Document:

Exhibit 10.17

 

Confidential Materials omitted and filed separately with the

 

Securities and Exchange Commission. Double asterisks denote omissions.

 

 

MASTER AGREEMENT FOR THE MANUFACTURE, PACKAGING AND SUPPLY OF PRODUCTS

 

THIS AGREEMENT is made on the 7th day of August, 2017 between ALMAC PHARMA SERVICES LIMITED, (No. NI45055) whose registered office is at Almac House, 20 Seagoe Industrial Estate, Craigavon, BT63 5QD, Northern Ireland (“ALMAC”); and NABRIVA THERAPEUTICS IRELAND DAC, having its registered office at 25-28 North Wall Quay, Dublin 1, Ireland (the “Client”)

 

WHEREAS: Client sells and supplies certain pharmaceutical products to third parties and the Client wishes to engage ALMAC to manufacture and/or pack and or/store and supply the Client with the Products and ALMAC has agreed to provide Services (defined below) including but not limited to manufacture, packaging, storage, analysis and release and supply of the Products to the Client, and the Client has agreed to purchase, the Products on the terms of this Agreement.

 

IT IS NOW AGREED AS FOLLOWS:

 

1.                                          DEFINITIONS

 

1.1                                   In this Agreement unless the context otherwise requires:

 

“Affiliate” means, with respect to a party, any company or business entity which controls, is controlled by, or is under common control with such party.  For the purpose of this definition “control” means direct or indirect beneficial ownership of at least fifty per cent (50%) of the issued share capital with voting rights in such company or business entity;

 

“ALMAC’s Facility” shall mean ALMAC’s facility situated at Seagoe Industrial Estate, Craigavon, Northern Ireland BT63 5UA, or, to the extent approved in advance by Client, such other place at which ALMAC or its sub-contractors (if applicable and as agreed between ALMAC and Client), may from time to time provide the Services;

 

“Applicable Appendix” shall mean the proforma quotation, proposal or proforma invoice attached hereto at Schedule 1;

 

“Applicable Laws” shall mean all applicable rules, regulations and laws of the United States and European Union including, where relevant to the Services performed pursuant to an Applicable Appendix, cGMP

 

“Business Day” means 9.00 am to 5.00 pm GMT on any Monday to Friday, excluding public holidays and bank holidays in the United Kingdom, Northern Ireland, and United States of America (and/or Pennsylvania);

 

“Certificate of Analysis” means documentation providing a record of analytical testing data, provided and properly certified by a Qualified Person, stating and confirming that the Product to be provided by ALMAC or Free Issue Material to be provided by Client to which such documentation refers has been

 

 

tested to, and complies with the relevant release specification for the Product or Free Issue Material (as appropriate);

 

“Certificate of Conformity” means documentation signed by a Qualified Person, which will include a statement that the Product has been manufactured, packaged, tested, and stored according to the terms of cGMP, and the Specifications;

 

“cGMP” means current Good Manufacturing Practice of the pharmaceutical industry standards for the EMA in the European Union (more particularly described in directive 2003/94/EC of 8 Oct 2003) and the FDA in the United States of America (more particularly described in the Code of Federal Regulations 21 CFR Parts 210 and 211 cGMPs) relating to product description, manufacturing processes, quality control, packaging instructions, specifications, and guidelines relating to the manufacture, testing, analysis, packaging, and storage of medicinal products and any subsequent updates to such directives, regulations or guidelines;

 

“Claims” means any and all claims, demands, suits, Losses (as hereinafter defined), liability, damage, fines, expenses and costs (including without limitation attorney’s fees and expenses and settlement costs) arising from any cause of action brought by any party (including without limitation either Party and/or a Third Party or Third Parties), whether in contract, tort (including, without limitation, negligence) warranty, strict liability, product liability, statutory duty or otherwise;

 

“Competent Authority” means any local or national agency, authority, department, inspectorate, minister, ministry official or public or statutory person (whether autonomous or not) of any government or any country in the agreed Territory, including, but not limited to, the FDA, the EMA, the European Commission and the European Court of Justice;

 

“Confidential Information” means all information whether commercial, financial, technical, operational or otherwise in any format, disclosed by one Party to the other Party in connection with this Agreement that is either marked or designated as confidential or proprietary or would be readily recognized as such by a reasonable person working in the area of pharmaceutical manufacturing, in each case whether disclosed orally in documentary form, by documentation or otherwise (including information obtained visually during site visits to either party) and including the terms of this Agreement;

 

“Effective Date” means the date of this Agreement or the commencement date of the Services whichever is earlier;

 

“EU” means the European Union;

 

“EMA” means the European Medicines Agency and any successor entity thereto;

 

“EXW” shall mean “Ex works”, as that term is defined in INCOTERMS 2010, in accordance with Section 4 of this Agreement;

 

“FDA” means the United States’ Food and Drug Administration and any successor entity thereto;

 

“Free Issue Materials” means the intermediate products or materials, manufactured to cGMP, to be supplied by the Client to ALMAC free of charge for the purposes of this Agreement and as described in the Applicable Appendix (as may be amended by the mutual agreement of the Parties) together with the respective Certificate of Analysis for each batch;

 

“Intellectual Property Rights” means any and all trade marks, rights in designs, get-up, trade, business or domain names, copyrights, future copyrights, patents, rights in databases (whether registered or not and any applications to register or rights to apply for registration of any of the foregoing), rights in inventions, know how, trade secrets and other confidential information and all other intellectual property

 

 

rights of a similar or corresponding nature which may now or in the future subsist in any part of the world;

 

“Manufacturing and Packaging Instructions” means the full descriptions and instructions relating to the processes, formulae and quality standards to be observed by ALMAC in the manufacture, testing, packaging, release, and storage of the Products, as provided by the Client and as set out in the Technical Agreement;

 

“Marketing Authorisation” means the licence granted by a Competent Authority relating to each country of the Territory permitting manufacture, supply, importation, distribution, marketing and sale of the Products in the Territory;

 

“Minimum Annual Revenue” means the minimum annual spend (excluding materials and pass through costs) by Client on Services relating to the manufactured Products (at any scale including any process validation batches) which are to be sold in any given Year of this Agreement (as detailed in Schedule 2, as may be amended from time to time by written agreement of the Parties);

 

“Packaging Materials” means those printed and unprinted materials used in the packaging of the Products, the specification for which is set out in the Manufacturing and Packaging Instructions, which in the case of printed materials shall bear the Client’s and/or Product’s text, trademark and livery, to be obtained by ALMAC and the cost of which shall be included in the prices set out in the Applicable Appendix as may be amended from time to time by written agreement of the Parties;

 

“Party” means a party to this Agreement;

 

“Products” means the products described in the Applicable Appendix, which are the subject of the Services to be supplied by ALMAC to the Client on the terms of this Agreement and in accordance with the Technical Agreement;

 

“Purchase Order” means a formal document in written form issued by the Client to ALMAC containing a firm instruction to manufacture, package, test, store, and/or release the Products giving the following:

 

·                                purchase order number;

·                                Product identity;

·                                quantity required;

·                                contract price;

·                                delivery date required;

·                                delivery address required; and

·                                invoice address.

 

“Qualified Person” has the meaning ascribed to it under Article 48 of Directive 2001/83/EC, in relation to the production of human medicines, and Article 52 of Directive 2001/82/EC, in relation to the production of veterinary medicines;

 

“Raw Materials” means the materials, including the Packaging Materials but excluding the Free Issue Materials, used in the manufacture of the Products, the specifications for which are set out in the Specification, to be obtained by ALMAC and the cost of which shall be included in the prices set out in the Applicable Appendix as may be amended from time to time by written agreement of the Parties;

 

“RPI” means the “all items” General Index of Retail Prices in the United Kingdom published by the Office for National Statistics or any successor ministry or department;

 

 

“Services” means the manufacturing, packaging, storage, analysis, and/or release services that ALMAC agrees to perform pursuant to Section 2.1 hereof in connection with the Products;

 

“Specification” means the written specifications for the manufacture, testing, packaging, release, and storage of the Products as prepared and delivered by the Client, as set out in the Technical Agreement from time to time;

 

“Technical Agreement” means the separate agreement to be entered into between the Parties which describes the quality assurance requirements for Services under this Agreement and which shall form part of this Agreement, as may be amended by the Parties from time to time;

 

“Territory” means the United States of America and Europe or such other territory as may be agreed by the Parties in writing from time to time, such agreement not to be unreasonably withheld;

 

Third Party” shall mean a party other than ALMAC, Client, or their respective Affiliates, officers, directors, employees, agents and representatives;

 

“US” means the United States of America;

 

“Year” means the period of twelve (12) calendar months from and including the Effective Date, and each subsequent period of (12) calendar months during the continuance of this Agreement;

 

1.2                                   A reference to the singular includes the plural and vice-versa.

 

2.                                          PROVISION OF THE SERVICES

 

2.1                                   In accordance with the terms and conditions of this Agreement, ALMAC shall (where applicable):

 

(a)                              procure the Raw Materials in such quantities needed to satisfy its obligations under this Agreement and inspect all such Raw Materials to ensure that they satisfy the requirements of this Agreement and the Technical Agreement;

 

(b)                              provide the Services at ALMAC’s Facility in accordance with cGMP and the Specifications;

 

(c)                               test and/or arrange for the testing of each batch of the Products in accordance with the Technical Agreement;

 

(d)                              release and/or arrange for the release of each batch of the Products by a Qualified Person in accordance with the Technical Agreement such that that batch may be invoiced and despatched from ALMAC;

 

(e)                               supply and deliver the Products to the Client in accordance with Section 4 below;

 

(f)                                provide and maintain the appropriate personnel, equipment, tooling, and plant necessary to enable ALMAC to provide the Services in accordance with the Technical Agreement and all other relevant information supplied to ALMAC by the Client herein. For the avoidance of doubt, the cost of any change parts, tooling or equipment required specifically for the Products (and any subsequent replacement thereof) shall be listed in the Applicable Appendix;

 

(g)                               seek and maintain any necessary permit(s) and/or licence(s) as appropriate (with the assistance of the Client, where applicable) such that ALMAC may manufacture, supply, package, release, test, and store the Products in accordance with the Technical Agreement for the duration of this

 

 

Agreement.  For the avoidance of doubt, any costs related exclusively to Products incurred by ALMAC in this activity shall be for the account of the Client;

 

(h)                              not engage additional subcontractors to perform any aspect of the Services without Client’s prior written approval; and

 

(i)                                  keep accurate and complete records of the Services performed hereunder; retain such records for a period of [**] following the date of Product expiry, or longer if required by Applicable Laws, after which time such records shall be transferred to Client; and use commercially reasonable efforts to maintain such records in a manner that avoids cross-reference to any Third Party confidential information, so as to facilitate Client’s audit and/or use of any such records.

 

2.2                                   In accordance with the terms and conditions of this Agreement, the Client shall:

 

(a)                              manufacture or procure the manufacture of the Free Issue Materials in accordance with cGMP;

 

(b)                              deliver the Free Issue Materials, DDP in accordance with Incoterms 2010 Edition, to ALMAC’s Facility, together with a corresponding Certificate of Analysis, free of any cost or expense to ALMAC, at least [**] days prior to the intended date of supply of Products, as specified in the relevant Purchase Order, in such quantities in order to enable ALMAC to provide the Services against the Client’s Purchase Orders. For purposes of the preceding sentence, delivery of the Free Issue Material to ALMAC shall be deemed to occur upon delivery of such Free Issue Material to ALMAC’s Facility and receipt by ALMAC of the applicable Certificate of Analysis;

 

(c)                               provide to ALMAC on a monthly basis a rolling forecast of its anticipated schedule of deliveries of Free Issue Materials to ALMAC’s Facility for the following [**] months and shall use all reasonable endeavours to ensure that deliveries of Free Issue Materials are in accordance with Section 2.2(b) above and correspond with the Client’s demand for Products as evidenced by the Initial Forecast or Rolling Forecast (as appropriate), subject to the further terms and conditions set forth in Section 3;

 

(d)                              purchase such quantities of the Products as ordered by it pursuant to each Purchase Order;

 

(e)                               at ALMAC’s request, provide ALMAC with accurate information concerning the Free Issue Materials and the Products and their intended use by the Client that are relevant to ALMAC’s performance of its obligations under this Agreement.  The Client shall ensure that all technical information supplied to ALMAC (including information contained in the Technical Agreement) is consistent with the Marketing Authorisation;

 

(f)                                to the extent permitted by Applicable Laws, give full details to ALMAC of any complaint received by the Client in regard to the manufacturing, packaging, testing, release, or storage of Products and discuss the appropriate response to the complaint with ALMAC and where appropriate, ALMAC shall discuss and assist the Client with the details of any Product recall programme in the Territory; and

 

(g)                               seek any necessary variations of its Marketing Authorisation in the Territory (with the assistance of ALMAC, where applicable) in respect of the Products such that ALMAC may provide the Services for the duration of this Agreement.  For the avoidance of doubt, any costs incurred by ALMAC in providing such assistance shall be for the account of the Client.

 

 

2.3                                   Packaging Materials

 

(a)                              The Client will be responsible, at its own expense, for supplying ALMAC with digital artwork necessary to enable ALMAC to supply Products fully finished ready for sale by the Client, incorporating the Client’s trademark(s), livery, and text.  The Client will also be responsible for the cost of proofing and of production of any printing plates required by ALMAC to assemble, package and supply the Products and for the approval of final proofs generated by the printer.

