence or willful misconduct have contributed.


 


(c)           With
respect to Claims that arise, in whole or in part, from the use of any
Collaboration Product in the Territory (including Claims that arise with
respect to the Development Programs and/or Commercialization of any Collaboration
Product) and which Claims do not arise or occur from the events and/or
activities described in Sections 11.1(a) or 11.1(b) above, the Parties shall
share such Claims on a 50/50 basis as provided in Section 11.2.


 


(d)           The
Indemnified Party shall give the Indemnifying Party notice of any Claim upon
which the Indemnified Party intends to base an indemnification claim (an “Indemnity
Claim”).  The Indemnifying
Party has the right to control the defense, settlement or disposition of any
Indemnity Claim using counsel of its choice and on terms that the Indemnifying
Party deems are appropriate, except that the Indemnified Party may, at its own
expense, participate in that defense, settlement or disposition using counsel
of its own choice.  With respect to the
defense, settlement or disposition of an Indemnity Claim, the Indemnified Party
shall provide the Indemnifying Party with reasonable assistance and cooperation
as reasonably requested by the Indemnifying Party.  Without limiting the generality of the foregoing, the
Indemnifying Party may not cease to defend, settle or otherwise dispose of any
Indemnity Claim without the Indemnified Party’s prior written consent, which
consent may be unreasonably withheld, if, as a result thereof, the Indemnified
Party would become subject to injunctive or other equitable relief or such
disposition would otherwise have a material adverse effect on the Indemnified
Party.


 


Section 11.2         Non-Indemnification
Eligible Claims.  If any Third Party
makes any Claim against a Party based on or resulting from the use of a
Collaboration Product in the Territory, and such Claim does not arise from any
event or activity requiring one Party to indemnify the other under Section
11.1, then the Parties shall promptly meet and determine the best way to defend
against, and resolve, such Claim. 
Unless the Parties agree otherwise, the Parties shall jointly defend the
claim, using mutually acceptable counsel, and shall share the costs equally of
such defense and of any settlement or amount of damages paid based on such
Claim.


 


Section 11.3         Limitation of
Liability.  IN NO EVENT SHALL EITHER
PARTY BE LIABLE TO THE OTHER OR ANY OF ITS AFFILIATES FOR ANY CONSEQUENTIAL,
INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES (INCLUDING,
WITHOUT LIMITATION, LOST PROFITS, BUSINESS OR GOODWILL) SUFFERED OR INCURRED BY
SUCH OTHER PARTY OR ITS AFFILIATES, WHETHER BASED UPON A CLAIM OR ACTION OF
CONTRACT, WARRANTY, NEGLIGENCE, STRICT LIABILITY OR OTHER TORT,


 


44

















 


OR
OTHERWISE, ARISING OUT OF THIS AGREEMENT. 
THE FOREGOING SENTENCE SHALL NOT LIMIT THE RIGHTS OR OBLIGATIONS OF
EITHER PARTY WITH RESPECT TO INDEMNIFICATION FOR THIRD PARTY CLAIMS UNDER
SECTIONS 11.1 AND 11.2 OR DAMAGES AVAILABLE FOR A PARTY’S BREACH OF
CONFIDENTIALITY OBLIGATIONS IN ARTICLE 10.


 


Section 11.4         Disclaimer of Warranty.  Except as expressly set forth in this
Agreement, nothing in this Agreement may be construed as a warranty or
representation by either Party (a) regarding the effectiveness, value, safety
or non-toxicity of the Compound or any Collaboration Product, or any
information or results provided by either Party pursuant to this Agreement or
(b) that any Collaboration Product will obtain Regulatory Approval.  Each Party explicitly accepts all of the
same as experimental and for development purposes, and without any express or
implied warranty from the other Party. 
EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, EACH PARTY
EXPRESSLY DISCLAIMS, WAIVES, RELEASES, AND RENOUNCES ANY WARRANTY, EXPRESS OR
IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE.


 


ARTICLE 12


 


TERM
AND TERMINATION


 


Section 12.1         Term.  The Term of this Agreement shall commence on
the Effective Date and shall continue with respect to all Collaboration
Products, unless earlier terminated in accordance with the terms and conditions
of this Agreement, until the earlier of (i) the sixth (6th) anniversary of the
Effective Date, if the Parties have not achieved a statistically significant
primary endpoint (as set forth in the relevant Development Program, established
by the Development Committee and approved by the CSC) as accepted by the FDA
for the first Pivotal Trial in respect of any Collaboration Product; (ii) six
(6) months after the first generic version of any Collaboration Product is
launched in the Territory; or (iii) nine (9) years from the Effective Date, if
the Parties have not commenced the Promotion and/or Commercialization of any
Collaboration Product.


 


Section 12.2         Termination.


 


(a)           Termination
for General Breach.  Except as
otherwise provided in subsection (b) below, a Party may terminate this
Agreement in its entirety if the other Party breaches any material provision of
this Agreement and does not fully cure that breach within thirty (30) Business
Days after it receives notice thereof from the other party, or, where that
breach is not susceptible to cure during the aforementioned thirty (30)
Business Day period, such breaching Party does not begin bona fide efforts to
cure that breach during such period and thereafter diligently cure that breach
to the non-breaching party’s reasonable satisfaction within ninety (90)
Business Days after it receives notice of that breach.


 


(b)           Termination
of Indications for Breach of Development. 
Notwithstanding anything to the contrary in this Agreement, if Acorda
materially breaches any of its obligations relating to the Development of a
Collaboration Product for a particular


 


45

















 


indication, use or dosage form, other than the Lead Indication or with
regard to the Proof of Concept Trial for the Secondary Indication selected by
the Parties for joint Development under this Agreement (which material breach
with respect to either or both thereto is subject to the termination provisions
of this Agreement), then Teva shall not have the right to terminate this
Agreement in its entirety, but rather Teva may give Acorda written notice of
such breach under this subsection (b). 
If Acorda does not fully cure that breach within thirty (30) Business
Days after it receives notice thereof or, where that breach is not susceptible
to cure during the aforementioned thirty (30) Business Day period, begin bona
fide efforts to cure that breach during such period and thereafter diligently
cure that breach to Teva’s reasonable satisfaction within ninety (90) Business
Days after it receives notice of that breach, then Teva may by written notice
terminate Acorda’s rights under the Agreement as to further Development and
Promotion and profit participation with respect to the Collaboration Products
for the indication, use or dosage form that was the subject of such uncured
material breach (the “Indication Termination”).  In the event of such Indication Termination
by Teva, Acorda will not thereafter be entitled to Develop, Commercialize,
Promote or sell any Collaboration Products for any indications, uses or dosage
forms that were not then being Developed, Commercialized, Promoted or sold
under this Agreement at the time of such Indication Termination, without
providing assurances to Teva, acceptable to Teva, that Acorda will be able meet
its funding and other obligations under this Agreement with respect to any such
future indications, uses or dosage forms. 
Absent such assurances, this Agreement shall also be deemed terminated
as to such indications, uses or dosage forms for Collaboration Products.


