Document:

Exhibit 10.1

	
   

  	
  ***Text Omitted and Filed Separately

  
	
   

  	
  CONFIDENTIAL
  TREATMENT REQUESTED

  
	
   

  	
  Under
  17 C.F.R. §§ 200.80(b)(4) and 240.24b-2

  

 

AGREEMENT
TO AMEND SUPPLY AGREEMENT DATED AUGUST 29, 2005

(AMENDMENT
1)

This Agreement to
Amend (the “Amendment”) the Supply Agreement
dated August 29, 2005 (the “Agreement”)
between the Parties herein, is entered into on this the 6th day of July 2006

By and between

BlOCON LIMITED,
a company incorporated under the laws of India, having its registered office at
20th K.M. Hosur Road, Electronics City P.O.,
Bangalore 560 100, India (“Biocon”);

And

PAR PHARMACEUTICAL,
INC., a Delaware Corporation, with offices located at 300
Tice Boulevard, Woodcliff Lake, New Jersey 07677, United States of America (“Par”);

Biocon and Par are
each referred to as a “Party” and are
collectively referred to as the “Parties”.

Whereas Biocon and
Par have entered into a Supply Agreement dated August 29, 2005 for the supply
of tiacumicin [***] Active Pharmaceutical Ingredient and pursuant to the mutual
discussion between Biocon and Par and in accordance with Article 12.1 of
the Agreement, the Parties wish to amend the Agreement with effect from July 6,
2006 (the “Effective Date”).

The
Parties mutually agree as follows:

1.                                       The
Delivered Price per kilogram of API for both R&D Supply and Commercial
Supply under Article 4.2 of the Agreement shall henceforth be a uniform
Price of USD [***] (United States Dollars [***]).

2.                                       The
amendment mutually agreed upon herein shall be the only amendment to the
Agreement and all other terms and conditions of the Agreement shall remain
un-changed and shall continue to be in full force and effect.

IN
WITNESS WHEREOF, the Parties have caused this Amendment to be
executed as of the Effective Date by signature of their duly authorized
representatives.

	
  FOR BIOCON LIMITED

  	
   

  	
  FOR PAR PHARMACEUTICAL,
  INC.

  
	
   

  	
   

  	
   

  
	
  Name: Rakesh Bamzai

  	
   

  	
  Name:

  
	
  Title: President — Group Marketing

  	
   

  	
  Title:

  

 

 26

SUPPLY
AGREEMENT

This SUPPLY AGREEMENT is hereby entered into as of August 29, 2005
(the “Effective Date”), by and between Par Pharmaceutical, Inc. (“Par”), a
Delaware corporation with offices located at 300 Tice Boulevard, Woodcliff
Lake, New Jersey 07677 USA and Biocon Limited (“Biocon”) a company organized
under the laws of India, with offices located at 20th K M Hosur Road,
Electronics City, Bangalore 560 100 INDIA. 
Biocon and Par are each referred to as a “Party”, and are collectively
referred to as the “Parties”.

WHEREAS, Par wishes to develop products containing the active
pharmaceutical ingredient tiacumicin [***] for marketing as a pharmaceutical
product;

WHEREAS, Par wishes to purchase such tiacumicin [***] from Biocon under
the terms and conditions set forth herein; and

WHEREAS, Biocon desires to supply to Par its requirements of the active
pharmaceutical ingredient tiacumicin [***].

NOW, THEREFORE, in consideration of the foregoing premises and the
mutual promises and covenants set forth below and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Biocon and Par mutually agree as follows:

Article 1

DEFINITIONS

1.1           “Act” shall
mean the Federal Food, Drug and Cosmetic Act as amended from time-to-time.

1.2           “Adverse Drug
Event” shall mean any experience with any of the Product, which may impact
the Product Approval and which shall include any unfavorable, unusual or
unwanted signs, symptoms, or laboratory values (whether or not considered drug
related) experienced by a patient or customer that may be attributable to the
API.

1.3           “Affiliate”
shall mean in respect of a Party hereto, any corporation or business entity
controlled by, controlling, or under common control with a Party.  (For the purpose of this definition, “control”
means direct or indirect beneficial ownership of greater than fifty percent
(50%) of the voting stock of such corporation or other business entity, or a
greater than fifty percent (50%) interest in the income of such corporation or
other business entity, or the power to direct or cause the direction of the
management and policies of such corporation or other business entity whether by
ownership of voting securities, by contract or otherwise, or such other
relationship that, in fact, constitutes control.)

1.4           “Agreement”
shall mean this Supply Agreement, as amended from time to time.

1.5           “API” shall
mean tiacumicin [***] active pharmaceutical ingredient (CAS Registry Number CAS
[***]) as further defined by the API Specifications.

1.6           “API
Specifications” shall mean the specifications for the API contained in the
NDA or DMF established by Par pursuant to this Agreement, unless changes are
required in the United States Pharmacopeia, as such specifications may be
amended at the request of the FDA or by mutual agreement of the Parties from
time to time.  Until such time as a NDA
or DMF is submitted to the FDA, the term API Specifications shall have the
meaning as set forth in Exhibit A.

1.7           “Applicable Laws”
means all applicable laws, rules, and regulations that apply to the
manufacture, development, marketing, sale or commercialization of Product or
the performance of either Party’s obligations under this Agreement including
laws and regulations governing the import, export, development, marketing,
distribution and sale of Product, to the extent applicable and relevant, and
including all cGMP (defined below) or current Good Clinical Practices or
similar standards or guidelines promulgated or adopted by the FDA where
applicable, as well as U.S. export control laws and the U.S. Foreign Corrupt
Practices Act.

1.8           “cGMP” shall
mean current good manufacturing practices as required by the rules and
regulations of FDA.

1.9           “Commercially
Reasonable Efforts” means with respect to each Party, efforts  and commitment of resources in accordance
with such Party’s reasonable business, legal, medical, and scientific judgment
that are consistent with the efforts and resources such Party would use for its
other products or projects, which are of similar market potential and at a
similar stage in their life cycle, taking into account the competitiveness of
the market place, the regulatory structure involved and other relevant factors
that are not subject to each Party’s consents.

