Document:

Exhibit 10.14

 

CLINICAL MANUFACTURING AGREEMENT BY  AND BETWEEN [[5252615]] XBIOTECH USA, INC. AN D JANSSEN RESEARCH  &  DEVELOPMENT LLC

     

     

    

1 [[5252615]] TABLE  OF CONTENTS P age Article 1 DEFINITIONS .........................................................................................................1 Article 2 CLINICAL  PRODUCT MANUFACTURE  AND SUPPLY......................................5 2.1 Manufacture  and  Supply. .....................................................................................5 2.2 Materials  and Capacity.........................................................................................5 2.3 Forecasts..............................................................................................................6 2.4 Purchase  Orders ...................................................................................................6 2.5 Packaging. ...........................................................................................................7 2.6 Delivery  of  Clinical  Products. ..............................................................................7 Article 3 3 . 1 3 . 2 PRICING;  PAYMENT .............................................................................................7 Supply Price.........................................................................................................7 Invoices and Payments. ........................................................................................8 Article 4 4 . 1 TRANSITION ..........................................................................................................8 Transition.............................................................................................................8 Article 5 SPECIFICATIONS  AND  QUALITY CONTROL  MATTERS .................................9 5.1 Compliance with  Law. .........................................................................................9 5.2 Clinical Product  Requirements. ............................................................................9 5.3 Specifications.....................................................................................................10 5.4 Quality Agreement.............................................................................................10 5.5 Nonconforming  Clinical Product........................................................................10 5.6 Clinical Product  Actions. ...................................................................................12 5.7 Manufacturing  Site  Audits. ................................................................................12 5.8 Regulatory Matters.............................................................................................12 5.9 Person - In - Plant. .................................................................................................13 5.10 Records  and  Information Management. ..............................................................14 Article 6 6 . 1 6 . 2 6 . 3 6 . 4 REPRESENTATIONS, WARRANTIES  AND  COVENANTS ...............................14 Mutual  Representations and  Warranties.  ............................................................14   Capacity.............................................................................................................15 Certain Compliance Matters...............................................................................15 No  Other Representations  or  Warranties. ...........................................................15 Article 7 7 . 1 CONFIDENTIALITY  AND  PUBLICITY  ..............................................................16   Confidentiality. ..................................................................................................16 Article 8 8 . 1 8 . 2 TERM  AND TERMINATION................................................................................16 Term.  .................................................................................................................16   Termination  by Mutual  Agreement. ...................................................................16

     

     

    

2 [[5252615]] 8.3 Termination  for  Material Breach. .......................................................................17 8.4 Termination  for Convenience. ............................................................................17 8.5 Effects  of  Termination  or  Expiration. .................................................................17 8.6 Survival. ............................................................................................................17 Article 9 9 . 1 9 . 2 9 . 3 DISPUTE  RESOLUTION.......................................................................................17 Dispute Resolution, Generally............................................................................17 Mediation...........................................................................................................18 Arbitration. ........................................................................................................18 Article   10   INDEMNIFICATION............................................................................................20 10.1 Incorporation  of  Asset Purchase Agreement  Indemnification  Provisions. ...........20 Article 11 11 . 1 11 . 2 11 . 3 11 . 4 11 . 5 11 . 6 11 . 7 11 . 8 11 . 9 MISCELLANEOUS ..............................................................................................20 N o t i c e s . ............................... . ............................... . ............................... . ............. . 20 Governing  Law. .................................................................................................20 Assignment. .......................................................................................................20 Designation  of  Affiliates. ...................................................................................20 Relationship  of  the Parties..................................................................................21 Force Majeure....................................................................................................21 S e v e r a bil i t y . ............................... . ............................................................... . ...... . 21 English Language...............................................................................................21  Waiver  and Non - Exclusion  of  Remedies. ...........................................................22 11.10    Further  Assurance. .............................................................................................22 11.11  Headings............................................................................................................22 11.12    Construction.......................................................................................................22 11.13    Counterparts.......................................................................................................23 11.14    Entire  Agreement; Amendments. .......................................................................23 11.15    Specific Performance. ........................................................................................23 E xhibit List Exhibit A Exhibit B Exhibit C Exhibit D Exhibit E Exhibit F Exhibit G Exhibit H Initial Forecast  Schedule   Specifications   Compliance with Laws Policy  on  Employment  of  Young  People   Johnson  & Johnson  Policy  for  Wood  Pallets  Company  Records  and  Information Requirements  New Formulations Transition Matters

     

     

    

CLINICAL MANUFACTURING AGREEMENT This CLINICAL MANUFACTURING AGREEMENT (this “ Agreement ”) is entered into as of December 30 , 2019 (the “ CMA Effective Date ”), by and between JANSSEN RESEARCH & DEVELOPMENT LLC , a Pennsylvania corporation, having its principal place of business at 800 / 850 Ridgeview Drive, Horsham, PA 19044 (hereinafter “ Company ”), and XBIOTECH USA, INC . , a Delaware corporation, having its principal place of business at 5217 Winnebago Lane, Austin, TX 78744 (“ SUPPLIER ”) . Company and SUPPLIER are sometimes referred to herein individually as a “ Party ” and collectively as the “ Parties ” . WHEREAS, XBiotech Inc . , an Affiliate of SUPPLIER, and Janssen Biotech, Inc . , an Affiliate of Company, have entered into that certain Asset Purchase Agreement, dated as of December 7 , 2019 (the “ Asset Purchase Agreement ”) ; and WHEREAS, pursuant to Section 2 . 4 (b)(iv) and Section 2 . 4 (c)(v) of the Asset Purchase Agreement, the Parties desire to enter into this Agreement for the Manufacture and supply of Clinical Products by SUPPLIER to Company, subject to the terms and conditions set forth herein ; and WHEREAS, this Agreement constitutes the Clinical Manufacturing Agreement contemplated by the Asset Purchase Agreement . NOW, THEREFORE, in consideration of the foregoing and the premises and conditions set forth herein, the Parties agree as follows : Article 1 DEFINITIONS As used in this Agreement, the following terms shall have the meanings set forth in this Article 1 , or if not defined in this Article 1 , shall have the meanings set forth in the Asset Purchase Agreement : “ Additional Equipment ” shall have the meaning set forth in Section 2 . 2 . 2 . “ Additional Specification ” shall have the meaning set forth in Section 5 . 3 . 1 . “ Affiliate ” means, with respect to a particular Person and a particular time, another Person that controls, is controlled by or is under common control with such first Person at any such time during the Term . For the purposes of this definition, the word “control” (including, with correlative meaning, the terms “controlled by” or “under the common control with”) means the actual power, either directly or indirectly through one or more intermediaries, to direct or cause the direction of the management and policies of a Person, whether by the ownership of fifty percent ( 50 % ) or more of the voting stock of such Person, by contract, or otherwise . “ Agreement ” shall have the meaning set forth in the preamble . “ AKA ” shall have the meaning set forth in Exhibit C .

     

     

    

 2 [[5252615]] “ Backup Equipment ”  shall  have  the  meaning set  forth  in  Section 2.2.3 . “ Business  Day ”  means  a  day  other  than  Saturday,  Sunday  or  any other  day  on  which   banking  institutions  in  New  York,  New York  are  closed for business. “ Clinical Product ” means Product and placebo for use in clinical trials, in the form of bulk drug substance, pre - filled syringes or vials, in each case as further described in the Specifications or the Additional Specifications . “ Clinical Product  Action ”  shall  have the  meaning set  forth  in  Section 5.6.1 .   “ Clinical Product Action Notice ”  shall have  the  meaning set  forth  in  Section 5.6.1 .   “ Clinical Product Requirements ” shall  have  the  meaning set  forth  in  Section 5.2 .   “ CMA Effective  Date ”  shall  have  the  meaning  set forth  in  the preamble.   “ Company ” shall have the  meaning set  forth  in  the preamble. “ Compound ”  means  the  monoclonal  antibody  known as bermekimab (MABp1), the   sequence  of  which  is  set  forth  in  Schedule  1.1(c)  to  the  Asset Purchase Agreement. “ CPR  Mediation  Procedure ” shall  have  the  meaning set  forth  in  Section  9.2.1 .   “ CPR  Rules ” shall have the  meaning set  forth  in  Section 9.3.1 . “ Current Capacity ” means, in the case of Clinical Products in the form of pre - filled syringes or vials, up to 4 , 160 units per month (or up to 50 , 000 units per calendar year), in each case irrespective of the drug concentration in the formulation included in such syringes or vials . “ Dispute ”  shall  have  the  meaning set  forth  in  Section 9.1 . “ EMA ”  means  the  European  Medicines  Agency  or  any successor  agency(ies)  or   authority  having  substantially the  same function. “ FCA ”  shall  have  the  meaning set  forth  in  Exhibit  C .   “ FCPA ” shall  have  the  meaning set  forth  in  Exhibit C . “ FDA ” means  the  U.S.  Food  and  Drug  Administration and any  successor  agency(ies)  or   authority  having  substantially the  same function. “ FFDCA ”  means  the  U.S.  Federal  Food, Drug,  and  Cosmetic  Act  (21  U.S.C.  † 301  et   seq.), as  amended  from  time  to time. “ Firm Order ”  shall  have  the  meaning  set  forth  in  Section 2.3.2 . “ Force  Majeure ”  means  any  event beyond  the reasonable  control  of  the affected  Party,   which may include embargoes; war  or  acts  of  war,  including  terrorism; insurrections, riots, or

     

     

    

3 [[5252615]] civil unrest ; strikes, lockouts or other labor disturbances ; epidemics, fire, floods, earthquakes or other acts of nature ; acts, omissions or delays in acting by any Governmental Authority (other than delays incident to the ordinary course of drug development) ; and failure of plant or machinery . “ Forecast Schedule ” shall have the  meaning set  forth  in  Section 2.3.1 . “ Good Manufacturing Practices ” or “ GMP ” means the then - current good manufacturing practices required by the FFDCA, as amended, and the regulations promulgated thereunder by the FDA at 21 C . F . R . Parts 210 and 211 , for the manufacture and testing of pharmaceutical materials, and comparable Law related to the manufacture and testing of pharmaceutical materials in jurisdictions outside the U . S . , including the quality guideline promulgated by the ICH designated ICH Q 7 A, titled “Q 7 A Good Manufacturing Practice Guidance for Active Pharmaceutical Ingredients” and the regulations promulgated thereunder, in each case as they may be updated from time to time . “ International Public Organization ”  means  any  of  the organizations  listed  in  8 C.F.R. † 316.20, as  amended  from  time to time. “ Know - How ”  shall  have  the  meaning set  forth  in  the  IP  License  Agreement.   “ Licensed Space ” shall have the  meaning set  forth  in  the License  to Occupy. “ Licensed Rights ” shall  have  the  meaning set  forth  in  the  IP  License  Agreement,  in   respect  of  licenses  granted  thereunder  by SUPPLIER. “ Manufacture ” means all activities and processes related to the manufacturing of any pharmaceutical product, or any ingredient thereof, including purchasing raw materials and intermediates, producing active pharmaceutical ingredient, formulating, and all labeling, packaging, in - process and finished product testing, storage and release of pharmaceutical product or any component or ingredient thereof, performance of quality assurance activities related to manufacturing and release of pharmaceutical product, and the performance of ongoing stability tests and regulatory activities related to any of the foregoing . When used as a verb, to “Manufacture” means to engage in Manufacturing activities . “ Manufacturing Capacity ” means the Current Capacity unless the Parties agree upon a new Manufacturing Capacity, including in connection with the installation of Additional Equipment, as provided in Section 2 . 2 . 2 below . “ Manufacturing Process ” means the processes and activities (and each step in the processes and activities) planned to be used to Manufacture Clinical Products as described in the master batch record for such Clinical Products, which shall be mutually agreed by the Parties and documented in writing . “ Manufacturing Representative ” has the meaning set forth in Section 5 . 9 . “ Manufacturing Sites ” means facilities of SUPPLIER or its Affiliates where Clinical Products are Manufactured from time to time .

     

     

    

4 [[5252615]] “ Materials ” means active pharmaceutical ingredients, raw ingredients, intermediaries, excipients, processing aids, packaging materials and any other components used in the Manufacture of Clinical Product . “ Nonconforming Clinical  Product ”  shall  have  the  meaning set  forth  in  Section  5.2 .   “ Nonconformity ”  shall  have  the  meaning set  forth  in  Section 5.2 . “ Officials ” shall have the  meaning set  forth  in  Section 6.2.2 . “ Party ”  and  “ Parties ” shall  have  the  meaning set  forth  in  the preamble.   “ Payment ”  shall  have  the  meaning set  forth  in  Section 6.2.2 . “ Person ” means an individual, sole proprietorship, partnership, limited partnership, limited liability partnership, corporation, limited liability company, business trust, joint stock company, trust, incorporated association, joint venture or similar entity or organization, including a government or political subdivision, department or agency of a government . “ Product ” means any pharmaceutical product containing the Compound, including all dosage forms, presentations, formulations and line extensions thereof, including a pharmaceutical product which is comprised of the Compound and other pharmaceutically active compound(s) and/or ingredients, any prototypes thereof and any variations thereof . “ Purchase Order ” shall  have  the  meaning set  forth  in  Section 2.4.1 .   “ Quality Agreement ” shall have the  meaning  set  forth  in  Section  5.4 .   “ Quarterly  Fee ”  shall  have  the  meaning set  forth  in  Section 3.1 . “ Quarterly Manufacturing Capacity ” means, with respect to any calendar quarter, the Manufacturing Capacity for such calendar quarter, being calculated as three ( 3 ) times the Manufacturing Capacity per month . “ Regulatory Authority ” means any applicable Governmental Authority with authority over the Manufacture or Exploitation of a pharmaceutical product in a country or jurisdiction, including (a) in the U . S . , the FDA, and (b) in the European Union, the EMA . “ Specifications ” shall have the  meaning set  forth  in  Section 5.2 . “ SUPPLIER ” shall  have  the  meaning set  forth  in  the  preamble.   “ Term ” shall have the  meaning set  forth  in  Section 8.1 . “ Third  Party ”  means  any  Person other  than  (a)  Company, (b)  SUPPLIER,  or  (c)  an   Affiliate  of  either  of  Company  or SUPPLIER. “ U.S. ”  means  the United  States  of  America,  including its  territories and possessions.

     

     

    

5 [[5252615]] “ UKBA ”  shall  have the  meaning set  forth  in  Exhibit C . Article 2 CLINICAL PRODUCT MANUFACTURE  AND SUPPLY 1. M anufacture  and Supply . During the Term and pursuant to the terms of this Agreement, SUPPLIER shall supply to Company all of Company’s requirements of Clinical Products, except as otherwise permitted by this Agreement or mutually agreed by the Parties in accordance with this Agreement . 2. M aterials  and Capacity . 1. Prioritization . During the Term, and subject to Company’s compliance with its obligations hereunder, SUPPLIER shall use reasonable best efforts to maintain capacity adequate to fulfill Company’s requirements of Clinical Products, as set forth in the applicable Forecast Schedule . If at any time during the Term, SUPPLIER is unable to Manufacture and supply all of the quantities of Clinical Products forecasted or ordered by Company hereunder, on the one hand, and all of the quantities of products desired by SUPPLIER, its Affiliates and their Third Party customers, on the other hand, due to (a) shortages of Materials that are used in both the Manufacture of Clinical Products and in the Manufacture of products for SUPPLIER, its Affiliates or their Third Party customers or (b) constraints on the capacity at the Manufacturing Sites, then SUPPLIER shall allocate Materials and capacity (including, for the avoidance of doubt, the use of any Additional Equipment) (i) first, to the Manufacture and supply of Clinical Products for Company and (ii) second, only to the extent of any remaining Materials and/or capacity, to the Manufacture and supply of products for SUPPLIER, its Affiliates or their Third Party customers . 2. Additional Equipment . If, at any time during the Term, notwithstanding SUPPLIER’S compliance with Section 2 . 2 . 1 , SUPPLIER is unable to Manufacture and supply all of the quantities of Clinical Products forecasted or ordered by Company hereunder due to constraints on the capacity at the Manufacturing Sites, SUPPLIER shall (i) promptly provide Company with written notice thereof and (ii) promptly provide such information as is reasonably requested by Company to enable Company to determine whether such constraints could be alleviated (in whole or in part) through the acquisition of additional equipment . If Company determines that such constraints could be alleviated (in whole or in part) through the acquisition of additional equipment, Company may, in its sole discretion, direct SUPPLIER to (and, upon such direction, SUPPLIER shall) acquire such additional equipment (“ Additional Equipment ”) at Company’s cost . In connection with the acquisition of any Additional Equipment, the Parties shall agree to an updated Manufacturing Capacity . SUPPLIER shall retain title to any Additional Equipment following any expiration or termination of this Agreement, other than the termination of this Agreement by Company pursuant to Section 8 . 3 (in which case Company shall be deemed to have been granted such title as of such termination) . 3. Backup Equipment . At any time during the Term, Company may, in its sole discretion, direct SUPPLIER to (and, upon such direction, SUPPLIER shall) acquire additional equipment to be used in the event that any of SUPPLIER’S equipment is temporarily or permanently rendered inoperative (“ Backup Equipment ”) at Company’s cost . SUPPLIER agrees

     

     

    

6 [[5252615]] that, during the Term, it shall use any such Backup Equipment only to the extent necessary to Manufacture and supply Clinical Products for Company, and for no other purpose . SUPPLIER shall retain title to any Backup Equipment following any expiration or termination of this Agreement, other than the termination of this Agreement by Company pursuant to Section 8 . 3 (in which case Company shall be deemed to have been granted such title as of such termination) . 2 . 2 . 4 Calculation of Costs ; Invoicing . Costs for Additional Equipment or Backup Equipment shall include, in addition to acquisition costs for such Additional Equipment or Backup Equipment, all reasonable documented out - of - pocket costs incurred by SUPPLIER with respect to the acquisition, installation, testing and validation of such Additional Equipment or Backup Equipment . SUPPLIER shall include any such costs actually incurred in the invoices delivered pursuant to Section 3 . 2 below, together with reasonably detailed supporting documentation therefor . 3. F orecasts . 1. Monthly Forecast Schedule . On the CMA Effective Date and within the first two weeks of each month commencing following the CMA Effective Date, Company shall submit to SUPPLIER a written, good faith rolling forecast of Company’s monthly requirements for Clinical Products for at least the following eighteen ( 18 ) months or such shorter period remaining under the Term (each such forecast, a “ Forecast Schedule ”) . The initial Forecast Schedule is attached hereto as Exhibit A . 2. Binding Commitment . The first four ( 4 ) months of each Forecast Schedule provided by Company shall be a binding commitment on Company to purchase from SUPPLIER, and, so long as such quantities are within the then - current Manufacturing Capacity, a binding commitment on SUPPLIER to sell to Company, the specified volume of Clinical Products set forth therein (each, a “ Firm Order ”) . For the avoidance of doubt, any months of a Forecast Schedule beyond the Firm Order period shall be non - binding . 4. P urchase Orders 1. All Clinical Product shall be supplied pursuant to purchase orders (each, a “ Purchase Order ”) submitted by Company to SUPPLIER . Each Purchase Order shall be consistent with the corresponding Firm Order and shall contain such Purchase Order number, quantities, order schedule, delivery locations, carrier information and other information reasonably necessary to permit correct delivery of Clinical Products for shipment, including such information and in a format as may be reasonably requested by SUPPLIER . 2. Exclusive Terms . This Agreement and the Quality Agreement set forth the exclusive contract terms between the Parties for, and shall apply to, all orders for Clinical Products . Any terms in any Firm Order, Purchase Order, invoice or other notice submitted by either Party to the other Party that are different from or additional to the provisions hereof shall be null and void notwithstanding SUPPLIER’s delivery of, and Company’s acceptance of, Clinical Products under any Firm Order, Purchase Order, invoice or other notice containing such terms .