 


(c)           Termination
for Bankruptcy.  Either Party may
terminate this Agreement in its entirety, upon written notice, if the other
Party ceases to function as a going concern, makes an assignment for the
benefit of creditors, files a voluntary petition in bankruptcy, has an
involuntary petition in bankruptcy filed against it that is not dismissed within
sixty (60) Business Days, admits in writing its inability to pay its debts as
they become due or if an encumbrances takes possession, custody or control or a
receiver is appointed over substantially all of the property or assets of such
other Party.  All rights and licenses
granted under or pursuant to this Agreement by one Party to the other Party
are, for all purposes of Section 365(n) of Title 11, U.S. Code (the “Bankruptcy
Code”), licenses of rights to “intellectual property” as defined in
the Bankruptcy Code.  As a licensee of
such rights under this Agreement, a Party shall retain, and may fully exercise,
all of its rights and elections under the Bankruptcy Code.  If a Bankruptcy Code case is commenced by or
against a Party (the “Bankruptcy Party”), and this Agreement is
rejected as provided in the Bankruptcy Code, and the Bankruptcy Party elects to
retain its rights hereunder as provided in the Bankruptcy Code, then the
Bankruptcy Party (in any capacity, including debtor-in-possession) and its successors
and assigns (including, without limitation, a Bankruptcy Code trustee) shall
take such steps as are necessary to permit the other Party to exercise its
rights under this Agreement.  All
rights, powers and remedies of the non-Bankruptcy Party provided under this
provision are in addition to, and not in substitution for, any and all other
rights, powers and remedies now or hereafter existing at law or in equity
(including, without limitation, the Bankruptcy Code) in the event of any such
commencement of a bankruptcy proceeding by or against a Bankruptcy Party.


 


(d)           Unacceptable
Change of Control.  If there occurs
a Change of Control of Acorda, then Acorda shall provide Teva with prompt
written notice of same, but, in any event, no later than fifteen (15) days
after the effective date of such Change of Control.  Teva shall


 


46

















 


thereafter have the right, upon written notice provided within sixty
(60) Business Days of its receipt of Acorda’s notice of such Change of Control,
to terminate this Agreement in its entirety.


 


Section 12.3         Effect
of Expiration or Termination.


 


(a)           Termination
or Expiration of this Agreement. 
Upon the expiration or termination of this Agreement, the following
shall apply:


 


(i)            All
rights, licenses and privileges granted under this Agreement by Teva to Acorda
shall automatically terminate and immediately revert to Teva, subject only to
the survival provisions of Section 12.5;


 


(ii)           Acorda
shall promptly transfer to Teva originals and all copies of all Know-How,
Patent Rights, as well as all Marketing Materials, Product Samples, and other
materials in its possession or control that relate to the Compound or any
Collaboration Product, and ownership in and to all INDs and all Regulatory Approvals
(including NDAs) for all Collaboration Products;


 


(iii)         Without
waiving any rights or remedies that it has or that are granted to it by
operation of law, each Party shall pay to the other Party all undisputed sums
accrued that are due and owing under this Agreement;


 


(iv)          The
Parties shall comply with the provisions of Section 10.4 of this
Agreement;


 


(v)            Except
as otherwise expressly provided in this Agreement, including Section 12.4,
and subject to any rights or obligations that have accrued prior to expiration
or termination, neither Party shall have any further obligation to the other
Party under this Agreement, nor shall any Party be entitled to receive any fees
or other payments on account of such termination or expiration; and


 


(vi)          Acorda
will cooperate and provide reasonable assistance to Teva, at Teva’s expense, to
transition the Detailing of the relevant Collaboration Product(s) currently
being Detailed jointly by the Parties to a Detailing effort to be borne solely
by Teva.


 


(b)           Indication
Termination.  Upon an Indication
Termination, the following shall apply:


 


(i)            All
rights, licenses and privileges granted under this Agreement by Teva to the
Acorda in respect of Collaboration Product with respect to the indication, use
or dosage form that was the subject of the Indication Termination shall
automatically terminate and immediately revert to Teva;


 


(ii)           Acorda
shall promptly transfer to Teva originals and all copies of all Know-How,
Patent Rights, as well as all Marketing Materials, Product Samples, and other
materials in its possession or control that relate to such indication, use or
dosage form, to the extent practicable and only if such materials can be
entirely separated from, and are not being utilized with respect to,
then-existing Collaboration Products;


 


47

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have been
separately filed with the Commission.


 


(iii)         The
Parties shall comply with the provisions of Section 10.4 of this
Agreement.


 


(iv)          Except
as otherwise expressly provided in this Agreement, including Section 12.4,
and subject to any rights or obligations that have accrued prior to expiration
or termination, neither Party shall have any further obligation to the other
Party under this Agreement nor shall any Party be entitled to receive any fees
or other payments on account of such termination or expiration in respect of
such indication, use or dosage form for Collaboration Products; and


 


(v)            The
Parties shall promptly meet and agree on a procedure to adjust the sharing of
Copromotion Profits, as per the process set forth in
Section 3.5(c)(iv)(1), as if such indication, use or dosage form of the
Collaboration Product were a Proposed Use for which Acorda was the
Non-Participating Party.


 


Section 12.4         Residual
Payments after Certain Terminations.


 


(a)           If
Acorda terminates this Agreement early pursuant to Section 12.2(c), or if
Teva terminates this Agreement early pursuant to Section 12.2(d), then,
and in any such event, the terminated Party shall not be entitled to any
compensation or consideration for such termination unless the effective date of
such termination of Acorda occurs after the date Acorda completes the Next
Trial and the carcinogenicity study for a Collaboration Product for the Lead
Indication as contemplated in Section 3.2(b), in which event as Acorda’s
sole compensation and consideration arising out of such termination, Teva shall
thereafter pay to Acorda residual payments (the “Residual Payments”) in the
following applicable amounts:


 


(i)            If
such termination occurs prior to FDA approval of an NDA for a Collaboration
Product for the Lead Indication, the Residual Payments shall equal [***] of Net
Sales, if any, of any Collaboration Products in the Territory, until the date
on which the Term of this Agreement would have expired pursuant to
Section 12.1 (if it had not been earlier terminated pursuant to Sections
12.2(c) or 12.2(d)); provided, however, that notwithstanding the foregoing, in
no event shall Residual Payments to Acorda pursuant to this
Section 12.4(a)(i) exceed an amount equal, in the aggregate, to the sum
of: [****] of Acorda's share of the Development Costs in respect of
Collaboration Products through such date of termination and [***] of the
milestone payments paid to Teva by Acorda pursuant to Section 4.1 through
the date of Termination.


 


(ii)           If
such termination occurs after receipt of FDA approval of an NDA for a
Collaboration Product for the Lead Indication and the acquiring party in the
Change of Control that gave rise to the termination is an entity (or an
affiliate thereof) that is selling, commercializing, manufacturing or developing
a product that competes (or, if approved, will compete) directly with a
Collaboration Product, the Residual Payments shall be an amount equal to the
aggregate share of Copromotion Profits that Acorda would have received from
Teva under this Agreement during the two (2) year period commencing with the
date of termination, as if the Agreement had not been earlier terminated by
Teva pursuant to Subsection 12.2(d).


 


48

















 


Certain portions of this Exhibit have been omitted pursuant to a
request for confidentiality. Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.


 


(iii)         If
such termination occurs after receipt of FDA approval of an NDA for a
Collaboration Product for the Lead Indication and the termination is effected
by Teva pursuant to Subsection 12.2(d) for any reason other than that set
forth in paragraph (ii) above, the Residual Payments shall be an amount equal
to [***] of Net Sales, if any, of Collaboration Products in the Territory for
the period commencing on the date that is the second (2nd)
anniversary of the Launch Date and ending on the date on which the Term of this
Agreement would have expired pursuant to Section 12.1, as if the Agreement
had not been earlier terminated by Teva pursuant to Subsection 12.2(d).


