SUCH MEETINGS THE COLLABORATION COMMITTEE'S RESPONSIBILITIES WILL INCLUDE:
(I) FORMULATING AND REVIEWING THE COLLABORATION OBJECTIVES WITH RESPECT TO EACH
OPTIMIZATION PROGRAM; (II) MONITORING THE PROGRESS OF THE COLLABORATION TOWARD
THOSE OBJECTIVES; (III) EVALUATING HITS IDENTIFIED BY PHARMACOPEIA FROM
SCREENING PROGRAMS; (IV) INITIALLY REVIEWING RECOMMENDATIONS BY PHARMACOPEIA TO
SCHERING FOR HITS PROPOSED TO BE ACCEPTED AS LEAD COMPOUNDS FOR NEW OPTIMIZATION
PROGRAMS; AND (V) TAKING SUCH OTHER ACTIONS AS MAY BE SPECIFIED UNDER THIS
AGREEMENT OR WHICH THE PARTIES DEEM APPROPRIATE.
THE COLLABORATION COMMITTEE
MAY DESIGNATE A PATENT COMMITTEE COMPRISED OF EMPLOYEES OR REPRESENTATIVES OF
THE PARTIES TO OVERSEE THE PATENT PROSECUTION AND/OR ENFORCEMENT ACTIVITIES
DESCRIBED IN ARTICLE VI, AND TO FACILITATE COMMUNICATION AND AGREEMENT BETWEEN
THE PARTIES REGARDING INVENTORSHIP OF INVENTIONS MADE IN THE COLLABORATION AND
THE CLASSIFICATION OF SUCH INVENTIONS (E.G., AS SCHERING IMPROVEMENTS,
PHARMACOPEIA IMPROVEMENTS, COLLABORATION TECHNOLOGY, ETC.).
ADDITIONAL
NON-VOTING REPRESENTATIVES OR CONSULTANTS FROM EITHER PARTY MAY FROM TIME TO
TIME BE INVITED BY SCHERING OR PHARMACOPEIA TO ATTEND AND PARTICIPATE IN
COLLABORATION COMMITTEE MEETINGS (E.G., TO EVALUATE AND ADVISE ON BUSINESS OR
SCIENTIFIC ISSUES) SUBJECT TO COMPLIANCE WITH THE CONFIDENTIALITY PROVISIONS OF
SECTION 7.1.
EACH PARTY SHALL BE RESPONSIBLE FOR ITS OWN EXPENSES IN CONNECTION
WITH THE COLLABORATION COMMITTEE.
3.3
COLLABORATION COMMITTEE DECISIONS.
DECISIONS OF THE COLLABORATION COMMITTEE SHALL BE BASED UPON THE CONSENSUS OF
ALL THE MEMBERS.
IN THE EVENT THAT THE COLLABORATION COMMITTEE CANNOT OR DOES
NOT, AFTER GOOD FAITH EFFORTS, REACH AGREEMENT ON AN ISSUE, SUCH ISSUE SHALL BE
REFERRED TO THE PRESIDENT OF SCHERING'S AFFILIATE, THE SCHERING-PLOUGH RESEARCH
INSTITUTE ("SPRI"), AND THE PRESIDENT AND CHIEF OPERATING OFFICER OF
PHARMACOPEIA DRUG DISCOVERY FOR RESOLUTION.
IN THE EVENT THAT THESE OFFICERS
ARE UNABLE TO RESOLVE THE ISSUE WITHIN FIFTEEN (15) BUSINESS DAYS AFTER
SUBMISSION OF THE ISSUE TO THEM, THEN THE UNRESOLVED ISSUE MAY BE SUBMITTED BY
EITHER PARTY TO BINDING ARBITRATION PURSUANT TO SECTION 11.3 OF THIS AGREEMENT,
EXCEPT THAT THE DECISION SHALL BE MADE BY ONE (1) ARBITRATOR WITH EXPERTISE IN
PHARMACEUTICAL PRODUCT DEVELOPMENT, AND THE DECISION OF THE ARBITRATOR SHALL BE
RENDERED WITHIN SIX (6) MONTHS OF INITIATION OF THE ARBITRATION.
DURING THE
PENDENCY OF ANY SUCH ARBITRATION PROCEEDINGS, THE PARTIES SHALL PROCEED WITH
PERFORMANCE OF THE COLLABORATION FOLLOWING THE COURSE OF CONDUCT DETERMINED BY
SCHERING; PROVIDED, HOWEVER, THAT NOTWITHSTANDING THE FOREGOING, PHARMACOPEIA
SHALL NOT BE OBLIGATED TO (I) PERFORM ANY ACTION THAT WOULD VIOLATE ITS
OBLIGATIONS TO ANY THIRD PARTY OR CONTRAVENE SECTION 2.12, (II) SPEND OR FOREGO
RECEIVING ANY AMOUNTS OF MONEY (EXCEPT AS NECESSARY IN CONNECTION WITH THE
FULFILLMENT OF PHARMACOPEIA'S RESPONSIBILITIES UNDER SECTION 2.3), OR (III)
KNOWINGLY PREPARE OR DELIVER TO SCHERING ANY COMPOUNDS PREVIOUSLY LICENSED TO
ANY THIRD PARTY.
NOTWITHSTANDING THE FOREGOING, SCHERING, IN ITS SOLE
DISCRETION, SHALL HAVE COMPLETE AND FINAL CONTROL OVER SCHERING'S RESEARCH,
DEVELOPMENT AND COMMERCIALIZATION OF SCHERING COMPOUNDS, AGREEMENT COMPOUNDS
AND/OR AGREEMENT PRODUCT(S) IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS
AGREEMENT.
3.4
DEVELOPMENT STATUS; NOTICE OF SALE OF
AGREEMENT PRODUCTS.
DURING THE TERM OF THIS AGREEMENT, SCHERING SHALL PROVIDE
PHARMACOPEIA WRITTEN