     

     

    

7 [[5252615]] 5. P ackaging . SUPPLIER shall be responsible for packaging Clinical Products in accordance with the Specifications and the Quality Agreement . 6. D elivery  of  Clinical Products . SUPPLIER shall deliver Clinical Products to Company DAP (Incoterms 2010 ) at the location, and within five ( 5 ) days of (before or after) the delivery date, requested in the applicable Purchase Order . For the avoidance of doubt, SUPPLIER shall retain risk of loss to any Clinical Product unless and until such Clinical Product has been delivered to Company at such location as specified in the applicable Purchase Order . SUPPLIER shall provide Company notice of the anticipated delivery date at least three ( 3 ) days prior to delivery, and if such anticipated delivery date changes, SUPPLIER shall promptly provide Company notice of such change . Article 3 PRICING; PAYMENT 1. S upply Price . 1. Subject to Section 3 . 1 . 2 , for each calendar quarter during the Term, Company shall pay SUPPLIER in consideration for the Manufacture and supply of Clinical Products (which, for the avoidance of doubt, shall include Company’s right to occupy the Licensed Space pursuant to the License to Occupy) a fee of four million five hundred thousand dollars ( $ 4 , 500 , 000 ) for such quarter (the “ Quarterly Fee ”) . For purposes of this Agreement, references to “calendar quarters” in this Agreement shall include the calendar quarters (or partial calendar quarters) (i) beginning on the CMA Effective Date and (ii) ending on the last day of the Term . 2. If the Term includes any partial calendar quarter, the Quarterly Fee payable in respect of such partial calendar quarter shall be prorated based on the number of days in such partial calendar quarter (as compared to the number of days in a full calendar quarter) . 3. If, during any calendar quarter, SUPPLIER fails to deliver all of the Clinical Products specified in one or more Purchase Orders to be delivered to Company during such calendar quarter, the Quarterly Fee payable in respect of the next calendar quarter shall be reduced by the percentage of Clinical Products not so delivered as compared to the Clinical Products so specified for delivery ; provided that there shall be no such reduction to the extent such Clinical Products not so delivered were in excess of the Quarterly Manufacturing Capacity with respect to such calendar quarter . 4. If Company is entitled to a prorated or reduced Quarterly Fee pursuant to Section 3 . 1 . 2 , Section 3 . 1 . 3 and/or Section 5 . 5 . 2 (c), but has already paid such Quarterly Fee, SUPPLIER shall promptly reimburse Company for the difference between the Quarterly Fee paid and the prorated or reduced Quarterly Fee that was actually owed . If the application of Section 3 . 13 and/or Section 5 . 5 . 2 (c) would result in a reduction to a future Quarterly Fee, but no such future Quarterly Fee is payable hereunder, SUPPLIER shall promptly reimburse Company in an amount equal to the amount that such future Quarterly Fee would have been reduced .

     

     

    

8 [[5252615]] 2. I nvoices  and Payments . 1. The first Quarterly Fee shall be payable within five ( 5 ) days of the CMA Effective Date . Thereafter, invoices with respect to each calendar quarter (or partial calendar quarter) shall be provided to Company no more than sixty ( 60 ) days prior to the first day of such calendar quarter . Payment terms will be net ninety ( 90 ) days after Company’s receipt of an uncontested invoice from SUPPLIER ; provided , however , the actual payment to SUPPLIER from Company or its designee will not be made until the next scheduled payment run as set forth at www . ap . jnj . com . Company may contest any invoice or portion thereof if (i) it reasonably believes that the charges reflected therein do not accurately reflect a proration or reduction in the Quarterly Fee required under Section 3 . 1 . 2 , 3 . 1 . 3 and/or 5 . 5 . 2 (c) or (ii) it disputes any of the costs included in such invoice pursuant to Section 2 . 2 . 4 , in each case by providing notice to SUPPLIER of such dispute within twenty ( 20 ) days of its receipt of such invoice Once the matter is resolved, Company shall pay the appropriate charges . SUPPLIER shall continue to perform its obligations under this Agreement during such dispute . If an invoice is disputed in part, SUPPLIER may issue a new invoice in compliance with this Section 3 . 2 . 1 reflecting solely the undisputed charges, and any such invoice shall be payable within ninety ( 90 ) days after receipt thereof ; provided , however , the actual payment to SUPPLIER from Company or its designee will not be made until the next scheduled payment run as set forth at www . ap . jnj . com . 2. SUPPLIER shall not invoice Company hereunder, and no claim for payments will be considered with respect to Clinical Products Manufactured hereunder prior to both Parties’ duly authorized representatives signing this Agreement and Company issuing a purchase order number to SUPPLIER with respect to the services provided hereunder, provided that Company shall use reasonable best efforts to issue such purchase orders at such times and in such manner as will facilitate payments in accordance with this Section 3 . 2 . Article 4 TRANSITION 1. T ransition. 1. During the Term and for the 12 months after the expiration or termination of this Agreement, the Parties shall cooperate and use reasonable best efforts to enable the prompt transition of the Manufacture and supply of Product from the existing Manufacturing processes of SUPPLIER at the Manufacturing Sites to new Manufacturing processes of Company at facilities designated by Company at no additional cost . SUPPLIER shall provide reasonable technical assistance, including (i) information and Know - How in its control and related to Product or the Compound (including any information described on Exhibit H ) and (ii) introductions and access to SUPPLIER’S suppliers of Materials, in each case as requested by Company to facilitate the foregoing . 2. In the event that SUPPLIER is unable to fulfill all of Company’s requirements for Clinical Products (as a result of constraints on capacity, Force Majeure, insolvency, bankruptcy or otherwise), upon Company’s request, SUPPLIER shall transfer existing

     

     

    

9 [[5252615]] Manufacturing processes for the Compound and Products to Company (or its designee) and provide reasonable technical assistance to Company (or its designee), including introductions and access to SUPPLIER’S suppliers of Materials, to the extent reasonably necessary to enable Company to Manufacture the Compound and Products during the Term . 3. In the event that SUPPLIER is unable to fulfill all of Company’s requirements for Clinical Products (as a result of constraints on capacity, Force Majeure, insolvency, bankruptcy or otherwise), upon Company’s request, SUPPLIER will transfer any other information and Know - How in its control reasonably requested by Company in order to enable Company to Manufacture the Compound and Products during the Term, including (a) complete sets of any preclinical or clinical data generated by or on behalf of SUPPLIER with respect to the Compound or any Products, (b) raw data tables with respect to the data described in clause (a), (c) Chemistry, Manufacture and Control (CMC) data or information generated by or on behalf of SUPPLIER with respect to the Compound or any Product, (d) any information described on Exhibit H and (e) any other Know - How that is necessary or specifically useful for the Manufacture of the Compound or Products, in each case to the extent that such information or know - how was not previously provided by SUPPLIER to Company . 4. Any Know - How or Trade Secrets transferred or otherwise provided by SUPPLIER to Company or its designee pursuant to this Article 4 shall be deemed to be Licensed Rights, with respect to SUPPLIER as Licensor and Company as Licensee under the IP License Agreement, unless and solely to the extent such Know - How or Trade Secrets is Seller Intellectual Property . Article 5 SPECIFICATIONS AND  QUALITY CONTROL MATTERS 1. C ompliance  with Law . SUPPLIER will, and will cause its Affiliates to, comply with applicable Laws, including GMP, in performing Manufacturing activities with respect to Clinical Products . 2. C linical Product Requirements . SUPPLIER hereby represents, warrants and covenants to Company that Clinical Products supplied to Company under this Agreement shall be Manufactured in accordance with the Manufacturing Process, applicable Laws (including GMP), the Quality Agreement and the policies of Company set forth on Exhibit D and Exhibit E hereto (the “ Manufacturing Methods and Procedures ”) . SUPPLIER hereby further represents, warrants and covenants to Company that Clinical Products supplied to Company under this Agreement shall, at the time of delivery, (a) conform to the applicable Clinical Product specifications set forth on Exhibit B hereto or, to the extent applicable, the Quality Agreement (as such specifications may be amended from time to time in accordance with Section 5 . 3 . 2 or the Quality Agreement, the “ Specifications ”) or the applicable Additional Specifications, (b) have at least eighteen ( 18 ) months shelf life from the date of filling of the drug product into syringes or vials and (c) conform to the volume and form (i . e . , bulk drug substance, prefilled syringes or vials) ((a), (b) and (c) collectively, the “ Clinical

     

     

    

10 [[5252615]] Product Requirements ”) . Any supply of Clinical Products that does not satisfy the Clinical Product Requirements at the time that such supply is released by SUPPLIER or its Affiliate to Company is referred to in this Agreement as “ Nonconforming Clinical Product ” and shall be regarded as having a “ Nonconformity . ” 3. S pecifications . 1. During the Term, SUPPLIER shall use reasonable best efforts to develop additional formulations of Clinical Products as described on Exhibit G hereto . SUPPLIER and Company shall cooperate and use reasonable best efforts to agree on Clinical Product specifications for such additional formulations (such agreed specifications, as such specifications may be amended from time to time in accordance with Section 5 . 3 . 2 or the Quality Agreement, the “ Additional Specifications ”) . For the avoidance of doubt, once Additional Specifications have been agreed, Company shall be permitted to place Purchase Orders in respect of the Clinical Products represented by such Additional Specifications . If, during the Term, Company determines that additional formulations of Clinical Products not set forth on Exhibit G are necessary, SUPPLIER may from time to time cooperate with Company to develop such formulations and any Additional Specifications with respect thereto, subject to the mutual agreement of the Parties with respect to the terms and conditions applicable to the activities described in this sentence (it being understood that the additional formulations set forth on Exhibit G hereto are not subject to this sentence and are instead subject to the first sentence of this Section 5 . 3 . 1 and shall be at no additional cost to Company) . 2. During the Term, if Company proposes any change(s) to the Specifications or Additional Specifications based on any requirement, request or recommendation of a Governmental Authority, Company shall deliver a written request for such change(s) to SUPPLIER, and SUPPLIER shall reasonably consider such change(s) in good faith . SUPPLIER shall have final decision - making authority with respect to such proposed change(s) ; provided that SUPPLIER shall implement any such change(s) required, requested or recommended by a Governmental Authority if such change(s) would not reasonably be expected to adversely affect SUPPLIER or its Affiliates or any Regulatory Authorization held thereby . Company shall be responsible for the incremental costs of any additional resources required to implement any such change(s) requested by Company . 4. Q uality Agreement . SUPPLIER and Company have entered into that certain Quality Agreement, dated as of December 19 , 2019 , relating to the Clinical Products supplied hereunder (the “ Quality Agreement ”) . SUPPLIER, either by itself or through its Affiliates, shall perform such quality control or analytical tests on Clinical Products and provide to Company certifications or other documents, in each case, as may be provided for in the Quality Agreement, and shall maintain such records as are reasonably necessary to demonstrate compliance with GMP in the Manufacture of Clinical Products, as may be provided for in the Quality Agreement . 5. N onconforming Clinical Product . 1. Inspection  of  Clinical Products .

     

     

    

 11 [[5252615]] (a) Company will inspect Clinical Products supplied under this Agreement promptly upon receipt thereof . Subject to the immediately following sentence, Company shall have ninety ( 90 ) days following the delivery of any order of Clinical Products to notify SUPPLIER that it has rejected all or any part of such order in its reasonable and good faith belief that such order contains Nonconforming Clinical Product, which notice shall be accompanied by a sample of the allegedly Nonconforming Clinical Product . With respect to latent Nonconformities and Nonconformities not discoverable by Company within ninety ( 90 ) days of delivery through the use of reasonable inspection methods and procedures (a “ Latent Nonconformity ”), Company shall give notice to SUPPLIER by the first to occur of eighteen ( 18 ) months after delivery thereof or within sixty ( 60 ) days following detection of any such Latent Nonconformity . (b) If Company gives timely notice of allegedly Nonconforming Clinical Products in accordance with Section 5 . 5 . 1 (a), such Clinical Products shall be conclusively deemed to be Nonconforming Clinical Products, unless SUPPLIER delivers a written notice of disagreement (a “ Nonconformity Disagreement Notice ”) to Company within fifteen ( 15 ) days of receiving notice of the allegedly Nonconforming Clinical Products from Company . If Company fails to give timely notice of allegedly Nonconforming Clinical Products in accordance with Section 5 . 5 . 1 (a), such Clinical Products shall be conclusively deemed to have been accepted by Company . 2. Nonconformity . The following terms shall  apply  for  Nonconforming  Clinical   Product that  have  not  been  accepted,  or  deemed  accepted, by Company: (a) Company shall destroy the Nonconforming Clinical Products or return them to SUPPLIER, in accordance with SUPPLIER’s written instructions and at SUPPLIER’s expense ; and (b) SUPPLIER shall, at Company’s request, replace the Nonconforming Clinical Products ; and (c) SUPPLIER shall reduce the Quarterly Fees owed by Company to SUPPLIER (or refund the Quarterly Fees paid by Company to SUPPLIER, as applicable), as if SUPPLIER failed to deliver the quantity of Nonconforming Clinical Products, in accordance with and to the extent required by Section 3 . 1 . 3 . (d) Disagreement Regarding Nonconformity . If SUPPLIER does not agree with Company’s determination that any Clinical Products are Nonconforming Clinical Products and timely delivers a Nonconformity Disagreement Notice, then the Parties will select an independent Third Party laboratory reasonably acceptable to each Party to evaluate if the allegedly Nonconforming Clinical Products meet such requirements . Absent manifest error or fraud, this evaluation will be binding on the Parties . If the evaluation certifies that the allegedly Nonconforming Clinical Products do not meet the Clinical Product Requirements, SUPPLIER will be responsible for the cost of the evaluation . If the evaluation certifies that the allegedly Nonconforming Clinical Products do meet the requirements of Sections 5 . 2 (a) and (b) , then ( 1 ) Company shall be responsible for the cost of the evaluation, ( 2 ) the Clinical Products shall be deemed accepted, and ( 3 ) if SUPPLIER replaced the Nonconforming Clinical Products and if, as

     

     

    

12 [[5252615]] a result of such replacement, the total Clinical Products supplied by SUPPLIER exceeded the Manufacturing Capacity (on an annual or monthly basis), Company shall pay SUPPLIER for such Clinical Products . 6. C linical Product Actions . 1. Notification . SUPPLIER shall notify Company in writing promptly following its determination that any event, incident or circumstance related to safety issues or regulatory concerns has occurred that is reasonably likely to result in the need for a recall or withdrawal of Clinical Products supplied under this Agreement (a “ Clinical Product Action ”), and shall include in such notice (a “ Clinical Product Action Notice ”) the reasoning behind such determination and any supporting facts . Such Clinical Product Action Notice shall be given no later than five ( 5 ) Business Days after such determination is made ; provided that if any Regulatory Authority (a) threatens or initiates any action to remove Clinical Products from use in clinical trials in any country, or (b) requires a Party, or any of its Affiliates or (sub)licensees, to distribute a “Dear Doctor” letter or its equivalent regarding the use of Clinical Products, then, in either case ((a) or (b)), the Clinical Product Action Notice shall be given within one ( 1 ) Business Day after SUPPLIER becomes aware of the action, threat or requirement (as applicable) . 2. Expenses . Unless and solely to the extent a Clinical Product Action is necessitated by a Latent Nonconformity (or by the bad faith, willful misconduct or gross negligence of, or the material breach of this Agreement by, SUPPLIER), Company shall be solely responsible for all costs arising out of such Clinical Product Action and shall reimburse SUPPLIER for any out - of - pocket expenses incurred by SUPPLIER in carrying out a Clinical Product Action . If and then solely to the extent a Clinical Product Action is necessitated by Latent Nonconformity (or by the bad faith, willful misconduct or gross negligence of, or the material breach of this Agreement by, SUPPLIER), SUPPLIER shall reimburse Company for any out - of - pocket expenses incurred by Company or its Affiliates in assisting SUPPLIER to carry out a Clinical Product Action . 7. M anufacturing  Site Audits . SUPPLIER will permit Company to conduct quality assurance audits and inspections of SUPPLIER’s and its Affiliates’ records and facilities relating to Manufacture of Clinical Products, during normal business hours, in accordance with the terms of the Quality Agreement . Each Company representative participating in any such audit or inspection shall enter into a confidentiality agreement in a form reasonably acceptable to SUPPLIER and any applicable Affiliate . 8. R egulatory Matters . 1. SUPPLIER’s Obligations . SUPPLIER shall, and shall ensure that its Affiliates shall, at their own cost, obtain and maintain throughout the Term any certificates, permits, licenses and approvals issued by any relevant Governmental Authority required for the Manufacture of Clinical Products at the Manufacturing Sites in accordance with this Agreement . 2. Regulatory Approval Cooperation . SUPPLIER shall provide Company with all supporting data and information relating to the Chemistry, Manufacture and Control (CMC) of Clinical Products at the Manufacturing Sites that is in the possession and control of SUPPLIER and

     

     

    