 


(b)           Residual
Payments shall accrue upon the receipt of the amounts covered under applicable
invoices for the sale of any such Collaboration Product by Teva, its Affiliates
or licensees.  Residual Payments that
accrue in a particular calendar quarter shall be paid by Teva to Acorda within
thirty (30) Business Days after the end of such quarter.  With each such Residual Payment, Teva shall
provide Acorda with a written report setting forth for each such Collaboration
Product during the relevant calendar quarter, the Gross Sales, Net Sales, the
basis for all deductions used in calculating Net Sales of each such
Collaboration Product and the calculation of Residual Payments owed on such
sales.


 


(c)           Acorda
shall retain the right under Section 4.5(b) to have a third party auditor
reasonably acceptable to Teva and subject to such appropriate confidentiality
agreement to audit Teva’s records to confirm the accuracy of the Residual
Payments owed and paid under this Section 12.4.


 


Section 12.5         Survival.  Sections 4.5(b), 4.5(h), 8.1(c), 11.1,
11.2, 11.3, 12.3, 12.4 and 12.5, and Articles 9, 10 and 14 shall survive any
expiration or termination of this Agreement.


 


ARTICLE 13


 


REPRESENTATIONS
AND WARRANTIES; COVENANTS


 


Section 13.1         Mutual Representations and Warranties.  Acorda and Teva each hereby represent and
warrant to the other that, as of the Effective Date:


 


(a)           It
has the full right, power and authority to enter into and perform this
Agreement and to grant the rights granted in this Agreement.


 


(b)           The
execution, delivery and performance of this Agreement does not conflict with,
violate, or breach any other agreement to which it is a party, or its articles
of incorporation or by-laws, or any judgment, order or decree to which it is
subject.


 


(c)           This
Agreement has been duly executed and delivered by it and is a legal, valid and
binding obligation enforceable against it in accordance with its terms, subject
to and limited by:  (i) applicable
bankruptcy, insolvency, reorganization, moratorium, and other laws generally
applicable to creditors’ rights and (ii) judicial discretion in the
availability of equitable relief that enforceability is limited by applicable
federal and state bankruptcy laws.


 


(d)           In
the case of Teva, that it owns all right, title and interest in and to, or has
licensed the right to use for the purposes of this Agreement, its Patent
Rights.


 


49

















 


(e)           In
the case of Teva, that it owns, or has licensed the right to use for the
purposes of this Agreement, its Know-How.


 


(f)            In
the case of Teva, to the best of its knowledge, its Patent Rights are valid and
enforceable.


 


(g)           In
the case of Acorda, to the best of its knowledge, that it owns all right, title
and interest in and to, or has received an assignable license to use for the
purposes of this Agreement, the Acorda Background Technology, if any, and that
its rights thereto are valid and enforceable.


 


Section 13.2         Mutual Covenants.  Each Party, as applicable, hereby covenants
and agrees to the other:


 


(a)           To carry out its obligations and activities
under this Agreement in accordance with all applicable laws and regulations.


 


(b)           That except as otherwise permitted pursuant
to the terms of this Agreement, during the Term of this Agreement that it will
not enter into any agreement with a Third Party that would have a material
adverse effect on its ability to perform the obligations undertaken by it in
the Agreement.


 


(c)           It
will maintain, throughout the Term of this Agreement, adequate liability
insurance (including product liability coverage) in order to satisfy its
obligations under this Agreement of no less than two million dollars
($2,000,000) per occurrence and five million dollars ($5,000,000) in the
aggregate.  Each Party shall ensure that
the other Party is named as an additional insured under those liability
insurance policies, and will furnish the other with certificates evidencing
that insurance coverage no later than thirty (30) Business Days after the
Effective Date and thereafter, on each anniversary of the Effective Date upon
the written request of the other Party.


 


Section 13.3         Further Representations,
Warranties and Covenants of Acorda.


 


(a)           Acorda
represents and warrants that it has furnished to Teva a consolidated balance
sheet of Acorda as at December 31, 2002, and consolidated statements of
income and cash flows of Acorda for the fiscal year then ended, audited by KPMG
and consolidated balance sheets of the Acorda as of March 31, 2003, and
statements of income of Acorda for the period then ended.  Except as otherwise specifically identified
to Teva in writing by Acorda, the foregoing financial statements have been prepared
in accordance with GAAP and fairly present in all material respects the
consolidated financial condition of Acorda as at the close of business on the
date thereof and the results of operations for the periods then ended (subject,
in the case of unaudited statements, to year-end and audit adjustments and the
absence of footnotes).  There are no
contingent liabilities of Acorda or any of its subsidiaries as of such dates
involving material amounts known to the officers of Acorda that were not
disclosed in such balance sheets and the notes related thereto.


 


(b)           Acorda
represents and warrants to Teva that (i) as of the Effective Date, it is not in
default under any loan or credit agreement, note, bond, indenture, mortgage or
other


 


50

















 


evidence of indebtedness or instrument securing indebtedness to which
it is a party or by which its assets are bound, and it reasonably expects not
to be in default under any of the foregoing during the Term of this Agreement,
and (ii) it has immediately available funds sufficient to carry out the
transactions contemplated by this Agreement and to perform all of its
obligations under or arising out of this Agreement.


 


(c)           Acorda
represents and warrants to Teva that, as of the Effective Date, other than any
plans or negotiations relating to a public offering of its securities pursuant
to Sections 12 or 15 of the Securities Act of 1933, it is not involved in any
negotiations nor does it have any plans for negotiations, nor does it
anticipate the receipt, in the period of six (6) months after the Effective
Date, of any offers to negotiate, to be acquired by any Third Party or to sell
all or substantially all of its assets or business to any Third Party.


 


ARTICLE 14


 


MISCELLANEOUS


 


Section 14.1         Assignment.  This Agreement is personal to each Party and
neither Party may assign, mortgage, dispose of, transfer or delegate any of its
rights, duties or obligations under this Agreement or any interest in this
Agreement without the other Party’s prior written consent, which consent may
not be unreasonably withheld, except that (a) Teva may assign or
delegate any or all of its rights and obligations under this Agreement to its
Affiliates without Acorda’s prior written consent; provided that Teva remains
primarily liable for the performance and non-performance of its Affiliate’s
duties and obligations under this Agreement, and (b) either Party may assign
this Agreement without such consent to its successor in interest in connection
with a merger, acquisition or sale of all or substantially all of such Party’s
assets, provided that such successor in interest agrees in writing to be bound
by all of such Party’s obligations as assignee.  This Agreement is binding upon, enforceable against, and inures to
the benefit of the Parties hereto and their respective successors and permitted
assigns (but, in the case of Acorda, subject to the provisions of
Section 12.2(d)).  Any attempt by
either Party to assign or delegate any of the duties, responsibilities or other
obligations of this Agreement that is not in compliance with this
Section 14.1 shall be deemed to be null and void from the beginning.


 


Section 14.2         Notices.  Unless otherwise specified in this
Agreement, all notices, requests, demands and other communications required
under this Agreement must be in writing at the Parties’ respective addresses as
set forth below, unless notification of change of address is given.  Notice may be given by express mail using a
nationally-recognized courier, by certified mail, return receipt requested, and
by facsimile (with proof of receipt), and is deemed to have been given at the
time it is received:


 


	
  If to Acorda:

  	
  Acorda Therapeutics, Inc.

  
	
   

  	
  15 Skyline Drive

  
	
   

  	
  Hawthorne, New York 10532 U.S.A.

  
	
   

  	
  Attention:

  
	
   

  	
  Telephone:

  
	
   

  	
  Facsimile:

  



 


51

















 


	
  With a copy to:

  	
  Acorda’s General Counsel at the above address

  
	
   

  	
   

  
	
  If to Teva:

  	
  Teva Pharmaceutical Industries Ltd.

