AGREEMENT.
ALKERMES SHALL CAUSE THE FINISHED PRODUCT TO BE MANUFACTURED IN ACCORDANCE WITH
THE PROCEDURES, CGMPS AND THE QUALITY AGREEMENT, AND SHALL CAUSE THE DILUENT AND
ADDITIONAL COMPONENTS TO BE MANUFACTURED IN ACCORDANCE WITH THE CGMPS AND THE
QUALITY AGREEMENT.
ALKERMES SHALL OBTAIN REPRESENTATIVE SAMPLES FROM EACH BATCH
OF THE PRODUCT PRODUCED BY ALKERMES.
ALKERMES SHALL ASSAY AND ANALYZE SUCH
SAMPLES IN ACCORDANCE WITH THE SPECIFICATIONS AND SHALL PREPARE A CERTIFICATE OF
ANALYSIS AND CONFORMITY THAT SHALL BE DELIVERED TO CEPHALON.
THE PRODUCT
SUPPLIED HEREUNDER SHALL BE HANDLED AND STORED BY CEPHALON IN ACCORDANCE WITH
THE SPECIFICATIONS PRIOR TO ANY SALE OR DISTRIBUTION.
3.12
QUALITY CONTROL AND QUALITY ASSURANCE.
(A)
QUALITY AGREEMENT.
AS SOON AS POSSIBLE, BUT IN NO CASE LATER THAN
SIXTY (60) DAYS FOLLOWING THE EFFECTIVE DATE, THE PARTIES AGREE TO NEGOTIATE IN
GOOD FAITH AND USE DILIGENT EFFORTS TO ENTER INTO A QUALITY AGREEMENT ("QUALITY
AGREEMENT") SETTING FORTH THE INDIVIDUAL RESPONSIBILITIES OF ALKERMES AND
CEPHALON WITH RESPECT TO THE MANUFACTURE OF THE PRODUCT.
THE QUALITY AGREEMENT
SHALL BE REVIEWED ANNUALLY BY THE PARTIES AND, UPON MUTUAL AGREEMENT, REVISED
AND UPDATED AS NECESSARY.
IN THE EVENT OF A CONFLICT BETWEEN THE QUALITY
AGREEMENT AND THIS AGREEMENT, THIS AGREEMENT SHALL GOVERN AND CONTROL, UNLESS
OTHERWISE EXPRESSLY PROVIDED IN THE QUALITY AGREEMENT BUT IN ANY CASE CONSISTENT
WITH THE STANDARDS SET FORTH IN SECTION 3.11.
(B)
ALKERMES PROCEDURES.
ALKERMES SHALL NUMBER OR CAUSE TO BE
NUMBERED EACH SHIPMENT WITH A MANUFACTURER LOT NUMBER THAT IS TRACEABLE TO ALL
RAW MATERIALS AND/OR ADDITIONAL COMPONENTS USED TO MANUFACTURE SUCH PRODUCT.
(C)
CEPHALON PROCEDURES.
CEPHALON SHALL IDENTIFY SUCH PRODUCT WITH A
VENDOR LOT NUMBER THAT IS TRACEABLE TO THE SHIPMENT PURCHASED FROM ALKERMES.
3.13
RECALLS OR SEIZURES.
ALKERMES SHALL BE RESPONSIBLE FOR UNDERTAKING
ANY RECALL OF ANY PRODUCT OR FINISHED PRODUCT AND THE PARTIES SHALL CONSULT WITH
ONE ANOTHER WITH RESPECT TO ANY PROPOSED RECALL; PROVIDED, HOWEVER, THAT A
RECALL SHALL BE UNDERTAKEN IN THE EVENT THAT EITHER PARTY BELIEVES A RECALL IS
NECESSARY OR PRUDENT.
EACH PARTY SHALL ALSO IMMEDIATELY NOTIFY THE OTHER PARTY
OF ANY SEIZURE OF ANY PRODUCT OR FINISHED PRODUCT.
ALKERMES SHALL MEET ALL
REGULATORY REQUIREMENTS RELATED TO ANY SUCH RECALL OR SEIZURE.
ALKERMES SHALL
USE COMMERCIALLY REASONABLE MANUFACTURING EFFORTS TO SUPPLY A QUANTITY OF
FINISHED PRODUCTS SUFFICIENT TO ENABLE CEPHALON TO REPLACE ALL FINISHED PRODUCTS
SUBJECT TO THE RECALL OR SEIZURE.
SUCH REPLACEMENT FINISHED PRODUCTS SHALL BE
DELIVERED AS SOON AS REASONABLY POSSIBLE.
IF THE PRODUCT OR FINISHED PRODUCT
DEFECT CAUSING THE RECALL OR SEIZURE RESULTS PRIMARILY FROM A BREACH OF
ALKERMES' MANUFACTURE AND SUPPLY OBLIGATIONS HEREUNDER, INCLUDING THE STORAGE OR
DISTRIBUTION OF THE PRODUCT OR FINISHED PRODUCT BY ALKERMES PRIOR TO SHIPMENT,
THEN THE
*
CONFIDENTIAL TREATMENT REQUESTED
13
COST AND EXPENSES OF SUCH RECALL OR SEIZURE, INCLUDING THE COST OF REPLACEMENT
FINISHED PRODUCTS, SHALL BE PAID BY ALKERMES.
IF THE PRODUCT OR FINISHED
PRODUCT DEFECT CAUSING THE RECALL OR SEIZURE RESULTS PRIMARILY FROM CEPHALON'S
ACTS OR OMISSIONS, INCLUDING THE STORAGE OR DISTRIBUTION OF THE