 

(b)                              The Client shall give ALMAC at least [**] months’ written notice of its requirements under Section 2.3(a) above, such notice to include the final approved printer proofs, incorporating the Client’s artwork, to enable ALMAC to obtain Packaging Materials with such markings. The period of notice required shall apply in respect of the markings required for the first delivery of the Products and to any change, for whatever reason, in the required markings occurring during the term of this Agreement.

 

(c)                               In the event of a change in Client’s purchasing or operational requirements necessitating a change in the Packaging Materials or Raw Materials, or any other change in Packaging Materials or Raw Materials that are requested by the Client, the Client shall bear the cost to ALMAC of the unused Packaging Materials or Raw Materials that are rendered obsolete by such change, and any assembled quantities of the Products assembled in accordance with the Client’s Purchase Orders or the next [**] months of the Rolling Forecast demand.

 

3.                                          FORECASTING AND ORDERING

 

3.1                                   Initial Forecast

 

On or before the Effective Date the Client shall provide to ALMAC a non-binding forecast of the Client’s anticipated monthly requirement for the Products for the following [**] months (the “Initial Forecast”).  Almac will be permitted to place orders on its suppliers for the Packaging Materials or Raw Materials in line with the requirements forecast for the first [**] months.

 

3.2                                   Rolling Forecast

 

The Client shall provide to ALMAC, in continuation of the Initial Forecast, an updated forecast of demand for the following [**] months, submitted on a monthly basis (“Rolling Forecast”).  The quantities indicated in the Rolling Forecast for the first [**] calendar months ahead of the current one shall constitute firm quantities (the “Binding Portion”), against which the Client shall issue Purchase Orders.  The quantities indicated in the Rolling Forecast for the remaining [**] calendar months shall be considered an estimate of future requirements and shall be non-binding except in so far that ALMAC will be permitted to place orders on its suppliers for the Packaging Materials or Raw Materials in line with the requirements forecast for the first [**] months of the Rolling Forecast.

 

3.3                                   Purchase Orders

 

(a)                              The Client shall provide ALMAC with Purchase Orders not less than [**] days prior to the required delivery date for Product to be provided as bulk tablets and [**] days prior to the required delivery date for Product to be provided as packaged tablets.  Upon receipt of the Purchase Orders, ALMAC shall review and confirm in writing acceptance or otherwise of the Purchase Order within [**] days from receipt.  Any rejection of a Purchase Order shall be accompanied with a written explanation of the grounds for rejection.

 

(b)                              Specific arrangements for the volume and timing of supply of the Products may be agreed in advance in writing between the Parties from time to time, including (without prejudice to the generality of the foregoing) arrangements to deal with promotional activity being conducted by the Client, at its own expense, in respect of the Products. Any additional costs to support such arrangements will be agreed in advance with the Client.

 

 

(c)                               Subject to the supply of Free Issue Materials by the Client, ALMAC shall at all times use all reasonable endeavours to supply and to ensure that it is able at all times to fulfil Purchase Orders for Products on time that are reasonably placed upon it by the Client.  The Client shall use all reasonable endeavours when placing Purchase Orders with ALMAC to ensure that the Purchase Orders correspond with the anticipated requirements set out in the forecasts referred to in Sections 3.1 and/or 3.2 above.

 

(d)                              In the event that the Client fails to deliver Free Issue Materials to ALMAC in not less the [**] days for Product to be provided as bulk tablets and one hundred and in not less than [**] days for Product to be provided as packaged tablets prior to the required date of supply of Products (pursuant to Section 2.2 (b) above), both Parties shall discuss the revised timelines for delivery of the Product and ALMAC shall use commercially reasonable efforts to supply the Product within the revised timelines.

 

In the event that a Purchase Order is rescheduled or cancelled pursuant to this Section 3.3(d) any reasonable substantiated costs incurred by ALMAC due to loss or delay in manufacture, shall be charged to the account of the Client.

 

(e)                               If for any reason ALMAC believes that it is or is likely to be unable to fulfil all or any part of any Purchase Order made by the Client for the Products, it shall promptly inform the Client in writing of this belief. Under the terms of this Section 3.3(e), if ALMAC is unable to fulfil a Purchase Order within [**] days of the scheduled delivery date, the Client will meet with ALMAC to reschedule the delivery date for such Purchase Order and ALMAC will use all reasonable endeavours to reschedule such date and deliver in accordance with the same.

 

4.                                          DELIVERY

 

4.1                                   Delivery of the Products from ALMAC to Client shall be made EXW ALMAC’s Facility. Delivery shall be made at such time as the Products are placed at the disposal of the Client at ALMAC’s Facility.  If requested by Client, ALMAC shall assist Client in arranging shipment of the Product to Client or Client’s designated location in accordance with Client’s instructions and at Client’s risk and expense.  All shipments will be subject to the standard terms and conditions of the selected courier and ALMAC shall have no liability to Client for any loss, damage or delay in a shipment attributable to the selected courier or any Third Party.

 

4.2                                   Provided ALMAC has used all reasonable endeavours to arrange delivery of Products on the date specified in the Purchase Order, ALMAC shall not be liable for any loss of any nature occasioned by any delay in delivery.  Time of delivery shall not be of the essence.

 

4.3                                   Delivery of the Products shall be made together with a Certificate of Analysis and a Certificate of Conformity for the Products, plus the relevant batch documentation as required for release and in accordance with the Technical Agreement, unless otherwise agreed between the Parties from time to time. For the first three (3) batches of Product ALMAC shall provide to the Client full batch documentation for the Products delivered.  Thereafter, the Parties shall agree a reasonable level of assistance to be provided by ALMAC to the Client in respect of the provision of batch documentation.

 

4.4                                   If Client causes any delay to ALMAC’s provision of the Services, for reasons within Client’s control including but not limited to delay in providing information requested by ALMAC or a delay in the delivery of any Free Issue Materials or Raw Materials, ALMAC shall be entitled to charge the Client for any reasonable, substantiated costs arising as a result of such delay, including non-cancellable expenses and lost capacity, which cannot, with reasonable endeavours, be substituted with (an) alternative project(s). In any event, ALMAC shall use commercially reasonable efforts to minimize

 

 

any such costs and shall provide Client with an itemized invoice detailing its calculation of such costs.

 

4.5                                   Notwithstanding section 4.1 above, risk of loss and title to the Raw Materials, Free Issue Materials (including Free Issue Materials contained in Products or in-process steps) and Products shall remain with Client at all times.  Notwithstanding the foregoing, ALMAC shall be liable for any loss in the Raw Materials, Free Issue Materials (including Free Issue Materials contained in Products or in-process steps) or Products to the extent that such loss is caused by ALMAC’s gross negligence or willful misconduct whilst the Raw Materials, Free Issue Materials (including Free Issue Materials contained in Products or in-process steps) and Products are on Almac’s premises in which case Almac’s liability shall be limited to the total value of the applicable Purchase Order (excluding materials and pass through costs).

 

4.6                                   Client will prepare, obtain, and maintain all necessary import and export registrations relating to the Product.

 

5.                                          CHARGES AND PAYMENT TERMS

 

5.1                                   In consideration of ALMAC’s provision of the Services under this Agreement, the Client shall pay to ALMAC the charges set out in Applicable Appendix.  Such payment will be made in full within [**] days after the date of the invoice being issued to Client. Except as provided otherwise in the Applicable Appendix, all sums payable under this Agreement are exclusive of any applicable levy or taxes.

 

5.2                                   Where any undisputed payment due under this Section 5 has not been made by [**] days after the due date, ALMAC reserves the right to suspend the Services until all outstanding amounts have been paid.

 

5.3                                   The Parties shall meet prior to the end of each Year to renegotiate in good faith the charges set out in Applicable Appendix. At such meeting the Parties shall discuss and agree on adjustments (which, for clarity, may be increases or decreases) to such charges to accommodate:

 

(a)                              any increase/decrease in the costs of the Services resulting from increases/decreases in labour, Raw Materials, administrative costs, increases/decreases in the costs of any and all activities sub-contracted, or as a result of statutory changes which materially affect the Products or their cost; and

 

(b)                                any increase/decrease in the RPI during the period of twelve (12) months preceding the month in which the Parties meet to review the charges pursuant to this Section 5.3.

 

(c)                                  any change in volume demand, batch size, yield, and/or manufacturing efficiency for the Products.

 

In the event that any such adjustments to such charges are agreed, the Applicable Appendix shall be amended accordingly and the revised charges implemented. Unless otherwise agreed in writing, any such adjustments shall apply to Product orders going forward and shall not affect orders made by Client prior to mutual agreement on such adjustments.

 

5.4                                   Notwithstanding Section 5.3 above, ALMAC shall have the right at any time to adjust the price of the Products by giving [**] days written notice thereof, provided that such adjustment represents the

 

 

true substantiated change in costs of the Services resulting from changes in Packaging Materials or Raw Materials, changes in the costs of any and all activities sub-contracted, or as a result of statutory changes or a change in the Manufacturing and Packaging Instructions or the Specifications which materially affect the Products or their cost. Following such notice from ALMAC, the charges set out in the Applicable Appendix shall be amended accordingly and the revised charges implemented.  Unless otherwise agreed in writing, any such adjustments shall apply to Product orders going forward and shall not affect orders made by Client prior to mutual agreement on such adjustments. For clarity, the Parties agree that Client’s obligation to bear cost increases in this Section 5.4 will be limited to those cost increases that relate solely to the production, packaging and storage of the Products; other costs (such as costs for changes relating to cGMP compliance or affecting other products generally) will be borne by ALMAC.

 

5.5                                   ALMAC shall submit invoices for the Products to the Client upon delivery of Products (including all paperwork reasonably required by Client in order to enable Product release by Client) against each Purchase Order, or part thereof, in accordance with Section 5.1 above.

 

5.6                                   ALMAC reserves the right to charge interest at a rate [**]% per annum above the then-current 1-Year LIBOR rate on all overdue accounts, such interest being deemed to accrue on a day to day basis from the due date for payment (both before and after judgment).

 

5.7                                   In the event that Client cancels the Services within [**] days of the date on which the Services were due to commence, ALMAC shall be entitled to charge the Client for any reasonable, substantiated costs arising as a result of such cancellation, including all fees for Services rendered to the effective date of termination, non-cancellable expenses and lost capacity, costs and expenses relating to the purchase of supplier materials or equipment, which cannot, with reasonable endeavours, be substituted with (an) alternative project(s). In any event, ALMAC shall use commercially reasonable efforts to minimize any such costs. ALMAC shall provide the Client with an invoice for its termination expenses and charges as soon as reasonably practicable following termination and winding-up of such work.

 

6.                                          MINIMUM ANNUAL REVENUE

 

6.1                              In addition to the obligations contained elsewhere in this Agreement, the Client shall, with effect from the release of the first commercial batch of Product (including validation batches if they are to be commercialised) and thereafter for the duration of this Agreement, in each Year of this Agreement, spend the Minimum Annual Revenue.

 

6.2                                   Notwithstanding the provisions of Section 6.1:

 

(a)                              in any Year of this Agreement the Client shall not be obligated to spend more than the Minimum Annual Revenue;

 

(b)                              the Minimum Annual Revenue may be amended by mutual agreement between the Parties in writing and the Applicable Appendix amended accordingly.

 

If the Client fails to place Purchase Orders for the Minimum Annual Revenue during a given Year, the Client shall pay to ALMAC an amount equal to the difference between the Minimum Annual Revenue and the actual revenue realised under this Agreement in that Year.

 

 

7.                                          AUDITS, INSPECTIONS AND REGULATORY PROCEDURES

 

7.1                                   Subject to the undertakings as to confidentiality in this Agreement and on reasonable prior written notice, ALMAC shall permit employees or authorised representatives of the Client on any Business Day to enter and inspect those areas of ALMAC’s Facility which directly relate to the manufacture and supply of the Products:

 

(a)                              to conduct an annual cGMP audit of ALMAC’s Facility;

 

(b)                              as the result of a quality complaint relating to the Products, to conduct a cGMP audit of ALMAC’s Facility;

 

(c)                               as the result of a quality complaint relating to the Products, to conduct an audit to observe and inspect operations and compliance with the Technical Agreement,

 

PROVIDED THAT the Client shall ensure that such employees and representatives are qualified and competent to conduct such audits and that those employees and representatives are bound by confidentiality obligations equivalent to those under this Agreement and with all regulations and reasonable instructions issued by ALMAC relating to the conduct of persons at ALMAC’s Facility. The Parties agree that such audits shall be conducted in a manner as to ensure minimum disruption to ALMAC’s normal business activities.

 

7.2                                   Either Party shall promptly notify the other Party of any regulatory inspections of ALMAC’s Facility by a Competent Authority of which it becomes aware in so far as such inspection relates to the Products.  ALMAC shall have primary responsibility for preparing any responses which may be required by the Competent Authority and the Client shall upon request of ALMAC use its best endeavours to support and assist ALMAC in preparing such responses.