  
	
   

  	
  5 Basel Street, P.O. Box 3190

  
	
   

  	
  Petah Tiqva 49131

  
	
   

  	
  Israel

  
	
   

  	
  Attention:

  	
  Chief Executive Officer

  
	
   

  	
  Telephone:

  	
  972-3-926-7208

  
	
   

  	
  Facsimile:

  	
  972-2-924-6026

  
	
   

  	
   

  
	
  With a copy to:

  	
  Teva’s General Counsel, Uzi Karniel, at the above
  address and

  
	
   

  	
   

  
	
   

  	
  Richard S. Egosi, Esq.

  
	
   

  	
  Vice President and General Counsel

  
	
   

  	
  Teva North America

  
	
   

  	
  1090 Horhsam Road

  
	
   

  	
  North Wales, PA 19454-1090

  
	
   

  	
  Telephone:

  	
  (215) 591-8627

  
	
   

  	
  Facsimile:

  	
  (215) 591-8813

  



 


Section 14.3         Entire
Agreement.  This Agreement, the
Exhibits and Annexes attached hereto, all of which are hereby incorporated into
this Agreement, and except as preempted by Section 10, the Confidentiality
Agreement, contain the entire agreement between the Parties with respect to the
subject matter of this Agreement and supersede all previous agreements and
understandings between the Parties, whether written or oral, with respect
thereto.  Any amendment or modification
of this Agreement must be in writing executed by duly authorized
representatives of the Parties in the same manner as this Agreement.


 


Section 14.4         No
Endorsements.  Except as
contemplated and permitted in Section 9.7, neither Party may use the other
Party’s corporate name or logo or the name or logo of that other Party’s
Affiliates in a manner that could reasonably be construed to imply an
endorsement by that other Party or for publicity or advertising purposes or as
a reference to current or prospective customers without that other Party’s
prior written consent, which may be granted or withheld by that other Party in
its sole discretion.


 


Section 14.5         No
Waiver.  No consent by either Party
to, or a waiver of, a breach by either Party, whether express or implied,
constitutes consent to, waiver of, or excuse of, any other, different or
subsequent breach by either Party.


 


Section 14.6         Affiliates.  Each Party shall cause their respective
Affiliates to cooperate, in good faith, with the other Party and its
Affiliates, in the execution of any responsibilities assigned or delegated to
them with respect to the Development, Promotion and/or the Commercialization of
Collaboration Products, in such a manner as to maximize sales and profitability
with respect to Collaboration Products and to otherwise comply with all
applicable provisions of this Agreement. 
Each Party undertakes to ensure, to the extent applicable, that any


 


52

















 


or all of their respective Affiliates will take those actions as may be
necessary in order to ensure the foregoing.


 


Section 14.7         Force
Majeure.


 


(a)           Neither
Party shall be liable to the other for any failure or delay in the fulfillment
of its obligations under this Agreement (other than the payment of monies due
and owing to a Party under this Agreement), when any such failure or delay is
caused by fire; flood; earthquakes; accidents; explosions; sabotage; strikes,
or other labor disturbances (regardless of the reasonableness of the demands of
labor); civil commotions; riots; invasions; wars; acts, restraints,
requisitions, regulations, or directions of government authorities; acts of
God; or any other cause (similar to the foregoing) beyond the reasonable
control of the performing Party (collectively, “Force Majeure Events”).


 


(b)           In
the event that either Party is unable to discharge its obligations under this
Agreement on account of a Force Majeure Event (i) the performing Party will
notify the other Party forthwith, and will nevertheless make every endeavor, in
the utmost good faith, to discharge its obligations, even if in a partial or
compromised manner and (ii) the other Party has the right to terminate this
Agreement, if the performing Party’s inability to discharge such obligations
continues for a period of more than one hundred eighty (180) days.


 


Section 14.8         Relationship
of the Parties.


 


(a)           This
Agreement does not in any way create the relationship of principal and agent or
partners or joint venturers or agents or any similar relationship between
Acorda and Teva.  Neither Party has the
right, power or authority to bind the other to the fulfillment of any condition
not contained in this Agreement or to any other contract or obligation or
liability nor make any representation on behalf, or in the name, of the other
Party, whether express or implied.


 


(b)           Neither
Party is responsible for the hiring, firing or compensation of the other
Party’s employees or for any employee benefits.  No employee or representative of a Party has any authority to
bind or obligate the other Party for any sum or in any manner whatsoever, or to
create or impose any contractual or other liability on the other Party without
that Party’s authorization.


 


Section 14.9         Public
Announcements.  Neither Party shall
issue any press release or make any public statement pertaining to this
Agreement, the Development activities or any other transaction under this
Agreement without obtaining the prior written approval of the other Party.  Each Party may, however, issue any such
release or statement, upon the advice of its counsel, that such issuance is
required in order to comply with applicable law or securities rules or
regulations.  With respect to any such
required disclosure, each Party shall share such proposed disclosure in advance
with the other Party and shall take into account in good faith the comments, if
any, made by such Party; provided that such comments are made in a timely
manner, and provided further, that the disclosing Party shall retain the final
decision regarding the content and timing of such disclosure.  Further, the Party making any such required
disclosure shall, to the extent available, seek confidential treatment of the
same.


 


53

















 


Section 14.10       Severability.  The provisions of this Agreement are
severable, and if any one or more provisions is determined to be illegal or
otherwise unenforceable, either in whole or in part, the remaining provisions
or portions hereof nevertheless continue to be valid and binding on, and
enforceable by and between, the Parties.


 


Section 14.11       Fees
and Expenses.  Except as otherwise
provided in this Agreement, each of the Parties hereto shall pay its own
respective fees and expenses (including, without limitation, the fees of any
attorneys, accountants, investment bankers or other representatives) incurred
in connection with this Agreement and the transactions contemplated hereunder,
whether or not such transactions are consummated.


 


Section 14.12       Dispute
Resolution, Arbitration and Governing Law.


 


(a)           Subject to Annex G, in the event of any
dispute, controversy or claim between the Parties relating to or arising out of
this Agreement (a “Dispute”), each
Party will use its best efforts to expeditiously settle the Dispute in an
amicable manner within a time reasonable under the circumstances.  In the absence of a settlement, the Dispute
will be initially referred to the CSC. 
If the CSC is unable to resolve the Dispute within twenty (20) Business
Days of referral (or such longer period as the Parties or the CSC may agree),
the Dispute will be referred by either of the CSC co-chairpersons in writing to
the Chief Executive Officers of, or such other senior executive officers
designated by, Teva and Acorda for resolution. 
In the event that those senior executive officers fail to reach
agreement within twenty (20) Business Days of referral of the Dispute, or such
other period as the Parties may agree, then such Dispute will be decided by
arbitration in accordance with the International Rules of the American
Arbitration Association for Commercial Arbitration (the “Arbitration Tribunal”) in effect at the
time the Dispute arises, unless the Parties mutually agree otherwise.  Any such arbitration under this Section
14.12(a) shall be conducted in accordance with the provisions of Annex B
attached hereto.


 


(b)           Neither Party has the right to independently
seek recourse from a court of law or other authorities in lieu of arbitration,
but each Party has the right, before or during the arbitration, to seek and
obtain, from a court of competent jurisdiction, provisional equitable remedies
to avoid irreparable harm, maintain the status quo, or preserve the subject
matter of the arbitration.


