Document:

Research and Development Agreement

 Exhibit 10.1 
  
 

 
  
 RESEARCH AND DEVELOPMENT
AGREEMENT 
  
 THIS RESEARCH AND DEVELOPMENT AGREEMENT
(this “Agreement”) is made as of the 24th day of February, 2005, by and between COBRA BIOLOGICS LTD (a wholly owned subsidiary of COBRA BIOMANUFACTURING Plc) (“COBRA”), located at The Science Park, Keele ST5
5SP, United Kingdom and AUXILIUM PHARMACEUTICALS, INC. with an office located at 160 W. Germantown Pike, Norristown, PA 19401 (“AUXILIUM”). 
  
 RECITALS 
  
 WHEREAS, AUXILIUM is engaged in the research, development and sale of pharmaceutical products; and 
  
 WHEREAS, COBRA is in the business of and has appropriate facilities
for providing certain services to the pharmaceutical industry and others; and 
  
 WHEREAS, AUXILIUM and COBRA wish to enter into this Agreement for COBRA to provide certain services (the “Services”) to AUXILIUM; 
  
 AGREEMENT 
  
 NOW, THEREFORE, for good and valuable consideration, AND INTENDING TO BE LEGALLY BOUND, COBRA and AUXILIUM hereby agree as follows:

  
 1. Duties and Responsibilities of COBRA 
  

	 	1.1.	This Agreement sets forth the general terms and conditions with respect to the Services. The description and payment schedule for the Services are expressly set forth in the
Exhibit(s) attached to this Agreement, which are incorporated by reference herein. 

  

	 	1.2.	COBRA agrees to provide the Services in accordance with: (a) all applicable laws and regulations, including, without limitation, the United States federal Food, Drug and Cosmetics
Act and standards of Good Clinical Practices, Good Laboratory Practices and Good Manufacturing Practices, as applicable; and (b) the standards and practices that are generally accepted in the industry and exercised by other persons engaged in
performing similar services. 

  

	 	1.3.	AUXILIUM agrees to pay for the Services in accordance with the payment terms set out in the Exhibit(s). If AUXILIUM fails to make any payment in full on the due date COBRA may
charge AUXILIUM interest (both before and after judgment) on the amount unpaid at the rate of 2% above the prime rate (as it may be set from time to time) in the Wall Street Journal. Such interest shall be compounded with monthly rests.

  
 CONFIDENTIAL 

 

 
  
 2. Conflicts of Interest 

 

	 	2.1.	COBRA represents and warrants that COBRA is authorized to enter into this Agreement and that the terms of this Agreement are not inconsistent with or a violation of any contractual
or other legal obligation to which COBRA is subject. 

  

	 	2.2	The parties agree and acknowledge that COBRA is in the business of providing contract research and development services to the pharmaceutical industry. Accordingly, COBRA shall be
free to undertake the provision of research and development services on behalf of third parties so long as it does not knowingly develop products that specifically compete with products developed for AUXILIUM by COBRA under this Agreement or
otherwise breach the confidentiality and intellectual property provisions of this Agreement. 

  
 3. Confidentiality 
  

	 	3.1.	“Confidential Information” shall mean any and all information, including but not limited to, clinical, analytical and/or scientific data, reports, processes,
procedures, methods, formulations, inventions, and/or trade secrets relating to products developed pursuant to this Agreement and any other non-public information disclosed by a party (the “Disclosing Party”) to the other party (the
“Receiving Party”) pursuant to this Agreement of any kind, nature or description concerning any matters affecting or relating to the business of the Receiving Party. Confidential Information also includes, but is not limited to,
trade secrets, ideas, inventions, research and development work, work-in-process, products, methods, procedures, technology, computer software, databases and programming, test data and data files, know-how, designs, specifications, programs,
standard operating procedures, policies, guidelines, processes, formulations and unpublished data, personnel, staffing, cost, profit, marketing, sales, engineering and manufacturing data and information, patient, customer, supplier and investigator
lists and data, and proposals and contracts (including specifically this Agreement), salary structure/compensation information, pricing strategies, budgets and other related data, financial information and projections, services, techniques and any
other information which, if divulged to a third party, could have an adverse impact on the Disclosing Party, or on any third party to which such Disclosing Party owes a confidentiality obligation. However, Confidential Information shall not include
information that (i) is or becomes generally publicly available through no fault of a party to this Agreement; (ii) the Receiving Party can prove was known to the Receiving Party prior to the disclosure of the information by the Disclosing Party; or
(iii) is required to be disclosed by court order, applicable law or by a regulatory authority, provided that the Receiving Party shall use its best efforts to limit such disclosure and to obtain confidential treatment or a protective order for such
Confidential Information. 