 

7.3                                   If, pursuant to Section 7.2 above, an authorised agent of a Competent Authority visits or announces plans to visit ALMAC’s Facility where such visit may have a direct impact on the Products, ALMAC shall (subject to any obligations of confidentiality in favour of third parties):

 

(a)                              permit the Client (or its appointed nominee where the Client does not have appropriately qualified persons in its employ) to carry out an inspection of ALMAC’s Facility at the Client’s option in advance of the proposed visit and/or after the visit where this is reasonably possible;

 

(b)                              immediately after the visit (whether in connection with an inspection carried out by the Client pursuant to sub-Section 7.3(a) above or otherwise), provide to the Client such details of the results of the visit and details of any observations or recommendations made as shall be available where these observations are directly relevant to the Products or the place of the provision of the Services; and

 

(c)                               on receipt of any report relating to the visit, provide to the Client full details of any results together with details of any relevant observations or recommendations made, where such information impacts on ALMAC’s ability to perform the obligations under this Agreement.

 

7.4                                   If in accordance with this Section 7, ALMAC’s participation in any regulatory review which relates directly to the Products is significant in regard to use of personnel, time and/or expense, both Parties shall review costs associated with the participation and shall agree to a reasonable rate of compensation to be paid by the Client in advance of ALMAC’s participation in such review, it being understood that Client’s obligation to bear costs for such review will be limited to those costs that relate solely to the production of the Products; other costs (such as those relating to cGMP compliance or parts of a regulatory review affecting other products generally) will be borne by ALMAC.

 

 

7.5                               At least [**] days prior to Client filing any regulatory submissions to a Competent Authority which contains ALMAC generated data or provided information, Client shall provide ALMAC with a copy of any relevant documents incorporating such data or information to ALMAC for review.

 

8.                                          PRODUCT COMPLAINTS, RECALLS OR PRODUCT HOLDS

 

8.1                                   In the event that:

 

(a)                              any government authority issues a request, directive or order that the Products be recalled or held; or

 

(b)                              a court of competent jurisdiction orders such a recall or hold; or

 

(c)                               the Client determines after consultation with ALMAC that the Products should be recalled or held,

 

each Party shall provide all reasonable assistance to the other with respect to such recall or hold, and the Parties shall take all appropriate corrective actions.  In the event that such recall or hold results from any cause or event arising from the provision of the Services by ALMAC or other cause or event attributable to ALMAC, and except where ALMAC has acted in accordance with the Technical Agreement, the Manufacturing and Packaging Instructions, the Specifications or any other instructions given by the Client, ALMAC shall be responsible, subject to the provisions of Section 13.3, for all direct expenses of the recall or hold. In the event that such recall or hold results from any cause or event attributable to the Client, the Client shall be responsible for all direct expenses of the recall or hold. For the purposes of this Agreement, the direct expenses of the recall or hold shall include, without limitation, the expenses of providing replacement Product and notification and distribution or return of the recalled or held Product (as appropriate).

 

8.2                                   The Parties shall use all reasonable endeavours to mitigate costs incurred under Section 8.1 above, and will retain documentary evidence of all costs actually incurred so as to permit accurate assessment of the sums due from the Client/ALMAC (as appropriate) to the other pursuant to Section 8.1.

 

9.                                          CONFIDENTIALITY

 

9.1                                   All Confidential Information of ALMAC disclosed to Client and all Confidential Information of Client disclosed to ALMAC shall be held in confidence by the Receiving Party (as defined below) and not disclosed by the Receiving Party to any Third Party or used by the Receiving Party except to perform obligations under, exercise rights under, or enforce this Agreement.  Notwithstanding the foregoing, the Receiving Party may disclose Confidential Information to its Affiliates, employees, officers, directors, consultants and representatives who need to know such Confidential Information for the purpose of performing obligations under, exercising rights under, or enforcing this Agreement.  The Receiving Party agrees that it will be liable for any disclosure of Confidential Information by any Affiliate, employee, officer, director, consultant or representative of the Receiving Party that would constitute a breach of this Agreement if made by the Receiving Party.

 

9.2                                   If the Party receiving Confidential Information of the other Party (the “Receiving Party”) is requested in any judicial or administrative proceeding or by any governmental or regulatory authority to disclose any Confidential Information of the other Party (the “Disclosing Party”) or needs to use Confidential Information of the Disclosing Party to enforce or protect the rights of the Receiving Party in any such proceeding, or is otherwise required to disclose such Confidential Information pursuant to applicable laws or regulations or the rules of any recognised stock exchange, the Receiving Party shall give the Disclosing Party prompt notice of such request, need, or requirement

 

 

so that the Disclosing Party may seek an appropriate protective order.  The Receiving Party shall cooperate fully with the Disclosing Party in obtaining such an order.  If in the absence of a protective order the Receiving Party is nonetheless compelled to disclose Confidential Information of the Disclosing Party (or if the Receiving Party reasonably needs to present the Confidential Information in a proceeding to best enforce or protect its rights hereunder), the Receiving Party may make such disclosure without liability hereunder, provided that the Receiving Party gives the Disclosing Party written notice of the Confidential Information to be disclosed as far in advance of its disclosure as is practicable and, upon the Disclosing Party’s request and at its expense, the Receiving Party will use reasonable efforts to obtain reasonable assurances that confidential treatment will be accorded to such Confidential Information.

 

9.3                                   The obligation set out in Section 9.1 shall not apply:

 

(a)                              where the information referred to in Section 9.1 is in the public domain as at the date of this Agreement or falls into the public domain hereafter other than by reason of disclosure of such information by the Receiving Party in breach of the terms of this Agreement;

 

(b)                              where such information was already known to the Receiving Party as of the date of disclosure by the Disclosing Party and had not been previously received by Receiving Party directly or indirectly from Disclosing Party, all , as evidenced by contemporaneous written records;

 

(c)                               where such information is subsequently disclosed to the Receiving Party, free of any obligations of confidence, by a Third Party having the right to disclose the same; and

 

(d)                              is developed by or for the Receiving Party independently of the information disclosed by the Disclosing Party, as evidenced by contemporaneous written records.

 

9.4                                   Each Party undertakes to the other that it shall keep the existence and nature of this Agreement confidential and not use this Agreement or the name of the other Party in any publicity, advertisement or other disclosure with regard to this Agreement without the prior written consent of the other Party, except as may be required by applicable laws or regulations or the rules of a recognized stock exchange.

 

9.5                                   Upon the expiration or prior termination of this Agreement each Party shall use all reasonable efforts to collect and return to the other Party or destroy any and all data, notes, records, reports, and other electronic or written information, including any and all copies that may have been made thereof, that contain Confidential Information received from the other Party.  ALMAC shall be entitled to keep one archival copy of Confidential Information provided by Client in ALMAC’s confidential files, solely for use in monitoring its compliance with the non-disclosure and non-use provisions herein.

 

10.                                   WARRANTIES

 

10.1                            Each Party represents and warrants to the other Party as of the Effective Date that (a) it is a corporation duly organized and validly existing under the laws of the jurisdiction of its organization, and has the full right, power and authority to enter into this Agreement, to perform its obligations hereunder; and (b) this Agreement has been duly executed by it and is legally binding upon it, enforceable in accordance with its terms, and does not conflict with any agreement, instrument or understanding, oral or written, to which it is a party or by which it may be bound, nor violate any material law or regulation of any court, governmental body or administrative or other agency having jurisdiction over it.

 

10.2                            ALMAC warrants only that (a) the Products supplied to the Client hereunder will have been manufactured, packaged, tested, and stored in accordance with Applicable Law (including cGMP), the Technical Agreement and the Manufacturing and Packaging Instructions; (b) the Products will

 

 

at the time of delivery conform with the Specification and be free and clear of all liens, security interests or encumbrances; (c) the use of ALMAC Property (as defined in Section 11.3) to perform the Services do not and will not infringe the Intellectual Property Rights of any Third Party; and (d) it will not in the performance of its obligations under this Agreement use the services of any person it knows is debarred or suspended under 21 U.S.C. §335(a) or (b) . The remedies provided in sections 10.6 and 10.7 provide the sole and exclusive remedies of Client with respect to any failure to comply with subsections (a) and (b) of this warranty.

 

10.3                            All other warranties, express or implied including without limitations any implied warranty of merchantability or fitness for a particular purpose, are hereby disclaimed by ALMAC and excluded from these terms.

 

10.4                            The Client warrants that:

 

(a)                              Free Issue Materials supplied by the Client to ALMAC will, at the time of delivery, conform with the specifications during its shelf-life provided always that the Products are correctly transported, handled correctly and stored;

 

(b)                              the Free Issue Materials supplied to ALMAC hereunder will have been manufactured, packaged, handled, stored and tested in accordance with the terms of this Agreement and all appropriate legislation, rules and other requirements of the appropriate Competent Authority(ies) (including cGMP) in the EU that are in force from time to time during the term of this Agreement;

 

(c)                               it has authority to supply (and to authorise ALMAC to use in the manner contemplated by this Agreement) all specifications, instructions or information furnished by it to ALMAC and the performance of the Services based on such specifications, instructions or information or the use of Product by ALMAC as may be required to perform is obligations hereunder, does not and will not infringe the rights of any Third Party.

 

(d)                       Client represents and warrants that it will comply with all applicable import and export laws and regulations with respect to the provision of Free Issue Materials to ALMAC and subsequent shipments of Product under this Agreement.

 

10.5                            All other warranties, express or implied including without limitations any implied warranty of merchantability or fitness for a particular purpose, are hereby disclaimed by Client and excluded from these terms.

 

10.6                            The Client shall have the right to reject Product by notifying ALMAC in writing of any claim that any Products are damaged or defective or that any Products do not comply with the warranty in Section 10.2 above (in each case, a “Defective Product”): (i) in the case of a defect that is apparent upon normal visual inspection, within [**] days of receipt of such Products by Client; or, (ii) in the case of latent defects or non-conformities that are not reasonably discoverable by visual inspection or through review of the manufacturing documentation provided by ALMAC, by notifying ALMAC of the defect or non-conformity after such period (within [**] Business Days after Client becomes aware of such defect or non-conformity, but in no event after the expiry of the shelf-life of such Product).  In the event of any notification and rejection pursuant to the preceding sentence, ALMAC shall (subject to the supply of all Free Issue Materials to the extent that the Free Issue Materials cannot be reworked or re-used and associated Certificates of Analysis by the Client and provided that Client demonstrates that the Product has been shipped, stored and/or handled by the Client or any Third Party in accordance with the Specification and unless the cause of the notified problem has occurred post delivery and through no fault of ALMAC’s, or the notified problem is caused by faults in the Free Issue Materials, the Specification or the Manufacturing and Packaging Instructions

 

 

or other instructions or information provided by the Client), replace the Defective Products within [**] days, at no extra cost to the Client, and shall make arrangements with the Client for the return or destruction of such Defective Products.  ALMAC shall be liable to Client for the cost of any additional Free Issue Materials (to the extent that the Free Issue Materials cannot be reworked or re-used) required to be re-supplied by Client in order for ALMAC to replace the Defective Products to the extent that the Free Issue Materials are required to be re-supplied solely as a result of Almac’s gross negligence or willful misconduct, in which case Almac’s liability shall be limited to the total value of the applicable Purchase Order (excluding materials and pass through costs). If replacement is not possible, ALMAC shall refund to Client the portion of fees attributable to the Defective Product.  Where the fault for non-conformity lies with the Client in accordance with the provisions of this Section, the Client shall pay to ALMAC the invoice price for the Services and the Client will bear all costs associated with the rework and/or replacement of Defective Product by ALMAC.

 

10.7                            Should the Product be rejected pursuant to Section 10.6 above, and should ALMAC within [**] Business Days, after notice of such rejection, notify Client that is does not agree that there are grounds for such rejection, the Parties shall mutually agree upon a Third Party to test samples of such Product and to review records and test data and other relevant information developed by both Parties relating thereto to ascertain whether the affected unit(s) of Product are Defective Product.  The findings of such Third Party shall be binding on both Parties.  If the Product is found not to be Defective Product, the Client shall pay the costs of such tests and shall be deemed to have accepted the applicable Product and the Client shall pay to ALMAC the invoice price for the Product.  If the Product is found to be Defective Product, ALMAC shall pay the costs of such tests and shall provide replacement Product in accordance with the provisions of Section 10.6.

 

11.                                   INTELLECTUAL PROPERTY

 

11.1                            Nothing in this Agreement shall affect, or grant any right to any Intellectual Property Rights owned by the Parties prior to the commencement of this Agreement.

 

11.2                            All Intellectual Property Rights which may arise in any documents, drawings, items, designs, processes, software or any other thing developed or produced by ALMAC or any of its employees or agents (whether in conjunction with the Client’s employees or agents or not) in performance of this Agreement shall vest in Client, unless otherwise agreed in writing between the Parties.

 

11.3                            Notwithstanding anything to the contrary contained herein, Client acknowledges that ALMAC and its professional staff currently possess certain inventions, processes, know-how, trade secrets, methods, approaches, analyses, improvements, other intellectual properties and other assets including, but not limited to, clinical trial management analyses, analytical methods, procedures and techniques, computer technical expertise and proprietary software, and technical and conceptual expertise in the area of manufacture, packaging and supplying products, all of which have been developed independently by ALMAC without the benefit of any information provided by Client (collectively, “ALMAC Property”).  Client agrees that any ALMAC Property which is used, improved, modified or developed by ALMAC during the term of this Agreement shall be and remain the sole and exclusive property of ALMAC.