1.10         “Commercial Launch”
shall mean the date of the first commercial sale of a product containing the
API by Par or its Affiliate to a third party after the FDA has approved the NDA
for such product.

1.11         “Confidential
Information” shall mean all information and data that may be exchanged by
the Parties which may include, but shall not be limited to, sales and product
information, customer information, manufacturing processes, product
formulations, information regarding applications and submissions (relating to
existing and proposed products) made to the Food and Drug Administration, new
product plans, product development efforts, marketing strategies, financial
information and projections and other commercial and product data which is
proprietary and of commercial value.  It
is acknowledged that the Confidential Information contemplated hereby may be
disclosed not only in writing or other tangible forms but also orally through,
for example, discussions or presentations involving our respective
representatives.  All information
exchanged between the Parties shall be presumed to be Confidential Information.

1.12         “Delivered Price
per kg” shall mean the price payable by Par to Biocon for validation and
commercial volumes of API supplied by Biocon to Par.

 2
 

1.13         “Delivery Date”
shall mean a date for which delivery of API is specified in a purchase order.

1.14         “DMF” shall
mean a FDA Drug Master File.

1.15         “FDA” shall
mean the United States Food and Drug Administration.

1.16         “NDA” means a
new drug application pursuant to 21 U.S.C. §355 for the Product.

1.17         “Regulatory
Authority” shall mean any foreign, federal, state or local regulatory
agency, department, bureau or other Governmental Authority, including, without
limitation, the FDA and the U.S. Drug Enforcement Administration, which is
responsible for issuing approvals, licenses, registrations (including but not
limited to, the Registrations), permits or authorizations necessary for, or
otherwise governs, the Manufacture, handling, use, storage, import, export,
transport, distribution or sale of Products in the Territory.

1.18         “Product”
shall mean the final commercially distributed dosage form of the API.

1.19         “Product Approval”
shall mean final FDA approval to market commercially in the U.S.A. the
specified Product for use in humans.

1.20         “Territory”
shall mean the United States its territories, possessions, the Commonwealth of
Puerto Rico, Canada and the State of Israel.

Article 2

SALE AND
PURCHASE OF API

2.1           Exclusive Supply
Requirements.  Subject to the terms
and conditions of this Agreement, during the Term of this Agreement, Biocon
shall supply Par (or Par’s designee) with its requirements of API for the
Territory.  Except as allowed under
Section 2.1.1 below, during the Term of this Agreement, Biocon shall only
supply API to Par, and not to any other party

2.1.1        Third Party Supply.  The above notwithstanding, in the event
Biocon has (i) supplied Par with [***] kg lots of API; and
(ii) developed capacity to provide at least [***] kg per year of API to
Par, Biocon may sell API to Optimer Pharmaceuticals or its respective designees
for sale outside the Territory.  In the
event Biocon is unable to meet its supply requirements for API to Par and
Optimer Pharmaceuticals or its respective designees Biocon shall first and
preferentially supply Par with all if its API requirements before supplying any
API to Optimer Pharmaceuticals or its respective designees.  Furthermore, any supply agreement for API
entered into between Optimer Pharmaceuticals or its respective designees and
Biocon shall clearly state that Biocon’s supply obligations to such party is
secondary and inferior to Biocon’s obligations to supply Par with API.

2.2           Exclusive
Purchase Requirements.  Subject to
the terms and conditions of this Agreement, during the term of this Agreement,
Par shall (i) for the first year following the Commercial Launch purchase
the greater of at least [***] percent ([***]%) of its requirements of API for
the Territory or [***] kg of API from Biocon; (ii) for the second year
following the

 3
 

Commercial
Launch purchase the greater of at least [***] percent ([***]%) of its
requirements of API for the Territory or [***] kg of API from Biocon; and
(iii) for the third year through the seventh year following the Commercial
Launch purchase at least [***]percent ([***]%) of its requirements of API for
the Territory from Biocon, with no minimum purchase of API from Biocon.  If Par’s requirements for API exceed [***] kg
per year or, except as to the initial purchase order for Commercial Launch
under Section 3.2, [***] kg per calendar quarter, or such other maximum
capacity as may be agreed to by the Parties under Section 5.1, Biocon
shall not be in breach of this Agreement and Par shall be released from the
minimum purchase percentage above and Par shall be free to source from a third
party all required volumes that are in excess of the amount supplied by
Biocon.  The Parties hereby agree that at
any time during the Term of this Agreement in the event Par desires to qualify
a source other than Biocon to supply API, Biocon shall, solely at Par’s
request, assist in a transfer of a technical package, at Par’s expense, to Par
or Par’s designated alternate source, which shall include all pertinent
biological materials, processes and analytical methods as my be required to
produce commercial quantities of API that meet the API Specifications.  For clarity, both Parties agree that should
Par fail to receive Product Approval or should the FDA request or demand that
the Product no longer be sold, Par will have no obligation to purchase any
quantity of API from Biocon, except as provided for in Section 3.1.

2.2.1        Revised Minimum
Requirements.  If Par’s commercial
requirements are less than [***] kg per year after two full years from the
Commercial Launch, Biocon and Par shall negotiate in good faith to agree on a
reduced minimum annual purchase amount. 
In any event, Par’s minimum annual purchases during the third year
through the seventh year following the Commercial Launch will be no less than
[***] percent ([***]%) of Par’s requirements.

2.3           Failure to Timely
Supply.  If Biocon, at any time
during the Term, fails to timely deliver any quantity of API ordered by Par by
the Delivery Date, then, in addition to any other rights and remedies available
to Par, Par shall have the right at its sole option to purchase such defaulted
quantity of API from a third party.  In
the event (i) Biocon fails to timely supply Par with more than [***]
percent ([***]%) of its commercial requirements of API for either two
consecutive calendar quarters or for any three calendar quarters in any two
year period; and (ii) except as to the initial purchase order for
Commercial Launch under Section 3.2, such commercial requirement does not
exceed [***] kg for such calendar quarters, Biocon shall be in breach of this
Agreement and, in addition to any other rights and remedies available to Par,
Par’s minimum purchase requirements under Sections 2.2 and 3.2.5 shall
terminate.