  
 CONFIDENTIAL 

	 	

  

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	 	3.2.	Each party agrees that it shall not at any time, whether during or after the termination of this Agreement (a) use any Confidential Information of a Disclosing Party for any purpose
other than performing obligations pursuant to this Agreement and the Exhibit(s); or (b) disclose or otherwise make available, directly or indirectly, any item of Confidential Information to anyone other than those of the Receiving Party’s
employees, independent contractors or agents who reasonably need to know the same in the performance of the obligations under this Agreement and the Exhibit(s). Each party shall advise its employees, independent contractors and agents who have
access to any Confidential Information of the confidential nature thereof, and agrees that such persons will be bound by terms of confidentiality with respect thereto that are at least as restrictive as the terms of this Section 3.

  

	 	3.3.	Upon the completion or earlier termination of this Agreement, or at any time upon request, a Receiving Party shall promptly return to the Disclosing Party all written Confidential
Information except that which is required to be retained due to any legal and/or regulatory requirements. 

  
 4. Independent Contractor 
  

	 	4.1.	The parties acknowledge that COBRA is an independent contractor and agrees that: 

  

	 	(a)	COBRA has an independently established business and is engaged by AUXILIUM to undertake the Services for a limited period of time; 

  

	 	(b)	Nothing in this Agreement shall be construed to create a partnership, joint venture, employment or similar relationship between COBRA and AUXILIUM; 

  
 5. Intellectual Property 
  

	 	5.1.	If at any time or times as a result of performing the Services pursuant to this Agreement, COBRA shall (either alone or with others), make, conceive, create, discover, invent or
reduce to practice any invention, modification, discovery, design, development, improvement, process, software program, work of authorship, documentation, formula or data (collectively, “Developments”), whether or not patentable or
registrable under any patent, copyright, trademark or similar statutes or subject to analogous protection (collectively, “Legal Protection”) that (a) relate to COBRA’s work with or business of AUXILIUM (including, without
limitation, any of the products or services being or to be developed, manufactured or sold by AUXILIUM), (b) result from the performance of the Services, (c) result from the use of premises or personal property (whether tangible or intangible)
owned, leased or contracted for by AUXILIUM, or (d) result from or are based on Confidential Information of AUXILIUM, such Developments, and any rights that COBRA may have or acquire therein in any country throughout the world, and their resulting
benefits (collectively, “Rights”) are and shall immediately become the sole and absolute property of AUXILIUM, as “work made for hire” or otherwise. 

  
 CONFIDENTIAL 

	 	

  

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	 	5.2.	COBRA hereby assigns to AUXILIUM, without further compensation at any time, all of COBRA’s Rights with respect to the Developments. To ensure AUXILIUM’s ownership of the
Developments, COBRA shall promptly: 

  

	 	(a)	Disclose each Development to AUXILIUM (or any persons designated by it), and without disclosing the same to others, communicate to AUXILIUM all available information relating to the
Developments (with all necessary plans and models); and 

  

	 	(b)	Whether during or after the termination of this Agreement, at the reasonable request and cost of AUXILIUM, sign, execute, make and do all such deeds, documents, acts and things as
AUXILIUM and its duly authorized agents may reasonably require to (i) apply for, obtain, register, vest, renew and restore, in the name of AUXILIUM alone (unless AUXILIUM otherwise directs), any Rights with respect to the Developments under Legal
Protection in any country throughout the world; and (ii) enforce and defend any judicial, opposition or other proceedings, petitions or applications in respect of such Legal Protection relating to a Development, or the revocation thereof.

  

	 	5.3	Except where there is a good faith dispute between the parties in relation to ownership of a Development, if AUXILIUM is unable, after reasonable effort, to secure COBRA’s
signature on any application for Legal Protection relating to a Development, COBRA hereby irrevocably appoints AUXILIUM and its duly authorized officers and agents as COBRA’s agent and power of attorney, to act for and in COBRA’s behalf
and stead to execute and file any such applications or other documents and to do all other lawfully permitted acts to further the issuance and prosecution of Legal Protection thereon with the same legal force and effect as if executed by COBRA.

  

	 	5.4	AUXILIUM grants to COBRA a royalty free non-exclusive worldwide license to use any Developments and other intellectual property rights of AUXILIUM solely to enable COBRA to perform
the Services. 

  

	 	5.5	Nothing in this Agreement shall affect any intellectual property rights owned by and/or licensed to COBRA as at the date of this Agreement or any intellectual property rights which
COBRA may subsequently develop, acquire, own and/or have licensed to it which arise outside of and independently to the provision of Services. 

  
 6. COBRA Warranties 
  

	 	6.1	COBRA represents and warrants that COBRA has never been and is not currently: 

  

	 	(a)	An individual who has been debarred or convicted of a crime for which a person can be debarred by the U.S. Food and Drug Administration (the “FDA”) under 21 U.S.C.
§335a (a) or (b), or by any other regulatory agency (a “Debarred Individual”), from providing services in any capacity to a person or entity that has an approved or pending drug product application, or an employer, employee or
partner of a Debarred Individual; or 

  
 CONFIDENTIAL 
  

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	 	(b)	A corporation, partnership, or association that has been debarred by the FDA under 21 U.S.C. §335a (a) or (b), or by any other regulatory agency (a “Debarred
Entity”), from submitting or assisting in the submission of an abbreviated new drug application, or an employee, partner, shareholder, member, subsidiary or affiliate of a Debarred Entity. 