 

11.4                            The Client shall be responsible for obtaining all necessary consents in respect of the use of any Third Party Intellectual Property Rights necessary for manufacturing or commercialization of the Products.  Where any royalties or other sums are payable to any Third Party in respect of the use of any such Intellectual Property Rights, such sums shall be paid by the Client unless otherwise specified.

 

11.5                            No warranty is given by ALMAC that the Products do not infringe the Intellectual Property Rights of any Third Party and ALMAC shall not be liable for any liability, loss, costs, expenses or proceedings whatsoever and howsoever arising because of any such infringement.

 

 

12.                                   INDEMNIFICATION

 

12.1                            Client agrees to indemnify ALMAC, its Affiliates, and their respective employees, agents, officers and directors from any and all Losses arising due to Third Party claims resulting from any of the following:

 

(a)                       the infringement of a Third Party’s intellectual property rights, to the extent arising due to ALMAC’s use of any Free Issue Materials or information or instructions provided by Client;

 

(b)                       the use, sale, distribution or marketing of Product by Client including any personal injury to any person; and

 

(c)                        the violation by Client of any Applicable Law.

 

12.2                                 ALMAC agrees to indemnify Client, its Affiliates, and their respective employees, agents, officers and directors from any and all Losses arising due to Third Party claims resulting from any of the following:

 

(a)                       personal injury to any person arising as a result of ALMAC’s negligence or intentional misconduct in performing the Services;

 

(b)                       ALMAC’s material breach of any term of this Agreement (including the warranty set forth in Section 10.1); and

 

(c)                        the violation of any Applicable Law.

 

12.3                                 In this Section the term “Losses” shall mean (i) all final damages and costs awarded against any of the indemnitees and/or any settlement payments incurred by any of the indemnitees; (ii) reasonable legal fees in the case of litigation or arbitration (including negotiation of any settlement); and (iii) out-of-pocket expenses reasonably incurred by the indemnitees in connection with the investigation, settlement, or defense of the claims.

 

12.4                            Notwithstanding the foregoing, each Party’s obligation of indemnification in this Section 12 shall be reduced to the extent that the Third Party claim arises from, is based on, or results from acts of negligence, willful misconduct or breach of this Agreement by the Party seeking indemnification.

 

12.5                                 The indemnification obligations of ALMAC and Client, as the case may be, shall only apply if: (i) the Party seeking indemnification (the “Indemnified Party”) promptly notifies the other Party (the “Indemnifying Party”) in writing of any Third Party claim, indicating the nature of the claim and the basis thereof; (ii) the Indemnified Party refrains from making any admission of liability or any attempt to settle any such Third Party claim without the Indemnifying Party’s consent; (iii) the Indemnifying Party is permitted to manage and control the defense of such Third Party claim; and (iv) the Indemnified Party reasonably cooperates with the Indemnifying Party in the defense of any such Third Party claim.

 

12.6                                 The Indemnified Party may be represented by its own legal counsel in respect of any Third Party claim, at its own expense.

 

12.7                                 The Indemnifying Party may not settle any Third Party claim without the consent of the Indemnified Party, such consent not to be unreasonably withheld or delayed.  Neither Party will admit fault on behalf of the other Party without the written approval of such other Party.  In the event that the Indemnified Party rejects a settlement of a specific amount, the Indemnified Party shall be liable for all losses awarded to the Third Party in excess of such amount.

 

 

12.8                                 Nothing in this Section 12 shall be deemed to restrict or limit the Indemnified Party’s general obligation at law to mitigate a loss which it may suffer or incur as a result of a matter that may give rise to a claim hereunder.

 

13.                                   LIMITATION OF LIABILITY

 

13.1                            Nothing in this Section 13 shall be deemed to exclude or limit the liability of either Party for any form of liability that may not be excluded or limited by law.

 

13.2                            Neither Party nor its Affiliates and their respective officers, directors, employees, agents and representatives shall be liable to the other or its Affiliates and their respective officers, directors, employees, agents and representatives whether in contract, tort, (including negligence) or for breach of statutory duty or misrepresentation, or otherwise, for any:

 

(a)                              loss of profits;

 

(b)                              increased production costs or cost of substitute services;

 

(c)                               loss of contracts or opportunity;

 

(d)                              indirect, special, incidental or consequential damages

 

suffered by any person under or in connection with this Agreement.

 

13.3                            Except with respect to Claims for (a) wilful intent, (b) gross negligence, (c) personal injury, including culpable injury to life, body, or health, (d) breach of confidentiality obligations under Section 9 (Confidentiality) and (e) breach of intellectual property obligations under Section 11 (Intellectual Property) which in each case shall be limited as set forth in Section 13.4 (below), the total aggregate liability of ALMAC and its Affiliates and their respective officers, directors, employees, agents and representatives for Claims arising under or in connection with this Agreement (including, for the avoidance of doubt, Losses arising pursuant to Section 12) shall not exceed [**].

 

13.4                                 The total aggregate liability of ALMAC and its Affiliates and their respective officers, directors, employees, agents and representatives with respect to Claims for (a) wilful intent, (b) gross negligence, (c) personal injury, including culpable injury to life, body, or health, (d) breach of confidentiality obligations under Section 9 (Confidentiality) and (e) breach of intellectual property obligations under Section 11 (Intellectual Property) shall be limited to damages not to exceed [**].

 

13.5                                    The limitations of liability set forth in this Section 13 shall not apply to the extent a party has insurance coverage for such claims, losses or damages, which exceeds such maximum liability.

 

14.                                   INSURANCE

 

14.1                            Each Party shall maintain at its own cost during the term of this Agreement and for the anticipated life of any Products supplied by ALMAC hereunder insurance with an insurer of repute as follows:

 

(a)                              Public Liability Insurance for a sum assured of not less that £[**] English pounds);

 

(b)                              Product Liability Insurance for a sum assured not less than £[**] English pounds).

 

 

14.2                            Upon the request of either Party from time to time a Party shall provide reasonable evidence of the currency of the insurances required under Section 14.1 by submitting a copy of the original insurance certificate.

 

15.                                   TERM AND TERMINATION

 

15.1                            Subject to earlier termination as provided for in Sections 15.2 and 15.3 below, this Agreement shall commence on the Effective Date and shall remain in force for a period of five (5) years from that date and shall continue thereafter unless or until terminated by either Party giving not less than twenty-four (24) months’ written notice to terminate to the other Party expiring on or at any time after the expiry of the initial five (5) year term.

 

15.2                            In the event that either Party:

 

(a)                                suffers the appointment of a receiver or administrator over any part of its property or the presentation of a winding-up or passes a resolution for its winding-up except for amalgamation or reconstruction;

 

(b)                           enters into any composition or arrangement with its creditors or becomes insolvent;

 

(c)                               commits any material breach of this Agreement that is not reasonably capable of being remedied;

 

(d)                              commits any material breach of this Agreement and fails to remedy such breach within [**] days of receipt of written notice from the other Party requiring it to remedy the breach,

 

this Agreement may be terminated forthwith by the other Party upon written notice.

 

15.3                            This Agreement may terminate at any time with the written agreement of both Parties.

 

15.4                            Either Party shall have the right to terminate this Agreement without cause on twenty-four (24) months’ written notice to the other Party.

 

15.5                            Termination of this Agreement or any Appendix for any reason will be without prejudice to the rights and obligations of the Parties accruing up to and including the date of such termination.  For the avoidance of doubt Client shall pay ALMAC all fees for Services rendered to the effective date of termination in accordance with this Agreement where there is any termination event referred to in this Section 15.  All warranties and other provisions contained in Sections 7, 8, 9, 11, 12, 13, 14, 15, 16, and 17, will survive termination of this Agreement.  Further, after any termination or expiration of this Agreement, this Agreement shall remain in full force and effect with respect to any outstanding Services described on any Appendices hereto, that are not completed as of the effective date of termination or expiration of this Agreement, unless such Services are specifically cancelled by written consent of both Parties.

 

15.6                            In the event of termination of this Agreement due to a breach of this Agreement by ALMAC (but not otherwise), the Client shall have the right, but not the obligation to:

 

(a)                              purchase from ALMAC some or all usable stocks of Products, Raw Materials, components and in-process materials at the contract price in the case of Products and otherwise at the cost price paid by ALMAC; and

 

(b)                              demand the return of all stocks of Free Issue Materials held by ALMAC.

 

 

15.7                            In the event of termination of this Agreement (other than as a result of the negligence, wilful default or other breach of the agreement by ALMAC), the Client shall be obliged to:

 

(a)                              purchase all usable stocks of Products, Raw Materials, components and in-process materials at the contract price in the case of Products and otherwise at the cost price paid by ALMAC solely to the extent the foregoing were manufactured (in the case of Products) or procured (in the case of the rest) in line with requirements of a Rolling Forecast; and

 

(b)                           accept, at the Client’s cost, return of all stocks of Free Issue Materials held by ALMAC.

 

15.8                                 In addition, in the event of termination due to Client’s default and at the date of termination Client has not ordered the Minimum Annual Revenue pursuant to Section 6, calculated on a pro-rata basis as of the date of termination (i.e., based on the portion of then-current Year that has transpired as of such date),  then it shall compensate ALMAC for an amount equal to the remaining unpaid portion of such pro-rata Minimum Annual Revenue.  In the case of termination for any other reason, no further payments shall be owed by Client to ALMAC with respect to the Minimum Annual Revenue obligations in Section 6, regardless of which such obligations have been met at the time of termination.

 

15.9                                    In the event of termination of this Agreement for any reason, ALMAC will upon Client’s request, and for a period of no more than [**] months, provide reasonable assistance in transferring manufacturing of Products to a facility owned by Client or a Third Party selected by Client.  The cost of such assistance shall be borne by Client, unless the Agreement has been terminated by Client under Section 15.2, in which case, the cost of such assistance shall be discussed in good faith by the Parties.

 

16.                                   FORCE MAJEURE

 

16.1                            Both Parties shall be released from their respective obligations under this Agreement if national emergency, war, prohibitive governmental regulation, or any other cause beyond the reasonable control of the parties or either of them renders the performance of this Agreement impossible; provided, however, ALMAC will use all reasonable endeavours to mitigate the effects of the force majeure on its performance and delivery of the Products.

 

17.                                   GENERAL

 

17.1                            Without the prior written consent of the other Party, neither Party shall assign or otherwise transfer this Agreement or any of its rights and obligations hereunder except to an Affiliate or a successor to its business that assumes all obligations of the assignor hereunder in connection with the transfer or sale of all or substantially all of its assets, corporate reorganization, or its merger or consolidation with or into any other entity, provided that no such assignment shall release the assignor from its obligations without the consent of the other Party hereto.

 

17.2                            The illegality, invalidity or unenforceability of any term, Section or provision of this Agreement in any jurisdiction shall not affect the legality, validity or enforceability in that jurisdiction of any other term, Section or provision of this Agreement or the legality, validity or enforceability in any other jurisdiction of that or any other provision of this Agreement.  If such illegality, invalidity, or unenforceability of a term of this Agreement materially alters the intended economic benefits or burdens of this Agreement, the Parties shall use commercially reasonable efforts to replace the

 

 

illegal, invalid, or unenforceable provision(s) with legal, valid and enforceable provision(s) that, insofar as practical, implement the the original intent of the Parties hereto.

 

17.3                            No delay, neglect or forbearance by a Party in enforcing its rights under this Agreement shall be a waiver of or prejudice enforcement of those rights, or operate as, or be construed as, a waiver of those rights under similar or other circumstances in the future.

 

17.4                            No purported variation of this Agreement shall take effect unless made in writing and signed by an authorized representative of each Party.  Either Party may propose variations to the Specifications and Services as a result of change in the market conditions or compliance with any enactment by at least one month’s written notice.  The Agreement of each Party to such variation is not to be unreasonably withheld or delayed (provided that ALMAC shall not be required in any circumstance to agree to any such variation that materially increases its costs or burdens of providing the Services) and, when agreed, such variations shall be incorporated in this Agreement by written memorandum or note signed by, or on behalf of, each Party.

 

17.5                            This Agreement shall be governed by and construed in accordance with laws of England & Wales and all disputes arising in connection with this Agreement shall be submitted to the jurisdiction of the English courts.  Each Party irrevocably waives any objection that it may now or hereafter have to the laying of the venue of any suit, action or proceeding brought in such court and any claim that such suit, action or proceeding brought in such court has been brought in an inconvenient forum.

 

17.6                            This Agreement, including all Appendices hereto, contains the entire understanding of the Parties hereto with respect to the subject matter contained herein, and there are no restrictions, promises, representations, warranties, covenants, agreements or undertakings other than those expressly set forth herein.  Any terms or conditions in any previous or subsequent purchase or service order of Client or otherwise shall be void and the terms and conditions of this Agreement shall govern and control.  Any previous master services agreements between Client and ALMAC shall be superceded by the terms and conditions of this Agreement and this Agreement shall govern and control in place of any previous master services agreements.  The recitals are incorporated herein and made a part of this Agreement.  In the event that there is any conflict between the terms and conditions of this Agreement and the Technical Agreement, the terms of this Agreement shall prevail unless otherwise agreed to by both Parties in writing.

 

17.7                            A person who is not a party to this Agreement shall not have any rights under or in connection with it.

