OR DEFICIENCY ON THE PART OF ISIS EXISTS, BMS
SHALL BE ENTITLED TO CONDUCT ADDITIONAL QUALITY AUDITS (AT MUTUALLY CONVENIENT
TIMES AND CONSISTENT WITH WHAT IS REASONABLE AND CUSTOMARY IN THE PHARMACEUTICAL
INDUSTRY) IN ORDER TO SATISFY ITSELF THAT APPROPRIATE REMEDIAL MEASURES HAVE
BEEN, OR ARE BEING, TAKEN BY ISIS REGARDING THE MATTERS IN QUESTION.
IN
ADDITION, IF ISIS HAS PERFORMED A COMPARABLE AUDIT WITH RESPECT TO CONTRACT
SERVICE PROVIDERS INVOLVED IN THE MANUFACTURE OF API, UPON REQUEST BY BMS, ISIS
WILL SHARE THE RESULTS OF THOSE AUDITS WITH BMS, UNLESS PRE-EXISTING AGREEMENTS
BETWEEN ISIS AND THE SERVICE PROVIDER PRECLUDE DOING SO.
BMS WILL RESPECT THE
CONFIDENTIALITY OF ISIS AND ANY SERVICE PROVIDERS DURING ANY AUDIT OR VISIT
(INCLUDING ENTERING INTO AN APPROPRIATE CONFIDENTIAL DISCLOSURE AGREEMENT AS
NECESSARY).
ISIS' OBLIGATION TO SUPPLY BMS API UNDER THIS SECTION 4.2 WILL
EXPIRE UPON THE [***] YEAR ANNIVERSARY OF THE EXPIRATION OF THE RESEARCH TERM
(I.E., AT [***] YEARS FOLLOWING THE EXPIRATION OF THE RESEARCH TERM).
ANY API
REQUESTED BY BMS AFTER THE END OF THE RESEARCH TERM WILL BE MANUFACTURED
PURSUANT A SEPARATE CLINICAL SUPPLY AGREEMENT AS DESCRIBED IN SECTION 4.3 BELOW.
SECTION 4.3
CLINICAL SUPPLY OF API THROUGH COMPLETION OF PHASE II AND
PHASE IIB TRIALS.
BMS WILL OBTAIN API FOR ALL CLINICAL DEVELOPMENT ACTIVITIES
UNDER THIS AGREEMENT THROUGH THE COMPLETION OF PHASE IIB TRIALS (THE "PHASE II
CLINICAL SUPPLY") FROM ISIS.
ISIS SHALL BE RESPONSIBLE FOR THE MANUFACTURE AND
SUPPLY OF BMS' REQUIREMENTS OF THE PHASE II CLINICAL SUPPLY.
SUCH API SHALL BE
DELIVERED AND PROVIDED AS A SERVICE FOR BMS WITH A SUPPLY SERVICES FEE BEING
$[***] PER GRAM OF API (WHICH IS ISIS' GOOD FAITH ESTIMATE OF ITS FULLY BURDENED
COST OF MANUFACTURE OF SUCH API).
THE PARTIES MAY NEGOTIATE IN GOOD FAITH AND
MUTUALLY AGREE UPON A REDUCTION TO THIS FEE TO THE EXTENT ISIS' MANUFACTURING
COSTS DECREASE AFTER THE EFFECTIVE DATE.
IN ADDITION, IF ISIS SUPPLIES ACTIVE
PHARMACEUTICAL INGREDIENT FOR A SIMILAR ASO TO A THIRD PARTY AT SIMILAR VOLUMES
ON TERMS WHEN TAKEN AS A WHOLE ARE MORE FAVORABLE THAN THE TERMS PROVIDED BMS
UNDER THIS AGREEMENT, BMS WILL HAVE THE RIGHT TO RECEIVE THE CLINICAL SUPPLY OF
API ON THE SAME TERMS OFFERED BY ISIS TO SUCH THIRD PARTY.
ISIS AND BMS WILL
ENTER INTO A MANUFACTURE AND SUPPLY AGREEMENT FOR THE PHASE II CLINICAL SUPPLY,
INCLUDING THE RELATED CMC ACTIVITIES AND/OR
10
ANY API REQUESTED BY BMS AFTER THE END OF THE RESEARCH TERM UNDER SECTION 4.2
(THE "CLINICAL SUPPLY AGREEMENT").
SUCH CLINICAL SUPPLY AGREEMENT SHALL INCLUDE
THE QUALITY AUDIT PROVISIONS SET FORTH IN SECTION 4.2 AND OTHER CUSTOMARY TERMS
AND CONDITIONS TO BE NEGOTIATED IN GOOD FAITH.
ISIS WILL NOT HAVE ANY
OBLIGATION UNDER THIS SECTION 4.3 TO NEGOTIATE OR ENTER INTO ANY MANUFACTURING
OR SUPPLY AGREEMENT OR SIMILAR AGREEMENT BEYOND THE SCOPE SET FORTH IN THIS
SECTION 4.3, INCLUDING WITHOUT LIMITATION ANY AGREEMENT COVERING CLINICAL SUPPLY
FOR PHASE III TRIALS OR COMMERCIAL SCALE-UP OR SUPPLY.
AS PART OF THE PHASE