13 [[5252615]] necessary for regulatory submissions by Company, including all records, raw data, reports, authorizations, certificates, methodologies, batch documentation, raw material specifications, standard operating procedures, standard test methods, certificates of analysis, certificates of compliance and other documentation in its possession or under its control relating to the Manufacturing of the Clinical Products . 5 . 8 . 3 Regulatory Inspections . SUPPLIER shall permit Company or its representatives to be present at any visit or inspection by any Regulatory Authority to the extent related to Clinical Products, or to any Manufacturing Site or other facility used to Manufacture, to test or to warehouse Clinical Products or specific to the systems or process used for the Manufacture of Clinical Products . SUPPLIER shall notify Company within three ( 3 ) Business Days of becoming aware of any planned inspection and within twenty - four ( 24 ) hours of any unplanned or ongoing inspection . SUPPLIER will provide Company copies of all regulatory reports of inspection, copies of all regulatory correspondence from Regulatory Authorities and copies of proposed written responses to be provided to Regulatory Authorities for Company’s review and comment before submission to any Regulatory Authority . SUPPLIER and Company will also provide daily inspection summary reports specific to Clinical Products or to any Manufacturing Site or other facility used to Manufacture, to test or to warehouse Clinical Products or specific to the systems or process used for the Manufacture of Clinical Products, in each case, in a format acceptable to both Parties each day of such an inspection . If SUPPLIER receives any observations or warning from any Regulatory Authority relating to any Clinical Products or Manufacturing Site or other facility (if it relates to the Manufacture of any Clinical Products) or to the systems or process used for the Manufacture of Clinical Products, SUPPLIER shall within ten ( 10 ) Business Days of the date such observations or warning is received by SUPPLIER, remedy or cause the remedy of the issues identified in such notice or warning or, if any such issues cannot reasonably be remedied within such ten ( 10 ) Business Day period the Parties will agree on a plan to resolve such issues within a mutually agreed time period . If the Parties cannot agree, the matter will be referred to the Head of Quality of each Party for resolution, by providing written notice to the appropriate contact person specified in the relevant Quality Agreement . 5 . 8 . 4 Additional Support . SUPPLIER may from time to time provide additional support in furtherance of the Manufacture and supply of Clinical Products, including support to assist Company in complying with applicable Law or the requirements of any Regulatory Authority (e . g . , the performance of analytical testing using certain assays in support of demonstrating Phase 2 and Phase 3 process comparability), subject to the mutual agreement of the Parties with respect to the terms and conditions applicable to the activities described in this sentence . 5.9 P erson - In - Plant . During the Term, SUPPLIER agrees to permit Company’s personnel or duly authorized representatives to observe and consult with respect to the Manufacturing of Clinical Products (each such employee or agent a “ Manufacturing Representative ”) . Each Manufacturing Representative will serve as the Company’s representative at the Manufacturing Sites during Manufacture of Clinical Products . SUPPLIER will allow each Manufacturing Representative reasonable access to (A) all data and information regarding Manufacture of Clinical Products and (B) to be present during the Manufacture of Clinical Products . Each Manufacturing Representative will have access only to those portions of the Manufacturing Sites reasonably

     

     

    

14 [[5252615]] related to the Manufacture of Clinical Products as well as reasonable access to office space, data and communication resources on an as - needed basis to enable such Manufacturing Representative to carry out the activities contemplated herein . In no event will any Manufacturing Representative interfere with, and SUPPLIER will remain fully responsible for, the Manufacture of Clinical Products . Each Manufacturing Representative will coordinate closely with SUPPLIER in order to minimize the impact of his/her presence on operations and will comply with all of SUPPLIER’S policies and procedures regarding their presence in the Facilities including any training requirements . 5.10 R ecords  and  Information Management . SUPPLIER  shall  comply  with  the records  and  information  management provisions set   forth  on  Exhibit F . Article 6 REPRESENTATIONS,  WARRANTIES  AND COVENANTS 1. M utual Representations  and Warranties . Each  of  the Parties hereby represents  and  warrants to  the other  Party  as  of  the  CMA   Effective  Date that: 1. Organization . It is a corporation duly organized, validly existing, and in good standing under the Laws of the jurisdiction of its organization, and has all requisite corporate power and authority to execute, deliver, and perform this Agreement . 2. Binding Agreement . This Agreement is a legal and valid obligation binding upon such Party and enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, or other Laws of general application affecting the enforcement of creditor rights, judicial principles affecting the availability of specific performance, and general principles of equity (whether enforceability is considered a proceeding at law or equity) . 3. Authorization . The execution, delivery, and performance of this Agreement by such Party have been duly authorized by all necessary corporate action and do not conflict with any agreement, obligation, instrument, or understanding, oral or written, to which it is a party or by which it is bound, nor violate any applicable Law or any order, writ, judgment, injunction, decree, determination, or award of any Governmental Authority presently in effect applicable to such Party . 4. No Further Approval . It is not aware of any government authorization, consent, approval, license, exemption of or filing or registration with any Governmental Authority under any applicable Law, currently in effect, necessary for the execution and delivery of this Agreement or any other agreement or instrument executed in connection herewith . 5. No Inconsistent Obligations . It is not under any obligation, contractual or otherwise, to any Person that conflicts with or is inconsistent in any material respect with the terms of this Agreement, or that would impede the diligent and complete fulfillment of its obligations hereunder .

     

     

    

15 [[5252615]] 2. C apacity . SUPPLIER hereby represents and warrants to Company that (a) as of the CMA Effective Date, the capacity at the Manufacturing Sites to Manufacture and supply Clinical Products in the form of pre - filled syringes or vials will be at least equal to the Current Capacity and (b) it will have sufficient capacity to Manufacture and supply all of the Clinical Products included on the initial Forecast Schedule attached hereto as Exhibit A . 3. C ertain Compliance Matters . 1. No Violation of Law . Notwithstanding any other provision of this Agreement, neither Party shall be required to undertake any activity or obligation under this Agreement which it has reason to believe may violate any applicable Laws ; provided , however , a Party which so believes shall promptly inform the other Party of such belief . 2. Anti - Bribery and Corruption . Neither SUPPLIER nor its Affiliates will make any payment, either directly or indirectly, of money or other assets, including the compensation SUPPLIER derives from this Agreement (collectively, a “ Payment ”), to government or political party officials, officials of International Public Organizations, candidates for public office, or representatives of other businesses or persons acting on behalf of any of the foregoing (collectively, “ Officials ”) or other individuals where such Payment would constitute violation of any applicable Law, including the Foreign Corrupt Practices Act of 1977 , 15 U . S . C . †† 78 dd - 1 , et seq . , and the United Kingdom Bribery Act . In addition regardless of legality, neither SUPPLIER nor its Affiliates will make any Payment either directly or indirectly to Officials or other individuals if such Payment is for the purpose of improperly influencing decisions or actions to secure a business advantage, including with respect to the subject matter of this Agreement . SUPPLIER shall have necessary procedures in place to prevent bribery and corrupt conduct by itself and each of its Affiliates and subcontractors . All activities will be conducted in compliance with the U . S . False Claims Act and the U . S . Anti - Kickback Statute . SUPPLIER and each of its Affiliates and subcontractors shall conduct its activities hereunder in accordance with the provisions of Exhibit C to this Agreement . 4. N o Other  Representations  or Warranties . EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN ANY OTHER WRITTEN AGREEMENT EXECUTED BY EACH OF THE PARTIES, THE PARTIES MAKE NO REPRESENTATIONS OR WARRANTIES OF ANY KIND WHATSOEVER, EITHER EXPRESS OR IMPLIED, WRITTEN OR ORAL, IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, INCLUDING ANY EXPRESS OR IMPLIED WARRANTY OF QUALITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR WARRANTY OF NON - INFRINGEMENT .

     

     

    

16 [[5252615]] Article 7 CONFIDENTIALITY AND PUBLICITY 7.1 C onfidentiality . SUPPLIER will, and will cause its Affiliates and its and their Representatives, to keep confidential and not disclose to any Person (i) the terms of this Agreement or (ii) any non - public, confidential or proprietary information of Company or its Affiliates (including information relating to the Business) obtained pursuant to or in connection with this Agreement and to not use any such information other than in furtherance of the performance of its obligations hereunder . The obligations of SUPPLIER under this Section 7 . 1 shall not apply to information to the extent such information (a) becomes generally available to the public without breach of SUPPLIER’S or its Affiliates’ obligations under this Section 7 . 1 or under the Asset Purchase Agreement or any Related Document or (B) is required to be disclosed by Law or any Order ; provided , however , that in the case of the foregoing clause (B), to the extent not prohibited by such Law or Order, SUPPLIER shall notify Company as early in advance of such disclosure as is practicable to allow Company to take appropriate measures (and SUPPLIER shall reasonably cooperate, at the expense of Company, in the taking of such measures) to preserve the confidentiality of such information . Article 8 TERM  AND TERMINATION 1. T erm . This Agreement shall become effective as of the CMA Effective Date and, unless earlier terminated pursuant to this Article 8 , shall continue in full force and effect until December 31 , 2021 (the “ Term ”) ; provided that the foregoing shall not limit any ongoing obligations of SUPPLIER with respect to Clinical Products ordered prior to the end of the Term, such as the performance of quality assurance activities or ongoing stability tests, as set forth in this Agreement or the Quality Agreement, following the end of the Term . Without limiting the foregoing, if Company requires additional supply of Clinical Products following the Term to complete then - ongoing clinical trials, then upon Company’s request, the Parties shall discuss in good faith an extension to the Term in order for SUPPLIER to provide such additional supply, including with respect to any modifications to the terms of this Agreement that would apply to such Clinical Product supply during such extension as may be reasonably requested by either Party . Any such requested modifications shall be commercially reasonable, and any such extension shall be subject to the mutual written agreement of the Parties . 2. T ermination  by Mutual Agreement . This  Agreement  may be  terminated  at any  time  upon  the mutual  written  agreement  of the Parties.

     

     

    

17 [[5252615]] 3. T ermination  for  Material Breach . This Agreement may be terminated by either Party if the other Party has committed a material breach and has failed to remedy such breach within thirty ( 30 ) Business Days following receipt of a written notice of such breach from the non - breaching Party . 4. T ermination  for Convenience . This  Agreement  may be  terminated  at any  time  by  Company  upon  providing at  least sixty ( 60 ) days’ prior written notice to SUPPLIER . 5. E ffects  of  Termination  or Expiration . Termination or expiration of this Agreement shall not relieve the Parties of any liability or obligation which accrued hereunder prior to the effective date of such termination or expiration . Each Party shall be free, pursuant to Article 9 , to seek, without restriction as to the number of times it may seek, damages, costs and remedies that may be available to it under applicable Law or in equity and shall be entitled, following final resolution of a Dispute in accordance with Article 9 , to offset the amount of any damages and costs awarded pursuant to a final determination under Article 9 against any amounts due to such other Party under this Agreement . Upon termination or expiration of this Agreement, SUPPLIER shall transfer to Company all right, title and interest in, to and under any Inventory (including Clinical Products) in the possession of SUPPLIER at no cost to Company, and Company will acquire from SUPPLIER good and marketable title to all such Inventory, free and clear of any Liens . 6. S urvival . In the event of termination or expiration of this Agreement, in addition to the provisions of this Agreement that continue in effect in accordance with their terms, the following provisions of this Agreement shall survive : Articles 1 (Definitions) (as applicable), 7 (Confidentiality), 9 (Dispute Resolution), 10 (Indemnification) (solely as to activities arising during the Term) and 11 (Miscellaneous) ; Sections 2 . 3 (Forecasts), 4 . 1 (Transition), 5 . 5 (Nonconforming Clinical Product), 5 . 6 (Clinical Product Actions), 6 . 4 (No Other Representations or Warranties), 8 . 5 (Effects of Termination or Expiration) and 8 . 6 (Survival) ; and any other provisions of this Agreement that are necessary to interpret or effectuate the intent of the foregoing provisions . Article 9 DISPUTE RESOLUTION 9.1 D ispute Resolution, Generally . The Parties recognize that a dispute may arise relating to this Agreement (a “ Dispute ”) . Any Dispute, including Disputes that may involve the parent company, subsidiaries or Affiliates under common control of any Party, shall be resolved in accordance with this Article 9 .

     

     

    

 18 [[5252615]] 2. M ediation . 1. The Parties shall first attempt in good faith to resolve any Dispute by confidential mediation in accordance with the then current Mediation Procedure of the International Institute for Conflict Prevention and Resolution (“ CPR Mediation Procedure ”) (www . cpradr . org) before initiating arbitration . The CPR Mediation Procedure shall control, except where it conflicts with these provisions, in which case these provisions control . The mediator shall be chosen pursuant to CPR Mediation Procedure . The mediation shall be held in New York, New York . 2. Either Party may initiate mediation by written notice to the other Party of the existence of a Dispute . The Parties agree to select a mediator within 20 days of the notice and the mediation will begin promptly after the selection . The mediation will continue until the mediator, or either Party, declares in writing, no sooner than after the conclusion of one full day of a substantive mediation conference attended on behalf of each Party by a senior business person with authority to resolve the Dispute, that the Dispute cannot be resolved by mediation . In no event, however, shall mediation continue more than 60 days from the initial notice by a Party to initiate mediation unless the Parties agree in writing to extend that period . 3. Any period of limitations that would otherwise expire between the initiation of mediation and its conclusion shall be extended until 20 days after the conclusion of the mediation . 3. A rbitration . 1. If the Parties fail to resolve the Dispute in mediation, and a Party desires to pursue resolution of the Dispute, the Dispute shall be submitted by either Party for resolution in arbitration pursuant to the then current CPR Non - Administered Arbitration Rules (“ CPR Rules ”) (www . cpradr . org), except where they conflict with these provisions, in which case these provisions control . The arbitration will be held in New York, New York . All aspects of the arbitration shall be treated as confidential . 2. The arbitrators will be chosen form the CPR Panel of Distinguished Neutrals, unless a candidate not on such panel is approved by both Parties . Each arbitrator shall be a lawyer with at least 15 years experience with a law firm or corporate law department of over 25 lawyers or who was a judge of a court of general jurisdiction . To the extent that the Dispute requires special expertise, the Parties will so inform CPR prior to the beginning of the selection process . 3. The arbitration tribunal shall consist of three arbitrators, of whom each Party shall designate one in accordance with the “screened” appointment procedure provided in CPR Rule 5 . 4 . The chair will be chosen in accordance with CPR Rule 6 . 4 . 4. If, however, the aggregate award sought by the Parties is less than $ 5 million and equitable relief is not sought, a single arbitrator shall be chosen in accordance with the CPR Rules . 5. Candidates for the arbitrator position(s) may be interviewed by representatives of the Parties in advance of their selection, provided that all Parties are represented .

     

     

    

 19 [[5252615]] 6. The Parties agree to select the arbitrator(s) within 45 days of initiation of the arbitration . The hearing will be concluded within nine ( 9 ) months after selection of the arbitrator(s) and the award will be rendered within 60 days of the conclusion of the hearing, or of any post - hearing briefing, which briefing will be completed by both sides within 45 days after the conclusion of the hearing . In the event the Parties cannot agree upon a schedule, then the arbitrator(s) shall set the schedule following the time limits set forth above as closely as practical . 7. The hearing will be concluded in ten hearing days or less . Multiple hearing days will be scheduled consecutively to the greatest extent possible . A transcript of the testimony adduced at the hearing shall be made and shall be made available to each Party . 8. The arbitrator(s) shall be guided, but not bound, by the CPR Protocol on Disclosure of Documents and Presentation of Witnesses in Commercial Arbitration (www . cpradr . org) ("Protocol") . The Parties will attempt to agree on modes of document disclosure, electronic discovery, witness presentation, etc . within the parameters of the Protocol . If the Parties cannot agree on discovery and presentation issues, the arbitrator(s) shall decide on presentation modes and provide for discovery within the Protocol, understanding that the Parties contemplate reasonable discovery . 9. The arbitrator(s) shall decide the merits of any Dispute in accordance with the law governing this Agreement, without application of any principle of conflict of laws that would result in reference to a different law . The arbitrator(s) may not apply principles such as "amiable compositeur" or "natural justice and equity . " 10. The arbitrator(s) are expressly empowered to decide dispositive motions in advance of any hearing and shall endeavor to decide such motions as would a United States District Court Judge sitting in the jurisdiction whose substantive law governs . 11. The arbitrator(s) shall render a written opinion stating the reasons upon which the award is based . The Parties consent to the jurisdiction of the United States District Court for the district in which the arbitration is held for the enforcement of these provisions and the entry of judgment on any award rendered hereunder . Should such court for any reason lack jurisdiction, any court with jurisdiction may act in the same fashion . 12. Each Party has the right to seek from the appropriate court provisional remedies such as attachment, preliminary injunction, replevin, etc . to avoid irreparable harm, maintain the status quo , or preserve the subject matter of the Dispute . Rule 14 of the CPR Rules does not apply to this Agreement . 13. EACH PARTY HERETO WAIVES : ( 1 ) ITS RIGHT TO TRIAL OF ANY ISSUE BY JURY, ( 2 ) WITH THE EXCEPTION OF RELIEF MANDATED BY STATUTE OR RESULTING FROM THE WILLFUL MATERIAL BREACH OF THIS AGREEMENT, ANY CLAIM TO PUNITIVE, EXEMPLARY, MULTIPLIED, INDIRECT, CONSEQUENTIAL OR LOST PROFITS/REVENUES DAMAGES (EXCEPT, IN EACH CASE, TO THE EXTENT AWARDED TO A THIRD PARTY), AND ( 3 ) ANY CLAIM FOR ATTORNEY FEES, COSTS AND PREJUDGMENT INTEREST .