 

17.8                            Notices shall be given as follows:

 

(a)                                All communications provided for in this Agreement shall be deemed duly given (subject to Section 17.8(b) below) if sent by first class mail, postage prepaid, overnight courier service or facsimile to the address and facsimile number of the respective Parties as set forth below or such other address of which that Party may from time to time notify the other in writing.  If sent by facsimile, such communication shall be deemed given when the transmission is completed if the sender has a confirmed transmission report.  If a confirmed transmission report does not exist, then the communication will be deemed given when it is actually received by the Party to whom it is sent.  If such communication or payment is delivered by overnight courier, it shall be deemed given when it has been signed for.  If delivered by first class mail, it shall be deemed given three (3) business days after being mailed.

 

 

	
To ALMAC:
    	
 
    	
Almac Pharma Services Limited
    
	
 
    	
 
    	
20 Seagoe Industrial Estate
    
	
 
    	
 
    	
Craigavon
    
	
 
    	
 
    	
BT63 5QD
    
	
 
    	
 
    	
United Kingdom
    
	
 
    	
 
    	
Attn: [**]
    
	
 
    	
 
    	
Fax: [**]
    
	
 
    	
 
    	
 
    
	
To Client:
    	
 
    	
Nabriva Therapeutics Ireland DAC
    
	
 
    	
 
    	
25-28 North Wall Quay
    
	
 
    	
 
    	
Dublin 1
    
	
 
    	
 
    	
Ireland
    
	
 
    	
 
    	
Attention: [**]
    
	
 
    	
 
    	
Email address: [**]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
with a copy to:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Nabriva Therapeutics AG
    
	
 
    	
 
    	
Leberstrasse 20
    
	
 
    	
 
    	
A-1110 Vienna
    
	
 
    	
 
    	
Austria
    
	
 
    	
 
    	
Attn.: [**]
    
	
 
    	
 
    	
Email address: [**]
    
	
 
    	
 
    	
Fax: [**]
    

 

(b)                                All original investigation documents and legal notices as well as a copy of all notices required to be given under this Agreement shall be in writing and sent by certified mail, return receipt requested, or overnight courier to the address provided in Section 17.8(a), to the attention of “LEGAL COUNSEL”.  Such notices shall be effective on receipt.

 

17.9                            This Agreement may be executed via facsimile or “.pdf” file and in two counterparts, each of which shall be deemed an original, but both of which together shall constitute one and the same instrument

 

IN WITNESS whereof this Agreement has been duly executed on the date first above written.

 

 

	
SIGNED by:
    	
/s/ Colin Hayburn
    	
 
    	
Date:
    	
26 July 2017
    
	
 
    	
Name: Colin Hayburn
    	
 
    	
 
    
	
 
    	
Title: Director
    	
 
    	
 
    
	
 
    	
for and on behalf of ALMAC PHARMA SERVICES LIMITED
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
SIGNED by:
    	
/s/ Colin Broom
    	
 
    	
Date:
    	
7 August 2017
    
	
 
    	
Name: Colin Broom
    	
 
    	
 
    
	
 
    	
Title: Chief Executive Officer
    	
 
    	
 
    
	
 
    	
for and on behalf of NABRIVA   THERAPEUTICS IRELAND DAC
    

 

 

SCHEDULE 1

 

PROFORMA PROPOSAL/PROFORMA INVOICE

 

 

SCHEDULE 2

 

MINIMUM ANNUAL REVENUE

 

The Minimum Annual Revenue shall be £[**] per annum following regulatory approval of the Product unless otherwise agreed in writing by the Parties.Exhibit 10.18

 

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Double asterisks denote omissions.

 

KEY INTERMEDIATE SUPPLY AGREEMENT

 

THIS KEY INTERMEDIATE SUPPLY AGREEMENT (this “Agreement”) is made as of this 28th day of August 2017 (“Effective Date”), by and among NABRIVA THERAPEUTICS IRELAND DAC (“NABRIVA”), and SEL BIOCHEM XINJIANG CO., LTD (“SEL”) and FOUNTAIN INTERNATIONAL DEVELOPMENT HOLDING LIMITED (“FOUNTAIN”). NABRIVA, SEL, and FOUNTAIN are hereinafter collectively referred to as the “Parties.”

 

WHEREAS, NABRIVA wishes to purchase from SEL bulk Key Intermediate for use in manufacturing drug substance and drug product for commercial sale by NABRIVA worldwide and for certain clinical and other related purposes;

 

WHEREAS, NABRIVA wishes to use FOUNTAIN for processing forecasts, purchase orders, payments, issuing invoices, and coordinating transportation, on behalf of SEL;

 

WHEREAS, SEL has suitable facilities and equipment and sufficient qualified personnel to perform their respective services as set forth in the Agreement, manufacture Key Intermediate in bulk form, and is willing to provide such Key Intermediate on the terms and conditions set forth below.

 

NOW, THEREFORE, the hereto, intending to be legally bound, agree as follows:

 

I.                                        DEFINITIONS

 

As used in this Agreement:

 

1.1                               “Adverse Experience” or “AE” shall mean any unfavorable and unintended change in the structure, function, or chemistry of the body temporally associated with any use of a product or of a derivative thereof containing Key Intermediate, whether or not the adverse experience is considered to be related to the use of such product, including but not limited to any of the following:  an unexpected side effect, injury, toxicity or sensitivity reaction, which may include an experience of unexpected incidence and severity; an adverse experience occurring in the course of the use of a drug product in professional practice; an adverse experience occurring in clinical studies; an adverse experience occurring from drug overdose, whether accidental or intentional; an adverse experience occurring from drug abuse; an adverse experience occurring from drug withdrawal; and any significant failure of expected pharmacological action.

 

1.2                               “Affiliate” means any corporation or other business entity which, directly or indirectly, is controlled by, controls, or is under common control with NABRIVA or SEL. For this purpose, “control” shall be deemed to mean direct or indirect ownership of fifty percent (50%) or more of the voting stock or other voting equity of such entity.

 

1.3                               “Confidential Information” means all information, data, know-how and all other business, technical and financial data disclosed hereunder by one Party or any of its Affiliates to the other party or any of its Affiliates, except any portion thereof which:

 

(a)                                 at the time of disclosure, is public knowledge;

 

(b)                                 after disclosure, becomes public knowledge by publication or otherwise, except by breach of this Agreement by the recipient;

 

(c)                                  the recipient can demonstrate by its written records was in the recipient’s possession at the time of such disclosure, and which was not acquired, directly or indirectly, from the disclosing party or its Affiliates;

 

(d)                                 is lawfully disclosed to the recipient on a non-confidential basis by a third party who is not obligated to the disclosing party or any other third party to retain such Confidential Information in confidence;

 

(e)                                  results from research and development by the recipient independent of such disclosure as shown by competent evidence; or

 

 

(f)                                   is required to be disclosed by applicable law, regulation, or the order of a court of competent jurisdiction; provided, in each case the Party so disclosing information timely informs the other Party and uses its reasonable efforts to limit the disclosure and maintain confidentiality to the extent possible and, if possible, permits the other Party to attempt by appropriate legal means to limit such disclosure.

 

Confidential Information disclosed orally, visually and/or in another intangible form shall be identified by the disclosing Party to the receiving Party as confidential at the time of such disclosure and confirmed in writing to the receiving Party within [**] days after such disclosure.

 

1.4                               “Key Intermediate” means CAS 125-65-5, molecular formula C22H34O5, and is more commonly known as pleuromutilin having those specifications as set forth on Schedule A hereto.

 

1.5                               “Material Breach” means a Party’s failure to perform a major part of its obligations under this Agreement, which prevents this Agreement from being performed in a timely manner or defeats the purpose of the Agreement.

 

1.6                               “Quality Technical Agreement” means the form of quality assurance/quality control agreement to be entered into by NABRIVA and SEL as set forth in Schedule B.

 

1.7                               “Purchase Price” shall have the meaning set forth in Section 6.3 hereof.

 

II.                                   PURCHASE AND SALE

 

2.1                               Purchase and Sale.  SEL agrees to manufacture and supply to NABRIVA or a NABRIVA Affiliate (or a designee of the foregoing) those quantities of Key Intermediate ordered pursuant to purchase orders placed by NABRIVA and/or its Affiliate from time to time in accordance with this Agreement. Key Intermediate supplied hereunder may be used by NABRIVA and its Affiliates and/or licensees for all purposes, including without limitation, manufacturing of drug substance and drug product for worldwide commercial sale by NABRIVA or for clinical and other related purposes.

 

2.2                               Cooperation. The Parties will reasonably cooperate with each other as may be necessary and customary in consideration of industry practice, and will disclose all material information necessary to enable each other to perform their duties under this Agreement in a timely fashion.

 

2.3                               Specific Duties.  In addition to its general obligations relating to the manufacture and supply of Key Intermediate, SEL shall be responsible for performing the following services at SEL’s cost:

 

(i)                                     manufacture of Key Intermediate under cGMP with fermentation starting materials (cell bank and fermentation media) as GMP starting materials.

 

(ii)                                  full validation of analytical methods according to ICH and use of compendia methods as required in connection with Key Intermediate manufacturing.

 

(iii)                               quality control and testing of all Key Intermediate in order to monitor compliance with all applicable standards and specifications required by this Agreement, including any Schedules hereto;

 

(iv)                              conducting stability testing of Key Intermediate in accordance with the procedures set forth in the Quality Technical Agreement;

 

(v)                                 summarizing implemented changes and supplying latest versions of approved critical documentation, and providing other information necessary for NABRIVA to prepare, submit, obtain and maintain all regulatory filings relating to the Key Intermediate (and/or drug product or drug substance produced using Key Intermediate) under the terms of this Agreement; and

 

(vi)                              performing such other services as agreed upon in writing by the Parties.

 

(vii)                           filing of the appropriate and required documentation, including Drug Master File (DMF) in the US and required international counterparts.

 

 

2.4                               No Subcontracting.  SEL and FOUNTAIN shall not subcontract any aspect of their obligations under this Agreement, except with the prior written consent of NABRIVA.

 

2.5                               Joint and Several Liability.  As consideration for NABRIVA agreeing to enter into this Agreement, each of SEL and FOUNTAIN shall be jointly and severally liable to NABRIVA for their respective obligations under this Agreement and any other agreement, document or instrument executed in connection herewith. To the extent that SEL or FOUNTAIN is in breach of its obligations, NABRIVA shall be entitled to bring a cause of action and to seek recovery against either SEL or FOUNTAIN irrespective of whether such party is the entity responsible for such breach.

 

2.6                               FOUNTAIN’s Responsibility.  FOUNTAIN will be responsible for receiving forecasts, purchase orders, payments, issuing invoices, and coordinating transportation on behalf of SEL.

 

III.                              KEY INTERMEDIATE QUANTITY, QUALITY AND MANUFACTURING PROCESSES; TECHNICAL ASSISTANCE

 

3.1                               Quantity. SEL agrees to reserve capacity for the quantities of Key Intermediate as defined in Schedule C. SEL shall have no obligation to supply quantities in excess of those set forth in Schedule C, but shall use its commercially reasonable efforts to accommodate NABRIVA’s demand for excess quantities.

 

3.2                               Specification; Quality Standards; Changes.  All Key Intermediate manufactured and sold by SEL to NABRIVA under this Agreement will meet the Key Intermediate specifications and minimum shelf life requirements set forth in Schedule A hereto (the “Specifications”), as well as the quality assurance standards established in the Quality Technical Agreement. Such Specifications, as well as the terms and conditions of the Quality Technical Agreement, are subject to modification from time to time by mutual written agreement of the Parties. Notwithstanding the foregoing, if NABRIVA finds it necessary or desirable to change the Specifications, the quality assurance standards, or any other aspect of the manufacturing process for Key Intermediate, NABRIVA may deliver a request for such change to SEL and SEL shall use best efforts to make any change identified in such request. Prior to implementation of any changes, the Parties agree to negotiate in good faith in an attempt to reach agreement on (a) the new price for any Key Intermediate manufactured and supplied hereunder by SEL which embodies such changes, based solely on the effect of such changes on SEL’s manufacturing costs for the Key Intermediate, (b) the reasonable timing required to implement changes and (c) any other amendments to this Agreement which may be necessitated by such changes (e.g., an adjustment to the lead time for purchase orders). The Parties agree that NABRIVA’s obligation to bear cost increases in subsection (a) above will be limited to those cost increases that relate solely to the production of the Key Intermediate; costs for other changes affecting SEL’s good manufacturing compliance (“cGMP”) or affecting other products generally will be borne by SEL.

 

3.3                               Manufacturing Processes. SEL has furnished to NABRIVA a copy of its purification procedures for the Key Intermediate, and SEL shall not modify such procedures without NABRIVA’s prior written consent. In the Quality Technical Agreement, the Parties will agree upon the equipment to be used to produce the Key Intermediate. For clarity, SEL will not be required to disclose confidential details of equipment used to make Pleuromutilin prior to purification.

 

3.4                               Documentation. NABRIVA has provided SEL with analytical methods, product specifications, product impurities, degradation products, and reference standards for manufacturing Key Intermediate as set forth in the attached Schedule A.SEL shall promptly provide NABRIVA, on an ongoing basis, with all available safety data and information concerning the Key Intermediate, process, and related materials, including without limitation any new information developed or learned by SEL in connection with the manufacturing of Key Intermediate hereunder (excluding in each case any confidential aspects of the fermentation process used by SEL). In addition, SEL shall provide all the change control and regulatory documentation as required by the EU and US authorities so as to maintain licenses, either by directly disclosing such information to NABRIVA or, where applicable, by filing such information with such authorities and permitting NABRIVA to reference such filing(s).