Article 3

PURCHASE
ORDERS; FORECASTS; AND DELIVERY

3.1           R&D Supply.  No later then three (3) months after the
Execution Date, Par shall issue (i) a binding purchase order for [***] kg
of API which shall designate the Delivery Date for [***] kg as any day prior to
December 1, 2005 and [***] kg as any day prior to March 1, 2006; (ii) a
binding purchase order for no less than [***] kg which shall designate the
Delivery Date as any day prior to May 31, 2006; and (iii) a binding
purchase order for no less than [***] kg of API which shall designate the
Delivery Date for [***] kg as any day prior to July 1, 2006, and the
Delivery Date for [***] as any day prior to Aug 1, 2006.

 4
 

3.2           Forecasts and
Orders.  Par shall provide its
forecasts and purchase orders to Biocon for API for commercial sale as follows:

3.2.1        Approximately four
(4) calendar quarters prior to the quarter in which the Commercial Launch is
projected to occur, Par shall provide Biocon with a forecast of API quantities
required to prepare for Commercial Launch and the first three (3) months of
sales following Commercial Launch.

3.2.2        Approximately one
hundred and eighty (180) days prior to the estimated Commercial Launch, Par
will provide Biocon with a firm purchase order for API quantities required to
prepare for Commercial Launch.  In
addition, Par will provide a forecast of API quantities required to prepare for
the first nine (9) months of sales following Commercial Launch.

3.2.3        Beginning one (1)
month following the Commercial Launch, Par shall thereafter issue firm purchase
orders to Biocon on a monthly basis, within five (5) days of the beginning of
each month, together with a forecast of its API requirements for the next
eleven (11) calendar months.  If Par
fails to supply a forecast for a month in a timely manner, the last submitted
monthly forecast shall become the new forecast.

3.2.4        Each purchase order
submitted by Par shall specify a Delivery Date for the API that shall be no
earlier than sixty (60) days from the date that the purchase order is submitted
to Biocon, unless agreed to by Biocon in writing.

3.2.5        The quantity of API
that Par specifies in each purchase order shall be no less than [***] percent
([***]%) and no more than [***] percent ([***]%) of the most recent forecast
for such month, unless agreed to by Biocon in writing.

3.3           Shipment and
Delivery.  All shipments of the API under
this Agreement shall be CIP (ICC Incoterms 2000) to Par’s Spring Valley, New
York facility plant or other place of shipment designated by Par.  Biocon shall deliver API within three (7)
days of the applicable Delivery Date (or Delivery Dates).  All deliveries of API by Biocon shall be
accompanied by all documentation required under the Applicable Laws to import
the API into the Territory.

Article 4

PRICE AND
PAYMENTS

4.1           Invoice.  Biocon shall invoice Par upon delivery of API
in accordance with this Agreement. 
Subject to the provisions of Section 4.2, payment for each shipment
of API to Par shall be due within sixty (60) days after the date of Biocon’s
invoice.  All payments required to be
made hereunder shall be paid in United States dollars by wire transfer of
immediately available funds to the financial institution, account number and
account Party’s name designated in writing by Biocon to Par from time to time.

4.2           Purchase Price.  Par shall pay Biocon for API on a per
kilogram delivered basis.

 5
 

4.2.1        R&D Supply.  The Delivered Price per kg for all research
and development amounts of API shall be (i) [***] dollars ($[***]) for the
first [***] kg, to be delivered before March 1, 2006;
(ii) [***]dollars ($[***]) for the remaining [***] kg and [***] kg.  The above notwithstanding, in consideration
for Biocon’s timely development of the API, Par shall purchase the API at
(i) [***]dollars per kg ($[***]/kg) for the initial [***] kg if Biocon
delivers [***] kg prior to November 1, 2005 and [***] kg prior to
January 1, 2006 and (ii) [***] dollars per kg ($[***]/kg) for the for
the [***] kg if Biocon delivers all [***] kg before March 31, 2006 and the
[***] kg if all [***] kg is delivered before July 1, 2006.

4.2.2        Commercial Supply.  The Delivered Price per kg shall be [***]
dollars ($[***]) for all amounts of API for commercial sale.  Notwithstanding the above, in the event the
FDA requires the API to be of greater than [***] percent ([***] %) purity
(i) the API Specifications shall immediately and automatically be changed
to reflect such requirement and (ii) the Delivered Price per kg shall be
increased to [***] dollars ($[***]) for all amounts of API for commercial sale
delivered thereafter.

4.2.3        Price Reduction.  The above notwithstanding, in the event that
economic and/or competitive factors reduce Par’s margin on sales of Product,
Biocon agrees to provide Par in good faith with a reduction in the cost of
API.  In addition to the above, in the
event Par decides to authorize a generic form of the Product (“Generic Product”)
into the market either by (i) allowing a third party to sell Generic
Product under the NDA or (ii) selling a Generic Product itself or through
an Affiliate, Biocon hereby agrees to either (i) lower its price for API
used in such Generic Product to the level other API suppliers of Generic
Product or (ii) allow Par to purchase the API for such Generic Product
from an alternate supplier.

Article 5

API
DEVELOPMENT AND DEVELOPMENT COMMITTEE

5.1           Development.  Biocon shall use Commercially Reasonable
Efforts to develop a commercially viable method of producing API.  At a minimum, Biocon shall, as of the
Commercial Launch in the USA, have developed the capacity to produce not less
than [***] kg per year of API (“Commercial Supply of API”).  In the event Par determines that its API
requirements per year will be in excess of [***] kg per year, the Parties may,
at their discretion, negotiate in good faith to raise Biocon’s production
capacity above [***] kg per year of API.

5.2           Development Fees.  In consideration for Biocon developing the
ability to provide a Commercial Supply of API, as stated in Section 5.1
above, Par shall pay to Biocon on a non-refundable basis (i) on the
Effective Date, [***] dollars ($[***]); and (ii) upon the delivery of
[***] kg of API, an additional [***] dollars ($[***]).

5.3           Development Costs.  With the exception of Section 5.3.1
below, all costs of developing a Commercial Supply of API shall be borne
entirely by Biocon.