     

     

    

20 [[5252615]] Article 10 INDEMNIFICATION 10.1 I ncorporation  of  Asset  Purchase Agreement Indemnification Provisions .  This Agreement shall be deemed to be a “Related Document” for the purposes of Article VII of the Asset Purchase Agreement, and Article VII of the Asset Purchase Agreement will govern the indemnification obligations of the Parties with respect to any “Losses”, as such term is defined in the Asset Purchase Agreement, arising under this Agreement (including, for the avoidance of doubt, with respect to any “Losses” arising from, relating to or otherwise in connection with any breach of or failure to perform any covenant or agreement of SUPPLIER or Company, as applicable, contained in this Agreement) . Article 11 MISCELLANEOUS 1. N otices . All notices given by one Party to the other Party under this Agreement will follow the procedures and be delivered to the addresses set forth in Section 9 . 2 of the Asset Purchase Agreement . 2. G overning Law . THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF . 3. A ssignment . Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned, in whole or in part, by either of the Parties without the prior written consent of the other Party, and any assignment without such consent shall be null and void, except that either Party may, without the prior written consent of the other Party, assign (a) any or all of its rights and obligations under this Agreement to any of its Affiliates ( provided that the assigning Party shall remain responsible for the performance of such assignee Affiliate) or (b) this Agreement in its entirety to a Third Party acquirer of that portion of its business relating to the subject matter of this Agreement . Any successor or assignee of rights and/or obligations permitted hereunder shall, in writing, expressly assume performance of such rights and/or obligations . 4. D esignation  of Affiliates . Each Party may discharge any obligation and exercise any right hereunder through delegation of its obligations or rights to any of its Affiliates . Each Party hereby guarantees the performance by its Affiliates of such Party’s obligations under this Agreement, and shall cause

     

     

    

21 [[5252615]] its Affiliates to comply with the provisions of this Agreement in connection with such performance . Any breach by a Party’s Affiliate of any of such Party’s obligations under this Agreement shall be deemed a breach by such Party, and the other Party may proceed directly against such Party without any obligation to first proceed against such Party’s Affiliate . 5. R elationship  of the Parties . It is expressly agreed that SUPPLIER, on the one hand, and Company, on the other hand, are independent contractors, and it is further agreed that the Parties fully intend and expect that the relationship between the two Parties shall not constitute a partnership, joint venture or agency . Except as expressly provided herein, neither SUPPLIER nor Company shall have the authority to make any statements, representations or commitments of any kind, or to take any action which shall be binding on the other, without the prior written consent of the other Party to do so . All individuals employed by a Party shall be employees of that Party and not of the other Party and all costs and obligations incurred by reason of such employment shall be for the account and expense of such Party . 6. F orce Majeure . Both Parties shall be excused from the performance of their obligations under this Agreement to the extent that such performance is prevented by Force Majeure and the nonperforming Party promptly provides notice of such Force Majeure circumstances to the other Party . Such excuse shall be continued so long as the condition constituting Force Majeure continues and the nonperforming Party takes reasonable best efforts to remove the condition . Notwithstanding the foregoing, a Party shall not be excused from making payments owed hereunder because of a Force Majeure affecting such Party . If a Force Majeure persists for more than ninety ( 90 ) days, then the Parties shall discuss in good faith the modification of the Parties’ obligations under this Agreement in order to mitigate the delays caused by such Force Majeure . In the event a Party is prevented from performing its obligations under this Agreement due to Force Majeure for more than six ( 6 ) months according to this Section 11 . 6 , the other Party shall have the right to terminate this Agreement upon sixty ( 60 ) days’ notice after the expiration of such period . A termination under this Section 11 . 6 by either Party shall be treated as a termination under Section 8 . 2 . 7. S everability . If any one or more of the provisions of this Agreement is held to be invalid or unenforceable by any court of competent jurisdiction from which no appeal can be or is taken, the provision shall be considered severed from this Agreement and shall not serve to invalidate any remaining provisions hereof . The Parties shall make good faith efforts to replace any invalid or unenforceable provision with a valid and enforceable one such that the objectives contemplated by the Parties when entering this Agreement may be realized . 8. E nglish Language . This Agreement shall be written in and executed in, and all other communications under or in connection with this Agreement shall be in, the English language . Any translation into any other language shall not be an official version hereof or thereof, and in the event of any conflict

     

     

    

22 [[5252615]] in  interpretation  between  the English version  and  such translation, the  English  version shall   control. 9. W aiver  and  Non - Exclusion  of Remedies . Any term or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving such term or condition . The waiver by either Party of any right hereunder or of the failure to perform or of a breach by the other Party shall not be deemed a waiver of any other right hereunder or of any other breach or failure by such other Party whether of a similar nature or otherwise . The rights and remedies provided herein are cumulative and do not exclude any other right or remedy provided by applicable Law or otherwise available except as expressly set forth herein . 10. F urther Assurance . Each Party shall duly execute and deliver, or cause to be duly executed and delivered, such further instruments and do and cause to be done such further acts and things, including the filing of such assignments, agreements, documents, and instruments, as may be necessary or as the other Party may reasonably request in connection with this Agreement to carry out more effectively the provisions and purposes hereof . 11. H eadings . The headings of each Article and Section in this Agreement have been inserted for convenience of reference only and are not intended to limit or expand on the meaning of the language contained in the particular Article or Section . 12. C onstruction . Whenever this Agreement refers to a number of days without using a term otherwise defined herein, such number refers to calendar days, whether or not “calendar days” is expressly stated . Except where the context otherwise requires, (a) wherever used, the singular shall include the plural, the plural shall include the singular ; (b) the use of any gender shall be applicable to all genders ; (c) the terms “including,” “include,” “includes” and “for example” shall not limit the generality of any description preceding such term and, as used herein, shall have the same meaning as “including, but not limited to,” and “including, without limitation” ; (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, refer to this Agreement in its entirety and not to any particular provision hereof ; (e) the word “will” means “shall” ; (f) if a period of time is specified and dates from a given day or Business Day, or the day or Business Day of an act or event, it is to be calculated exclusive of that day or Business Day ; (g) “Dollar”, “USD” or “ $ ” means U . S . Dollars ; (h) references to a particular Person include such Person’s successors and assigns to the extent not prohibited by this Agreement ; (i) a capitalized term not defined herein but reflecting a different part of speech than a capitalized term which is defined herein shall be interpreted in a correlative manner ; (j) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or

     

     

    

23 [[5252615]] modifications set forth herein) ; (k) any provision under this Agreement requiring the mutual agreement of the Parties or the consent or approval of a Party shall only be satisfied if made in writing signed by the relevant Party(ies) and (l) if this Agreement is terminated in accordance with its terms, the “Term” shall be deemed to end on the effective date of such termination . The language of this Agreement shall be deemed to be the language mutually chosen by the Parties and no rule of strict construction shall be applied against either Party . Each Party represents that it has been represented by legal counsel in connection with this Agreement and acknowledges that it has participated in the drafting hereof . 13. C ounterparts . This Agreement may be executed in two ( 2 ) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument . This Agreement may be executed by . pdf or other electronically transmitted signatures and such signatures shall be deemed to bind each Party as if they were the original signatures . 14. E ntire Agreement; Amendments . This Agreement, including the Exhibits hereto, sets forth the complete, final and exclusive agreement and all the covenants, promises, agreements, warranties, representations, conditions and understandings between the Parties with respect to the subject matter hereof and supersedes, as of the CMA Effective Date, all prior and contemporaneous agreements and understandings between the Parties with respect to the subject matter hereof . In the event of any inconsistency between the body of this Agreement or any Exhibits to this Agreement and the Asset Purchase Agreement or any other Related Document, this Agreement shall govern and control with respect to the supply of Clinical Product and the specific subject matter hereof, and the Asset Purchase Agreement and other Related Documents shall govern and control with respect to all other matters . There are no covenants, promises, agreements, warranties, representations, conditions or understandings, either oral or written, between the Parties with respect to the subject matter hereof other than as are set forth herein and therein . No subsequent alteration, amendment, change or addition to this Agreement shall be binding upon the Parties unless reduced to writing and signed by an authorized officer of each Party . In the event of any inconsistency between the body of this Agreement and any Exhibits to this Agreement, unless otherwise expressly stated to the contrary in such Exhibit, the terms contained in this Agreement shall govern and control . 15. S pecific Performance . The Parties agree that irreparable damage would occur and that the Parties would not have any adequate remedy at law in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached . It is accordingly agreed that the Parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, this being in addition to any other remedy to which they are entitled at law or in equity and as further set forth in Article 9 . For the avoidance of doubt, this Section 11 . 15 shall not restrict any Party from asserting that the terms and provisions of this Agreement have not

     

     

    

24 [[5252615]] been  breached  (or  would  not  be  breached)  by  the  actions  or  omissions  (or  intended  actions  or   omissions)  of  such Party. [SIGNATURE PAGE FOLLOWS]

     

     

    

IN  WITNESS  WHEREOF,  the  Parties  have  signed  this  Clinical  Manufacturing   Agreement  as  of  the  date  first  set  forth above . JANSSEN  RESEARCH  &  DEVELOPMENT LLC By: Name: Title: XBIOTECH  USA, INC. By: Name: Title; U5252615ll

     

     

    

IN  WITNESS  WHEREOF,  the  Parties  have  signed  this  Clinical Manufacturing   Agreement  as of  the  date  first  set  forth above. JANSSEN  RESEARCH  &  DEVELOPMENT LLC By: Name: Title: XBIOTECH  USA, INC. \ By: Name: Title: Chief Executive Officer [[5252615]]

     

     

    

Exhibit  A  - 1 [[5252615]] Exhibit A Initial Forecast Schedule

     

     

    

[[5262776]] Exhibit A Initial  Forecast Schedule 1 M o n t h s 18 - - - - 4100 - 17 - - - - 4100 - 16 - - - - 4100 - 15 - - - - 4100 - 14 - - - - 4100 - 13 - - - - 4100 - 12 - - - - 4100 - 11 - - - - 4100 - 10 - - - - 4100 - 9 - - - - 4100 - 8 - - - - 4100 - 7 - - - - 4100 - 6 - - - - 4100 - 5 - - - - 4100 - Binding Commitment 4 - - - - 4100 100 3 - - - - 4100 - 2 - - - - 4100 - 1 336 48 48 24 2100 500 Vials (units) 100 mg/ml 150 mg/ml 175 mg/ml 200 mg/ml Syringes (units) 2 Bulk  Drug   Substance (g) 1  Schedule  does  not  include demand  required  for  release  testing, stability  or similar  studies. Seller will provide additional Clinical Products  as  necessary  for such studies. 2  Syringe  demand will  be  allocated  between  the  formulations  listed  in  Exhibit  G  and placebo.

     

     

    

Exhibit  B  - 1 [[5252615]] Exhibit B Specifications Specifications  of  existing strengths  must meet all  specifications  as  listed  in  the  Product   IND/IMPD. Specifications  of  the  new  formulations will  be  adjusted accordingly. [See  attached.]

     

     

    

XBiotech Bermekimab I M PD P.5   P.5.1   P .5.1.1 Control of Drug Product Specification ES018, Bermekimab Drug product   100mg/ml Confidential Information: Outside distribution  must be  approved  by  Regulatory Affairs/Quality Assurance B i N o ext G e t nera t e ion Ant i c body  T h herapy SPECIFICATION Doc. No.:   Effective Date: DCR No.: ES018   09 / 0 6 / 18 18 - 187 Title: Bermekimab Subcutaneous Drug Product, ~ 100 mg/ml Revision: 6.0 Page 1  of 3 Bermekimab1 Subcutaneous  Drug  Product,  100  mg/ml Information Product:  Bermekimab Subcutaneous Drug Product,  ~ 100 mg/mL Nominal  Fill  Volume:  2.0 mL Approved Manufacturers:  XBiotech Inc. Part  No.: ES018 Storage  Conditions:  Store upright,  protected from light Storage  Temperature:  2  - 8  C Standard  Container  Size(s ):  USP  Type  I  2 - mL vial US Retest Period: TBD EU  Expiry Period: TBD QC  Release Sample Requirements:  2 vials for QC  Analytical,  5 vials for  Extractable Volume,  Sterility see below. Reserve Requirements per QA036:  4  vials stored  upright,  protected  from  light, at  2  - 8 ƒ C Composition/Description/Use:  Bermekimab Drug Substance (produced  and purified from  1005C2 Lonza process)   formulated  with Formulation Buffer NP  (no  polysorbate), and filled  into  USP TYPE  I  borosilicate  serum vials, with  Daikyo   Flurotec - butyl rubber  stoppers  and flip - off  aluminum seals. Note:  Any  update  to  the  RElEASE  specification  will require updating the  Certificate  of  Analysis at  the end of this   document. RElEASE  Specification  for Bermekimab Subcutaneous Drug Product,  ~ 100 mg/ml Attribute Test Method/SOP Specification Sample Size Appearance Visual/QC077 Clear,  colorless  to  pale  yellow liquid  with   no  visible particles 100% pH pH meter/QC045 6.2 - 6.5 300  L Concentration UV Absorbance/QC020 100   5.0 mg/mL 500  L Osmolality Osmometer/QC089 ೦ 240 mOsmol/Kg 500  L Purity/   Molecular Distribution SEC - HPLC/QC022 Monomer%   97% 100  L Soluble Oligomers%   2% Fragments%   2% Charge Heterogeneity CEX - HP L C /   QC068 Retention  time  and distribution  of peaks   comparable  to  Reference Standard Purity SDS - CE (nr)/QC004 ೦ 95% 100 μL Purity SDS - CE (r)/QC004  (HC+LC)  ೦ 95% pI cIEF/QC006 pI  of  the major  isoforms   comparable  to  Reference Standard Identity ELISA/QC122 MABp1 antibody 100 μL Potency HUVEC/QC021 80 - 120% average  relative potency 100  L Binding Kinetics Octet/QC072 K D %  =  75 - 137%  relative  to  Reference Standard 100  L Extractable Volume USP <697>/EP 2.9.17   QC136 2.0  - 2.3  mL 5  vials Particulate Matter USP <787>/QC126 Particle Size  10  m  25  m 1  vial Particle Limit <  6000 < 600 Endotoxin USP <85>/EP 2.6.14 /QC001 <  0.4375 EU/mg 200  L Sterility USP <71>/EP 2.6.1 Direct No Growth TBD* *   100  vials:  pull  10% or  4 vials,  whichever  is greater.  For  batch sizes  101 - 500  vials pull 10 vials. Confidential Page 287  of 468

     

     

    

XBiotech Bermekimab I M PD Confidential lnformation: Outside distribution  must be  approved  by  Regulatory Affairs/Quality Assurance B i N o ext G e t nera t e ion Ant i c body  T h herapy SPECIFICATION Doc. No.:   Effective Date: DCR No.: ES018   09 / 0 6 / 1 8 18 - 187 Title: Bermekimab Subcutaneous Drug  Product, ~  100 mg/ml Revision: 6.0 Page 2 of 3 STABIlITY  and  RETEST*  Specifications  for  Bermekimab Subcutaneous  Drug  Product,  ~  100 mg/ml See Stability  Protocol  TP213  for details Attribute Test Method/SOP Specification Sample Size Appearance Visual/QC077 Clear,  colorless  to  pale yellow liquid, essentially  free   of particles 100% pH pH meter/QC045 6.2 - 6.5 300   L Concentration UV Absorbance/   QC020 100   5.0mg/mL 500   L Purity/   Molecular Distribution SEC - HPLC/QC022 Monomer%   95.0% 100   L Soluble Oligomers%   5.0% Fragments%   2.0% Charge Heterogeneity CEX - HP L C /   QC068 Retention  time and  distribution  of  peaks   comparable  to  Reference Standard Purity SDS - CE (r)/QC004  (HC+LC)  ೦ 95% 200   L pl clEF/QC006 pl  of  the  major  isoforms   comparable  to  Reference Standard Binding Kinetics Octet/QC072 K D %  =  75 - 137%  relative  to  Reference Standard 100   L Potency HUVEC/QC021 80 - 120% average  relative  potency 100   L Particulate Matter USP <787>/QC126 Particle Size  10  m  25  m 1  vial Particle Limit < 6000 < 600 Sterility Container - Closure   lntegrity/ TP012 No Growth  at test interval 100% USP <71>/EP 2.6.1 Direct EU Phar.  2.6.1 2  vials Confidential Page 288  of 468

     

     

    

Confidential Information: Outside distribution ust be approved by Regulatory Affairs/Quality Assurance B i N o ext G e t nera t e ion Ant i c body T h herapy SPECIFICATION Doc. No.:   Effective Date DCR No.: ES030   09/19/19 19 - 172 Title: Bermekimab Drug Substance Revision: 6.0 Page  1  of 3 Bermekimab Drug Substance Information Product:  Bermekimab Drug Substance Part No.:  ES030 Approved Manufacturers:  XBiotech USA, Inc. Standard Container:   HyQtainers/Mixtainers/LabTainers (RM - 0022, RM - 0027, RM - 0036) Lot Number:  Lot number of PS - 018 Storage Temperature:  2  – 8 oC Expiry Date:  12 Months Storage Conditions:  Store protected from light Composition/Description/Use:  Purified, nano - filtered, unformulated, Bermekimab antibody (Viral   Filtrate) Note:  Any update to  RELEASE specification will require updating  the  CofA  at  the end of this document. RELEASE Specifications  for  Bermekimab Drug Substance Attribute Test Method/SOP Specification Appearance Visual/QC077 Clear  and  colorless liquid,  may  contain small particles pH pH/QC045 6.2 - 6.5 Concentration UV Absorbance/   QC020 Report Result Purity/   Molecular Distribution SEC - HPLC/QC022 Monomer%   97.0% Dimer%   2.0% Fragments%   1.0% Charge Heterogeneity CEX - HPLC/QC068 Retention time  and  distribution  of peaks  comparable  to   Reference Standard Purity SDS - CE (nr)/QC004 ≥ 95% Purity SDS - CE (r)/QC004  (HC+LC)  ≥ 95% pI / Identity cIEF/QC006 pI of the  major isoforms   comparable with Reference Standard Carbohydrate profile CHO - CE/QC011 Comparable with Reference Standard:  the  major cleaved   glycan isoforms  are from  these species G0F, G1F, G1’F,   G2F; total fucosylated cleaved glycans% comparable with   Reference Standard Binding Kinetics  / Identity Octet/QC072 K D % = 75  - 137%  relative  to  Reference Standard Residual gDNA RT - PCR/QC046 < 6.7 pg/mg Residual Host Cell Protein Cygnus ELISA/   QC051 < 100 ppm Residual Protein A ELISA/   QC 07 4 / QC 14 3 < 100 ppm Endotoxin USP<84>/EP 2.6.14   QC001 <  0.4375 EU/mg Bioburden USP<61>/EP 2.6.12   QC012 < 1  CFU/10 mL* *  Refer  to  USP<61>  and EP  2.6.12 for interpretation  of  Bioburden results.