  

	 	6.2	COBRA further represents and warrants that COBRA has not been convicted of or pled guilty or no contest to a crime or been sanctioned by a federal or state law enforcement,
regulatory, or licensing agency. 

  

	 	6.3	COBRA further represents and warrants that COBRA has no knowledge of any circumstances which may affect the accuracy of the representations set forth in Sections 6.1 or 6.2,
and that COBRA will immediately notify AUXILIUM in the event of any such debarment, conviction, threat or indictment occurring during the term of this Agreement. 

  
 7. Restrictions on Announcements 
  
 COBRA shall not make any announcement, oral presentation or publication relating to the Services without AUXILIUM’s prior written consent, except as required by law
or by court or administrative order, provided however, that COBRA gives to AUXILIUM such advance written notice of disclosure as is reasonably possible. COBRA shall not employ or use the name of AUXILIUM in any publication or
promotional material or in any form for public distribution, without the prior written consent of AUXILIUM. 
  
 8. Regulatory Inspection 
  
 In the
event that COBRA receives a Notice of Inspection (a “Notice”) from any regulatory authority, including, which relates to the Services and/or the facility in which the Services are being performed, COBRA shall: (a) notify AUXILIUM
promptly of such Notice; (b) keep AUXILIUM informed of the progress of the inspection; and (c) provide to AUXILIUM a copy of any documents produced to the regulatory authority pursuant to such Notice unless prohibited from doing so by the relevant
regulatory authority. 
  
 9. Access to Facilities 
  
 AUXILIUM’s authorized representatives may visit COBRA’s site and facilities where
the Services are being performed at reasonable times and with reasonable frequency during normal business hours and upon reasonable advance written notice to observe the progress of any Services. 
  
 CONFIDENTIAL 
  

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 10. Termination 
  

	 	10.1	Except to the extent specifically set forth in any Exhibit, either party may terminate this Agreement and/or any Exhibit at any time and for any reason upon a minimum of thirty (30)
days’ prior written notice to the other party. In the event of any such early termination of some or all of the Services, each party shall assemble and turn over in an orderly fashion to authorized representatives of the other party all
documents, write-ups, notes, computer programs and other material related thereto and belonging to the other party, and AUXILIUM shall pay the charges stated herein for Services satisfactorily performed for the period since the date of commencement
of the Services through the date of notice of termination. 

  

	 	10.2	Either party shall have the right at any time to cancel this Agreement and/or the Exhibit(s) immediately on written notice 

  

	 	(a)	for non-performance or material breach of this Agreement or such Exhibit(s) by the other party; or 

  

	 	(b)	if the other party suffers or takes any steps in any jurisdiction in relation to any event of insolvency, winding up and/or bankruptcy and/or any similar procedure.

  
 provided, however, that no such
termination of this Agreement shall relieve a breaching party of any liability or obligation it might otherwise have. 
  

	 	10.3	If AUXILIUM cancels this Agreement and/or the Exhibit(s) before completion of the relevant Services, it shall be liable to pay COBRA on a percentage of completion basis, for all
Services performed by COBRA up to the date of cancellation and for any committed costs that COBRA has incurred and/or will be liable to pay in connection with this Agreement and/or the Exhibits. 

  

	 	10.4	In the event either Party terminates this Agreement or any Exhibit before completion of the relevant Services, COBRA shall provide AUXILIUM with technology transfer assistance to a
third party from COBRA personnel skilled in providing the Services. Such technology transfer shall include all technical information necessary for the performance of the Services, including, without limitation, (i) chemical and other scientific
data, (ii) processes and analytic methodology used in validation, stability testing and other testing or analysis, and (iii) all other know how, data, technology and information necessary to continue performance of the Services. Any disclosure or
use of such technical information by a third party will be subject to appropriate confidentiality and use restrictions. AUXILIUM will bear the costs associated with such technology transfer if AUXILIUM terminates this Agreement or any Exhibit
pursuant to Section 10.1 or if COBRA terminates the Agreement or any Exhibit pursuant to Section 10.2. COBRA will bear the costs associated with such technology transfer if COBRA terminates this Agreement or any Exhibit pursuant to Section 10.1 or
if AUXILIUM terminates the Agreement or any Exhibit pursuant to Section 10.2. 

  
 CONFIDENTIAL 

	 	

  

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 11. Equitable Relief 
  
 Both parties agree that any breach of Sections 2, 3 or 5 of this
Agreement will cause irreparable damage to the other party and that in the event of such breach, each party shall have, in addition to any and all remedies at law, the right to an injunction, specific performance or other equitable relief to prevent
the violation of the other party’s obligations hereunder. 
  