 

3.5                               Communication. SEL and NABRIVA will respond to requests for support, information and approvals within [**] working days. If a complete response is not possible within such [**]day period, the Party owing the response shall communicate within such [**]day period the reason for the delay and when the response will be available.

 

3.6                               Quality Technical Agreement.  Within [**] days after the date of this Agreement, representatives of the Parties’ Quality Assurance departments shall meet to review and revise, if necessary, the attached Quality Technical Agreement outlining responsibilities and key contacts for Key Intermediate quality and compliance related issues. SEL will provide NABRIVA with certain production and control information for review prior to release as specified in the Quality Technical Agreement. The Quality Technical Agreement will also address, without limitation, annual product reviews, returned goods, regulatory audits, compliance with FDA current Good Manufacturing Practices, and such other quality related concerns deemed appropriate.

 

 

IV.                               CONFIDENTIAL INFORMATION

 

4.1                               The Parties acknowledge that each Party has, prior to the Effective Date, provided its Confidential Information to the other Party in connection with the manufacture and supply of the Key Intermediate, and further acknowledge that all such Confidential Information (as well as any additional Confidential Information provided by one party to the other hereunder) shall be subject to the provisions of this Section IV. Notwithstanding anything to the contrary herein, the following shall be deemed to be the Confidential Information:  (a) any and all information, knowledge, technology, and trade secrets relating to the Key Intermediate that is provided by NABRIVA to the SEL or FOUNTAIN, whether before, on, or after the Effective Date; and (b) any and all manufacturing records or other information or documentation delivered to NABRIVA by SEL relating to the manufacture of Key Intermediate hereunder; and (c) any Product-Related Inventions (as defined below).

 

4.2                               During the term of this Agreement and for [**] years thereafter, all Confidential Information shall be held in confidence by the receiving party, shall not be used by the receiving party for any purpose except as provided hereunder and shall not be disclosed to third parties except as provided in Section 4.4 or as may otherwise be permitted by the advance written consent of the disclosing party. Any Affiliate, director, officer, employee, consultant, or agents who receives Confidential Information shall be advised as to the confidential nature thereof and the prohibitions contained herein, and any copies of any portions of any Confidential Information that are disclosed to as provided in this Section will be identified as confidential.

 

4.3                               Notwithstanding Section 4.2, each Party may disclose Confidential Information of the other Party to its Affiliates, directors, officers, employees, agents or consultants who have a need to know exclusively in connection with the performance of their duties in satisfying the obligations of such Party hereunder and who are subject to written obligations of confidentiality and non-use that are no less restrictive than those set forth herein. Any Affiliate, director, officer, employee, agent or consultant who receives Confidential Information shall be advised as to the confidential nature thereof and the prohibitions contained herein. All copies of any portions of any Confidential Information distributed as provided in this Section will be identified as confidential.

 

4.4                               Upon termination of this Agreement, and upon the request of the disclosing party, the receiving party shall return or destroy all Confidential Information and any copies thereof in its possession, except that each Party may retain one copy of Confidential Information solely for archival purposes. Termination of this Agreement shall not operate to extinguish either Party’s obligation to treat Confidential Information as provided herein, and the same shall continue in effect in accordance with this Section.

 

4.5                               Nothing contained herein shall be deemed to grant to either Party, either expressed or implied, a license or other right or interest in the Confidential Information of the other or in any patent, trademark or other similar property of the other.

 

4.6                               Neither party shall use the name of the other in any press releases or other statements to the public (including publicity, promotional materials, or advertising), nor publicly disclose the existence of this Agreement for any purpose (other than as may be required by applicable law or regulation), without the prior written consent of the other, which shall not be unreasonably withheld or delayed.

 

V.                                    FORECASTS AND ORDERS

 

Orders and Forecasts.

 

5.1                               NABRIVA undertakes to purchase from SEL not less than [**] percent ([**]%) of NABRIVA’S Key Intermediate requirements per year per the forecast in Schedule D (the “SEL Share”); provided, however, NABRIVA shall be free to obtain from third party any portion of the SEL Share after receiving written confirmation from SEL that SEL is unable or unwilling to supply. Upon the execution of this Agreement, NABRIVA shall provide SEL and FOUNTAIN with a purchase order with NABRIVA’s Key Intermediate requirements for the [**] month period commencing with the month following the Effective Date of this Agreement. NABRIVA shall also provide a non-binding forecast of its requirements for Key Intermediate for an additional [**] month period following the initial [**] month period. The [**] month forecast shall represent NABRIVA’s reasonable estimates only, not purchase orders, to facilitate SEL’s planning. NABRIVA agrees to purchase Key Intermediate in not less than full lot quantities, which as of the Effective Date are approximately [**] per batch. SEL hereby undertakes to keep a stock of raw materials and intermediate components, adequate to meet NABRIVA’s Key Intermediate order. Such stock, to approximately correspond to six-month Key Intermediate supplies to NABRIVA, shall be agreed in good faith and in due time between the parties after execution of this Agreement.

 

 

5.2                               Forecasts Changes and Forecast Updates. On or before the [**] day of each month thereafter, NABRIVA shall provide SEL and FOUNTAIN with an additional [**] month purchase order to supplement the remaining [**] months of firm purchase orders, thereby establishing a new [**] month period of purchase orders, and shall provide an updated forecast of its estimated requirements of Key Intermediate for the [**] months succeeding such new [**] month period of firm purchase orders. Provided NABRIVA’s purchase orders do not exceed SEL’s reserve capacity set forth in Schedule C, SEL shall accept all NABRIVA purchase orders and shall supply NABRIVA in accordance with them, provided however that in case of any conflict or inconsistency between the terms of said orders and the terms and conditions of this Agreement, the terms of this Agreement shall prevail. NABRIVA can increase or decrease its firm order quantities with SEL’s prior agreement and SEL can adjust its shipping quantities with NABRIVA’s prior agreement. Parties shall use their commercially reasonable efforts to accommodate reasonable change requests from the other. SEL shall use commercially reasonable efforts to execute all orders received and accepted pursuant to this Section within [**] days from the date of receipt of the relevant order.

 

5.3                               To make the implementation of orders and delivery more efficient, the emails about Forecasts and Orders among Nabriva, SEL and FOUNTAIN should be forwarded to each other.

 

VI.                               PRICE, SHIPMENT AND PAYMENT

 

6.1                               SEL’s Responsibilities. SEL will properly manufacture the Key Intermediate so that it may be lawfully and safely shipped to NABRIVA or its designee worldwide and shall package the Key Intermediate for shipment in accordance with the Specifications. SEL and FOUNTAIN will prepare and execute all reasonably necessary shipping documents, consisting of Packing List, Dangerous Goods Declaration, and MSDS. NABRIVA will choose the carrier and the designee by indicating both on its purchase order provided to FOUNTAIN.

 

6.2                               Terms of Shipment. FOUNTAIN will invoice Key Intermediate FCA (Incoterms 2010) Shihezi. SEL shall arrange for transportation to final destination in accordance with NABRIVA’s written instructions, including use of the common carrier designated by NABRIVA. If NABRIVA does not designate a common carrier, SEL may select the common carrier. Risk of loss shall pass from SEL to NABRIVA when the Key Intermediate is delivered to the common carrier. All transport and insurance costs will be borne by NABRIVA.

 

6.3                               Price. FOUNTAIN shall invoice NABRIVA the Purchase Price for all Key Intermediate delivered as set forth in Schedule D attached hereto. FOUNTAIN shall send its invoice at the time of shipment.

 

6.4                               Terms of Payment. NABRIVA will pay FOUNTAIN the Purchase Price including pre-paid transportation and insurance costs, if any, in U.S. Dollars net [**] days from the date of AWB (air waybill) or [**] days from the date of B/L (bill of lading) and receipt of invoice from FOUNTAIN, together with copies of all documentation required for Key Intermediate release as provided in the Quality Technical Agreement. FOUNTAIN shall pay SEL in [**] working days after receiving the payment from NABRIVA. Late payments shall bear interest at the then-current United States prime rate as reported in the Wall Street Journal eastern edition, or if less, the highest rate permitted under applicable law.

 

VII.                          INSPECTION AND ANALYSIS

 

7.1                               Inspection by SEL.  SEL will analyze each Key Intermediate lot for compliance with the Specifications set forth in Schedule A. SEL or its authorized representative will send to NABRIVA a Certificate of Analysis and a Certificate of Compliance (together with any other documentation required under the Quality Technical Agreement(including Wood Pallets Declaration, Melamine Declaration, TSE and Jatropha Declaration, Residual Solvents Declaration, Elemental Impurities Declaration and Change Control Commitment) prior to, or together with, each shipment of Key Intermediate. In this regard, SEL agrees to retain all records and documents necessary to fulfill the requirements established by all applicable regulatory agencies.

 

7.2                               Inspection by NABRIVA.NABRIVA or its authorized representative will visually inspect and test all shipments upon their receipt and will report any reasonably discernible defects in the Key Intermediate to SEL and FOUNTAIN within [**] days of its receipt of the Key Intermediate and related records. Any defects not reasonably discernible will be reported to SEL and FOUNTAIN by NABRIVA within [**] business days of NABRIVA’s discovery of the same.

 

7.3                               Non-Conforming Key Intermediate. If any Key Intermediate does not meet the warranties set forth in Section IX as determined by NABRIVA’s testing and inspection of the Key Intermediate and/or review of the documentation provided by SEL, NABRIVA shall provide written notice to SEL of such findings within [**] business days of such testing and/or inspection. Such written notice shall set forth the results of such tests and/or inspection and the basis for such claim of non-conformance. SEL shall have [**] business days to respond to NABRIVA’s written notice. If

 

 

SEL is unable to resolve such non-conformance within [**] days or is unable to provide NABRIVA with a plan to address such non-conformance before Nabriva’s inventory of conforming Key Intermediate is exhausted, the Parties shall discuss the situation in good faith and mutually agree whether SEL will either (i) replace said Key Intermediate at no charge to NABRIVA and pay all round-trip shipping charges to and from the destination of the original shipment, (ii) refund to NABRIVA the Purchase Price for the rejected Key Intermediate and any applicable shipping costs (including customs duties), or (iii) credit NABRIVA’s account in an amount equal to the Purchase Price for the rejected Key Intermediate and any applicable shipping costs (including customs duties).If requested by SEL, NABRIVA will cooperate with FOUNTAIN to promptly return Non-Conforming Key Intermediate to SEL and SEL will pay all return shipment costs. Otherwise, SEL shall reimburse NABRIVA for the reasonable costs incurred by NABRIVA in properly disposing of such non-conforming Key Intermediate. Any notice given hereunder shall specify the manner in which the Key Intermediate fails to conform to the purchase order therefor or fails to meet such warranty or the Specifications. SEL shall not re-work or re-process such non-conforming Key Intermediate without NABRIVA’s prior written consent.

 

7.4                               Independent Testing.  If NABRIVA notifies SEL that any Key Intermediate does not meet the warranties in Section IX, and SEL does not agree with NABRIVA’s position, the Parties will attempt to reach a mutually acceptable resolution of the dispute. If they are unable to do so after a reasonable period of time (such period not to exceed [**] days from the date of original notification), the matter will be submitted to an independent testing laboratory acceptable to both parties. Both parties will accept the judgment of the independent laboratory. The cost of such testing will be borne by the party whose position is determined to have been in error.

 

VIII.                     REGULATORY MATTERS; REGULATORY FILINGS AND APPROVALS

 

8.1                               General.

 

(a)                                 SEL shall be responsible for obtaining and maintaining all site licenses for the manufacture of the Key Intermediate and shall comply with other applicable regulations promulgated by, but not limited to, the United States Food and Drug Administration (“FDA”) in connection with SEL’s manufacture of the Key Intermediate.

 

(b)                                 NABRIVA shall be responsible for obtaining and maintaining all regulatory licenses and approvals for the use of the Key Intermediate for all the purposes set forth in Section 2.1 above.

 

IX.                               REPRESENTATIONS AND WARRANTIES

 

9.1                               General.

 

(a)                                 SEL represents and warrants to NABRIVA that (i) it has and will maintain throughout the term of this Agreement, the expertise, with respect to personnel and equipment, to fulfill the obligations established hereunder, and has obtained all requisite material licenses, authorizations and approvals required by federal, state or local government authorities including, but not limited to, the FDA to manufacture the Key Intermediate in accordance with this Agreement; (ii) the production facility, equipment and personnel to be employed will be qualified to manufacture Key Intermediate according to current Good Manufacturing Practices (“cGMP”) at the time each such batch of Key Intermediate is produced, and that the production facility to be employed is in compliance with all applicable material laws and regulations;  (iii) there are no pending or uncorrected citations or adverse conditions noted in any inspection of the production facility to be employed which would cause the Key Intermediate to be misbranded or adulterated within the meaning of the United States Federal Food, Drug and Cosmetic Act, as amended, or other applicable laws; (iv)  the execution, delivery and performance of this Agreement by SEL does not conflict with, or constitute a breach of any order, judgment, agreement, or instrument to which SEL is a party; (v) the execution, delivery and performance of this Agreement by SEL does not require the consent of any person or the authorization of (by notice or otherwise) any governmental or regulatory authority; and (vi) SEL has not been debarred by the FDA under the Generic Drug Enforcement Act of 1992 (or by any analogous agency or under any analogous law or regulation), and neither it nor, to its knowledge, any of its officers or directors has ever been convicted of a felony under the laws of the United States for conduct relating to the development or approval of a drug product or relating to the marketing or sale of a drug product, and further, to its knowledge, that no individual or firm debarred by any governmental authority will participate in the performance, supervision, management or review of the production of Key Intermediate supplied to NABRIVA under this Agreement.