     

     

    

XBiotech Bermekimab I M PD P .5.1.2 ES050, Bermekimab Subcutaneous Drug  product   200mg/ml Confidential Information:  Outside distribution must be  approved  by  Regulatory Affairs/Quality Assurance Bi N o ext G e t nera t e ion Ant i c body  T h herapy SPECIFICATION Doc. No.:   Effective Date: DCR No.: ES050   09 / 0 6 / 1 8 18 - 187 Title: Bermekimab Subcutaneous Drug Product, ~ 200 mg/ml Revision: 2.0 Page 1  of 3 Bermekimab Subcutaneous  Drug  Product,  ~  200  mg/ml Information Product:  Bermekimab Subcutaneous Drug  Product,  ~  200 mg/mL Nominal  Fill  Volume:  2.0 mL Approved  Manufacturers:  XBiotech Inc. Part  No.: ES050 Storage  Conditions:  Store upright, protected  from light Storage Temperature:  2  - 8  C Standard Container  Size(s ):  USP Type  I  2 - mL vial US  Retest  Period:  TBD EU  Expiry  Period: TBD QC  Release  Sample Requirements:  2  vials for  QC  Analytical,  5  vials for Extractable Volume, Sterility  see below. Reserve Requirements  per  QA036:  4  vials stored upright, protected  from  light, at  2  - 8  ƒ C Composition/Description/Use:  Bermekimab  produced from  1005C2 Lonza  process, purified, formulated and filled  into USP   TYPE  I borosilicate  serum  vials,  with Daikyo Flurotec - butyl  rubber  stoppers and flip - off  aluminum seals. Note:  Any  update  to the  RElEASE  specification will  require updating  the  Certificate  of Analysis  at  the end  of this   document. RElEASE  Specification  for  Subcutaneous Bermekimab Drug  Product,  ~  200 mg/ml Attribute Test Method/SOP Specification Sample Size Appearance Visual/QC077 Clear,  colorless  to  pale  yellow  liquid,   essentially  free of particles 100% pH pH meter/QC045 6.2 - 6.5 300  L Concentration UV Absorbance/QC020 Report Results 300  L Osmolality Osmometer/QC089 ೦ 240 mOsmol/Kg 500  L Purity/   Molecular Distribution SEC - HPLC/QC022 Monomer%   97% 100  L Soluble  Oligomers%   2% Fragments%   2% Charge Heterogeneity CEX - HP L C /   QC068 Retention  time  and  distribution  of  peaks   comparable  to  Reference Standard Purity SDS - CE (nr)/QC004 ೦ 95% 100 μL SDS - CE (r)/QC004  (HC+LC)  ೦ 95% pI cIEF/QC006 pI from major isoforms   comparable  to  Reference Standard 100 μL Identity ELISA/QC122 MABp1 antibody 100 μL Potency HUVEC/QC021 80 - 120% average  relative potency 100  L Binding Kinetics Octet/QC072 K D % =  75 - 137%  relative  to  Reference Standard 100  L Extractable Volume USP  <697>/EP 2.9.17   QC136 2.0  - 2.3  mL 5 vials Particulate Matter USP <787>/QC126 Particle size  10  m  25  m 1 vial Particle Limit < 6000 < 600 Endotoxin USP  <85>/  EP 2.6.14 /QC001 <  0.4375 EU/mg 200  L Sterility USP  <71>/  EP 2.6.1 Direct No Growth TBD* *  For batch size   100  vials: pull  10%  or  4  vials,  whichever  is greater. For  batch size 101 - 500  vials, pull  10  vials. For batches   with  more  than 500  vials, pull  2% or  20  vials, whichever is less. Confidential Page 294  of 468

     

     

    

XBiotech Bermekimab I M PD Confidential  lnformation: Outside distribution must be  approved  by  Regulatory Affairs/Quality  Assurance Bi N o ext G e t nera t e ion Ant i c body  T h herapy SPECIFICATION Doc. No.:   Effective Date: DCR No.: ES050   09 / 0 6 / 1 8 18 - 187 Title: Bermekimab Subcutaneous Drug Product, ~ 200 mg/ml Revision: 2.0 Page 2  of 3 STABIlITY  and RETEST*  Specifications  for  Bermekimab Subcutaneous  Drug  Product,  ~  200 mg/ml See Stability  Protocol  TP213  for details Attribute Test Method/SOP Specification Sample Size Appearance Visual/QC077 Clear and colorless  to  pale yellow  liquid   essentially  free  of particles 100% pH pH meter/QC045 6.2 - 6.5 300  L Concentration UV Absorbance/QC020 Report Results 300  L Purity/   Molecular Distribution SEC - HPLC/QC022 Monomer%   95.0% 100  L Soluble Oligomers%   5.0% Fragments%   2.0% Charge Heterogeneity C E X - H P LC/   QC068 Retention  time  and distribution of peaks   comparable  to  Reference Standard Purity SDS - CE (r)/QC004  (HC+LC)  ೦ 95% 100   L pl clEF/QC006 pl  from  major isoforms   comparable  to  Reference Standard 100  L Binding Kinetics Octet/QC072 K D %  =  75 - 137% relative  to  Reference Standard 100  L Potency HU VE C /Q C021 80 - 120% average  relative  potency 100  L Particulate Matter USP <787>/QC126 Particle Size  10  m  25  m 1 vial Particle Limit < 6000 < 600 Sterility Con t aine r - Clo s u re   lntegrity/ TP012 No  Growth  at  test interval 100% USP <71>/EP 2.6.1 Direct 2 vials Confidential Page 295  of 468

     

     

    

Exhibit  C  - 1 [[5252615]] E xhibit C Compliance  with Laws 1. SUPPLIER acknowledges that Company aims to perform its activities, and to have other parties (such as SUPPLIER) with which it enters into business arrangements to perform their activities under such arrangements, in accordance with the highest ethical standards and best industry practices, including any voluntary codes of practice applicable in the industry . SUPPLIER agree to use reasonable efforts to help ensure that it does not fail to meet such aim with respect to activities hereunder through any violation of the U . S . Foreign Corrupt Practices Act (the “ FCPA ”), the U . S . False Claims Act (the “ FCA ”), the U . S . Anti - Kickback Law (the “ AKA ”), the United Kingdom Bribery Act (the “ UKBA ”), or any laws or regulations regarding governmental research grants (e . g . , rules governing grants from the National Institutes of Health, or other governmental agencies) . 2. SUPPLIER shall comply with all laws and regulations concerning its efforts in any country or jurisdiction where it is providing work hereunder or otherwise applying to any of its activities under this Agreement . SUPPLIER shall use reasonable efforts to ensure that its personnel performing hereunder become reasonably familiar with the FCPA, the FCA, the UKBA and the AKA, and their prohibitions and purposes, and that they will not undertake any actions that would violate the FCPA, the FCA, the UKBA and the AKA . Accordingly, SUPPLIER hereby warrants that : ( i) ( ii) ( iii) ( iv) neither it nor its agents or employees whose duties pertain to this Agreement are excluded from a federal health care program as outlined in Sections 1128 and 1156 of the Social Security Act (see the Office of Inspector General of the Department of Health and Human Services List of Excluded Individuals / Entities at http : //oig . hhs . gov/exclusions/exclusions_list . asp) ; neither  it  nor  its  agents  or  employees whose  duties pertain  to  this Agreement  are   debarred  by  the FDA under  21  U.S.C.  335a  (see the FDA Office  of  Regulatory   Affairs  Debarment List  at  http://www.fda.gov/ICECI/EnforcementActions/FDADebarmentList/default.htm); neither it, nor its agents or employees are otherwise excluded from contracting with the federal government (see the System for Award Management at https : //www . sam . gov/portal/SAM/# 1 ) ; it, or its agents or employees, if required, are duly licensed and in good standing in accordance with applicable U . S . , state or other applicable governmental licensing requirements ; (v) no payment or offer to pay, or the giving or offering to give, anything of value to an official or employee of any government or any department, agency or instrumentality thereof (including any health or medical providers owned or controlled by the government), or to any political party or any candidate for political office, shall be made with the purpose of influencing any decisions favorable to SUPPLIER or its Affiliates and the business resulting therefrom in

     

     

    

Exhibit  C  - 2 [[5252615]] ( vi) ( vii) contravention of the FCPA or the laws of the country in which it is providing work ; it has not paid, nor offered or agreed to pay, nor caused to be paid, directly or indirectly, any political contributions, fees or commissions to any governmental employee or representative (including any employee of any health or medical provider owned or controlled by the government) that would appear to cause a violation of the FCPA ; it will not directly or indirectly offer, pay, promise to pay, or authorize the giving of money or anything of value to any governmental official or representative, to any political party or official thereof, or to any candidate for political office, or to any other person, for the purpose of : a. inappropriately influencing any act or decisions of such person, official, political party, party official, or candidate in, if applicable, its official capacity, including a decision to fail to perform official functions ; or b. inducing such person, official, political party, party official, or candidate to use influence with the government, any instrumentality thereof, or any other entity to affect or influence any act or decision of such government or instrumentality, or entity, in order to assist SUPPLIER in obtaining or retaining business for or with, or directing business to, any Affiliate or Third Party . SUPPLIER further agrees that if subsequent developments cause the certifications and information reported herein to be no longer accurate or complete, it will immediately so advise Company in writing . 1 . 3 In the event of a claim or investigation, or an official request for Company to cooperate with respect to any such claim or investigation, by a Regulatory Authority or other legal authority having jurisdiction over either Party, of an alleged violation of the FCPA arising from any activities conducted by the SUPPLIER relating specifically to this Agreement or to the Clinical Products, SUPPLIER shall reasonably provide such Regulatory Authority or other legal authority having jurisdiction with access to SUPPLIER’s facilities, records (financial and otherwise), and supporting documentation, as reasonably requested by Company or its agents in order to cooperate in connection with such claim or investigation . 1 . 4 During the Term, SUPPLIER shall maintain true, accurate and complete books and records, including those : (i) documenting its interactions with any government or its officials or employees relating to its activities in connection with any Clinical Product ; (ii) payments made to any officials or employees of any government or any department, agency or instrumentality thereof ; and (iii) political contributions . SUPPLIER shall also maintain a reasonable system of internal accounting controls sufficient to satisfy the FCPA . 1 . 5 SUPPLIER acknowledges and  agrees that  any breach  of  its  obligations under  this   Exhibit  C shall  be a  basis for  notification  of  a  material breach  of  this Agreement.

     

     

    

 Exhibit  C  - 3 [[5252615]] 1 . 6 Notwithstanding anything to the contrary in this Agreement, a Party may disclose its terms and conditions (including any financial terms) to any governmental authorities in the U . S . or those in a country where it performs activities in connection with any Clinical Product that such Party determines in good faith has a legitimate need for access to such information for purposes of investigating or determining either Party’s compliance with applicable Law . 1 . 7 The Parties acknowledge that certain laws, now or in the future, may require pharmaceutical, medical device and other companies to disclose information on compensation, gifts or other remuneration provided to physicians, institutions, and other health care professionals . Either Party may report information about remuneration provided under this Agreement . Once reported, such information may be publicly accessible .

     

     

    

Exhibit D [[5252615]] E xhibit D Policy  on  Employment  of  Young  People   J&J  Policy  on the  Employment  of  Young Persons This policy applies  to  the  employment  of  persons  under  the age  of  18  ("young  persons")  in  the   manufacture  of  any  product, or  any component  of  a  product,  by  or  for Company  or  any  of  its   Affiliates worldwide.  Age, Health  &  Safety  – No  person  under  the age  of  16  shall  be  employed.  No  person   between  the ages  of  16  and  18  shall  be  employed  unless  such  employment  is  in   compliance  with  the  health,  safety  and  morals  provisions  of  the International  Labour   Organization Convention  138  Concerning  Minimum  Age ("ILO Convention 138"),  a   summary  of  which  is  attached hereto.  Hours  – No  young  person  shall  be  required  to  work more  than  48  hours  of  regularly   scheduled  time  and  12  hours  of  overtime per week nor  more  than six days per week.  Laws  &  Regulations  – No young  person shall  be  employed  unless such  employment  is   in  compliance with  all  applicable laws  and  regulations  concerning age, hours,   compensation, health  and safety.  External Manufacturers  – No manufacturer  shall  be  engaged  to  manufacture any   product,  or  any component  of  a  product,  for  Company  or  any  of  its  Affiliates worldwide   unless  such  manufacturer  has  entered  into  an enforceable  written  agreement  to  comply   with  this  policy,  submit  to  periodic  compliance inspections,  and  maintain  the  records   necessary  to  demonstrate  compliance.  If  any  such  manufacturer  shall be found  to  be in   breach  of  such  agreement, the  manufacturer's  engagement  shall  be terminated.

     

     

    

Exhibit E [[5252615]] E xhibit E Johnson  &  Johnson  Policy  for Wood Pallets This clause applies to all products and/or materials shipped to Company or its affiliates or authorized locations on wood pallets . Wood pallets must be constructed from lumber sourced from countries that prohibit the treatment of wood with any form of halophenol based chemicals (including but not limited to 2 , 4 , 6 trichlorophenol, 2 , 4 , 6 tribromophenol, any of the tetrachlorophenols, any of the tetrabromophenols and pentachlorophenol) . Wood pallets used must have been heat treated only in accordance with the Heat Treatment standards set forth in International Standards for Phytosanitary Measures Publication No . 15 , 2009 Revision (ISPM 15 ) . Additionally, the sourced lumber or finished pallets shall not be shipped or stored with pallets or materials that may contain the chemicals mentioned above . While ISPM 15 currently provides for the use of Methyl Bromide (MB), the use of pallets fumigated with Methyl Bromide is also prohibited . All wood pallets must be labeled with the HT stamp in accordance with ISPM 15 Annex II . This requirement is effective immediately . Failure to meet the above requirements of this paragraph may lead to rejection of shipments at SUPPLIER’s expense .

     

     

    

Exhibit F [[5252615]] E xhibit F Company Records  and  Information Requirements 1 . 1 Company’s Records and Information . All records and information, in any format, that SUPPLIER receives from, creates, or edits on behalf of Company or Company’s Affiliates will be referred to herein as “ Company Records and Information ” . For the avoidance of doubt, Company Records and Information does not include records and information created by SUPPLIER as part of SUPPLIER’S business processes (e . g . , invoices, internal reports, etc . ) . (a) SUPPLIER shall maintain, manage and protect Company Records and Information pursuant to this Agreement and any applicable Purchase Orders (i) in accordance with Company’s records retention policies and (ii) in accordance with all applicable statutes and regulations . (b) SUPPLIER shall not transfer Company Records and Information to any other entity unless directed by Company . For avoidance of doubt, this means no SUPPLIER employee or contractor may take Company Records and Information with them upon leaving SUPPLIER . (c) SUPPLIER shall maintain and manage Company Records and Information such that Company Records and Information is not commingled with records and information generated, managed or maintained by SUPPLIER under agreements with other customers . (d) SUPPLIER shall retain electronic backups of Company Records and Information (i) for disaster recovery purposes only and (ii) for no longer than 120 days from the creation date . 2. Preservation and Production . SUPPLIER shall comply promptly and fully with any request from Company to preserve Company Records and Information (or parts thereof) . SUPPLIER shall deliver promptly Company Records and Information requested to be searched, retrieved and produced, all as part of the services SUPPLIER provides under this Agreement in accordance with Section 1 . 8 of this Exhibit F . 3. Third Party Requests . Within 48 hours of SUPPLIER receiving from anyone other than Company a request, demand, notice, subpoena, order or other legal request (a “ Third - Party Request ”) for Company Records and Information, SUPPLIER shall notify Company and provide Company with a copy of the Third - Party Request (unless legally prohibited) . SUPPLIER shall confer with Company to identify, document and implement procedures to comply with the request . SUPPLIER shall take all reasonable steps to protect Company’s legal rights when responding to a Third - Party Request . 4. Training . All employees and contractors of SUPPLIER with access to the Johnson & Johnson Enterprise Network (JJNET) shall annually complete Records and Information Management training as specified by Company .

     

     

    

Exhibit F [[5252615]] 5. Destruction . SUPPLIER shall not destroy any Company Records and Information without first having received Company’s written confirmation that the Company Records and Information is not subject to any pending preservation obligation or retention requirement . 6. Transfer . When a transfer of Company Records and Information from SUPPLIER is required, SUPPLIER shall (i) transfer Company Records and Information to Company or an entity specified by Company in accordance with Section 1 . 8 of this Exhibit F , (ii) take no action on Company Records and Information until written notification from Company confirming accurate and complete transfer is received, and (iii) if directed by Company to permanently delete transferred Company Records and Information, SUPPLIER shall certify in writing that Company Records and Information has been permanently deleted as specified by Company . 7. Termination . Upon termination of this Agreement and at Company’s direction, SUPPLIER shall (i) transfer Company Records and Information to Company or an entity specified by Company in accordance with Section 1 . 6 of this Exhibit F or (ii) obtain Company’s written approval to destroy Company Records and Information in accordance with Section 1 . 5 of this Exhibit F and (iii) upon completion of the steps directed by Company, certify in writing that SUPPLIER has permanently deleted all Company Records and Information as specified by Company . 8. Format of Company Records and Information . As part of the services SUPPLIER provides under this Agreement, SUPPLIER will meet with Company as reasonably requested to identify, document and implement procedures to deliver to Company or an entity specified by Company, Company Records and Information in the format directed by Company . To meet Company’s records retention and other legal preservation obligations, Company may require SUPPLIER to provide Company Records and Information in a structured format maintaining the relationships that exist in the database underlying SUPPLIER’S application .

     

     

    

Exhibit G [[5252615]] E xhibit G New Formulations New  formulations  are requested to  change  the bermekimab concentrations  to 150  mg/mL  and   175  mg/mL.  The  new formulations  may be  filled  in  either  vials  or  pre - filled syringes. There  are   no  changes  requested to  the excipients. Specifications  for  the  new  formulations  should meet  all   specifications as  listed  in  Exhibit  B,  and  adjusted  for  the concentration as appropriate.

     

     

    

Exhibit H [[5252615]] E xhibit H Transition Matters R egulatory  All  Health  Authority  interactions  and correspondence,  IND  and  IMPD. Health   Authorities  GMP  inspection documentation,  if available C ell Line  Reports  detailing  the  history  of  the  host  CHO  cell line,  creation  of  the plasmid DNA   construct,  generation  of  the  manufacturing  cell  line, steps  taken to  assure  monoclonality,   MCB/WCB testing  and  results, and any genetic characterization studies performed  An aliquot  of  the  plasmid  DNA  used at transfection and the  full  nucleotide sequence  of   the  plasmid  DNA  (gb file) D rug Substance  For each  unit operation:  Summary  of  purpose  for each  unit operation  Evidence  of performance o Impact  on  quality attributes o Yield (and volumes  and concentration used  to  calculate yields) o Titer o Chromatograms  (for  purification  unit operations) including: ▪ OD ▪ pH ▪ conductivity ▪ pressure drop o UF/DF profile ▪ Pressure  profile  (inlet,  outlet, TMP) ▪ Flow  rate  profile  (feed, cross - flow) ▪ Conductivity, pH  Risk assessment  of  known and plausible  failure modes:  Potential  for failure  to  achieve  purpose  of  the  unit operation  Potential  for failure resulting  in  negative impact  on  drug  substance/  drug  product   quality  or stability  Intermediate  hold  times  and  supporting data  Drug  substance  stability data  Virus clearance and inactivation data  Limit  of  in  vitro  cell  age information  Details  of  how  LIVCA  was performed  Genetic stability  Virus  load  (virus - like particle)  Samples  of  process  intermediates,  drug  substance  and  drug  product from  across  clinical   manufacturing history D rug Product

     

     

    

 Exhibit H [[5252615]]  Retains  of  samples  of  filled  syringes and  vials  at all concentrations  Formulation development reports  Process development reports  Manufacturing  flow  diagrams and equipment used  for  each  unit operation.  Unit  operation  process  parameters  and targets  Risk assessments  Stability  data  from  GMP  and  non - GMP fills.  Table  of  GMP  lots  with  genealogy table identifying  lot  no and  corresponding clinical   trials that the DP was used for, date  of  manufacturing, scale  of manufacturing. Drug Delivery  Syringe selection rational and syringe evaluation and performance data  Syringe  F/F process  Viscosity and  glide  force  data  for formulations  used  in  the  development  and in  clinical   trials during the  PFS  stability;  Viscosity  vs  temperature  if  such  data exist  Any feasibility  report  on  drug  delivery and injection device A nalytical  All methods SOPs,  validation  reports  and  any development reports  for release  in  process   and  characterization methods  All critical  reagents  for  methods o Inventory  of  these critical reagents o Qualification reports/protocols  for  critical reagents  Reference standards (current  and  any  past ref std.)  with clear inventory  of  material and   clear  history  of  the reference standard program including qualification protocols and   reports o The  complete  history  of  the reference standard  to  link  potency from  the beginning   of  the  program to  the current  ref std.  Inventory and access  to  sample  retains DS and DP  both T=0  and  stability samples o Samples  as  requested to  cover  method bridging  and  comparability (amounts  of   each  sample TBD).  Inventory and access  to  in  process  sample retains  Method  bridging support o Perform  testing  of  appropriate DS  and  DP  batches using  Phase  2 methods  Regulatory filings  Characterization  reports  for  Elucidation  of structure  Reports  on CQAs  Reports  on  extinction coefficient (theoretical and experimental)  Stability protocols,  reports  and results  Per  Janssen  guidance, continuation  of  ongoing  stability plans  or  closing  out  or  bridge   studies execution  Specification documents  Agency  feedback  on  analytical methods  to  understand  any  outstanding commitments  Batch history  tables  to  understand what batches  were  used  from  GLP  Tox  to  current   clinical trials