 12.
Indemnification 
  

	 	12.1	AUXILIUM agrees to indemnify, defend and hold harmless COBRA and each of its affiliates, officers, directors, employees and representatives from and against any and all claims,
demands, investigations, suits or actions, (each a “Claim”) for any and all liability, losses, damages, costs or expenses (including reasonable attorneys’ fees and costs of court) arising out of or related to the Services
performed pursuant to this Agreement; the negligence, bad faith or willful misconduct on the part of AUXILIUM; or a breach of any applicable law or regulation by AUXILIUM; or a material breach of this Agreement by AUXILIUM provided, however, that
AUXILIUM’s indemnity obligations shall not apply to any Claim arising out of or related to the negligence, bad faith or willful misconduct of COBRA; a material breach of any applicable law or regulation by COBRA; or a material breach of this
Agreement by COBRA. 

  

	 	12.2	COBRA agrees to indemnify, defend and hold harmless AUXILIUM and each of its affiliates, officers, directors, employees and representatives from and against any and all Claims for
any and all liability, losses, damages, costs or expenses (including reasonable attorneys’ fees and costs of court) arising out of or related to the negligence, bad faith or willful misconduct on the part of COBRA; or a breach of any applicable
law or regulation by COBRA; or a material breach of this Agreement by COBRA provided, however, that COBRA’s indemnity obligations shall not apply where the breach on the part of COBRA arises as a direct result of the act or omission of
AUXILIUM. 

  

	 	12.3	Each party’s agreement to indemnify and hold the other harmless is conditioned on the indemnified party: providing written notice to the indemnifying party of any claim, demand
or action arising out of the Indemnified activities as soon as practicable but at least within thirty (30) days after the indemnified party receives written notice of such claim, demand or action; permitting the indemnifying party to assume full
responsibility to investigate, prepare for and defend against any such claim or demand; assisting the indemnifying party at the indemnifying party’s reasonable expense, in the investigation of, preparation for and defense of any such claim or
demand; and not compromising or settling such claim or demand without the indemnifying party’s written consent. 

  
 CONFIDENTIAL 
  

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 13. Limitations 
  
 BOTH PARTIES EXPRESSLY AGREE THAT EXCEPT WITH RESPECT TO CLAIMS ARISING OUT OF FRAUD,
INTENTIONAL MISCONDUCT AND/OR FAILURE TO COMPLY WITH OBLIGATIONS OF CONFIDENTIALITY PURSUANT TO PARAGRAPH 3 OF THIS AGREEMENT, NEITHER PARTY SHALL BE LIABLE OR RESPONSIBLE TO THE OTHER PARTY IN RELATION TO THIS AGREEMENT FOR ANY LOST PROFITS
(EXCLUDING COBRA’S MARGIN IN ITS FEES), INCIDENTAL, INDIRECT, PUNITIVE, SPECIAL AND/OR CONSEQUENTIAL DAMAGES. 
  
 EXCEPT WITH RESPECT TO CLAIMS ARISING OUT OF SECTIONS 3 AND 5 OF THIS AGREEMENT, EACH PARTY’S TOTAL LIABILITY TO THE OTHER PARTY IN RELATION TO ANY ONE CLAIM UNDER
THIS AGREEMENT AND/OR THE PERFORMANCE OF THE SERVICES SHALL NOT EXCEED THE TOTAL AMOUNTS PAYABLE TO COBRA UNDER THIS AGREEMENT. TO THE EXTENT THAT ANY LIABILITY OF EITHER PARTY WOULD BE MET BY ANY INSURANCE OF THAT PARTY THEN THE LIABILITY OF THAT
PARTY TO THE OTHER PARTY SHALL BE EXTENDED TO THE EXTENT THAT SUCH LIABILITY IS MET BY SUCH INSURANCE. 
  
 14. Entire Agreement 
  
 This
Agreement, together with all corresponding Exhibits, constitutes the entire agreement between the parties with respect to the subject matter hereof, and supersedes any and all prior and contemporaneous communications, representations, agreements or
understandings, whether oral or written, including, without limitation, any conflicting or inconsistent terms contained in either party’s proposals, conditions of business, terms and conditions, acknowledgements or invoices. No amendment or
modification of this Agreement or any Exhibit shall be binding unless in a writing signed by both parties. 
  
 15. Effective Date 
  
 This
Agreement shall have an effective date of September 15, 2004 and shall govern retrospectively Exhibits 1 through 5 which are identified in Schedule “A”, as well as additional Exhibits entered into by the Parties. 
  