 


(c)           This Agreement is governed by, and construed
in accordance with, the laws of the State of New York, U.S.A., without
reference to its conflict of laws principles, or the conflict of laws
principles of any other jurisdiction.


 


Section 14.13       Performance of Affiliates.  Each Party acknowledges that certain
obligations under this Agreement may be performed by its Affiliates.  Each of Acorda and Teva guarantees
performance of this Agreement by any of its Affiliates and shall be responsible
curing or otherwise remedying any breach of this Agreement by its Affiliates.


 


Section 14.14       Third Party Agreements.  The Parties acknowledge and agree that all
of the rights granted, and obligations owed, by Teva as set forth in this
Agreement are subject to the Third Party Agreements.  Teva agrees, to the extent that the Development, Promotion or


 


54

















 


Commercialization of any Collaboration Product for the Territory is
negatively impacted by the Third Party Agreements, upon the written request of
Acorda, to disclose such portions of the applicable Third Party Agreements for
Acorda’s review, subject to any confidentiality obligations that Teva may have
to Third Parties, and provided that Teva shall use commercially reasonable good
faith efforts to obtain a waiver of such confidentiality obligations that would
prevent Teva from disclosing to Acorda such portions of such Third Party
Agreements.


 


Section 14.15       Maintenance of Records.  Each Party shall keep and maintain all
records required by law or regulation with respect to Collaboration Products
and, to the extent appropriate hereunder, will make copies of such records
available to the other Party upon request.


 


Section 14.16       No Strict Construction.  This Agreement has been prepared jointly by
the Parties and may not be strictly construed against either Party.  Ambiguities, if any, in this Agreement may
not be construed against any Party, irrespective of which Party may be deemed
to have authored the ambiguous provision.


 


Section 14.17       Translations.  This Agreement is in the English language
only, which controls in all respects, and any versions of this Agreement in any
other language are for accommodation only and is not binding upon the
Parties.  All communications and notices
to be made or given pursuant to this Agreement, and any dispute proceeding
related to, or arising under, this Agreement, must be in the English language.


 


Section 14.18       Interpretation
and Definitions.  The preamble to
this Agreement is hereby integrated into this Agreement.  All Exhibits and Annexes to this Agreement,
attached at the time of signature of this Agreement, are hereby integrated into
this Agreement.


 


Section 14.19       Headings;
Section References.  The
Section and other headings contained in this Agreement are for reference
purposes only and do not affect the meaning or interpretation of this
Agreement.  As used in this Agreement,
the word “including” and phrase “such as” are illustrative and not limitative,
and incorporate, in all instances, the idea of “without limitation”.  All references in this Agreement to
Sections, Exhibits and Annexes are to Sections of, and Exhibits and Annexes to,
this Agreement, except as may be expressly specified otherwise.


 


Section 14.20       Counterparts.  This Agreement may be executed in any number
of counterparts, each of which is deemed to be an original of the same
instrument, but all of which together constitute but one and the same
instrument.


 


Section 14.21       Further
Instruments and Acts.  The Parties
agree to execute, acknowledge and deliver such further instruments and do all
other acts as may be necessary or appropriate to effect the purpose and intent
of this Agreement.


 


[The remainder
of this page has been intentionally left blank.]


 


55

















 


IN
WITNESS WHEREOF, each of the Parties has caused this
Agreement to be executed by its duly authorized representative as of the date
first set forth above.


 


 


	
   

  	
  TEVA PHARMACEUTICAL INDUSTRIES LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Eli Shohet

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Eli Shohet

  
	
   

  	
   

  	
  Title:

  	
  Vice-President - Business Development

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mitchell Shirven

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Mitchell Shirven

  
	
   

  	
   

  	
  Title:

  	
  Director, Strategic Business Planning

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ACORDA THERAPEUTICS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ron Cohen

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Ron Cohen

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
						



 


56

















 


ANNEX
A


 


Description of TV-1901


 


TV-1901 is
referred to by its chemical name, N-(2-amino-2-oxoethyl)-2-propylpentanamide,
or its International Non-proprietary Name, Valrocemide.  TV-1901 is the active ingredient in TV-1901
tablets.


 

















 


ANNEX B


 


Arbitration


 


1.             Initiation of
Arbitration.  A Party (“Complaining
Party”) that intends to begin an arbitration to resolve a Dispute as
contemplated by Section 14.12 of the Agreement (“Arbitration”) shall initiate
the Arbitration by providing written notice (“Arbitration Request”) of such
intent by certified or registered mail or properly documented overnight
delivery to the other Party (“Responding Party”).  The Arbitration Request shall include a copy
of the description of Dispute, set forth a proposed solution to the Dispute,
and include a suggested time frame within which the Parties must act to affect
such solution.  Contemporaneously with
sending the Arbitration Request, the Complaining Party shall submit a copy of
the Arbitration Request to the Arbitration Tribunal in the City of New York,
New York.


 


2.             Selection of
Arbitration.  Any and all Disputes
to be resolved pursuant to Arbitration shall be submitted to a neutral
arbitrator  (“Arbitrator”).  The Parties shall select the Arbitrator by
mutual agreement but if the Parties are unable to agree, then the Arbitrator
shall be selected in accordance with the procedures of the Arbitration
Tribunal.  The Arbitrator shall be a
former judge of a state or federal court who shall not be a current or former
employee, director or shareholder of, or otherwise have any current or previous
relationship with, either Party or its respective Affiliates.


 


3.             American
Arbitration Association Rules.  The
Arbitration shall be conducted in accordance with the rules of the American
Tribunal then in effect, subject to the time periods and other provisions of
this Annex or as otherwise set forth in the Agreement.


 


4.             Hearing.  Consistent with the time
schedule established pursuant to this Section 4 and Section 5
below, the Arbitrator shall hold a hearing (“Hearing”) to resolve each of
the issues identified in the description of Dispute.  To the extent practicable, taking into account the nature of the
Dispute and the availability of the Arbitrator, the Hearing shall be conducted
over a period not to exceed ten (10) consecutive Business Days, with each Party
entitled to approximately half of the allotted time, unless otherwise ordered
by the Arbitrator.  The Hearing shall be
conducted


 

















 


in a location
in the City of New York to be mutually agreed by the Parties.


 


5.             Discovery.  Within ten (10) Business Days of receipt by
the Responding Party of the Arbitration Request, the Parties shall negotiate in
good faith the scope and schedule of discovery, including depositions,
document production and other discovery devices, taking into account the nature
of the Dispute submitted for resolution. 
If the Parties are unable to reach agreement as to the scope and
schedule of discovery, the Arbitrator may order such discovery, as he or
she deems necessary.  In either case,
such discovery shall be completed within thirty (30) Business Days from the
date of the selection of the Arbitrator. 
At the Hearing, which shall commence within twenty (20) Business Days
after the completion of discovery, unless the Arbitrator otherwise orders, the
Parties may present testimony (either live witness or deposition), subject to
cross-examination, and documentary evidence.


 


6.             Hearing Submission.  At least twenty (20) Business Days prior to
the date set for the Hearing, each Party shall submit to each other and the
Arbitrator a list of all documents on which such Party intends to rely in any
oral or written presentation at the Hearing, a list of all witnesses, if any,
such Party intends to call at the Hearing and a brief summary of each witness’s
testimony.  At least five (5) Business
Days prior to the Hearing, each Party must submit to the Arbitrator and serve
on each other Party proposed findings of fact and conclusions of law on each
issue to be resolved.  Within five (5)
days following the close of the Hearing, each Party shall submit post-Hearing
briefs to the Arbitrator addressing the evidence and issues to be resolved as
may be required or permitted by the Arbitrator.