5.3.1        If during development
of the Commercial Supply of API Biocon discovers that there is a need for a
substantial capital investment for installing a down-streaming and recovery

 6
 

facility for
meeting Par’s supply requirements for this molecule (the “Facility”), then in
this event, Biocon may request from Par an amount, not to exceed [***] dollars
($[***]), for the out-of-pocket expenses it actually incurs for this capital
investment.  Such a request may only be
made before January 1, 2007 and shall include a good faith list and budget
of possible out-of-pocket expenditures that may be incurred in completing the
Facility.  In the event Biocon makes such
a request, Par shall have the right to inspect the Facility and receive copies
of all invoices regarding the cost of the Facility.  If Biocon anticipates or actually uses the
Facility for any purpose other than fulfilling Biocon’s obligations under this
Agreement, Par shall only be responsible for or shall be reimbursed for the
costs of the Facility in accordance with Biocon’s proportional use of the
Facility in fulfilling its obligations under this Agreement.  Par shall have the right to request an
accounting from Biocon regarding the use of the Facility and the right to audit
Biocon’s relevant financial books and records regarding the use of the
Facility.

5.3.2        All amounts paid by
Par under Section 5.3.1 above, shall be setoff against the future supply
of API to Par as a percent cost reduction per kg of API, not to exceed [***]
percent ([***] %) of Delivered Price per kg, until Par has fully recovered the cost
of the capital investment.

5.4           Development
Committee.  The Parties hereby agree
to cooperate in good faith to facilitate (i) the development of process
for API production and (ii) the uninterrupted supply of API to Par.  In support of the foregoing, the Parties
agree to establish a committee (the “Development Committee”) to ensure the
accomplishment of those goals and to allow for the necessary communications
between the Parties.

5.4.1        The Development
Committee shall be made up of six (6) people in total.  Each Party shall have equal representation in
the Development Committee.  Each Party
shall have the right from time to time to substitute new members, on a
permanent or temporary basis, for any of its previously designated members of
the Development Committee.  Each Party
shall bear its own costs associated with participation in the Development
Committee.

5.4.2        The Development
Committee shall:

(a)           make recommendations
and suggestions to enable each Party fulfill its obligations under this
Agreement as efficiently as possible;

(b)           facilitate
communication regarding, and resolution of, any disputes between the Parties;
and

(c)           coordinate the
exchange of information, technology and know-how as applicable to this
Agreement.

5.4.3        The Development
Committee shall not have the authority or power to impose financial costs or
other obligations on either Party above those stated in this Agreement.

 7
 

Article 6

BIOCON’S
QUALITY CONTROL OBLIGATIONS

6.1           Biocon
Obligations.  Biocon shall use its
best commercial efforts to ensure that all API supplied to Par under the terms
of this Agreement will:

(a)           conform in all respects to the API
Specifications and Quality Agreement (defined below);

(b)           be manufactured in conformity with
cGMP;

(c)           be of merchantable quality;

(d)           conform with all applicable material
requirements of any and all Product Approvals granted for the Products within
the Territory; and

(e)           meet any other material current
pharmacopoeia or regulatory requirements of all relevant Regulatory Authorities
in the Territory.

6.1.1        Packaging.  Biocon shall ensure that each batch of API is
labeled and each of the batch numbers is applied to each batch, as required by
the applicable Regulatory Authorities. 
Biocon shall use Commercially Reasonable Efforts to provide Par with API
with a minimum shelf life, before any retest, of [***] ([***]) months from the
date of delivery to Par.  Due to the
current the lack of stability data for the API, the Parties agree to negotiate
in good faith more definite stability parameters to be included in the Quality
Agreement (defined below).  In the event
such provision in the Quality Agreement regarding API stability conflicts with
or is inconsistent with this Agreement, that provision in the Quality Agreement
shall govern and control.  Biocon shall
ensure that a copy of the Certificate of Analysis (as defined in the Quality
Agreement) with respect to each batch of API supplied to Par accompanies each
batch.  Biocon will also ensure that all
documentation reasonably required by Par shall be made available to Par upon
request.

6.1.2        Shipment and
Storage.  Biocon shall provide and
maintain suitable storage and transport conditions for each batch of API and
shall provide Par with complete written instructions with respect to proper
conditions for the transport and storage of API.  Upon receipt of any batch of API by Par from
Biocon, Par shall provide and maintain suitable storage conditions therefore
and shall comply with any written instructions provided by Suppler that are
required by the DMF in respect of the transport and storage of API.

6.2           Quality Control
Agreement.  Within sixty (60) days
following the Effective Date, the Parties shall mutually agree upon an
intercompany quality agreement which will appropriately address regulatory,
operational and quality obligations and responsibilities (the “Quality
Agreement”).  Except as provided for in
Section 6.1.1, in the event of any terms of the Quality Agreement conflict
with or are inconsistent with the terms of this Agreement, the terms of this
Agreement shall govern and control.

 8

6.3           Inspections.  Upon reasonable prior notice, Par reserves
the right to audit Biocon’s manufacturing, distributing and storage facilities
to assure Biocon’s compliance with the Quality Agreement, cGMP and all
Applicable Laws.  The audit will consist
of an internal inspection of Biocon’s production and laboratory facilities and
documents related to the API.  Biocon
agrees to provide access to its facilities during and otherwise facilitate this
audit process.  Par shall also have the
right, upon reasonable prior notice, to have a Par employee or qualified
external consultant present at Biocon’s manufacturing facility as an observer
during the production of the API.  Biocon
also agrees to allow any relevant Regulatory Authority to inspect any of its
facilities used in fulfilling its obligations under this Agreement with respect
to the Product.

6.4           Nonconforming API.  Par may reject any shipment of API as
defective if the API does not conform to Biocon’s obligations under
Section 6.1 and/or the Biocon’s product warranties set forth
Section 9.2 or which is adulterated or misbranded within the meaning of
the Act.  In order to reject a shipment,
Par must: (i) give notice to Biocon of Par’s intent to reject such
shipment together with a written indication of the reasons for such possible
rejection within forty five (45) days after delivery of the API to Par, or in
the case of latent defects, within forty-five (45) days after the date that Par
discovers the defect and (ii) as promptly as reasonably possible thereafter,
provide Biocon with notice of final rejection (a “Rejection Notice”) and the
full basis therefore.  If no such notice
of intent to reject is timely received by the Biocon, Par shall be deemed to
have accepted such delivery of API.