 16. Construction of Agreement 
  
 The failure of either party to enforce any provision of this Agreement shall not be
construed as a waiver or limitation of that party’s right to subsequently enforce and compel strict compliance with every provision of this Agreement. If any provision of this Agreement or the application thereof shall be invalid or
unenforceable, the remainder of this Agreement shall be unaffected thereby and each remaining term or provision of this Agreement shall be valid and be enforced to the fullest extent permitted by law. In the event of any inconsistency between the
terms of this Agreement and any 
  
 CONFIDENTIAL 
  

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 Exhibit or any document attached to or referenced
in any Exhibit, the terms of this Agreement shall govern. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to provisions of conflicts of law. 
  
 17. Assignment 
  
 Neither COBRA nor AUXILIUM may assign this Agreement or any rights hereunder or delegate the performance of any duties hereunder without the
prior written approval of the other party, which approval shall not be unreasonably delayed or withheld; provided, however, that without such consent, AUXILIUM may assign this Agreement to an affiliate or in connection with the
transfer or sale of all or substantially all of its assets, stock or business, or its merger, consolidation or combination with or into another entity. Subject to the foregoing, this Agreement shall be binding upon, inure to the benefit of and be
enforceable by the respective heirs, administrators, successors and permitted assigns of the parties. 
  
 18. Survival 
  
 Any terms of this
Agreement which by their nature extend beyond its performance, expiration or termination (including, without limitation, Sections 3, 5, 11 and this Section 18) shall survive any termination or expiration of this Agreement,
however caused. 
  
 19. Notices 
  
 Any notices given under this Agreement shall be in writing and shall be given by personal
delivery, or sent by (a) facsimile transmission (with message confirmed during normal business hours); (b) first class mail, postage prepaid; or (c) Federal Express (or equivalent overnight delivery service), delivery charges prepaid. All notices
shall be given to a party at its respective address set forth in this agreement, or at such other address as such party may specify by notice in accordance with this Section 18. A notice shall be deemed given when actually received. 
  
 20. Force Majeure. 
  
 If either party’s performance of this Agreement or the Exhibit(s) (excluding payment)
is prevented, restricted or delayed (either totally or in part) by reason of any cause beyond the reasonable control of the parties, such as acts of God, explosion, disease, weather, war, insurrection, civil strike, riot or power failure, the party
so affected shall, upon giving notice thereof to the other party, be excused from such performance to the extent of such prevention, restriction or delay; provided, that the affected party shall use its commercially reasonable efforts to
avoid or remove such causes of non-performance and shall continue performance with the utmost dispatch whenever such causes are removed 
  
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 21. Dispute Resolution. 

 
 Except as otherwise specifically provided herein, any disputes or disagreements arising
under the Agreement will be referred to the chief executive officer of each party for a period not to exceed sixty (60) days. During such sixty (60) days, both parties may in good faith explore resolution of the dispute using alternative dispute
resolution techniques before pursuing other remedies. If such dispute is not resolved by the end of such sixty-day period, the parties shall be free to pursue any legal or equitable remedy available to them. 
  
 22. Signatories 
  
 This Agreement may be executed in counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of
which, when joined, shall together constitute one and the same agreement. Any photocopy or facsimile of this Agreement, or of any counterpart, shall be deemed the equivalent of an original. 
  
 ACCEPTED AND APPROVED BY AND BETWEEN: 
  

							
	 COBRA BIOLOGICS LTD.
	 	AUXILIUM PHARMACEUTICALS, INC.
				
	 By:
	 	 /s/ David R. Thatcher

	 	By:	 	 /s/ Jyrki Mattila

	 Name:
	 	 David R. Thatcher
	 	Name:	 	Jyrki Mattila
	 Title:
	 	 Chief Executive
	 	Title:	 	EVP Business Development, R&D, Technical Operations

  
 CONFIDENTIAL 
  

 -10-Process Development

 Exhibit 10.2 
  
 THE COMPANY HAS APPLIED FOR CONFIDENTIAL TREATMENT OF CERTAIN PROVISIONS OF THIS EXHIBIT WITH THE SECURITIES AND EXCHANGE COMMISSION. THE
CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE BRACKETED AND MARKED WITH ASTERISKS ([**]) AND HAVE BEEN OMITTED. THE OMITTED PORTIONS OF THIS EXHIBIT WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. 
  

					
	 	 	 	  	 

	 	 	  
 Process Development and cGMP
 Manufacture of Phase III CTM
  
 Auxilium Pharmaceuticals
  
 June 28, 2005
  
 Cobra Reference
No. O630
 or
 Auxilium Exhibit
No. 9
	  

  
 Cobra
Biomanufacturing Plc 
 The Science Park, 
 Keele, 
 U.K. 
 ST5 5SP 

 

 
  

 Executive Summary 
  
 The objective of this program of works is to develop a commercially scaleable fermentation and purification process at the [****]
scale, which is reproducible, robust and delivers higher [*********] productivity than the current [***] process [**************]. The activities detailed in this proposal will be conducted with a goal of achieving a
productivity [******] purified material from a [*********] strain process; the feasibility of which is based on previous productivities reported by BTC using the [*********] (and replicated by COBRA) and the experience gained by
Cobra using the [*********]. 
  