 

(b)                                 NABRIVA represents and warrants to SEL that (i) the execution, delivery and performance of this Agreement by NABRIVA does not conflict with, or constitute a breach of any order, judgment, agreement, or instrument to which NABRIVA is a party;(ii) it is the owner of or has the right to use the Key Intermediate, and (iii) the

 

 

execution, delivery and performance of this Agreement by NABRIVA does not require the consent of any person or the authorization of (by notice or otherwise) any governmental or regulatory authority (other than those relating to the granting of approval to commercialize the product containing the Key Intermediate).

 

9.2                               Manufacturing Warranty. SEL represents and warrants that: (a) all Key Intermediate supplied to NABRIVA will be manufactured in accordance with cGMPs and the Quality Technical Agreement in effect at the time of manufacture; (b) all Key Intermediate manufactured by SEL, at the time of delivery to the common carrier, (i) will not be adulterated or misbranded, and (ii) will conform to Specifications as established in Schedule A hereto; and (iii) will be free and clear of any lien, security interest or encumbrance; and (c) each document provided with or in a connection with the shipment of the Key Intermediate (such as a Certificate of Analysis, Certificate of Compliance, Wood Pallets Declaration,  Melamine Declaration, TSE and Jatropha Declaration, Residual Solvents Declaration, Elemental Impurities Declaration, and Change Control Commitment) is accurate.

 

9.3                               Anti-Bribery. SEL and FOUNATIN represents, warrants and agrees that it has been at all times and will continue to be in compliance with all potentially applicable anti-corruption/anti-bribery laws, including but not limited to the U.S. Foreign Corrupt Practices Act of 1977, the U.K.’s Bribery Act 2010, and any anti-corruption/anti-bribery laws in the jurisdictions where it operates. SEL and FOUNATIN represents, warrants and agrees that no bribes, payments, kickbacks, gifts, hospitality, donations, loans, or anything of value have been or will be made or received, offered, promised, or authorized, directly or indirectly, to improperly influence any act or decision of any person or entity, induce any person or entity to do or omit to do any act in violation of any person’s or entities’ lawful duties, or secure any improper advantage. The failure of SEL or FOUNTAIN to strictly comply with this Section 9.3 shall constitute a Material Breach and will result in NABRIVA having the right to terminate this Agreement pursuant to Section 16.2.

 

9.3                               Warranty Disclaimer. EXCEPT AS EXPRESSLY STATED IN THIS AGREEMENT, EACH PARTY EXPRESSLY DISCLAIMS ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

 

X.                                    QUALITY CONTROL, RECORDS AND INSPECTIONS

 

10.1                        Samples.  SEL will maintain samples of Key Intermediate as required by applicable regulatory standards or as otherwise mutually agreed by NABRIVA and SEL. SEL will be responsible for maintaining retention samples of the Key Intermediate as may be required by applicable regulatory standards.

 

10.2                        Validation.  SEL will validate all process, methods, equipment, utilities, facilities and computers used in the formulation, storage, testing and release of Key Intermediate in conformity with all applicable laws and regulations. NABRIVA will have the right to review the results of said validation upon request.

 

10.3                        Quality Compliance.  SEL will provide NABRIVA with timely notification of all significant deviations, notes to file, and other deficiencies that may reasonably be expected to impact the quality of the Key Intermediate, as well as all FDA or other applicable regulatory authority reports regarding testing, manufacture, bulk packaging or labeling of the Key Intermediate.

 

10.4                        Manufacturing Records.  SEL will maintain complete and accurate records relating to the Key Intermediate and the manufacture, bulk packaging, labeling and testing thereof for the period required by applicable regulatory standards, and SEL shall provide copies thereof (but excluding records that disclose confidential aspects of the fermentation process used by SEL) to NABRIVA upon NABRIVA’s request. The records (excluding records that disclose confidential aspects of the fermentation process used by SEL) shall be subject to audit and inspection under this Section X.

 

10.5                        Batch Records. Records which include the information relating to the manufacturing, bulk packaging and quality operation for each lot of Key Intermediate will be prepared by SEL at the time such operations occur. SEL will prepare such records in accordance with cGMP’s, the Specifications and the Quality Technical Agreement.

 

10.6                        Records Retention.  SEL will retain records and documents relating to the manufacture and supply of Key Intermediate for periods meeting all applicable regulations of the FDA, or other applicable regulatory authority.

 

10.7                        Regulatory Inspections. SEL will promptly inform NABRIVA of any contact, inspection or audit by any governmental agency related to or affecting the Key Intermediate. SEL will promptly provide NABRIVA with copies of any government-issued inspection observation reports (including without limitation FDA Form 483s and equivalent forms from other regulatory bodies) and agency correspondence that may reasonably be expected to adversely affect the Key Intermediate or SEL’s ability to supply Key Intermediate hereunder. SEL and NABRIVA will cooperate in resolving

 

 

any concerns with any governmental agency. SEL will also inform NABRIVA of any action taken by any governmental agency against SEL or any of its officers and employees which may reasonably be expected to adversely affect the Key Intermediate or SEL’s ability to supply Key Intermediate hereunder within 24 hours after the action is taken.

 

10.8                        NABRIVA Inspections. NABRIVA employees or NABRIVA authorized representatives will have the right during normal business hours, at reasonable intervals and upon giving SEL at least [**] working days advance  notice, to conduct [**], at NABRIVA’s sole expense, of SEL’s facilities used in the manufacturing, bulk packaging, storage, testing, shipping or receiving of Key Intermediate for the purpose of verifying the compliance of the Key Intermediate manufacture with the requirements provided for in this Agreement and with cGMP, provided however that, if circumstances arise that in NABRIVA’s reasonable judgement require that its representatives inspect SEL’s manufacturing facilities more than [**], the Parties shall discuss such circumstances and agree in good faith upon additional inspections and appropriate means for addressing such circumstances. All such employees and representatives shall be bound by the same confidentiality obligations as contained herein and shall abide at all times with SEL’s rules and regulations applicable to site visits, including without limitation safety rules and regulations. Such inspections may include GMP inspections and system audits. Persons conducting such inspections will have access only to documents, records, reports, data, procedures, facilities, regulatory submissions, and all other information required to be maintained by applicable government regulations relating to the Key Intermediate. SEL shall take appropriate actions to adopt reasonable suggestions of NABRIVA to correct any deficiencies identified by such inspection or audit. In addition, NABRIVA shall have the right to observe from time to time the manufacture, bulk packaging and quality control testing of Key Intermediate by SEL. No testing of the Key Intermediate by NABRIVA and no inspection or audit by NABRIVA of the SEL production facility under this Agreement shall operate as a waiver of or otherwise diminish SEL’s responsibility with respect to Key Intermediate quality under this Agreement. The duration of an inspection or audit will be limited to no more than [**] days (inspections or audits that last over [**] days will be charged to NABRIVA at SEL’s specified FTE (Full Time Equivalent) rates), being however understood that in any case said inspections and audits may not interfere with SEL’s normal operations.

 

XI.                               COMPLAINTS, ADVERSE EVENTS AND RECALLS

 

11.1                        Key Intermediate Complaints and AEs. NABRIVA shall maintain complaint files with respect to the pharmaceutical product containing Key Intermediate in accordance with cGMPs. In the event that SEL should receive any complaints and or AE notices with respect to the pharmaceutical product containing Key Intermediate, SEL will promptly notify NABRIVA by facsimile transmission within [**] working days of its receipt thereof. All such notices shall be sent to the attention of the:

 

Director, Medical Affairs at NABRIVA

Facsimile number [**]

 

NABRIVA shall promptly provide SEL with copies of any complaints received by NABRIVA relating to the pharmaceutical product containing Key Intermediate if such complaints might relate to the manufacture or bulk packaging of the Key Intermediate. SEL and NABRIVA shall promptly investigate  such complaints to determine if the complaint is relate to the manufacture or bulk packaging of the Key Intermediate and, if so, required corrective and preventive actions to be implemented, if any. NABRIVA shall have the exclusive responsibility for responding to all complaints, and for promptly providing SEL with a copy of any responses to complaints relating to the pharmaceutical product containing the Key Intermediate if such complaints relate to the manufacture of bulk packaging of Key intermediate. NABRIVA or its affiliates shall have responsibility for reporting all complaints relating to the pharmaceutical product containing Key Intermediate to the FDA and any other regulatory authorities, including, but not limited to, complaints relating to the manufacture or bulk packaging of the Key Intermediate as well as adverse experience (AE) reports. NABRIVA will correspond with complainants as to any complaints associated with pharmaceutical product containing Key Intermediate, whether received during or after the term hereof. SEL will assist NABRIVA in investigating complaints relating to the pharmaceutical product containing Key Intermediate if such complaints relate to the manufacture or bulk packaging of the Key Intermediate, by analyzing Key Intermediate and manufacturing processes to determine the nature and cause of an alleged Key Intermediate manufacturing defect or alleged Key Intermediate failure. SEL will also reasonably assist NABRIVA, if so expressly required by NABRIVA from time to time, in the investigation of any Adverse Experience (AE) reported to either party when such AEs are reasonably believed to be attributable to the manufacture or bulk packaging of the Key Intermediate. If NABRIVA determines that any reasonable physical, chemical, biological or other evaluation should be conducted in relation to an AE or complaint relating to the manufacture or bulk packaging of the Key Intermediate, SEL will reasonably conduct the evaluation and use its reasonable effort to provide NABRIVA with a written report of such evaluation within [**] days from receipt of NABRIVA’s written request for same, together with samples of the Key Intermediate from the relevant lot. The obligations and responsibility in connection with the above AEs and the management of the same shall pertain exclusively to NABRIVA.

 

 

11.2                        Recall Action.  If NABRIVA should elect or be required to initiate a recall of pharmaceutical product manufactured using Key Intermediate supplied hereunder, or a withdrawal or field correction of such pharmaceutical product, SEL will assist NABRIVA (and/or its Affiliate(s)) in connection with such recall, withdrawal, or field correction, including, without limitation, by conducting an investigation to determine the extent to which the Key Intermediate contributed to the need for such recall, withdrawal, or field correction. All regulatory authority contacts and coordination of any recall activities will be initiated by, and will be the sole responsibility of, NABRIVA.

 

11.3                        Recall Expenses.  If a recall or a withdrawal of any pharmaceutical product containing Key Intermediate is necessary for any reason, SEL and NABRIVA shall each bear the costs of the recall in proportion to each Party’s responsibility, if any, for the error necessitating the recall or withdrawal. Such recall costs include, but are not limited to, all reasonable costs and expenses of NABRIVA associated with implementing any such recall or withdrawal, including notification, packaging, shipping, distribution, and destruction costs and required reimbursements to third parties, and all costs and expenses associated with obtaining replacement product (including API).

 

11.4                        Recall Records. SEL will maintain complete and accurate records for such periods as may be required by applicable law or regulation.

 

XII.                          INSURANCE

 

12.1                        SEL does not have Public Liability, Products Liability, or Professional Liability Insurance. For risk evaluation and mitigation purposes, SEL agrees to allow Nabriva’s authorized insurance agents to inspect non-confidential areas of SEL’s production facility (Pleuromutilin purification, warehouse, solvent storage, fire protection, etc.) and to make non-binding recommendations to reduce risks. In the absence of reasonable cause, insurance inspections will be no more frequent than [**].

 

XIII.                     INVENTIONS

 

13.1                        NABRIVA shall own and retain all right, title, and interest in and to any and all ideas, works, information, inventions, improvements or the like (whether patentable or unpatentable), along with all intellectual property rights, that has been or shall be developed by NABRIVA prior to or in the course of performing its duties and obligations under this Agreement.

 

13.2                        SEL shall own and retain all right, title, and interest in and to any and all ideas, works, information, inventions, improvements or the like (whether patentable or unpatentable), along with all intellectual property rights, that has been or shall be developed by this SEL in the course of performing its duties and obligations under this Agreement; provided NABRIVA shall have a perpetual, non-exclusive, assignable, royalty free license to use such ideas, works, information, inventions, improvements or the like (whether patentable or unpatentable), and intellectual property rights in connection with NABRIVA’s use of the Key Intermediate.

 

13.3                        NABRIVA and the SEL shall jointly own all right, title, and interest in and to any and all ideas, works, information, inventions, improvements or the like (whether patentable or unpatentable) that are developed jointly by SEL and NABRIVA in the course of performing work for NABRIVA and that relate to the Key Intermediate, along with all intellectual property rights, with respect thereto (the “Product-Related Inventions”).  All Product-Related Inventions automatically will be considered as Confidential Information under the terms of Section IV.

 

XIV.                      INDEMNIFICATION

 

14.1                        By SEL and FOUNTAIN.  SEL and FOUNTAIN will indemnify and hold NABRIVA, its Affiliates, directors, officers, employees, agents, successors, and assigns harmless from any and all liability, damage, loss, cost, or expense (including reasonable attorneys’ fees) (“Losses”), to the extent arising out of or resulting from any third party claim, suit or action (“Claim”) related to  any negligence or willful conduct by SEL or FOUNTAIN or its Affiliates, or any breach by SEL or FOUNTAIN of any of its obligations, representations and/or warranties hereunder, except to the extent such Losses or Claims result from the matters contemplated in Section 14.2.