6.4.1        Par’s tests results
or basis for the Rejection Notice shall be conclusive unless Biocon notifies
Par in writing within thirty (30) days of receipt of Par’s Rejection Notice
that Biocon disagrees with such test results or basis for rejection (“Objection
Notice”).  If Par and Biocon fail within
ten (10) days after delivery of an Objection Notice to agree as to whether the
API identified in the Rejection Notice is defective, representative samples of
the batch of API in question shall be submitted to a mutually acceptable independent
laboratory or consultant (if not a laboratory issue) for analysis for
review.  The results of such evaluation
shall be binding upon the Parties.  The
Party that is determined to have been incorrect in its determination of whether
the API should be rejected shall pay the costs of any such evaluation.  If the fees of the independent laboratory or
consultant are due in advance, then Biocon shall pay such fees; provided,
however, that promptly after the independent laboratory or consultant completes
its evaluation, Par shall the reimburse the Biocon such fees if Par was
incorrect in its determination.

6.4.2        If any shipment is
rejected by Par, Par’s duty to pay all amounts payable to Biocon in respect to
the rejected API shall be suspended unless and until there is a determination
by an independent laboratory or consultant in support of Biocon’s Objection
Notice in accordance with Section 6.2.1.

6.4.3        Whether or not Biocon
accepts Par’s basis for its notice of rejection, Biocon shall use reasonable
efforts, at Par’s request, to provide replacement API, which shall be purchased
by Par as provided in this Agreement.

6.4.4        Unless Biocon
requests the return to it of a rejected batch within sixty (60) days of receipt
of Par’s notice of rejection, Par shall destroy the batch promptly and provide
Biocon 

 9
 

with
certification of such destruction.  Par
shall, upon receipt of Biocon’s request for the return of a rejected batch,
promptly return such batch at Biocon’s costs.

6.5           Cooperation.  Biocon shall provide all reasonable
cooperation with respect to Product Approval, including, but not limited to,
(i) preparing and filing any necessary specifications, data, applications,
or documents such as any applicable for the NDA; (ii) providing samples
and biological materials; and (iii) providing documentation of all
methods, formulas, and protocols used in the production of API.  Biocon shall give notice and supply copies to
Par of all communications between Biocon and any Regulatory Authority relevant
to the production of API.

6.6           API
Specifications.  Changes to the API
Specifications may only be made in accordance with the procedure delineated in
the Quality Agreement, that notwithstanding, in no case may a change to the API
Specifications be made upon less than eighteen (18) months prior written notice
to Par and without Par’s written consent, which shall not be unreasonably
withheld, unless such change is of the nature that does not require a filing
with, approval by or notification to, any Regulatory Authority.  Biocon agrees that it will promptly notify
Par of any and all changes to the API Specifications and/or manufacturing
process.

6.7           DMF.  Par may, at it discretion, request that
Biocon file a DMF related to production of API. 
If, and only if, Par makes such a request, Biocon shall properly file a
DMF related to the API with the FDA. 
Prior to the filing of a DMF related to the production of API, Biocon
shall submit such filing for Par’s review and approval.  Biocon shall maintain all applicable DMFs
during the Term of this Agreement.  In
the event Biocon does file a DMF, Biocon agrees to promptly provide Par and/or
Par’s designee with a letter of access to such applicable DMFs for the
API.  Biocon agrees that it shall not
file a DMF related to production of API unless specifically asked by Par, in
writing, to file such a DMF.  If a DMF is
filed, changes to the DMF may only be made in accordance with the procedure
delineated in the Quality Agreement, that notwithstanding, in no case may a
change to the DMF be made upon less than eighteen (18) months prior written
notice to Par and without Par’s written consent, which shall not be
unreasonably withheld, unless such change is of the nature that does not
require a filing with any Regulatory Authority. 
Biocon agrees that it will promptly notify Par of any and all changes to
the DMF.

Article 7

PRODUCT
COMPLAINTS AND RECALLS

7.1           Product
Complaints.  During the term of this
Agreement, Biocon shall assist Par with any necessary investigation arising
from product complaints or Adverse Drug Events relating to the Product.  Such assistance shall include Biocon’s re-testing
the API at the reasonable request of Par and forwarding the results of such
testing to Par as soon as reasonably possible. 
Biocon may charge Par for reasonable costs incurred related to this
assistance, including but not limited to travel expenses and re-testing
lab time.

7.2           API Safety.  Each Party shall notify the other Party of
any regulatory action taken by a Regulatory Authority concerning the safety of
the API within two (2) days of the action being taken and will provide the
other Party with complete information concerning that action.  In 

 10
 

addition, each
Party will notify the other of any action taken anywhere concerning the safety
of any Product produced with the API, promptly upon becoming aware of the
action being taken.

7.2.1        Product Recalls.  In the event of a voluntary or mandatory
recall of a quantity of the Product which is materially attributable to the API
purchased from Biocon or which results from any negligent act or omission of
Biocon, Biocon agrees that it will assume all risk of loss and will indemnify
and hold Par and its Affiliates harmless from any and all loss (except
incidental or consequential loss, such as, for example, loss of business or of
profits), liability, damage, claim, cost and expense (including, without
limitation, reasonable attorney’s fees and liabilities for personal injury
suffered by any person) (collectively, “Loss”) directly or indirectly arising
from or incidental to any such recall of Product up to [***] US dollars
($[***]).

7.2.2        In the event of a
voluntary or mandatory recall of a quantity of the Product which is not
materially attributable to the API or which has not resulted from any negligent
act or omission of Biocon, Par agrees that it will assume all risk of Loss and
will indemnify and hold Biocon and its Affiliates harmless from any and all
Loss directly or indirectly arising from or incidental to any such recall of
such Product.

7.2.3        In addition to the
obligations set forth this Article 7, each Party will disclose to the
other Party all regulatory notices or recalls which relate to the API within
seven (7) days of receipt of such notice or knowledge of such recall.