 


7.             Arbitrator’s Duties
and Authority.  The Arbitrator shall
preside over and resolve any Disputes between the Parties in connection with
the Arbitration.  The Arbitrator shall
have sole discretion with regard to the admissibility of any evidence and all
other matters relating to the conduct of the Hearing.  The Arbitrator shall, in rendering its decision, apply the
substantive law of the State of New York, excluding its conflict of laws
provisions.  The decision of the
Arbitrator shall be final and not appealable, except in the case of fraud or
bad faith on the part of the Arbitrator in connection with the conduct of such
proceedings.


 


B - 2

















 


8.             Decision and Award.  The Arbitrator shall render a decision and
award as expeditiously as possible, but in no event more than thirty (30)
Business Days after the close of the Hearing. 
In making the award, the Arbitrator shall rule on each disputed
issue.  Nothing contained herein shall
be construed to permit the Arbitrator or any court or any other forum to award
punitive, exemplary or any similar damages. 
Subject to Section 11.3 of the Agreement, the Parties expressly
waive any claim for punitive, exemplary or any similar damages and the only
damages recoverable under this Agreement are compensatory damages.


 


9.             Costs and Expenses.  Each Party shall pay its own costs
(including, without limitation, reasonable attorneys’ fees) and expenses in
connection with the Arbitration; provided, however, that if the Arbitrator
determines that the action of any Party was arbitrary, frivolous or in bad
faith, the Arbitrator may award such costs and expenses to the prevailing
Party.


 


10.           Confidentiality.  The Arbitration shall be confidential and,
except as required by law, neither Party shall make (or instruct the Arbitrator
to make) any public announcement with respect to the proceedings or decision of
the Arbitrator without the prior written consent of the other Party.  The existence of any Dispute, and the award
of the Arbitrator, shall be kept in confidence by the Parties and the
Arbitrator, except as required in connection with the enforcement of such award
or as otherwise required by applicable law.


 


11.           Jurisdiction to
Enforce Award.  For the purposes of
these arbitration provisions, the decision may be entered in any court of
competent jurisdiction.


 


12.           Exclusive Procedures.  The procedures specified herein shall be the
sole and exclusive procedures for the resolution of Disputes between the
Parties that are expressly identified for resolution in accordance with these
arbitration provisions.


 


B - 3

















 


ANNEX
C


 


Form of Certificate of Analysis


 


Form to be agreed upon and
supplied by the Parties.


 


Form of Certificate of Release


 


Form to be agreed upon and
supplied by the Parties.


 


 

















 


ANNEX
D


 


Copromotion Expenses


 


Copromotion Expenses shall
consist of the following expenses to the extent (a) included in a Marketing
Plan approved by the CSC and (b) allocable directly to the Collaboration
Product:


 


•              For the purposes of calculating
the costs referred to in Section 4.4, expenses associated with Sales
Representatives, Professional Education Managers, Scientific Managers and
Account Managers, and their field-based management, such as compensation-salaries,
benefits; sales contest prizes, awards, spot recognition, incentive bonuses in
cash or kind, including incentive trips; travel, including supplies, equipment,
materials, and services customarily used by Sales Representatives, such as
telephone, mailing and shipping, copying, printing, telephone and video
conferences; discretionary promotional and educational expenses, including
expenses for business entertainment, business meals, “lunch and learn”
programs, and grants; organizational meetings at national or below-national
level; auto expenses such as lease, gasoline, repairs, maintenance, taxes,
registration and insurance; information systems support, such as field
computers and accessories, license and maintenance fees for external software;
expenses for product and general training including training materials and
seminar fees, safe driving training and associate development; similar expenses
related to Sales Representatives’ immediate manager; and such other costs as
are agreed upon by the CSC.


 


•              Costs and expenses, including
compensation and benefits of non-field-based personnel of either Party working
directly on a Collaboration Product at least fifty percent (50%) of their time,
including, without limitation, product managers and scientific experts.


 


•              Direct costs and expenses
associated with the storage and distribution to Sales Representatives of
Product Samples and Marketing Materials.


 


•              Costs and expenses associated with
the tasks outlined under Section 7.6 of the Agreement (i.e., managed care costs),
including, without limitation, the costs of processing contracts and rebate
claims.


 


•              Journal advertising


 


•              Outdoor advertising


 


•              Advertising agency fees


 


•              Direct mail


 


•              Sales visuals and detail aids


 


•              Therapy information or initiation
materials


 

















 


 


•              Premium items


 


•              Printing costs


 


•              Reprints


 


•              Conventions and exhibits including
exhibition booths


 


•              Medical education symposia


 


•              Professional relations, including
“lunch and learn” programs, educational seminars and CME programs for all types
of medical professionals


 


•              Patient and caregiver education


 


•              Patient and caregiver literature


 


•              Fulfillment and mailing cost for
all promotional materials


 


•              Product Samples


 


•              Free Product programs and the
costs of distributing and storing such Free Products


 


•              Collaboration Products provided
free of charge to indigent patient programs or for Promotional programs as
defined by the CSC


 


•              Visiting faculty


 


•              Local speakers


 


•              Outside consultants


 


•              Public relations programs and
activities


 


•              Public relations agency fees


 


•              Sponsorship and support for
patient support organizations


 


•              Package insert printing costs


 


•              Grants


 


•              Videos and films


 


•              Patient support programs such as
insurance benefit investigation, financial support for indigent patients


 


•              Sales force regional programs


 


 


 


D - 2

















 


 


•              Launch meeting materials, costs of
obtaining services from external providers where such costs are directly
related to training at the launch meeting and launch meeting costs


 


•              Professional education meetings


 


•              Consultant/advisory meetings


 


•              Scientific publication and
communication including publication agency fees


 


•              External clinical proposals,
health outcomes and pharmaco-economics studies


 


•              Development, maintenance and
hosting of web sites and similar e-business initiatives


 


•              Medical plan costs including
supplies, fees and costs of outside consultants (when agreed to by the parties
jointly), market support initiatives and developmental activities as well as
the reasonable costs related to medical writing in connection with any such
studies or trials, whether such activities are performed by a Party or by a
subcontractor thereof


 


•              Pre-approved off-site facility
rental costs incurred by either Party


 


•              Costs of conducting PMS required
by the CSC but not the FDA


 


•              Costs of purchasing from reliable
third party sources (e.g., Verispan) during the Term of this Agreement market
research studies, data purchases, or externally audited data, for purposes of
sales force management, showing (i) the audited number of Detail minutes spent
by the Sales Representatives of each Party in Detailing the relevant
Collaboration Product and in Detailing all Collaboration Products Detailed by
such Sales Representatives and (ii) the total number of audited Details of the
relevant Collaboration Product and the total number of audited Details for all
Collaboration Products Detailed by Sales Representatives involved in Detailing
the Collaboration Product


 


•              Financing cost of receivables (the
applicable index shall be the rate of the three month Treasury bill note)


 


•              Costs and expenses for call center
services


 


•              Any direct costs incurred to
Promote the relevant Collaboration Product


 


 


 


D - 3

















 


ANNEX
E


 


Third Party Agreements


 


1.             Agreement between Teva and Yissum Research and
Development Company of the Hebrew University, dated September 15, 1992,
regarding the Compound, and any amendments thereto.


 


2.             Teva has received funding from the Office of the Israeli
Chief Scientist (the “OCS”) for the purposes of development and
commercialization of the Compound. 
Therefore, Teva is subject to the provisions of the Israeli Law for the
Encouragement of Research and Development in the Industry — 1984 (as amended)
and the rules and regulations promulgated thereunder and to the letters of
approval issued to Teva by the OCS with respect to the Compound.