     

     

    

Exhibit H [[5252615]] o Results
for all batches and clear understanding of what methods were used to generate these results  History of comparability
studies with data/reports O ther  List of raw materials o CoA of raw materials o Testing strategy of raw materialsExhibit 10.15

 

[[5258968]] TRANSITION  SERVICES AGREEMENT BY  AND BETWEEN JANSSEN RESEARCH  &  DEVELOPMENT,  LLC   AND XBIOTECH  USA,  INC.   DATED  AS  OF DECEMBER  30, 2019

     

     

    

[[5258968]] ARTICLE I DEFINITIONS...................................................................................... 1 Section 1.1. D efinitions .............................................................................. 1   Section 1.2. G lossary  of  Defined  Terms ..................................................... 2 ARTICLE II SERVICES............................................................................................ 2 Section 2.1. S ervices .................................................................................. 2 Section 2.2. P erformance  of  Services .......................................................... 2 Section 2.3. U se  of  Services ....................................................................... 3 Section 2.4. T ransitional  Nature  of  Services ............................................... 3 Section 2.5. U se  of  Third  Parties  to  Provide  Services ................................. 3 ARTICLE III OTHER  ARRANGEMENTS  ................................................................ 4 Section 3.1. A ccess .................................................................................... 4 Section 3.2. S eller Manager  and  Buyer Manager ........................................ 4 ARTICLE IV FEES; TAXES; BOOKS  AND  RECORDS  ...........................................  4   Section 4.1. F ees  for  Services ..................................................................... 4 Section 4.2. I nvoices .................................................................................. 5 Section 4.3. T axes ...................................................................................... 5 Section 4.4. N o Set - Off .............................................................................. 5 Section 4.5. B ooks  and  Records;  Audit  Rights ............................................ 5 ARTICLE V TERM  AND  TERMINATION .............................................................. 6   Section 5.1. T erm ....................................................................................... 6 Section 5.2. T ermination ............................................................................ 6 Section 5.3. E ffect  of  Termination .............................................................. 6 - i -

     

     

    

[[5258968]] ARTICLE VI CONFIDENTIALITY ........................................................................... 7 Section 6.1. C onfidentiality ........................................................................ 7 ARTICLE VII DISPUTE   RESOLUTION..................................................................... 7 Section 7.1. D ispute  Resolution; Generally ................................................. 7   Section 7.2. M ediation ................................................................................ 7 Section 7.3. A rbitration .............................................................................. 8 ARTICLE  VIII  INDEMNIFICATION; NO WARRANTY; SPECIFIC  PERFORMANCE  ......................................................................................................... 10 Section 8.1. I ncorporation  of  Purchase  Agreement Indemnification P rovisions ............................................................................. 10 Section 8.2. N O  WARRANTY ................................................................. 10 Section 8.3. S pecific Performance ............................................................ 10 ARTICLE IX MISCELLANEOUS............................................................................ 10 Section 9.1. L icense  to  Intellectual  Property ............................................. 10   Section 9.2. N otices .................................................................................. 11 Section 9.3. G overning  Law ..................................................................... 11 Section 9.4. A ssignment ........................................................................... 11 Section 9.5. R elationship  of  the  Parties ..................................................... 11 Section 9.6. F orce Majeure ....................................................................... 11 Section 9.7. S everability ........................................................................... 12 Section 9.8. W aiver and Non - Exclusion  of  Remedies ...............................  12   Section 9.9. F urther  Assurances ................................................................ 12 Section 9.10. H eadings ............................................................................... 12 Section 9.11. C onstruction ......................................................................... 12 Section 9.12. C ounterparts ......................................................................... 13 - ii -

     

     

    

[[5258968]] - iii - Section 9.13. E ntire  Agreement; Amendments ........................................... 13

     

     

    

 [[5258968]] - iv - E XHIBITS EXHIBIT A  – Services EXHIBIT B  – Seller  Manager  and  Buyer Manager

     

     

    

This TRANSITION  SERVICES  AGREEMENT  (this  “ A greement ”),  dated as  of   December  30,  2019,  is  by  and between  Janssen Research &  Development,  LLC,  a  New Jersey   limited liability  company (“JRD”),  and  XBiotech  USA,  Inc.,  a  Delaware  corporation (“Service P rovider ”).  JRD  and  Service Provider  are  sometimes individually  referred to  herein  as  a  “Party”   and  are  sometimes collectively  referred to  herein  as  the “Parties”. R E C I T A L S: WHEREAS,  on  December  7,  2019,  Janssen  Biotech, Inc.,  a  Pennsylvania   corporation (“Buyer”),  and  XBiotech Inc.,  a  corporation existing  under  the  laws  of  the Province   of  British Columbia (“Seller”), entered  into  that certain  Asset Purchase Agreement (the   “Purchase Agreement”),  pursuant  to  which,  among  other  things, Seller  agreed  to  sell,  and Buyer   agreed  to  purchase,  all  of  Seller’s and  its  Affiliates’ right,  title  and interest  in,  to  and  under  the   Purchased  Assets, upon the  terms  and  subject  to  the  conditions set  forth  therein; and WHEREAS,  following  the Closing, Service Provider  desires  to  provide  or  make   available  certain  Services  (as  defined below)  to  JRD  and  its Affiliates. NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this Agreement and the Purchase Agreement, the Parties hereby agree as follows : ARTICLE I D EFINITIONS Section 1.1. D efinitions .  Capitalized  terms  used  and  not defined  in  this  Agreement   have  the  meanings assigned  to them  in  the Purchase Agreement.  In  addition, for  the purpose  of   this  Agreement, the  following  terms shall  have  the meanings  set  forth below. “Force  Majeure  Event”  means  any  event beyond  the  reasonable  control  of  the   affected  Party,  which may include embargoes; war  or  acts  of  war,  including  terrorism;   insurrections,  riots,  or  civil  unrest;  strikes,  lockouts  or  other  labor  disturbances; epidemics,  fire,   floods, earthquakes  or  other  acts  of  nature;  acts,  omissions  or  delays in  acting  by  any   Governmental Authority (other than delays incident  to  the ordinary  course  of  drug  development);   and failure  of  plant  or machinery. “Service  Period”  means,  with respect  to  any  Service,  the period  commencing  on   the  Closing  Date  and  ending  at the  close  of  business  on  the earlier  of  (i)  the  date  on  which  such   Service  is  terminated  in  accordance with  S ection  5.2 and (ii)  the  date  on  which  all  of  the   Specified Clinical Trials shall  have  been  completed  (including  any  Services  which,  by  their   nature,  are  completed  following  any Specified Clinical Trials). “Specified Clinical  Trials”  means  the  (i)  Phase  2(b)  clinical  trials  for  the   Compound  with  respect  to  the treatment  of  atopic dermatitis and hidradenitis suppurativa and  (ii)   the  investigator - initiated  studies for  the  Compound with  respect  to  the treatment  of  systemic   sclerosis and pancreatic cancer,  in  each  of  cases  (i)  and  (ii),  that  are  ongoing  as  of  the  date   hereof. [[5258968]]

     

     

    

Section 1.2. G lossary  of  Defined  Terms .  The following  terms  have  the meanings  set   forth  in  the  Sections set  forth below: D efinition  “ A g r e e m e n t ”   “Buyer” “Buyer Manager” “CPR Mediation Procedure”   “CPR  Rules” “ D i s pu t e ”   “Fees” “JRD” “Party”  or  “Parties”   “Pass - Through Costs”   “Protocol” “Purchase Agreement”   “Seller” “Seller  Manager”   “Service Provider” “ S e r v i c e s ”   “Term” S ection  P r e a m b l e   Recitals   3.3(b) 7.2(a) 7.3(a) 7.1 4.1 P r e a m b l e P r e a m b l e 4 . 1 7.3(h) R e c i t a l s R e c i t a l s 3 . 3 (a) P r e a m b l e   2.1 5.1 ARTICLE II S ERVICES Section 2.1. S ervices . Commencing  on  the  Closing  Date  and  for  the remainder  of  the   applicable Service Period,  Service  Provider shall provide,  or  shall  cause one  or  more  of  its   Affiliates  to  provide,  to  JRD  and  its  Affiliates, the services described  on  E xhibit  A (the   “Services”).  If,  during  the  Term, JRD identifies  any  service that  is  not  a  Service,  which was   provided  by  Service Provider  or  any  of  its  Affiliates  to  the Business during the  Reference  Period   and  which  JRD  determines  in  good  faith  it  needs  to  continue  to  operate the  Business,  then  JRD   may request that  Service  Provider provide  such  service,  and  Service Provider  and  JRD  shall   negotiate  in  good  faith  to  determine  whether Service  Provider  will provide  such  service. Upon   mutual  agreement  of  the  Parties,  such service  will  be  added  to  E xhibit A , and  will thereafter  be   considered  a  “Service” hereunder. Section 2.2. P erformance  of Services . (a) Service Provider  shall  perform,  or  caused  to  be  performed, all Services  in   a  manner  that  is  substantially similar  in  nature,  frequency and quality  to  the analogous services   provided during the  Reference  Period  by  Service Provider  and  its  Affiliates  to  the  Business.   Service Provider  shall  perform  its  duties  and  responsibilities  hereunder  in  good  faith  and in   compliance  with  applicable  Law  and,  in  the provision  of  the  Services,  shall comply  with  all   applicable clinical trial agreements with respect  to  the  Specified  Clinical Trials  and  shall  not   deviate  from  any  of  the clinical trial protocols applicable  to  the Specified Clinical Trials  or  make   any material changes  to,  or  material determinations with respect  to,  the conduct  of  the Specified - 2 - [[5258968]]

     

     

    

- 3 - [[5258968]] Clinical Trials (including  with  respect  to  study design,  budget  or  headcount),  in  each  case   without  the  consent  of JRD. (b) Each  of  Service Provider and  JRD  agrees  to  cooperate  and  use  commercially  reasonable  efforts to  obtain  any  necessary  third - party  consents required  for  the  provision  of  any  Services  hereunder.  If,  with respect  to a  Service,  Service Provider  and  JRD,   despite  the  use  of  their  respective commercially reasonable efforts,  are  unable  to  obtain  a   required  consent  or  the performance  of  such  Service  by  Service Provider  or  its  Affiliates  would   constitute a  violation  of  applicable Laws, Service Provider  shall  in  good  faith  use  its   commercially  reasonable  efforts to  devise  an alternative arrangement  for  the provision  of  such   Services  (which  may  include, subject  to  JRD’s  consent,  retaining  any  Contract  that  would have   otherwise been assigned  or  transferred  to  Buyer  as an  Assumed  Contract  until  the expiration  or   termination  of  the applicable Service Period). (c) Each  Party  shall  be  responsible  for its  own  compliance  with  any  and  all   Laws  applicable  to  its performance  under  this  Agreement.  No  Party  shall take  any  action  in   violation  of  any  such  applicable  Law  that  results  in  Liability  being imposed  on  the other Party. (d) JRD  agrees  to  cooperate  in  good  faith  with  Service  Provider  to  facilitate   the  performance  of  the Services  by  Service Provider.  In  furtherance  of  the  foregoing, JRD   agrees  that Service Provider  shall not  be  deemed  to  be in  breach  of  its  obligations  hereunder  to  the  extent  a  failure  to  perform  such  obligations  is  caused  by  any  failure  or  delay  of  JRD  or  its   Affiliates  to  satisfy its  obligations  under  this  Agreement.  Neither  Service Provider nor any  of  its   Affiliates shall  be  liable for  any  action  or  inaction  to  the  extent  taken  or  omitted  to  be  taken by  it   pursuant  to  the  instructions  received from  JRD  or  its Affiliates. Section 2.3. U se  of  Services .  Service  Provider shall  be  required  to  provide  the   Services  only  to  JRD  and  its Affiliates  and only  in  connection  with  the conduct  by  JRD  and  its   Affiliates  of  the Business. Section 2.4. T ransitional  Nature  of  Services .  Each  of  Service Provider  and  JRD   acknowledges the transitional nature  of  the Services,  and  Service Provider agrees  to  cooperate  in   good  faith  with  JRD  and  to  use commercially reasonable  efforts to  effectuate  a smooth  transition   of  the  Services  from  Service Provider  to  JRD (or its designee). Section 2.5. U se  of  Third  Parties  to  Provide  Services . Service Provider  may  perform   its  obligations  to  provide  a  Service  through  agents, subcontractors,  independent  contractors  or   other  Third  Parties;  p rovided ,  h owever , that  (a)  the delegation  of  performance  of  the applicable   Service  does  not impact  the nature, frequency  or  quality  of  such  Service  and  (b)  any  increased   costs  resulting  from such delegation  shall  be  borne  by  Service Provider.  Nothing  in  this  S ection  2 .5 shall  relieve Service Provider  of  its  obligations  under this  Agreement  by  use  of  such  agents,   subcontractors  or  independent  contractors  and  a  breach  of  this Agreement  by  any  such  agents,   subcontractors,  independent  contractors  or  other  Third  Parties shall  be  deemed  to  constitute  a   breach  of  this  Agreement  by  Service Provider.

     

     

    

ARTICLE III O THER  ARRANGEMENTS Section 3.1. A ccess .  If, in  the  course  of  its  performance  of  the Services hereunder, any   of  Service Provider  or  its  Affiliates  or  any  of  their  respective Representatives  is  granted by JRD   or  any  of  its  Affiliates access  to  JRD’s  or  its  Affiliates’  locations,  systems  and  information,   Service Provider agrees  to  comply,  and cause  its  Affiliates  to  comply, in  all  material  respects   with JRD’s  or  its  Affiliates’ reasonable policies  and  to  permit  its  personnel  to  be  appropriately   supervised  or  accompanied  during  such  access  as  reasonably required  by JRD. Section 3.2. S eller Manager  and  Buyer Manager . (a) During the  Term,  Service Provider shall  designate  one  employee,  who   initially  shall  be  the individual identified  on  E xhibit B , as the individual who  shall  have overall   responsibility  for managing  and  coordinating, as applicable, the provision  of  the Services  (the   “Seller  Manager”)  and  who  shall  coordinate  and  consult  with the Buyer  Manager  with  regard to   the  Services.  Service Provider  may,  from  time to  time  at  its  reasonable discretion and  upon   written notice  to  JRD,  designate other  individuals  to  serve  in  the  capacity  of  the  Seller Manager. (b) During the  Term, JRD  shall  designate one  employee,  who  initially  shall  be   the  individual  identified  on  E xhibit  B , as the individual who  shall  have  overall responsibility  for   managing  and coordinating, as applicable, the receipt  of  the Services  (the  “ B uyer Manager ”)  and   who  shall coordinate  and  consult  with the  Seller  Manager with  regard to  the  Services. JRD  may,   from  time  to  time  at  its  reasonable discretion and  upon  written notice  to  Service Provider,   designate other  individuals  to  serve  in  the  capacity  of  the Buyer Manager. (c) The Seller Manager and the Buyer Manager shall serve as the respective primary points of contact for Service Provider, JRD and each of their respective Affiliates with respect to the subject matter of this Agreement . ARTICLE IV F EES;  TAXES; BOOKS  AND RECORDS Section 4.1. F ees  for Services .  In  consideration  for  all  of  the Services  to  be  provided   hereunder,  for  each calendar  quarter  during  the  Term,  JRD  shall  pay  Service Provider  a  fee for   such quarter  equal  to  all  Pass - Through Costs (as  defined  below)  incurred  by  Service Provider   during  such  calendar  quarter,  p lus a  markup  of  30%  (collectively,  the  “ F ees ”).  For purposes  of   this  Agreement, “Pass - Through  Costs”  shall  mean  those  reasonable  documented  amounts  and   fees  paid  to  study  sites  and  related  providers  of  the  Specified  Clinical Trials  for  the conduct  of   such  trials during the applicable Service Periods, together  with  such  expenses reimbursed  to  such   sites and vendors,  in  each  case  under  the applicable clinical  trial  or  services  agreements  to  the   extent  related  to  the  conduct  of  such  trials during  the  applicable Service  Periods.  For the   avoidance  of  doubt,  Pass - Through Costs  shall  not  include  any  internal  costs  or  expenses  of   Service Provider  or  its Affiliates. - 4 - [[5258968]]

     

     

    

- 5 - [[5258968]] Section 4.2. I nvoices . Invoices  with  respect  to  each  calendar  quarter  (or  partial   calendar quarter), together  with  reasonably  detailed  supporting  documentation therefor,  shall be   provided  to  JRD within  thirty  (30)  days  following  the  last  day  of  such  calendar  quarter  (or,  if   earlier,  the  expiration  of  the Term).  Payment  terms  will  be net  thirty  (30)  days  after  JRD’s  receipt  of  an  undisputed  invoice  from  Service  Provider;  p rovided ,  h owever , the  actual  payment   to  Service  Provider  from  JRD  or  its designee  will  not  be made  until  the  next  scheduled  payment   run  as  set  forth at  www.ap.jnj.com. JRD  may  contest any  invoice  or  portion  thereof  if  it   reasonably  believes that the  charges  reflected therein  are  inappropriate  or  questionable. Once  the   matter  is  resolved, JRD  shall  pay  the  appropriate  charges.  Service Provider shall continue  to  perform  its  obligations under  this Agreement  during such  dispute. If  an  invoice  is  disputed  in   part,  Service  Provider  may  issue  a  new  invoice  in  compliance  with  this  S ection  4.2 reflecting   solely  the  undisputed  charges,  and  any  such  invoice shall  be  payable within  thirty  (30)  days  after   receipt  thereof;  p rovided ,  h owever ,  the  actual  payment  to  Service  Provider from  JRD  or  its   designee will  not  be made  until the  next  scheduled  payment  run  as  set  forth at  www.ap.jnj.com. Section 4.3. T axes . JRD  shall bear any sales, use,  value - added  and  similar  Taxes   imposed  by  any  Taxing Authority  attributable  to  the  Services provided hereunder. Notwithstanding anything  in  this  Agreement  to  the  contrary, JRD  and  its  Affiliates shall  be   entitled  to  deduct  and  withhold  from  any amount  payable  pursuant  to  this Agreement such amounts as  JRD  believes  in  good  faith  are  required  to  be  deducted  and  withheld  with  respect  to   the  making  of  such  payment  under any  provision of  federal,  state  or  local  (in each  case, whether domestic  or  foreign)  Tax Law.  To  the  extent  that  amounts  are  deducted  and  withheld  and  paid   over  to the  appropriate  Taxing Authority,  such amounts  shall be  treated  for all  purposes  of this Agreement  as  having  been  paid  to  the  Person  in  respect  of  which  such  deduction and   withholding was made. Section 4.4. N o  Set - Off .  Except as mutually agreed  to  in  writing  by  Service Provider   and  JRD,  no  Party  or  any  of  its  Affiliates  shall  have any right  of  set  off  or  other  similar  rights   with respect  to (a)  any  amounts  invoiced  or  paid  pursuant  to  this Agreement  or  (b)  any  other   amounts  claimed  to  be  owed to  the other  Party  or  any  of  its  Affiliates arising out  of  this   Agreement. Section 4.5. B ooks  and  Records;  Audit  Rights .  Service Provider  and  its  Affiliates shall   keep complete  and  accurate  records  relating  to  the Services provided  hereunder  and the related   Fees. JRD  shall  have  the  right,  not more  frequently  than  once  a  year,  at  its  own  expense,  to  have   an independent,  certified  public accountant selected  by JRD  and reasonably acceptable  to   Service  Provider,  review  any  such records  of  Service  Provider  and  its  Affiliates  upon  thirty (30)   days  prior  written  notice  and during regular business hours  and  under obligation  of  confidence   and  subject  in  all cases  to  any confidentiality obligations Service Provider  and  its  Affiliates  have   to  Third Parties, for  the  sole  purpose  of  verifying  the  Fees  related to  Services performed  by  or on   behalf  of  Service Provider and  its  Affiliates  under this  Agreement.  The  report  of  the  independent   public accountant  shall  be  shared with Service Provider at  least  fifteen  (15)  days  prior to   distribution  of  the  final  report to  JRD,  such that Service Provider can provide the  independent   public accountant  with justifying  remarks  for inclusion  in  the  report  prior  to  sharing  the   conclusions  of  such  independent public audit  with  JRD. The final audit  report  will be  shared  with   Service Provider  and  JRD  at the  same  time  and specify  whether  the  Fees  paid  to  Service  Provider   were consistent  with  Service Provider’s and  its  Affiliates’  Pass - Through  Costs  incurred  in the