Article 8

TERM AND
TERMINATION

8.1           Term.  The term of this Agreement (the “Term”) shall
commence on the Effective Date and, unless earlier terminated in accordance
with Sections 8.2 through 8.3, shall continue in full force and effect
until the tenth anniversary of the Commercial Launch.

8.2           Termination by
Mutual Agreement.  This Agreement may
be terminated by mutual written agreement of the Parties.

8.3           Termination for
Default.  If either Party materially
defaults in the performance of any material agreement, condition or covenant of
this Agreement and such default or noncompliance shall not have been remedied
within ninety (90) days after receipt by the defaulting Party of a notice
thereof from the other Party, the Party not in default may terminate this
Agreement.

8.4           Survival.  Expiration or termination of this Agreement
shall not relieve the Parties of any obligations accruing prior to the
Effective Date thereof or resulting therefrom. 
All payment obligations due pursuant to this Agreement shall survive
termination or expiration of this Agreement. 
Without limiting the foregoing, the following provisions shall survive
the expiration or termination of this Agreement for any reason:
(a) Article 8 (Term and Termination), (b) Article 9 (Representations,
Covenants and Warranties), (c) Article 10 (Indemnification),
(d) Article 11 (Confidentiality and Public Disclosure), and
(e) Article 12 (Miscellaneous). 
Any rights of Biocon to payments accrued through termination as well as
obligations of the Parties under firm orders for 

 11
 

purchase and
delivery of API at the time of such termination shall remain in effect, except
that in the case of termination under Section 8.3, the terminating Party
may elect whether obligations under firm purchase orders shall remain in
effect.

Article 9

REPRESENTATIONS,
COVENANTS AND WARRANTIES

9.1           Par
Representations, Convents and Warranties. 
Par hereby represents and warrants to Biocon that:

(a)           it has the corporate
authority to enter into this Agreement and to perform its obligations
hereunder;

(b)           it shall use
Commercially Reasonable Efforts to gain Product Approval in the US; and

(c)           it is not aware of
any legal, contractual or other restriction, limitation or condition which
might affect adversely its ability to perform hereunder.

9.2           Biocon
Representations and Warranties.  Biocon
hereby represents and warrants to Par that:

(a)           it has the corporate
authority to enter into this Agreement and to perform its obligations
hereunder;

(b)           it is not aware of
any legal, contractual or other restriction, limitation or condition which might
affect adversely its ability to perform hereunder;

(c)           to the best of
Biocon’s knowledge: (i) the manufacture, importation, and sale to Par of
any API provided by Biocon to Par hereunder; and the use by Par in the Product,
of any such API will not violate the process patent of any third party in the
Territory; and

(d)           all API shipped to
Par pursuant to this Agreement shall (i) be in compliance with the API
Specification and Quality Agreement at the time of delivery, (ii) be
manufactured in a plant which meets the requirements of the FDA, including,
without limitation, conformance with cGMP, (iii) be safe and efficacious
raw material intended for use in a product manufactured for human therapeutic
use and (iv) be stored and handled by Biocon at all times in the proper
manner and suitable conditions for such API.

Article 10

INDEMNIFICATION

10.1         Indemnification
Obligations of Par.  Subject to
Section 10.4, from and after the Effective Date, Par shall indemnify
Biocon against and hold Biocon and Biocon’s Affiliates harmless from any Loss
payable to third parties, arising from or in connection with:

 12
 

(a)           any material breach
of the warranties by Par hereunder;

(b)           any other material
misrepresentation or material breach of this Agreement by Par; and

(c)           the making, using or
selling of the Product including product liability and patent infringement
liability.

10.2         Indemnification
Obligations of Biocon.  Subject to
Section 10.4, from and after the Effective Date, Biocon shall indemnify
Par against and hold Par and Par’s Affiliates harmless from, any Loss payable
to third parties, arising from or in connection with:

(a)           any willful act or
omission of Biocon or its Affiliates or Designees in connection with the
storage, handling, manufacture, use, marketing, advertising, promotion,
distribution or sale of the API in the Territory;

(b)           any material breach
of any representation, warranty or covenant by Biocon under this Agreement; and

(c)           any express written
claim made by Biocon of its Affiliates (except to the extent that such claim
has been approved by the Regulatory Authority or authorized by Par) as to the
efficacy or safety of or the use of API made by any purchaser of API.

10.3         Procedure.  If Par or any of its Affiliates or Biocon or
any of its Affiliates (in each case an “Indemnified Party”) receives any
written claim that it believes is the subject of indemnity hereunder by Biocon
or Par, as the case may be, (in each case as “Indemnifying Party”), the
Indemnified Party shall, as soon as reasonably practicable after forming such
belief, give notice thereof to the Indemnifying Party, including full
particulars of such claim to the extent known to the Indemnified Party;
provided, that the failure to give timely notice to the Indemnifying Party as
contemplated hereby shall not release the Indemnifying Party from any liability
to the Indemnified Party, absent the demonstrated prejudice to the Indemnifying
Party caused by such delay.

10.3.1      Defense.  The Indemnifying Party shall have the right,
by prompt notice to the Indemnified Party, to assume the defense of such claim
with counsel reasonably satisfactory to the Indemnified Party, and at the cost
of the Indemnifying Party.  If the
Indemnifying Party does not so assume the defense of such claim or, having done
so, does not diligently pursue such defense, the Indemnified Party may assume
such defense, with counsel of its choice, but for the account of the
Indemnifying Party.  If the Indemnifying
Party so assumes such defense, the Indemnified Party may participate therein
through counsel of its choice, but the cost of such counsel shall be for the
account of the Indemnified Party.

10.3.2      Cooperation.  The Party not assuming the defense of any
such claim shall render all reasonable assistance to the Party assuming such
defense, and all out-of-pocket costs of such assistance shall be
for the account of the Indemnifying Party.

10.3.3      Settlement.  No such claims shall be settled other than by
the Party defending the same and then only with the consent of the other Party,
which shall not be unreasonably 

 13
 

withheld;
provided that the Indemnified Party shall have no obligation to consent to any
settlement of any such claim which imposes on the Indemnified Party any
liability or obligation which cannot be assumed and performed in full by the
Indemnifying Party.