 Cobra’s primary objective under this
contract is to achieve a productivity of a minimum [*************] process from the [***] strain providing Auxilium with a commercially viable process and establishing the opportunity, at Auxilium’s sole discretion, for a
long-term commercial relationship with Cobra. 
  
 Initially, Cobra would like to
reproduce the [**********************] under which BTC reported a productivity which would result in the manufacture of a minimum of [*************] fermentation. The results from this experiment will set the benchmarking for
productivities. This work will be done at Cobra’s cost in order to ensure that the productivity goal of a minimum of [*************] batch from the [********] is realistic and achievable. 
  
 In an effort to assume some of the risk in this Phase III partnership, Cobra will inform
Auxilium at the end of each Stage I, II, and III what productivity may be expected from a [*************] process. If the [********] (or an otherwise mutually agreed upon [****] productivities resulting from the benchmark work
using the [***********]) has not been met, then Cobra may suggest moving forward with the achieved productivities in order to supply the [****] material required for Auxilium’s initial Phase III trials according to the established
project timeline. Auxilium will have the right to terminate the program at the completion of each Stage if the objective or the timeline has not been met. In order to meet Auxillium’s timescales for supply and still deliver an optimized
fermentation process capable of achieving the [*******] or an otherwise mutually agreed upon productivity, Cobra will commit to an additional 3-month process development program free of charge. 
  
 In order to produce cGMP clinical material for Phase III trials, a reproducible and robust
process will need to be established. All experiments will be complemented with comprehensive analysis in order to obtain a better understanding of the way the fermentation properties affect the quantity of the [*************] expressed, the
level of contaminants and the stability of the [************] during the purification process. The process will be scaled up from the [**] scale to the [****] scale, focusing on reproducibility and robustness. Finally, an engineering
run will be performed under cGMP in order to test the process and make any necessary modifications prior to any additional cGMP manufacture(s) and ultimately validation of the process. 
  

					
	Confidential Document	 	2	  	June 28, 2005

 

 
  

 Stage I 
  

	 	•	 	Fermenter evaluation for [*****************] component media for benchmarking and comparative purposes (FOC) 

  

	 	•	 	Assess optimal media from [**] fermentations previously performed under [*************] 

  

	 	•	 	Investigate the fermentation strategy [(*************)] 

  

	 	•	 	Establish a robustness & reproducible fermentation process 

  
 Price = [$**********] 
  
 Stage II 
  

	 	•	 	DSP process development 

  
 Price = [$*********] 
  
 Stage III 
  

	 	•	 	Scale up fermentation process from Stage I to [****] scale 

  

	 	•	 	Including the inoculum preparation 

  

	 	•	 	Scale up of DSP to [****] scale 

  
 Price = [$*********] 
  
 Stage IV 
  

	 	•	 	cGMP Engineering Run of 1 Batch at [****] Scale 

  
 Price = [$*********] 
  
 Stage V 
  

	 	•	 	cGMP Manufacture of 2 Batches at [****] Scale 

  
 Price = [$********] 
  
 Total Price = $3,315,000 (excluding consumables) 
  

					
	Confidential Document	 	3	  	June 28, 2005

 

 
  

 Quotation O630 
  
 Stage I - Process Development Fermentation 
  

The majority of this work will be done on material from [**] fermentations. Where more [***********] is required, a [***] run will be implemented
specially to address the issue. 
  
 Work to be Completed: 
  

	•	 	Fermenter evaluation for [*************] media for benchmarking and comparative purposes (FOC) 

  

	•	 	Screen various [****************] in shake flasks aiming to achieve [************************] 

  

	•	 	Assess fermentation strategies [(*************)] in [**] fermenters using newly identified [********] sources if appropriate 

  

	•	 	Detailed analysis of fermentation samples [(*************)] 

  

	•	 	Estimation of [*************] and contaminant quantities 

  

	•	 	Set up a stability to evaluate [*************] degradation of [************************]  

  

	•	 	Determine harvest window 

  

	•	 	Select best fermentation medium and strategy based on [*************], levels of contaminants and [***********] stability [(*************)] 

 

	•	 	Generate material for purification studies by the [**********] (this will be completed [***********]) 

  

	•	 	Technical report on all completed work, data, data analysis, conclusions and recommendations. 

  
 Key Deliverable: The deliverable for Stage I is a volumetric fermentation titre of [*************] fermentation culture as
estimated by [********] by [**********]. 
  
 Decision Point: If
deliverable is met on schedule, then proceed to next stage of proposal. If deliverable is not met on schedule, then Auxilium will review available information and determine whether to proceed to next stage or terminate the project. 
  