 


 

















 


 


ANNEX
F


 


Elements of a Marketing Plan


 


Each Marketing Plan for a
Collaboration Product Developed pursuant to the terms and conditions of the
Agreement shall contain, at a minimum, the elements set forth in this Annex
F applicable to the relevant Collaboration Product’s then current
lifecycle.


 


                I.              Situation
Analysis


 


                a.             Market
and Market Dynamics Overview


 


                i.              Description
of the condition(s), incidence, prevalence


 


                ii.             Current
treatments


 


                iii.            Size
of the market, dollars, prescriptions, patients


 


                iv.            Pricing


 


                v.             Market
trends


 


                vi.            Unmet
needs


 


                b.             Key
competitors


 


                                i.              Messages,
promotional activity, SWOT


 


                c.             Drugs
in development


 


                d.             Key
customers


 


                i.              Demographics


 


                II.            Product


 


                a.             Description


 


                b.             SWOT


 


                III.           Key
issues/Challenges


 


                IV.           Critical
success factors


 


                V.            Prioritized
customers


 


                VI.           Non-financial
objectives


 


                a.             Including
number of calls on the specific number of Targeted Prescribers


 


 

















 


 


                b.             Goals/needs
for label improvement, new forms, or new indications


 


                VII.          Positioning
and Key Messages


 


                VIII.        Strategies


 


                IX.           Tactics
& Tactical Spend


 


                a.             Manpower


 


                b.             Non-manpower


 


                c.             Education
& Scientific Communication


 


                X.            Suggested
MOP based on Item VI (b) above


 


                XI.           Human
resources to be employed


 


                a.             Sales
FTEs to be employed


 


                b.             Number
of support personnel to be allocated


 


                XII.         Financial
objectives


 


                XIII.        Major
assumptions


 


                XIV.        Forecast


 


                XV.         Accelerators/Decelerators


 


                XVI.        P&L
statement


 


 


F - 2

















 


 


ANNEX
G


 


Matters Within Teva’s Sole Decision Making
Authority


 


1.             All matters concerned with the Compliance Committee
issues associated with the Commercialization of Collaboration Products.


 


2.             Items within the purview of the Compliance Committee, as
more particularly set forth in Section 2.1(b)(iii) of the Agreement.


 


3.             Whether Acorda may pursue Independent Development of a
Collaboration Product for a Proposed Use, as more particularly set forth in
Section 3.5(b) of the Agreement.


 


 


 

















 


ANNEX
H


 


Next Trial and Carcinogenicity Study for the
Lead Indication


 


To be agreed upon and supplied
by the Parties.


 


 


 


 

















 


 


TABLE OF CONTENTS


 


	
  ARTICLE 1

  	
  DEFINED
  TERMS

  
	
   

  	
   

  
	
  ARTICLE 2

  	
  GOVERNANCE OF DEVELOPMENT AND
  COMMERCIALIZATION OF COLLABORATION PRODUCTS

  
	
   

  	
   

  
	
  ARTICLE 3

  	
  DEVELOPMENT OF PRODUCTS

  
	
   

  	
   

  
	
  ARTICLE 4

  	
  FINANCIAL PROVISIONS

  
	
   

  	
   

  
	
  ARTICLE 5

  	
  COPROMOTION; PROMOTIONAL EFFORTS;
  PRODUCT SAMPLING

  
	
   

  	
   

  
	
  ARTICLE 6

  	
  MANUFACTURE AND COMMERCIALIZATION OF
  COLLABORATION PRODUCTS

  
	
   

  	
   

  
	
  ARTICLE 7

  	
  REGULATORY COMPLIANCE; MEDICAL
  COMPLAINTS; MANAGED CARE AND GOVERNMENT CONTRACTING

  
	
   

  	
   

  
	
  ARTICLE 8

  	
  GRANT OF RIGHTS AND NONCOMPETITION

  
	
   

  	
   

  
	
  ARTICLE 9

  	
  INTELLECTUAL PROPERTY

  
	
   

  	
   

  
	
  ARTICLE 10

  	
  CONFIDENTIALITY

  
	
   

  	
   

  
	
  ARTICLE 11

  	
  INDEMNIFICATION; LIMITATION OF
  LIABILITY; WARRANTY DISCLAIMER

  
	
   

  	
   

  
	
  ARTICLE 12

  	
  TERM AND TERMINATION

  
	
   

  	
   

  
	
  ARTICLE 13

  	
  REPRESENTATIONS AND WARRANTIES;
  COVENANTS

  
	
   

  	
   

  
	
  ARTICLE 14

  	
  MISCELLANEOUS

  



 


 


	
  Annex A

  	
  -

  	
  Description of TV-1901

  
	
  Annex B

  	
  -

  	
  Arbitration

  
	
  Annex C

  	
  -

  	
  Form of Certificate of Analysis and Form of
  Certificate of Release

  
	
  Annex D

  	
  -

  	
  Copromotion Expenses

  
	
  Annex E

  	
  -

  	
  Third Party Agreements

  
	
  Annex F

  	
  -

  	
  Elements of a Marketing Plan

  
	
  Annex G

  	
  -

  	
  Matters Within Teva’s Sole Decision Making
  Authority

  
	
  Annex H

  	
  -

  	
  Next Trial and Carcinogenicity Study for
  the Lead Indication

  



 


i


 

























 


	
  

  



 


 


September 23, 2003


 


 


Eli Shohet


Vice President of Business
Development


Teva Pharmaceutical Industries,
Ltd.


P.O. Box 3190


Petah Tiqva  49131


Israel


 


Re: Fampridine Right of First
Negotiation Grant


 


Dear Mr. Shohet:


 


This letter shall confirm our
agreement regarding a possible collaboration agreement to develop, co-promote
and commercialize in the United States (including its possessions and
territories), Canada and Mexico (collectively, the “Territory”) all finished
pharmaceutical products that contain Acorda’s chemical compound referred to as
fampridine (the “Fampridine Agreement”).


 


Commencing on the date hereof
Acorda hereby grants to Teva the exclusive right of first negotiation pursuant
to which it shall enter into good faith negotiations exclusively with Teva
regarding terms of a possible mutually acceptable Fampridine
Agreement.   It is understood that
neither party is obligated to enter into such a Fampridine Agreement except on
terms acceptable to it in its discretion, and that Acorda may determine that
the terms proposed by Teva are not as attractive as proceeding on its own (or,
as permitted below, with a third party). 
If the parties are unable to agree upon mutually acceptable terms for
the Fampridine Agreement, and Teva has not already provided Acorda with its
written notice to terminate such good faith negotiations, then Acorda may
terminate the right of first negotiation hereunder upon written notice given to
Teva at any time from and after the date sixty (60) days from the last date (the
“Trial Completion Date”) on which Acorda has delivered to Teva summary results
(in the format described in Appendix A to this Letter Agreement) of the
completed SCI-F301, SCI-F302 and 
MS-F202 clinical trials for Fampridine SR currently being conducted by Acorda
(collectively, the “Clinical Trials”). 
The period commencing on the date hereof and ending on the earlier of
sixty (60)  days after the Trial
Completion Date, or the date Teva terminates such good faith negotiations is
referred to herein as the “Negotiation Period”.  Upon the end of the Negotiation Period, Acorda may thereafter
negotiate the terms of, and enter into, an agreement regarding rights to
fampridine in any of the countries of the Territory with one or more third
parties on any terms.  However, Acorda
may, if it so elects and Teva is willing, continue negotiations with Teva
regarding reaching terms for the Fampridine Agreement.  Throughout the Negotiation Period, Acorda
shall not, directly or indirectly, negotiate any terms of a potential Fampridine
Agreement with any party other than Teva; provided, however, that the foregoing
would not prevent Acorda from (a) entering into strategic alliances with
service vendors at any time before, during or after the end of the Negotiation
Period,  or (b) providing to
possible licensees due diligence disclosures solely of technical data and
intellectual property rights respecting fampridine (but in no event shall
Acorda, directly or indirectly, discuss with or accept during the Negotiation
Period from any licensees (or other third parties), business terms, or the
economic structure of a potential agreement respecting fampridine for any
country in the Territory, whether in connection with such due diligence
disclosures or otherwise).