     

     

    

performance  of  Services,  or,  if  inconsistent, the amount  of  any  underpayment  or  overpayment.  If   the  review  of  such records  reveals  an  inconsistency,  then  JRD  shall promptly  pay  to  Service   Provider any underpaid  amounts  that  should have  been  invoiced  to  JRD  and  Service Provider   shall  promptly  pay  to  JRD  any overpaid amounts  that should  not  have  been  invoiced  to  JRD.  If   any  such  discrepancies  are  an overpayment  of  amounts  due  under this Agreement  greater than   ten  percent (10%)  of  the  amounts  actually  due  for  any  prior  twelve  (12)  month  period,  Service   Provider shall  pay all  reasonable  costs  incurred  in  conducting  such  review.  Once  JRD  has   conducted a  review  and  audit  of  Service Provider  in  respect  of  any  given  period,  it  may  not   subsequently re - inspect  Service  Provider’s  or  its  Affiliates’  records  in  respect  of  such period,   unless  a  subsequent audit  of  a separate  reporting  period  uncovers fraud  on  the  part  of  Service   Provider  or  its  Affiliates that  is  reasonably  expected to  have  been occurring during the  prior   audited period. ARTICLE V T ERM  AND TERMINATION Section 5.1. T erm .  The  term  of  this Agreement (the “Term”)  shall commence  on  the   Closing  Date  and, unless  earlier terminated  pursuant  to  S ection  5.2 ,  shall  terminate  upon  the   earlier  to occur  of:  (a)  the termination  of  all  Service Periods;  or  (b)  the mutual  written  agreement   of  the  Parties  to  terminate  this Agreement  in  its  entirety.  JRD  may  request,  subject  to  Service   Provider’s consent  (not  to  be  unreasonably  withheld,  conditioned  or  delayed),  to  extend  the   Service Period  with  respect  to  any  or  all  of  the Services as  may be  agreed  to by  the Parties. Section 5.2. T ermination . (a) Subject  to  S ection  5.3 and  without  prejudice  to  JRD’s  rights with respect   to a  Force  Majeure  Event,  JRD  may  from  time  to  time  terminate  this Agreement with  respect  to  the  entirety  of  any  individual Service  or  a  portion  thereof  for  any  reason  or  no  reason,  by  the  giving  of  written  notice  to  Service  Provider  of  such  Service specifying the  date  such termination  shall  be  effective,  which  shall  in no  event  be less  than  thirty  (30)  days  after  receipt  by  Service   Provider  of  such notice. (b) Service Provider  may  terminate  this Agreement  in  its  entirety  or  with   respect  to  any individual  Service  or  a  portion  thereof  at any  time  upon  written  notice  to  JRD  if   JRD  has  failed  to  perform  any  of  its  material obligations under  this  Agreement, including   making  payment  of  Fees  for  any Service  when due  (other than  amounts  under  dispute  in   accordance  with  S ection 4.2 ),  and  such  failure  shall  continue uncured  for  a  period  of  thirty  (30)   days after  receipt  by  JRD  of  a written  notice  of  such  failure  from  Service Provider. Section 5.3. E ffect  of  Termination . Upon the termination  of  any  Service pursuant  to   this  Agreement,  Service  Provider shall  have no  further  obligation  to  provide  the terminated   Service  to  JRD,  and  JRD shall  have no  obligation  to  pay  any future  Fees  relating  to  any  such   Service;  p rovided ,  h owever , that  JRD  shall  remain obligated  to  Service  Provider  for  the  Fees   owed  and payable  in  respect  of  Services provided  prior to  the  effective  date  of  termination  for   such  Service.  In  connection with the termination  of  any  Service, the provisions  of  this   Agreement not relating  solely  to  such terminated Service shall survive any  such  termination, and - 6 - [[5258968]]

     

     

    

in  connection  with  a  termination  of  this  Agreement  in  its  entirety,  A rticle  I ,  S ection  4.5 ,  this   A rticle  V ,  A rticle  VII and  A rticle  VIII ,  all  confidentiality obligations under  this Agreement (including  A rticle  VI )  and  Liability  for all  due  and  unpaid  Fees, shall survive  such  termination.   The termination  of  this  Agreement  shall  not  relieve the  Parties  of  any  liability  or obligation which accrued  hereunder  prior  to  the  effective  date  of  such termination. ARTICLE VI C ONFIDENTIALITY Section 6.1. C onfidentiality . Service Provider  will,  and will cause  its  Affiliates  and  its  and  their   Representatives,  to  keep confidential and not  disclose  to  any  Person  (i)  the terms  of  this   Agreement  or  (ii)  any non - public, confidential  or  proprietary information  of  JRD  or  its  Affiliates   (including  information relating  to  the  Business)  obtained pursuant  to or  in  connection  with  this   Agreement  and  to  not  use any  such  information  other  than  in  furtherance  of  the performance  of   the  Services. The  obligations  of  Service Provider  under  this  Section  6.1  shall  not  apply  to   information  to  the  extent  such information  (a)  becomes generally available  to  the  public  without   breach  of  Service Provider's  or  its  Affiliates’ obligations under  this  Section 6.1  or  under  the   Purchase Agreement  or  any Related  Document  or  (b)  is  required  to  be  disclosed  by  Law  or  any   Order;  provided,  however,  that  in  the  case  of  the  foregoing clause  (b),  to  the  extent not   prohibited  by such  Law  or  Order, Service Provider  shall  notify  JRD  as  early  in  advance  of  such   disclosure  as  is  practicable  to  allow  JRD to  take  appropriate  measures (and  Service Provider  shall  reasonably  cooperate,  at  the  expense  of  JRD,  in  the taking  of  such  measures)  to  preserve  the   confidentiality  of  such information. ARTICLE VII D ISPUTE RESOLUTION Section 7.1. D ispute  Resolution; Generally .  The  Parties recognize that  a  dispute  may   arise  relating  to this  Agreement  (a  “Dispute”).  Any  Dispute,  including  Disputes  that  may   involve  the  parent company,  subsidiaries  or  Affiliates  under common  control  of  any Party, shall   be  resolved  in  accordance  with  this  A rticle  VII ;  p rovided that  in no  event  is  anything in  this A rticle VII intended  to  limit,  or  shall be  construed  to  limit,  in  any  manner,  the  Parties’  rights  to   seek  specific performance pursuant  to  S ection 8.3 . Section 7.2. M ediation . (a) The  Parties shall  first  attempt  in  good  faith  to  resolve  any  Dispute by   confidential mediation  in  accordance with the then current  Mediation  Procedure  of  the   International  Institute  for Conflict  Prevention and Resolution  (“ C PR  Mediation  Procedure ”)   (www.cpradr.org)  before initiating  arbitration.  The  CPR Mediation  Procedure  shall  control,   except  where  it  conflicts with  these  provisions,  in  which case these provisions control.  The   mediator  shall  be  chosen  pursuant  to  CPR Mediation Procedure.  The  mediation shall  be  held  in   New York, New York. - 7 - [[5258968]]

     

     

    

(b) Either  Party  may initiate mediation  by written  notice  to  the other  Party  of   the  existence  of  a  Dispute.  The  Parties agree  to  select  a  mediator  within  twenty  (20)  days  of  the   notice  and the mediation will  begin  promptly  after the  selection. The  mediation will continue   until the  mediator,  or  either  Party,  declares  in  writing,  no  sooner than after the conclusion  of one (1)  full  day  of  a  substantive mediation conference attended  on  behalf  of  each  Party  by a  senior   business  person  with  authority to  resolve  the Dispute, that the Dispute  cannot  be  resolved  by   mediation.  In  no  event, however, shall  mediation  continue more  than  sixty (60)  days from the   initial  notice  by a  Party  to  initiate mediation unless the Parties  agree  in  writing  to  extend  that   period. (c) Any period  of  limitations  that  would  otherwise  expire  between the   initiation  of  mediation and  its  conclusion  shall  be  extended  until  twenty  (20)  days  after the   conclusion  of  the mediation. Section 7.3. A rbitration . (a) If the Parties fail to resolve the Dispute in mediation, and a Party desires to pursue resolution of the Dispute, the Dispute shall be submitted by either Party for resolution in arbitration pursuant to the then current CPR Non - Administered Arbitration Rules (“CPR R ules ”) (www.cpradr.org),  except where  they  conflict  with  these provisions,  in  which  case  these   provisions control.  The  arbitration  will  be  held  in  New York, New York.  All  aspects  of  the   arbitration shall  be  treated  as confidential. (b) The  arbitrators  will  be chosen form  the CPR Panel  of  Distinguished   Neutrals,  unless  a  candidate  not  on  such  panel  is  approved by both  Parties.  Each  arbitrator  shall  be  a  lawyer  with at  least  fifteen  (15)  years’ experience  with  a  law  firm  or  corporate  law   department  of  over twenty - five  (25)  lawyers  or  who  was  a  judge  of  a  court  of  general   jurisdiction.  To  the  extent  that the Dispute requires special expertise, the  Parties  will  so  inform  CPR  prior to  the  beginning  of  the selection process. (c) The  arbitration  tribunal shall  consist  of  three (3)  arbitrators,  of  whom each   Party  shall  designate  one  in  accordance with the “screened” appointment procedure  provided  in   CPR  Rule  5.4.  The chair  will  be  chosen  in  accordance with CPR Rule 6.4. (d) If,  however, the  aggregate  award sought  by  the Parties  is  less than  $5   million  and equitable relief  is  not  sought,  a  single  arbitrator  shall  be  chosen  in  accordance with   the  CPR Rules. (e) Candidates  for  the arbitrator  position(s)  may  be  interviewed  by   representatives  of  the Parties  in  advance  of  their  selection,  p rovided that  all  Parties  are   represented. (f) The  Parties agree  to  select  the arbitrator(s)  within  forty - five  (45)  days  of   initiation  of  the arbitration.  The  hearing will  be  concluded  within  nine  (9)  months  after selection   of  the  arbitrator(s)  and  the award will  be  rendered within  sixty (60)  days  of  the conclusion  of  the   hearing,  or of  any post - hearing  briefing,  which  briefing will  be  completed  by both  sides within   forty - five  (45)  days  after the conclusion  of  the hearing.  In  the  event  the Parties  cannot agree - 8 - [[5258968]]

     

     

    

upon a schedule, then the arbitrator(s) shall set the schedule following the time limits set forth above as closely as practical . (g) The hearing will be concluded in ten ( 10 ) hearing days or less . Multiple hearing days will be scheduled consecutively to the greatest extent possible . A transcript of the testimony adduced at the hearing shall be made and shall be made available to each Party . (h) The arbitrator(s) shall be guided, but not bound, by the CPR Protocol on Disclosure of Documents and Presentation of Witnesses in Commercial Arbitration ( w ww . cpradr . org ) (“Protocol”) . The Parties will attempt to agree on modes of document disclosure, electronic discovery, witness presentation, etc . within the parameters of the Protocol . If the Parties cannot agree on discovery and presentation issues, the arbitrator(s) shall decide on presentation modes and provide for discovery within the Protocol, understanding that the Parties contemplate reasonable discovery . (i) The  arbitrator(s)  shall  decide  the  merits  of  any Dispute  in  accordance with   the  law  governing  this  Agreement,  without  application  of  any  principle  of  conflict  of  laws  that   would result  in  reference  to  a  different law. The  arbitrator(s)  may  not  apply  principles  such  as   “amiable  compositeur” or  “natural  justice  and equity.” (j) The  arbitrator(s)  are  expressly  empowered to  decide dispositive motions  in   advance  of  any  hearing and shall  endeavor to  decide  such motions as would  a  United  States   District Court  Judge  sitting  in  the jurisdiction whose substantive  law governs. (k) The  arbitrator(s)  shall  render  a written  opinion stating the reasons  upon   which  the  award  is  based.  The Parties  consent  to  the  jurisdiction  of  the  United  States  District   Court  for  the  district  in  which  the arbitration  is  held  for  the enforcement  of  these provisions and   the entry  of  judgment  on  any award rendered hereunder.  Should  such  court  for  any  reason  lack   jurisdiction, any court  with  jurisdiction  may  act  in  the  same fashion. (l) Each  Party  has the  right  to  seek  from  the  appropriate  court  provisional  remedies  such  as attachment, preliminary injunction,  replevin,  etc. to  avoid  irreparable  harm,   maintain  the  status  quo,  or  preserve  the subject matter  of  the Dispute.  Rule  14  of  the CPR Rules   does  not  apply  to  this Agreement. (m) EACH  PARTY  HERETO  WAIVES:  (1)  ITS  RIGHT  TO  TRIAL OF   ANY  ISSUE  BY  JURY, (2)  WITH  THE  EXCEPTION OF  RELIEF  MANDATED BY  STATUTE  OR RESULTING  FROM  THE  WILLFUL  MATERIAL  BREACH  OF  THIS  AGREEMENT,  ANY  CLAIM  TO  PUNITIVE,  EXEMPLARY,  MULTIPLIED, INDIRECT,   CONSEQUENTIAL OR LOST PROFITS/REVENUES  DAMAGES  (EXCEPT,  IN  EACH   CASE,  TO  THE  EXTENT  AWARDED  TO  A THIRD PARTY),  AND  (3)  ANY  CLAIM  FOR   ATTORNEY FEES,  COSTS  AND  PREJUDGMENT INTEREST. - 9 - [[5258968]]

     

     

    

- 10 - [[5258968]] ARTICLE VIII I NDEMNIFICATION; NO  WARRANTY;  SPECIFIC PERFORMANCE Section 8.1. I ncorporation  of  Purchase  Agreement  Indemnification  Provisions .  This   Agreement shall  be  deemed  to  be  a  “Related Document”  for  the  purposes  of  A rticle  VII of  the   Purchase  Agreement,  and  A rticle  VII of  the  Purchase Agreement  will  govern  the indemnification   obligations  of  the Parties  with  respect  to  any  “Losses”,  as  such  term  is  defined  in  the Purchase   Agreement,  arising  under  this  Agreement (including,  for  the  avoidance  of  doubt,  with  respect  to   any  “Losses”  arising  from,  relating  to  or  otherwise  in  connection  with  any breach  of or  failure  to   perform  any  covenant  or  agreement  of  Service Provider  or  JRD,  as applicable,  contained  in  this   Agreement). Section 8.2. N O  WARRANTY .  JRD  HEREBY ACKNOWLEDGES  THAT   SERVICE  PROVIDER  AND  ITS  AFFILIATES  DO NOT  ORDINARILY  PROVIDE  TO   THIRD  PARTIES  SERVICES  SUCH  AS  THE  SERVICES  AS  PART  OF  THEIR   RESPECTIVE BUSINESS  ACTIVITIES.  JRD  ACKNOWLEDGES  AND  AGREES  THAT  ALL  SERVICES  ARE  PROVIDED ON  AN “AS  IS”  BASIS  AND  THAT JRD ASSUMES ALL   RISK AND LIABILITY  ARISING FROM OR RELATING  TO ITS  USE OF  AND  RELIANCE  UPON  THE  SERVICES.  ACCORDINGLY,  EXCEPT  AS  EXPRESSLY PROVIDED  IN  THIS   AGREEMENT,  NONE OF  SERVICE  PROVIDER  OR  ITS  AFFILIATES MAKES  ANY   REPRESENTATIONS OR  WARRANTIES OF ANY  KIND  WHATSOEVER, EXPRESS OR  IMPLIED,  AT  LAW  OR  IN  EQUITY,  IN  CONNECTION WITH OR WITH RESPECT  TO   ANY  OF  THE  SERVICES.  SERVICE  PROVIDER  SPECIFICALLY DISCLAIMS  ANY   OTHER  WARRANTIES,  WHETHER WRITTEN OR  ORAL,  OR  EXPRESS  OR IMPLIED,  INCLUDING  ANY  WARRANTY OF  QUALITY,  MERCHANTABILITY, OR FITNESS  FOR   A  PARTICULAR  USE OR PURPOSE OR  THE  NON - INFRINGEMENT OF  ANY   INTELLECTUAL PROPERTY  RIGHTS OF  THIRD PARTIES. Section 8.3. S pecific Performance .  The Parties  agree that  irreparable  damage would   occur  and  that the  Parties  would not  have  any adequate  remedy at  law  in  the  event  that any  of  the   provisions  of  this  Agreement  were  not performed  in  accordance  with  their  specific terms  or  were   otherwise  breached. It  is  accordingly agreed that  the  Parties  shall  be  entitled  to  an injunction  or   injunctions  to  prevent breaches  of  this  Agreement  and  to  enforce specifically the  terms  and   provisions  of  this  Agreement,  this  being  in  addition  to  any other remedy  to  which  they are   entitled at  law  or  in  equity  and as  further set  forth  in  A rticle  VII .  For  the  avoidance  of  doubt, this   S ection  8.3 shall  not restrict any  Party  from  asserting that the  terms  and  provisions  of  this   Agreement  have  not  been breached  (or  would  not  be  breached)  by  the actions  or  omissions (or   intended actions  or  omissions)  of  such Party. ARTICLE IX M ISCELLANEOUS Section 9.1. L icense  to  Intellectual Property .  JRD shall grant  to  Service  Provider  a   nonexclusive, worldwide, royalty - free  license  to  use  Intellectual  Property Rights  owned by

     

     

    