10.4         Infringement
Defense.  Notwithstanding anything to
the contrary herein, Par and its designated counsel will manage and control any
intellectual property litigation against Par or Biocon or their Affiliates
arising out of claims by a third party, that the importation, manufacture, use,
sale, or marketing of the API or the Product infringes the intellectual
property rights of such third party.  To
the extent reasonably required, Biocon shall also become a client of Par’s
designated counsel, and such counsel shall keep Biocon apprised of all material
decisions issued by the courts in such matters. 
All litigation expenses related to such intellectual property litigation
shall be borne by Par.  Biocon shall make
available to Par and its designated legal and regulatory counsel, such
information, including without limitation, manufacturing processes for drug
product and regulatory information, related to the product as Par and its
counsel may reasonably request.

10.5         Limitations.  Notwithstanding anything to the contrary
herein:

(a)           Neither Party shall
be liable to the other under this Article 10 for Losses that arise from
the misconduct or negligence of, or a violation of any Applicable Law by, the
other Party, such other Party’s Affiliates or any of their respective officers,
directors, agents, employees, or shareholders, or from the breach by such other
Party of the provisions of this agreement.

(b)           An Indemnified Party
shall not be entitled to recover any special, incidental, or consequential
damages whatsoever under this Agreement except to the extent any such special,
incidental, or consequential damages shall be payable by such Indemnified Party
to a third party.

(c)           Although a Person
may be entitled to make a claim for indemnification pursuant to more than one
section of this Article 10, a Person shall not be entitled to recover
indemnification for the same claim under more than one section of this
Article 10.

(d)           Absent willful
breach of any representation, warranty or covenant by Biocon, Biocon indemnity
of Par for any product liability claims or product liability arising from
recalls (as set forth in Section 7.2.1), shall be capped at a total [***]
US dollars ($[***]).

Article 11

CONFIDENTIALITY
AND PUBLIC DISCLOSURE

11.1         Each of the Parties
agrees that, subject to Sections 11.2 and 11.3 below (a) it will not
disclose any Confidential Information of the other Party that it may acquire at
any time during the term of this Agreement without the prior written consent of
such Party; (b) it will not make use of any Confidential Information of
the other Party for any purpose other than for the purposes set forth herein,
or in furtherance of the transactions contemplated by, this Agreement and it
will use all reasonable efforts to prevent unauthorized publication or
disclosure by any person of such Confidential Information including requiring
its employees, consultants or agents to enter into similar confidentiality
agreements in relation to such Confidential Information.

 14
 

11.2         Each of the Parties
acknowledge and agree that the terms and conditions of this Agreement shall be
considered Confidential Information of each Party and shall be treated
accordingly; provided, however, that each Party shall have the right to
disclose this Agreement to its consultants and advisors under customary
obligations of confidentiality.  Neither
Party shall make any public disclosure or press release regarding this
Agreement and shall not otherwise disseminate information, including product
lists and company literature (written or electronic), that may have the affect
of giving notice to any third party or the public of the existence or terms of
this Agreement.  For clarity, it is
understood that even if the existence of this Agreement becomes public
knowledge neither Party shall divulge any of the terms, including the nature or
identity of the API, of this Agreement.

11.3         The restrictions on
the use and disclosure of Confidential Information in Section 10.1 shall
not include any such information that is required to be disclosed
(i) under Applicable Law, (ii) to respond to an inquiry of a
Governmental Authority concerning the Product, or (iii) in a judicial,
administrative or arbitration proceeding, then the receipt shall
(A) provide the other Party with as much advance notice as reasonably
practicable of the required disclosure, (B) cooperate with the other Party
in any attempt to prevent or limit the disclosure, and (C) limit any
disclosure to the specific purpose at issue.

11.4         The Parties
acknowledge and agree that the terms and conditions of this Agreement shall be
considered Confidential Information of each Party and shall be treated
accordingly.  Notwithstanding the
foregoing, Biocon acknowledges and agrees that Par may be required to disclose
some or all of the information included in this Agreement in order to comply
with its obligations under the United States Securities Act of 1933, the United
States Securities Exchange Act of 1934 (“SEC”), listing standards or agreements
of any national or international securities exchange or The NASDAQ Stock Market
or other similar laws of a Governmental Authority, and Biocon hereby consents
to such disclosure; provided however, in connection with any such disclosure or
filing, Par will use its reasonable efforts, under the guidance of its
attorneys, to obtain confidential treatment of this Agreement as permitted by
law or applicable rules and regulations and Par shall provide Biocon with a
copy of the disclosure intended to be made, and the opportunity to provide
comments thereon that shall be duly considered by Par.

11.5         Each Party, at the
request of the other, shall return Confidential Information disclosed to it
hereunder, in whatever form contained, including all notes or memoranda made by
its employees, agents, or representatives obtained or derived from any such
Confidential Information, including any listing which identifies the documents
which were provided, except that one copy of this Agreement maybe retained at
each Party’s Office of Counsel, to maintain a record of the same.

Article 12

MISCELLANEOUS

12.1         Entire Agreement.  This Agreement contains the entire agreement
of the Parties regarding the subject matter hereof and supersedes all prior
agreements, understandings and negotiations regarding the same.  This Agreement may not be changed, modified,
amended or supplemented except by a written instrument signed by both
Parties.  Furthermore, it is the
intention 

 15
 

of the Parties
that this Agreement be controlling over additional or different terms of any
order, confirmation, invoice or similar document, even if accepted in writing
by both Parties, and that waivers and amendments shall be effective only if
made by non-pre-printed agreements clearly understood by both
Parties to be an amendment or waiver.

12.2         Assignability.  This Agreement may not be assigned by either
Party without the prior consent of the other Party; provided, however,
(a) either Party may assign this Agreement to any entity which acquires
substantially all of its assets or business, and (b) Par may assign this
Agreement, in whole or in part, to any Affiliate of Par.

12.3         Severability.  If any provision of this Agreement shall be
held illegal or unenforceable, that provision shall be limited or eliminated to
the minimum extent necessary so that this Agreement shall otherwise remain in
full force and effect and enforceable.

12.4         Further Assurances.  Each Party hereto agrees to execute,
acknowledge and deliver such further instruments, and to do all such other
acts, as may be necessary or appropriate in order to carry out the purposes and
intent of this Agreement.