 


	
  15 SKYLINE DRIVE

  	
  PHONE: (914) 347-4300

  	
  E-MAIL: ACORDA@ACORDA.COM

  
	
  HAWTHORNE, NY 10532

  	
  FAX: (914) 347-4560

  	
  WWW.ACORDA.COM

  



 

















 


 


Notwithstanding the provisions
of the immediately preceding paragraph of this Letter Agreement, if prior to
the end of the Trial Completion Date, Acorda desires to enter into negotiations
with a third party regarding terms of an agreement respecting fampridine for
any country in the Territory, then Acorda shall first issue written notice to
Teva requesting Teva’s best and final offer for its terms of the Fampridine
Agreement (the “B&F Notice”).  
Teva shall then have fifteen (15) business days after its receipt of the
B&F Notice to provide Acorda with its written best and final offer. 
If Acorda does not accept such proposed Teva best and final offer (as set forth
in a written notice to Teva) or Teva fails to timely provide such a best and
final offer, then Acorda shall have the right to negotiate the terms and
thereafter enter into an agreement regarding rights to fampridine with a third
party, provided that the terms of such third party agreement respecting
fampridine are more favorable to Acorda (on a financial or such other basis as
reasonably determined by Acorda) than the terms set forth in Teva’s written
best and final offer (if any), and such agreement is duly executed by such
third party and Acorda prior to the Trial Completion Date.


 


If prior to the Trial
Completion Date Acorda does not enter into an agreement regarding fampridine
with a third party as provided in the immediately preceding paragraph, then
Teva shall have the right to provide to Acorda a written best and final offer
for its terms of the Fampridine Agreement within  sixty (60) days after the Trial Completion Date.   If Teva issues such best and final offer
and Acorda does not accept same (as set forth in a written notice to Teva),
then Acorda shall have the right to thereafter proceed on its own in connection
with the development, promotion and commercialization of fampridine in the
Territory or enter into an agreement respecting fampridine for any country in
the Territory on any terms


 


For clarity, it is understood
that this Letter Agreement grants Teva no rights of negotiation (or any other
rights) regarding fampridine in any country or territory outside the Territory,
and that Acorda retains all such rights exclusively. Throughout the Negotiation
Period, and following review by Teva of the summary results of the Clinical
Trials in Appendix A hereof, the parties acknowledge that additional due
diligence may be necessary, including on-site review and discussion at
Acorda regarding protocols, protocol amendments, analytical plans, and
final data.  Notwithstanding the
foregoing, such additional due diligence shall not be interpreted to extend the
Negotiation Period beyond the term as defined above.


 


Please indicate your agreement
with the foregoing by signing and returning a copy of this letter to the
undersigned, whereupon this shall constitute a legal and binding agreement
between us.


 


Very truly yours,


 


	
  Acorda Therapeutics, Inc.

  	
   

  	
  Teva Pharmaceutical
  Industries, Ltd.

  
	
   

  	
   

  	
   

  
	
  /s/ Ron Cohen

  	
   

  	
  /s/ Eli
  Shohet

  
	
  Ron Cohen

  	
   

  	
  Eli Shohet

  
	
  Chief Executive Officer

  	
   

  	
  Vice
  President of Business Development

  



 


 

















 


Appendix A


 


As defined in the Letter
Agreement to which this Appendix A is attached, the Trial Completion Date will
be the last date upon which Acorda provides the following summary results of
the Clinical Trials to Teva.


 


One summary will be provided
for the each of the two Phase 3 clinical trials (SCI-F301 and SCI-F302)
evaluating the safety and efficacy of Fampridine-SR in the treatment of
spasticity and the Phase 2 clinical trial (MS-F202) evaluating safety and
efficacy of Fampridine-SR for the treatment of lower extremity motor
dysfunction


 


The parties agree that the
following summary results may not include summary results of secondary or
sub-group analyses or the extension studies, if such analyses or studies are
completed after completion and delivery of the following summary results.  Acorda would provide such summaries of such
additional analyses or extension studies to Teva, when available, but such
additional summary information shall not extend the Negotiation Period.


 


SCI-F301/SCI-F301 Data Table


 


	
  Baseline
  Demographics

  	
   

  	
  Placebo

  	
   

  	
  Fampridine-

  SR 25mg

  	
   

  	
  Delta

  	
   

  	
  p-value

  
	
  Age

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sex

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ASIA classification (B/C/D)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Duration of injury

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ashworth Score

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Spasm Frequency Score

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Spasm Severity Score

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subject Global Impression (SGI)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Clinical Global Impression (CGI)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Index of Erectile Function
  (IIEF)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Female Sexual Function Index (FSFI)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bowel function questionnaire

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bladder function questionnaire

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Efficacy Variables

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Primary endpoints

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ashworth Score

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subject Global Impression (SGI)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Secondary endpoints

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Spasm Frequency Score

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Spasm Severity Score

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Clinical Global Impression (CGI)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Index of Erectile Function
  (IIEF)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Female Sexual Function Index (FSFI)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bowel function questionnaire

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bladder function questionnaire

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


	
  Treatment-Emergent Adverse Events

  	
   

  	
  Placebo

  	
   

  	
  Fampridine-SR 25mg

  	
  p-value

  	
   

  
	
  This table is representative.  The actual treatment-emergent adverse
  events will be listed in as many rows as are required.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


 

















 


MS-F202 Data Table


 


	
  Baseline
  Demographics

  	
   

  	
  Placebo

  	
   

  	
  Fampridine-SR (bid dose)

  	
   

  	
  p-values
  (vs. placebo)

  
	
   

  	
   

  	
   

  	
   

  	
  10 mg

  	
   

  	
  15 mg

  	
   

  	
  20 mg

  	
   

  	
  10 mg

  	
   

  	
  15 mg

  	
   

  	
  20 mg

  
	
  Age

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sex

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  MS classification

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ashworth Score

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LEMMT

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Timed 25 foot walk

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9 hole peg test

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PASAT 3”

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Efficacy Variables

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Primary endpoint

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Timed 25 foot walk

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Secondary endpoints

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LEMMT

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ashworth score

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9-hole peg test

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PASAT

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subject Global Impression (SGI)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Clinical Global Impression (CGI)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


 


	
  Treatment-Emergent

  Adverse Events

  	
   

  	
  Placebo

  	
   

  	
  Fampridine-SR (bid dose)

  	
   

  	
  p-values
  (vs. placebo)

  
	
   

  	
   

  	
   

  	
   

  	
  10 mg

  	
   

  	
  15 mg

  	
   

  	
  20 mg

  	
   

  	
  10 mg

  	
   

  	
  15 mg

  	
   

  	
  20 mg

  
	
  This table is representative.  The actual treatment-emergent adverse
  events will be listed in as many rows as are required.