 

14.2                        By NABRIVA.  NABRIVA will indemnify and hold SEL, their Affiliates, directors, officers, employees, agents, successors, and assigns harmless from any and all Losses, to the extent arising out of or resulting from any Claim related to (i) any pharmaceutical products manufactured using the Key Intermediate, to the extent such products are sold by or on behalf of NABRIVA or its Affiliates or  (ii) any negligence or willful misconduct by NABRIVA or its Affiliates, or any breach by NABRIVA of any of its obligations, representations and/or warranties hereunder in each case, except to the extent such Losses or Claims result from the matters contemplated in Section 14.1.

 

 

14.3                        By Each Party.  In the event that negligence or willful misconduct of SEL and/or FOUNTAIN and NABRIVA contribute to any Loss, SEL and/or FOUNTAIN and NABRIVA will each indemnify and hold harmless the other with respect to that portion of the Loss attributable to its negligence or willful misconduct.

 

14.4                        Procedures.  In the event that one Party receives notice of a Claim for which it is entitled to indemnification by the other Party, the Party receiving notice shall give prompt notification to the indemnifying Party. The Party being indemnified shall cooperate fully with the indemnifying Party throughout the pendency of the Claim, and the indemnifying Party shall have complete control over the conduct and disposition of the Claim including the retention of legal counsel engaged to handle such matter. The indemnifying party hereunder will not be liable for any costs associated with the settlement of any Claim brought against it or the other Party unless it has received prior notice of the settlement negotiations and has agreed to the settlement.

 

XV.                           LIMITATION OF LIABILITY

 

NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, IN NO EVENT SHALL SEL OR NABRIVA BE LIABLE TO THE OTHER FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES INCLUDING, WITHOUT LIMITATION, LOSS OF PROFITS OR REVENUES, ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREMENT. NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS SECTION XV IS INTENDED TO OR SHALL LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF EITHER PARTY WITH RESPECT TO ANY THIRD PARTY CLAIMS UNDER SECTION 14.1 OR 14.2 OR THE DAMAGES AVAILABLE FOR BREACH OF THE CONFIDENTIALITY OBLIGATIONS IN SECTION IV.

 

XVI.                      TERMINATION

 

16.1                        This Agreement shall become effective and remain in effect for a period of five (5) years from the Effective Date (the “Initial Term”) and, unless either of the Party gives written notice of non-renewal at least two (2) years prior to the end of the Initial Term (or any renewal term), this Agreement shall be renewed for consecutive terms of three (3) years.

 

16.2                        Breach.  If either Party hereto commits a Material Breach hereunder, the other Party may, at its option, terminate this Agreement by giving the breaching Party at least [**] days prior written notice of its intent to terminate this Agreement, which notice shall specify the breach and the termination date, unless the breaching Party cures said breach prior to the specified termination date.

 

16.3                        Insolvency.  Either Party may terminate this Agreement immediately in its entirety if the other Party files a petition of bankruptcy, is adjudged bankrupt, takes advantage of any insolvency act, or executes a bill of sale, deed of trust, or assignment for the benefit of creditors.

 

16.4                        Survival.  The rights and obligations contained in Sections covering representations and warranties, indemnification and confidentiality will survive termination of this Agreement, as will any rights to payment or other rights or obligations that have accrued under this Agreement prior to termination. Termination will not affect the liability of either party by reason of any act, default, or occurrence prior to said termination.

 

16.5                        Transfer.  If either Party terminates this Agreement, SEL will upon request and for a period of no more than [**] months, and at NABRIVA’s expense, provide reasonable assistance in transferring manufacturing of Key Intermediate to a facility owned by NABRIVA or a third party selected by NABRIVA.

 

16.6                        Upon termination or expiration of this Agreement, NABRIVA shall pay all balances due and SEL shall return to NABRIVA or NABRIVA’s nominee any and all materials in its stock and belonging to NABRIVA and shall deliver to NABRIVA, against payment of the applicable price, any remaining Key Intermediate.

 

XVII.                 GOVERNING LAW AND ALTERNATIVE DISPUTE RESOLUTION

 

17.1                        This Agreement shall be governed by and construed in accordance with the law of Singapore.

 

17.2                        The Parties understand and appreciate that their long term mutual interest will be best served by effecting a rapid and fair resolution of any claims or disputes which may arise out of services performed under this Agreement or from any

 

 

dispute concerning Agreement terms. Therefore, both Parties agree to use their best efforts to resolve all such disputes as rapidly as practicable on a fair and equitable basis. Toward this end the Parties agree to develop and follow a process for presenting, rapidly assessing, and settling claims on a fair and equitable basis.

 

17.3                        If the matter has not been resolved utilizing the process set forth in Section 17.2, any dispute shall be submitted to binding arbitration for final decision.

 

17.4                       It is expressly agreed that arbitration shall be held in English language in Singapore in accordance with the Rules of Arbitration of the International Chamber of Commerce.

 

XVIII.            MISCELLANEOUS

 

18.1                        Headings.  The headings and captions used herein are for the convenience of the Parties only and are not to be construed to define, limit or affect the construction or interpretation hereof.

 

18.2                        Severability. In the event that any provision of this Agreement is found to be invalid or unenforceable, then the offending provision shall not render any other provision of this Agreement invalid or unenforceable, and all other provisions shall remain in full force and effect and shall be enforceable, unless the provisions which have been found to be invalid or unenforceable, to the fullest extent permitted by law. If any such affected provision materially affects the commercial basis of this Agreement, the Parties shall negotiate in good faith so as to amend the provisions of this Agreement so as to preserve and afford to each Party the full extent of benefits that this Agreement is intended to provide.

 

18.3                        Entire Agreement.  This Agreement, including all those Schedules appended hereto, contains the entire agreement of the Parties regarding the subject matter hereof and supersedes all prior agreements, understandings or conditions (whether oral or written) regarding the same. Further, this Agreement may not be changed, modified, amended or supplemented except by a written instrument signed by the duly authorized representatives of the Parties. Neither Party has relied on any representation except as may be expressly set forth herein.

 

18.4                        Assignability.  This Agreement and the rights hereunder may not be assigned or transferred by either Party without the prior written consent of the other Party, provided however, that either Party may assign this Agreement to an Affiliate, and provided further that in the event of a merger, acquisition or sale of all or substantially all of the assets of a Party, the rights and obligations of such Party under this Agreement may be assigned to the survivor of such Party in that transaction, provided that the survivor agrees to be bound by the terms and conditions of the Agreement. This Agreement shall be binding upon and inure to the benefit of each Party’s successors and permitted assigns.

 

18.5                        Further Assurances.  Each Party hereto agrees to execute, acknowledge and deliver such further instruments, and to take such other actions, as may be necessary or appropriate to carry out the purposes and intent of this Agreement.

 

18.6                        Waiver.  The waiver by either Party of a breach of any provisions contained herein shall be effective only if made 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.

 

18.7                        Force Majeure.  A Party shall not be liable for nonperformance or delay in performance (other than of obligations regarding confidentiality) caused by any event reasonably beyond the control of such party including, without limitation, wars, hostilities, revolutions, riots, civil disturbances, national emergencies, strikes, lockouts, unavailability of supplies, epidemics, fires, floods, earthquakes, other forces of nature, explosions, embargoes, or any other Acts of God, or any laws, proclamations, regulations, ordinances, or other acts or orders of any court, government or governmental agency. Any occurrence of Force Majeure shall be reported promptly to the other party. A Party whose performance has been excused will perform such obligation as soon as is reasonably practicable after the termination or cessation of such event or circumstance. The other Party has no right to demand indemnity for damage, provided however that, in the event that Force Majeure preventing performance shall continue for more than six (6) months, either Party may terminate this Agreement with a written notice to the other without any liability hereunder, except the obligation to make payments due to such date.

 

18.8                        Remedies.  Each party agrees and acknowledges that its disclosure of Confidential Information in breach of this Agreement may cause irreparable harm to other party, and therefore that any such breach or threatened breach may entitle such Party to seek injunctive relief, in addition to any other legal remedies available in a court of competent jurisdiction.

 

 

18.9                        Good Faith. The Parties agree to perform this Agreement in a spirit of good faith and fair dealing, and each will seek to avoid intentionally doing anything that would deprive the other of the full benefits contemplated hereunder. Neither Party will use any affiliate or third party as a means of avoiding its responsibilities under this Agreement. The Parties agree to communicate openly and in a spirit of co-operation to ensure that all services are rendered in accordance with the highest degree of professional competence, cGMPs and any other applicable law, regulation or regulatory requirement.

 

18.10                 Independent Contractors.  The Parties are independent contractors under this Agreement. Nothing contained in this Agreement is to be construed so as to constitute NABRIVA and SEL and FOUNTAIN as partners, agents or employees of the other, including 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 unless expressly so authorized in writing by the other Party.

 

18.11                 Counterparts.  This Agreement shall be executed by the duly authorized officers of the Parties. This Agreement may be executed in one (1) or more counterparts, including by facsimile or other electronic transmission, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

 

18.12                 Notices.  Except as otherwise expressly stated herein, all notices, consents or approvals required by this Agreement shall be in writing and sent by overnight courier service, certified or registered air mail, postage prepaid, or by facsimile or email (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. Notices shall be deemed effective on the date of mailing.

 

If to NABRIVA:

 

Nabriva Therapeutics Ireland DAC

25-28 Northwall Quay

Dublin 1

Ireland

Attention: [**]

Email address: [**]

 

With copy to:

 

Nabriva Therapeutics AG

Leberstrasse 20

1110 Vienna

Austria

Attention: [**]

Email address: [**]

 

All FOUNTAIN invoices and/or charges in billing should be directed to the  Accounting Department at:

 

Nabriva Therapeutics Ireland DAC

c/o Nabriva Therapeutics AG

Leberstrasse 20

1110 Vienna

Austria

Attention: Accounts Payable

Email: [**]

 

If to SEL:

 

Zhejiang University Sunny Technology Co., Ltd.

Address: 9th Floor, Building A, Paradise Software Park

No.3 Xi dou men road, Hangzhou 310012, China

Attn.: [**]

 

 

Facsimile[**]

Email: [**]

 

If to FOUNTAIN:

 

Fountain International Development Holding Limited

MNB2926 RM1007

10/F Ho King CTR 2-16

Fa yuen St Mongkok, Hong Kong.

Attention: Mrs. Lena Bu

Facsimile: [**]

Email: [**]

 

All NABRIVA purchase orders shall be sent to:

 

Fountain International Development Holding Limited

MNB2926 RM1007

10/F Ho King CTR 2-16

Fa yuen St Mongkok, Hong Kong.

Attention: Mrs. Lena Bu

Facsimile: [**]

Email: [**]

 

 

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

 

	
 
    	
NABRIVA THERAPEUTICS IRELAND DAC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Colin Broom
    
	
 
    	
 
    	
Name: Colin Broom
    
	
 
    	
 
    	
Title: CEO
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
SEL BIOCHEM Xinjiang Co, LTD
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Grace Xu
    
	
 
    	
 
    	
Name: Grace Xu
    
	
 
    	
 
    	
Title:   Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FOUNTAIN INTERNATIONAL   DEVELOPMENT HOLDING LIMITED
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Lena Bu
    
	
 
    	
 
    	
Name: Lena Bu
    
	
 
    	
 
    	
Title: General manager
    

 

 

Schedule A

 

Key Intermediate Specifications

 

The Parties have agreed upon all those applicable specifications for the Key Intermediate (Pleuromutilin) as set forth hereunder. The Parties shall agree upon any modifications to the specifications here below in writing.

 

·                  Include packaging specifications

 

·                  Include minimum shelf life

 

·                  Include analytical methods, product specifications, product impurities, degradation products, and reference standards provided by Nabriva

 

 

Schedule B

 

SEL undertakes to comply with the cGMP, where applicable, the Specifications, relevant DMF in the country to which Key Intermediate shall be delivered, the know-how and any other requirements agreed in writing between the Parties applicable to the manufacture, storage (including raw materials) and delivery of the Key Intermediate. The respective responsibilities of SEL and NABRIVA with regard to applicable cGMP regulations shall be defined in detail in the Quality Technical Agreement.

 

Form of Quality Technical Agreement

 

The Quality Technical Agreement will be revised, if necessary, within [**] days from the execution date of this Agreement.

 

 

Schedule C

 

SEL Reserve Capacity

 

The minimum annual capacity to be reserved by SEL for the Initial Term of this Agreement is  [**]/year.

 

[**] months before the expiry of the said Initial Term the Parties shall meet and discuss to seek an agreement in good faith on the minimum annual capacity to be reserved by SEL for the further term of this Agreement following the Initial Term.

 

 

Schedule D

 

Purchase Price

 

Nabriva’s forecast to SEL is:

 

2018     [**]

 

2019     [**]

 

2020     [**]

 

2021     [**]

 

2022     [**]

 

Pricing

 

2018-2022                                    [**]

 

If the above quantity is exceeded, the excess quantity will be at [**]. For example:

 

2018-2022 for a cumulative order of [**], the excess [**] will be at [**]

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