			
	Subtotal	  	[$**********]

  
 Stage II – Process Development
Purification 
  
 Using material generated in Stage I a [************]
where more starting material is required) process run through using the modified purification process will be performed, the aim being to assess the productivity and the purity of the material generated from the new process. Additionally, the
product will be characterized to demonstrate that at each 
  

					
	Confidential Document	 	4	  	June 28, 2005

 

 
  

 
stage material recovered is comparable to the reference material supplied by BTC. At the intermediate stage it will be compared [*************] and
the bulk drug substance will be compared to the Final Drug Product [*************] reference material supplied by BTC [*************] to ensure they are comparable to the material produced to date with regards to sequence. 

 
 Work to be Completed: 
  
 Product Characterization and Stability Studies 
  

	•	 	Characterization of the product generated at Cobra in comparison to existing reference material 

  

	 	•	 	[*********************] 

  

	 	•	 	[*********************] 

  

	 	•	 	[*********************] 

  

	•	 	Obtain a full understanding of the product stability during the purification process and an initial evaluation of the stability of the liquid drug substance.

  

	•	 	Assessment of procedures to inhibit [*************] 

  

	•	 	A structured study of product stability with inhibition of [*************] of the [*************] products 

  
 Assessment of Modified Fermentation Process 
  

	•	 	Key hold steps and final product stages will be assessed and compared with that observed for the existing process 

  

	•	 	Technical report on all completed work, data, data analysis, conclusions and recommendations. 

  
 Key Deliverable: The deliverable for Stage II is [*****************************************.] 
  
 If deliverable is met on schedule, then proceed to next stage of proposal. If deliverable is
not met on schedule, then Auxilium will review available information and determine whether to proceed to next stage or terminate the project. 
  

			
	Subtotal	  	[$**********]

  
 Stage III - Process Scale-up and
Intensification [(*************)] 
  
 Work to be Completed:

  
 Fermentation 
  

	•	 	Identify efficient and effective inoculation steps to produce a robust reproducible inoculum train 

  

					
	Confidential Document	 	5	  	June 28, 2005

 

 
  

	•	 	Assess the reproducibility of the inoculum preparation process [*************] 

  

	•	 	Address issues of handling and preparing large quantities of media [*************] 

  

	•	 	Perform [****] fermentation scale-up run 

  

	•	 	Analysis of fermentation harvest 

  

	•	 	Technical report on all completed work, data, data analysis, conclusions and recommendations. 

  
 Purification 
  

	•	 	Removal of all un-scalable operations such as: [*************] 

  

	•	 	Intensification by attempting to process at [*************] 

  

	•	 	Increase throughput to [*************] 

  

	•	 	Increase [*************] 

  

	•	 	Small scale demonstration at [**] and [***] scale of purification process [*************] 

  

	•	 	Generate new SOPs and BMRs documentation for cGMP Engineering Run in Stage IV 

  

	•	 	Critical process parameters and operating ranges will be identified and incorporated into SOPs and BMRs, however they will not be validated at this stage 

 

	•	 	Analysis 

  

	•	 	Technical report 

  
 In Stage III, the intensified purification process will be performed at the [*************] scale to demonstrate that product quality and yields are in-line with expectations and to identify any logistical
issues ahead of scaling the purification process to the [****] scale. The product generated from this study may be put through full QC clearance and will be made available to Auxilium for in-house studies and possibly pre-clinical use. 

 
 Key Deliverable: The deliverable for Stage III is the small-scale demonstration of
a reproducible and robust process that will [************************************************************.] 
  
 If deliverable is met on schedule, then proceed to next stage of proposal. If deliverable is not met on schedule, then Auxilium will review available information and
determine whether to proceed to next stage or terminate the project. 
  
 Critical Decision Point: If the demonstration of a robust and reproducible process that [******************************************************************************************
***********************************************************************,] then the program will proceed to next stage of the proposal. If the productivities obtained by the end of Stage III do not meet the deliverable or do not 
  

					
	Confidential Document	 	6	  	June 28, 2005

 

 
  

 
reach the objectives of commercially viable scale, then Auxilium may instruct Cobra to proceed with the current productivities for the cGMP Engineering Run
and/or implement a 3-month process development program immediately after Decision Point considerations. Cobra will then outline exactly what the next steps for a 3-month process development program and detail probability of success and will
implement the program after approval by Auxilium. 
  

			
	Subtotal	  	[$*************]

  
 Stage IV – [****] cGMP
Engineering Run 
  
 The fermentation and purification processes will be
demonstrated by executing a full scale [****] Engineering Run, the aim being to [************************] drug substance for lyophilization. All materials will be tested to the agreed specification. The Engineering Run will be performed to a
cGMP BMR. Material produced from this batch will be made available to the customer for potential finished product processing. 
  
 Work to be Completed: 
  

	•	 	[****] cGMP Engineering run 

  

	•	 	[************************] 

  

	•	 	QC Clearance of bulk material 

  

	•	 	cGMP summary report for production of drug substance 

  

	•	 	QC analysis of lyophilized material (drug product) 

  

	•	 	Summary report for QC release of drug product 

  

	•	 	QP release 

  

			
	Subtotal	  	[$*************]

  
 Key Deliverable: The
deliverable for Stage IV is proof of full scale manufacturing process as evidenced by production of [*************] that meets preliminary/tentative specifications and was produced from the developed manufacturing process under cGMP
conditions [*************.] 
  