12.5         Use of Party’s
Name.  No right, express or implied,
is granted by this Agreement to either Party to use in any manner the name of
the other or any other trade name or trademark of the other in connection with
the performance of this Agreement.

12.6         Notice and Reports.  All notices, consents or approvals required
by this Agreement shall be in writing sent by certified or registered air mail,
postage prepaid or by facsimile or cable (confirmed by such certified or
registered mail) to the Parties at the following addresses or such other
addresses as may be designated in writing by the respective Parties:

	
  To Biocon:

  	
   

  	
  Biocon Limited

  
	
   

  	
   

  	
  20th KM Hosur Road

  
	
   

  	
   

  	
  Electronics City PO

  
	
   

  	
   

  	
  Bangalore 560 100

  
	
   

  	
   

  	
  Attn: Head, Legal & General Counsel

  
	
   

  	
   

  	
  Fax: +91-80-2852-3423

  
	
   

  	
   

  	
   

  
	
  With copies to:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [***], President Group Marketing

  
	
   

  	
   

  	
  [***], VP Group Marketing

  
	
   

  	
   

  	
  [***], President Finance

  
	
   

  	
   

  	
   

  
	
  To Par:

  	
   

  	
  Par Pharmaceutical, Inc.

  
	
   

  	
   

  	
  300 Tice Boulevard

  
	
   

  	
   

  	
  Woodcliff Lake, NJ 07677

  
	
   

  	
   

  	
  Attn: [***]

  
	
   

  	
   

  	
  Fax: (201) 802-4224391-5364

  
	
   

  	
   

  	
  Attn: [***]

  
	
   

  	
   

  	
  Fax: (201) 391-5364

  

 

 16
 

 

	
  With copies to:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Frommer Lawrence & Haug LLP

  
	
   

  	
   

  	
  745 Fifth Avenue

  
	
   

  	
   

  	
  New York, New York 10151

  
	
   

  	
   

  	
  Attn: Arthur Hoag, Esq.

  
	
   

  	
   

  	
  Fax: (212) 588-0500

  

 

Notices shall be deemed
effective on the date of mailing.

12.7         Relationships of
the Parties.  Both Parties are
independent contractors under this Agreement. 
Nothing contained in this Agreement is intended nor is to be construed
so as to constitute Biocon and Par as partners, agents or joint venturers with
respect to this Agreement.  Neither Party
hereto shall have any express or implied right or authority to assume or create
any obligations on behalf of or in the name of the other Party or to bind the
other Party to any contract, agreement or undertaking with any third party.

12.8         Waiver.  The waiver by either Party of a breach of any
provisions contained herein shall be in writing and shall in no way be construed
as a waiver of any succeeding breach of such provision or the waiver of the
provision itself.

12.9         Applicable Law.  This Agreement shall be governed by and
construed in accordance with the laws of the England without regard to the
conflicts of laws provisions thereof, however, the Parties understand and agree
that this Agreement pertains to the development and marketing of pharmaceutical
products in the United States, and as such, all other matters associated with
this Agreement shall be governed by the laws and regulations of the United
States, including without limitation, the laws and regulations pertaining to
intellectual property rights, drug approval and marketing.

12.10       Captions.  Paragraph captions are inserted for
convenience only and in no way are to construed to define, limit or affect the
construction or interpretation hereof.

12.11       Force Majeure.  A Party shall not be liable for
nonperformance or delay in performance, other than of obligations regarding
payment of money or confidentiality, caused by any event reasonably beyond the
control of such Party including, but not limited to wars, hostilities,
revolutions, riots, civil commotion, national emergency, strikes, lockouts,
unavailability of supplies, epidemics, fire, flood, earthquake, force of
nature, explosion, embargo, or any other Act of God, or any law, proclamation,
regulation, ordinance, or other act or order of any court, government or
governmental agency.

 17
 

IN WITNESS WHEREOF, the
Parties hereto have executed this Agreement to be effective as of the date
first written above.

	
  PAR PHARMACEUTICAL, INC.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  BIOCON
  LIMITED

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
							

 

 18

EXHIBIT
A

API
Specifications

To be completed together
with preparation of the Quality AgreementExhibit
10.4

	
  

  	
  ***Text Omitted and Filed Separately

  
	
   

  	
  CONFIDENTIAL
  TREATMENT REQUESTED

  
	
   

  	
  Under
  17 C.F.R. §§ 200.80(b)(4) and 240.24b-2

  

 

January 16, 2007

VIA EXPRESS MAIL AND FACSIMILE:

Biocon Limited

20th KM
Hosur Road

Electronics City PO

Bangalore, India 560 100

Attn: Head, Legal & General Counsel

Fax: +91-80-2852-3423

Re:                               Assignment of Agreements

Dear Rakesh:

As you are aware, Par Pharmaceutical, Inc. (“Par”) and Biocon Limited (“Biocon”)
are parties to a certain Supply Agreement entered into on August 29, 2005
(the “Supply Agreement”) related to the supply of quantities of
tiacurnicin [***].  In addition to
and in connection with the Supply Agreement, Par and Biocon have also entered
into a Material Transfer Agreement and a Quality Agreement (collectively with
the Supply Agreement, the “Agreements”). 
As we have discussed, Par would like confirmation of Biocon’s agreement
that Par may assign the Agreements and all of Par’s rights and obligation under
the Agreements to Optimer Pharmaceuticals, Inc. (“Optimer”).

Please indicate Biocon’s consent to the Assignment by
counter-signing below and returning a copy of this letter to me by facsimile.

	
  

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
          /s/
  Paul Campanelli

  	
   

  
	
   

  	
  Paul Campanelli

  
	
   

  	
  E. V. P. Business Development & Licensing

  
	
   

  	
  Par Pharmaceutical, Inc.

  
	
   

  	
  January 17, 2007

  

 

ACKNOWLEDGED AND AGREED:

	
          /s/ Rakesh Bamzai

  	
   

  
	
  Mr. Rakesh Bamzai

  
	
  President – Group Marketing

  
	
  January 16, 2007

  
	
  Biocon Limited

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00117-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00117-of-00352.parquet"}]]