- 11 - [[5258968]] Service Provider solely  for  the purpose  of,  and  only  to  the  extent  necessary  for,  providing  the   Services. Section 9.2. N otices .  All notices  given by  one  Party  to  the other  Party  under  this   Agreement will follow  the  procedures  and be  delivered to  the addresses  set  forth  in  S ection 9.2  of  the  Purchase  Agreement. Section 9.3. G overning Law .  THIS  AGREEMENT  SHALL  BE  GOVERNED BY,   AND  CONSTRUED  IN  ACCORDANCE  WITH,  THE  LAWS  OF  THE  STATE  OF  NEW   YORK, REGARDLESS OF  THE  LAWS  THAT  MIGHT OTHERWISE  GOVERN  UNDER   APPLICABLE  PRINCIPLES OF CONFLICTS OF  LAWS THEREOF. Section 9.4. A ssignment .  Neither this Agreement  nor any  of  the  rights,  interests  or   obligations  hereunder  shall  be  assigned,  in  whole  or  in  part,  without  the prior written  consent  of   the  other  Party, and  any  assignment  without  such consent  shall be  null  and  void,  except  that  JRD   may,  without the  consent  of  Service Provider, assign  any  or  all  of  its  rights  and  obligations under   this Agreement  to  any  of  its  Affiliate  ( p rovided that  JRD shall  remain responsible  for  the   performance  of  such  assignee Affiliate).  Any  successor  or  assignee  of  rights and/or obligations   permitted  hereunder shall,  in  writing,  expressly assume performance  of  such  rights and/or   obligations. Section 9.5. R elationship  of  the Parties .  It  is  expressly agreed  that Service  Provider,  on   the  one  hand,  and  JRD  on  the other  hand,  are  independent  contractors,  and  it is  further  agreed  that  the  Parties fully  intend  and expect that the relationship between the two  Parties  shall not   constitute a  partnership,  joint  venture  or  agency.  Except as expressly provided  herein,  neither   Service Provider nor  JRD shall  have  the  authority  to  make  any statements, representations  or   commitments  of  any kind,  or  to  take  any action  which  shall  be  binding  on  the other,  without  the   prior  written  consent  of  the other  Party to  do  so. All  individuals employed  by a  Party  shall  be   employees  of  that  Party  and  not  of  the other  Party  and  all costs  and  obligations incurred  by   reason  of  such  employment shall  be  for  the account  and  expense  of  such Party. Section 9.6. F orce  Majeure . The failure  by  Service Provider  to perform  any  term   hereunder  when  caused  by  or  resulting  from a  Force  Majeure Event shall  not constitute  a  default   or  breach  under any  term  of  this  Agreement;  p rovided ,  h owever , that  Service  Provider  shall  use   its  commercially reasonable  efforts to  continue  to perform  its  obligations under  this Agreement   and  to  minimize  the adverse effects  arising  from  any Force Majeure Event.  If  any  such  excused   delay  occurs,  the Service Period  shall  be  extended  for  a  period  equal to  the  time  lost  by reason  of   the  delay unless  this  Agreement  has  previously been terminated  under  A rticle  V or  under this S ection  9.6 .  Service  Provider  shall,  as  soon  as reasonably practicable after the occurrence  of any such event, (a)  provide  written  notice  to  JRD  of  the nature  and  extent  of  any  such  Force  Majeure   Event;  and (b)  use  its  commercially reasonable  efforts to  remove  any  such  causes  and  resume   performance  under  this  Agreement  as  soon  as reasonably practicable unless  this  Agreement  has   previously been terminated  under  A rticle  V or  under  this  S ection  9.6 .  During  the period  of  a   Force  Majeure  Event,  (i) no  Fees  shall  be  assessed  or  otherwise  accrue  for  the duration  of  such   Force  Majeure Event  to  the  extent  such Fees relate  to  Services  Service Provider  is  unable  to   provide as  a  result  of  such Force  Majeure Event  and  (ii)  JRD  shall  be  entitled  to  permanently   terminate such Service(s)  if  a  Force  Majeure Event shall  continue  to  exist for more  than thirty

     

     

    

- 12 - [[5258968]] (30)  consecutive  days  by  delivering written  notice  of  such  termination  to  Service Provider,  it   being  understood  that such termination may  be  effective immediately  upon  delivery  of  such   written notice. Section 9.7. S everability .  If  any  one  or  more  of  the provisions  of  this Agreement  is   held  to  be invalid  or  unenforceable  by  any  court  of  competent  jurisdiction  from  which  no  appeal   can  be  or  is  taken, the provision shall  be  considered  severed  from this  Agreement  and  shall not   serve  to  invalidate any remaining provisions  hereof. The  Parties shall make  good  faith  efforts to   replace  any  invalid  or  unenforceable provision  with  a  valid  and enforceable one  such  that the   objectives contemplated  by  the  Parties  when  entering  this  Agreement  may  be realized. Section 9.8. W aiver and Non - Exclusion  of  Remedies .  Any  term  or  condition  of  this   Agreement  may  be  waived at any  time by  the  Party  that  is  entitled  to  the  benefit  thereof,  but  no   such  waiver  shall  be  effective  unless  set  forth  in  a  written  instrument duly  executed  by  or on   behalf  of  the  Party  waiving  such  term  or  condition. The waiver  by  either  Party  of  any  right   hereunder  or  of  the  failure  to  perform  or of  a  breach  by  the other  Party  shall not  be  deemed  a   waiver  of  any  other  right  hereunder  or  of  any  other  breach  or  failure  by such other Party  whether   of  a  similar  nature  or  otherwise. The  rights  and  remedies provided  herein  are  cumulative and  do   not  exclude  any  other  right  or  remedy  provided  by  applicable  Law  or  otherwise  available  except   as expressly  set  forth herein. Section 9.9. F urther Assurances .  Each  Party  shall  duly  execute  and  deliver,  or  cause  to   be  duly  executed  and  delivered, such further instruments  and  do  and  cause  to  be  done  such   further  acts  and  things,  including  the  filing  of  such  assignments,  agreements, documents,  and   instruments, as may  be  necessary  or  as the other  Party  may  reasonably request  in  connection  with   this Agreement  to  carry  out  more  effectively the provisions  and  purposes hereof. Section  9.10.  H eadings .  The headings  of  each  Article  and  Section  in  this  Agreement   have  been inserted  for convenience  of  reference only and  are  not intended  to  limit  or  expand  on   the  meaning  of  the  language  contained  in  the particular  Article  or Section. Section  9.11.  C onstruction . Whenever  this  Agreement  refers  to a  number  of  days   without  using  a  term  otherwise  defined  herein,  such  number  refers  to  calendar days, whether  or   not  “calendar days”  is  expressly  stated.  Except  where  the context  otherwise  requires,  (a)   wherever  used, the  singular  shall include the plural, the plural shall include the singular;  (b)  the   use  of  any gender shall  be  applicable  to  all  genders;  (c)  the terms “including,” “include,”   “includes” and  “for  example” shall not  limit  the generality  of  any  description preceding  such   term  and,  as used  herein,  shall have the  same meaning  as “including,  but not limited  to,”  and   “including, without limitation”;  (d)  the  words  “herein”,  “hereof” and “hereunder”,  and  words  of   similar  import,  refer  to  this Agreement  in  its  entirety  and not  to  any particular provision hereof; (e) the word  “will” means “shall”;  (f)  if  a  period  of  time  is  specified and  dates from a  given day or  Business Day,  or  the  day  or  Business  Day  of  an  act  or  event,  it  is  to  be  calculated  exclusive  of   that  day  or  Business  Day;  (g)  “Dollar”, “USD”  or  “$”  means  U.S.  Dollars;  (h)  references  to  a   particular  Person  include  such  Person’s successors  and  assigns  to  the  extent  not  prohibited  by   this  Agreement;  (i)  a  capitalized  term  not  defined herein but reflecting  a  different  part  of  speech   than  a  capitalized  term  which  is  defined  herein  shall  be  interpreted  in  a  correlative manner;  (j)   any definition  of or  reference  to  any agreement,  instrument  or  other  document herein  shall be

     

     

    

- 13 - [[5258968]] construed  as  referring  to  such agreement,  instrument  or  other  document  as  from  time  to  time   amended,  supplemented  or  otherwise modified  (subject  to  any restrictions  on  such amendments,   supplements  or  modifications  set  forth herein);  (k)  any  provision  under  this  Agreement  requiring   the  mutual agreement  of  the  Parties  or  the  consent  or  approval  of  a  Party  shall  only  be  satisfied  if   made  in  writing  signed  by  the  relevant Party(ies)  and  (l)  if  this  Agreement  is  terminated  in   accordance with  its terms,  the “Term” shall  be  deemed  to  end  on  the effective  date  of  such   termination.  The language  of  this  Agreement  shall be  deemed  to  be  the  language  mutually   chosen  by  the Parties and  no rule  of  strict construction shall  be  applied  against  either  Party.  Each   Party  represents that  it  has  been represented  by legal  counsel  in  connection  with  this  Agreement   and  acknowledges that  it  has  participated  in  the  drafting hereof. Section  9.12.  C ounterparts .  This  Agreement  may be  executed  in  two  (2)  or  more   counterparts,  each  of  which  shall  be  deemed  an  original, but all  of  which together  shall  constitute   one  and  the  same instrument.  This  Agreement  may be  executed by  .pdf  or  other electronically   transmitted signatures  and  such  signatures  shall  be  deemed  to  bind  each  Party  as  if  they  were the   original signatures. Section  9.13.  E ntire  Agreement; Amendments .  This  Agreement,  including  the Exhibits   hereto, sets  forth  the complete,  final  and exclusive  agreement  and  all the covenants,  promises,   agreements,  warranties,  representations, conditions  and  understandings  between  the Parties with   respect  to  the subject matter hereof and supersedes all  prior  and  contemporaneous  agreements   and  understandings between the Parties with respect  to  the  subject matter hereof.  In  the  event  of   any inconsistency between the  body  of  this  Agreement  or  any Exhibits  to  this Agreement and  the   Asset Purchase Agreement  or  any  other  Related  Document, this Agreement shall  govern  and   control  with respect  to  the provision  of  Services  and  the  specific  subject matter  hereof,  and  the   Asset Purchase Agreement  and  other Related Documents shall  govern  and  control  with respect  to   all  other  matters.  There  are  no  covenants, promises,  agreements,  warranties,  representations,   conditions  or  understandings, either  oral  or  written, between the Parties with respect  to  the   subject matter hereof other than as  are  set  forth  herein  and  therein.  No  subsequent  alteration,   amendment,  change  or  addition  to  this Agreement  shall  be  binding  upon  the Parties unless   reduced  to  writing  and signed  by  an  authorized officer  of  each Party. *   *   *  *

     

     

    

IN  WITNESS  WHEREOF, the  Parties  have  caused  this Agreement  to  be  executed   by  their  duly  authorized representatives. JANSSEN  RESEARCH & DEVELOPMENT, LLC XBIOTECH  USA, INC. By: Name: Z> Title: e,r= - o tl£. D . By : _ Name:   Title: John Simard Chief  Executive Officer [{5258968J) [Signature  Page  to  Transition  Services  Agreement]

     

     

    

IN  WITNESS WHEREOF,  the  Parties  have caused  this  Agreement  to  be  executed   by  their duly  authorized representatives. JANSSEN  RESEARCH & DEVELOPMENT, LLC XBIOTECH  USA, INC. By : _ Name: Title: [Signature  Page to Transition  Services Agreement} {[5258968}}

     

     

    

[[5262213]] Exhibit A   Services 1. Continue to provide bulk drug substance for ongoing investigator initiated studies for systemic sclerosis and pancreatic cancer. 2. Continue  the  administration  of  ongoing Phase 2(b) HS  &  AD  clinical trials and provide services as follows: Task Post  transfer Responsible   (X = XBiotech) (J=Janssen) Comments  / Dependencies Clinical Operations Manage  protocol   deviations/issue escalation  and   report  as needed X, J Janssen  to  review current  process  and deviations  lists  by  January 15,   2020.  Minimum quarterly meeting  with XBiotech  for PDs. Write  and approve monitoring   guidelines/study procedures   checklist X, J Follow  current monitoring  guidelines until  Janssen  assessment  of   document completed.  Janssen  to  review  and  approve/update  current   guidelines  by  January  15,  2020. Future versions  to  be  reviewed  by   Janssen  prior  to  final approval. Write  &  approve  IMP handling   manuals  (preparation and   administration) X, J Current manuals  to  continue  to  be  followed. Janssen  to  review  and   approve/request changes  to  current version  by January 15,  2020.   Future  final versions  to  be  reviewed/approved  by Janssen. Prepare  ethics  committee   submissions and submit  to   ethics committees X Copies  of  all  submissions  to  be  sent  to  Janssen  for review/approval. Administer IRB/IEC payments X XBiotech  to  administer payments  as  such payments  become due. Prepare  responses  to IRB/IEC   questions X Janssen  to  review  pior  to submission Submit responses  to  IRB/IEC   questions X Janssen  copied on  all IRB/EC responses Conduct  PSV, SIV,  MV, COV X On - Site  Quality  Monitoring  Visits and co - monitoring visits  by   Janssen  as needed. Prepare, negotiate,  amend and execute  existing  contracts  with   sites  and  vendors until   completion  of studies X Contracts (including amendments) need  to  be  approved  by Janssen Payment  to  study sites X All  Sites  will  have  notification  of  Janssen ownership.  XBiotech  to   administer payments  as  such payments  become due.

     

     

    

[[5262213]] Task Post  transfer Responsible   (X = XBiotech) (J=Janssen) Comments  / Dependencies Payment  of Vendors X All  vendors will  have  notification  of  Janssen  ownership.  XBiotech  to   administer payments  as  such payments  become due. Notification  of  Study end  to   IRB/EC X Janssen  to  be  provided with  the  letters  of  notification upon   XBiotech’s receipt  for recordkeeping. Management  and  Oversight  of   vendors X All  vendors will  have  notification  of  Janssen ownership. Provide monitoring services X Translations  of  study   documents X Janssen  to  provide XBiotech  feedback  if necessary. Newsletters X Janssen  to  review  and approve Maintain  Trial  Master  File   (TMF)  during study X Janssen  to  audit TMF  files;  All  files  to  be  sent  to  Janssen  at  end  of   study 1572 J, X Should  both  now  be  listed  on  the 1572 Financial disclosure J, X Both companies should  be listed Laboratory Q - Labs X  - oversight All  vendors will  have  notification  of  Janssen ownership. DATA MANAGEMENT Compare,  select  and  develop   standards X N/A  as  eCRF was  already  developed.  Might  become  applicable  if   eCRF  changes  would  need  to  be  installed after transfer  to Janssen. eCRF  design  & setup X eCRF  already built and  in use. QOL questionnaires X User  Acceptance Test (UAT)   of eCRF X Only applicable  if  eCRF  changes.  Janssen  to  review  if  updates  are   made. Data Handling Study Team Agreement (DHSTA=Data Management Plan) X, J XBiotech  to  draft  DHSTA (DMP),  Janssen  to  review  and approve. Laboratory transfer   specifications X DTAs  to  be  provided  to  Janssen; Janssen  to  support future updates  of   LTS EDC  system  set up X Provide Janssen Access. Dictionary linking X Janssen  to  approve dictionaries Coding X Janssen  to  review  and approve

     

     

    

[[5262213]] Task Post  transfer Responsible   (X = XBiotech) (J=Janssen) Comments  / Dependencies Production data transfer X,  J oversight Transfer  will  include  external data and  EDC data. Transfer data per  data  transfer   agreement  and  upon request X Transfer  will  include  external data and  EDC data. DM Study  Files (TMF) X Transfer  at  end  of trial Data validation X,  J oversight Data  validation already completed Medical Writing Prepare, review  and approve   protocol  and protocol amendments J , X Content  of  protocol amendments need  to  be  approved  by  Janssen REGULATORY AFFAIRS Sponsorship X*, J *According  to  the  Transfer of Obligations Prepare  submission  packages   (protocols, ICF,  IB  patient   materials etc.) X,  J oversight Janssen  Template  is  being  drafted  for IB Review submission packages X,J  oversight IMPD  Amendment preparation   and review X, J Janssen  to  submit  to IND Notification  of  study end  to   Ethics Committees and  Health   Authorities X  - IRB/ECs J  – Health Authorities Provide Janssen  with copies  of  notifications  for  study files; SAFETY Receive  Inbound  Serious   Adverse  Events  (SAEs) from   study sites X,J XBiotech  to  send  SAE cases  and  Source  Documents  to  GMSO.   XBiotech  to  be  trained  on  Janssen  SOPs  for  SAEs,  Pregnancy   Reporting  and  PQCs. Clinical  Trial Supplies Package  and label Investigational Medicinal   Product (IMP) X

     

     

    

[[5262213]] Task Post  transfer Responsible   (X = XBiotech) (J=Janssen) Comments  / Dependencies IMP  storage (bulk supply) X IMP  shipment  to  study site X IMP  reconciliation  at study   sites X Handling  of Changes, deviations, CAPA’s, Product   Quality Complaints  (PQC) and   Recalls X, J Janssen  to  be  informed  about  any  PQCs involving supplies.   XBiotech  to  be  trained  on  Janssen  PQC  and  recall process Review  and  Approve   Complaints and recalls X Janssen  to review Receive  Temperature  out  of   Range  (TOR)  events from sites X Review  and  approve/reject   TOR events X Overall  drug  supply   management (ensuring supplies   for  all  trials,  expiry   management, etc.) X Drug  destruction  at Sites X Drug  destruction  at Depots X Review major deviations,   CAPAs  and  changes  to  Drug   Substance (DS),  Drug  Product   (DP)  and IMP documentation X J Janssen  to review

     

     

    

[[5262213]] List  of Abbreviations: CAPA Corrective  and  Preventive Actions CDS Clinical  Data  Support CMO Clinical Manufacturing Organization CMV Clinical  Monitoring Visit COV Close  Out Visit COS Change of Sponsorship CRA Clinical  Research Agreement CRO Contract Research Organization CTA Clinical  Trial Application  or  Clinical Trial Agreement CTSRS Clinical  Trial Safety  Reporting System DHSTA Data  Handling  Study  Team Agreement  =  Data   Management Plan DM Data Management DOA Delegation  of Authority DP Development Plan DS Development Strategy DSUR Development  Safety Update Report ECG Electrocardiogram eCRF Electronic  Case  Report Form eCTD Electronic  Common  Technical Document GCO Global  Clinical Operations IB Investigator Brochure IDMC Independent  Data  Monitoring Committee IEC Independent Ethics Committee

     

     

    

[[5262213]] IMP Investigational  Medicinal Product IND Investigational New Drug IRB Institutional  Review Board JCI Janssen - Cilag International OSQMV On  - Site  Quality  Monitoring Visits PSV Pre - Study Visit QA Quality Assurance QOL Quality  Of Life QP Qualified Person SAE Serious Adverse Event SIV Site Initiation Visit SMT Safety  Management Team SOP Standard Operating Procedure SUSAR Suspected Unexpected Serious Adverse Reaction TLF Tables  listings  and figures WI Work Instruction

     

     

    

[[5258968]] B - 1 Exhibit B Buyer Manager and  Seller Manager   B uyer Manager: Kathleen Long S eller Manager: Ashley Otero

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