 Decision Point: Proceed with cGMP
manufacture(s). 
  
 If the target deliverable is met on schedule, then proceed to
the next stage of the proposal. If deliverable is not met on schedule, then Auxilium will review available information and determine whether to proceed to next stage or terminate project. 
  
 Assumption of Risk: Cobra will accept responsibility for a failure due to a cGMP requirement of the Engineering Run. Auxilium will
accept responsibility for a technical failure of the Engineering Run since time restraints prohibited a full scale practice engineering run prior to cGMP. 
  

					
	Confidential Document	 	7	  	June 28, 2005

 

 
  

 Stage V – [***] cGMP Manufacture 
  
 Work to be Completed: 
  

	 	•	 	cGMP reproducibility runs (minimum of [**] further cGMP process runs) 

  

	 	•	 	QC analysis of intermediates and clearance of drug substance (bulk) 

  

	 	•	 	QA review and provision of cGMP summary reports 

  

	 	•	 	Work completed by [*************] 

  

			
	Subtotal	  	[$*************]

  

	 	•	 	QC analysis of lyophilized Drug Product [(*************)] 

  

	 	•	 	QP release of Drug Product [(*************)] 

  

			
	Subtotal	  	[$*************]

  
 Assumption of Risk by Cobra:
Cobra will accept responsibility for any failed cGMP runs. 
  

			
	Total	  	$3,315,000

  
 This quotation is valid until
July 15, 2005. 
  
 Notes: 
  

	1.	The costs of consumables have not been included in the above quotation and will be billed directly to the customer without additional charge. Estimates are provided below, but
cannot be confirmed until the final process is determined [(*************).] 

  

			
	Fermentation	  	 
	Stage 1	  	[$*************]
	Stage 2	  	[$*************]
	Stage 3	  	[$*************]
	Stage 4	  	[$*************]
	Stage 5	  	[$*************]

  

			
	DSP	  	 
	Stage 2	  	[$*************]
	Stage 3	  	[$*************]
	Stage 4	  	[$*************]
	Stage 5	  	[$*************]

  

			
	Other QA and Subcontract
	Whole Program	  	[$*************]

  

					
	Confidential Document	 	8	  	June 28, 2005

 

 
  

	2.	This proposal does not include formulation development, fill/finish or lyophilization of final product. 

  

	3.	This proposal does not include Process Validation. 

  

	4.	All subcontract prices are estimates and are not binding (below). Subcontracted work will be invoiced separately from the Cobra work program with an additional 10% charge for
coordination. Cobra will notify Auxilium prior to any work being subcontracted. 

  

	 	•	 	[*************] 

  

	 	•	 	[*************] 

  

	 	•	 	[*************] 

  

	5.	Cobra will take responsibility for shipment. The price of shipment of bulk, dosage forms and samples and insurance thereof is excluded from this contract. Shipping will be arranged
in consultation with the customer and will be billed directly to the customer [(*************)**********************************************************************]. 

  

	6.	Prior to any information being disclosed in the form of a Press Release written approval must be obtained from the other party. 

  

	7.	In order to comply with cGMP regulations; a separate technical agreement between Cobra and Auxilium must be in place before cGMP manufacture is initiated. A proforma template can be
supplied by Cobra on request. 

  

	8.	It is estimated that the cost of the additional process validation studies may range from [$*************] depending on the scope of studies required for this orphan drug by
the FDA. A final price will be determined as soon as possible or after meeting with the FDA. 

  

	9.	All other terms and conditions of the Research and Development Agreement (“the Agreement”) having an effective date of September 15, 2004 are incorporated by
reference as if fully set forth herein; provided, however, that the parties specifically agree that Cobra shall not be entitled to terminate the Agreement pursuant to Section 10.1 of the Agreement with respect to the Services set forth in this
Exhibit 9. 

  

	10.	 For Work performed by Cobra regarding Stages I, II, and III this Proposal will be governed by the Terms and Conditions of the Research and Development Agreement
executed between Cobra and Auxilium, dated [*************.] To the extent that Cobra and Auxilium proceed to Stages IV and V of this Proposal, the Cobra Services shall be subject to a final agreement to be negotiated between the parties
regarding contract manufacturing and clinical supply (“Final Contract Manufacturing and Clinical Supply Agreement”). The Final Contract 

  

					
	Confidential Document	 	9	  	June 28, 2005

 

 
  

	 	 
Manufacturing and Clinical Supply Agreement shall include, but not be limited to criteria and standards governing scale up and production, cGMP compliance,
including validation, testing, batch release and other quality assurance, technical and regulatory requirements designated by Auxilium. 

  
 How to Proceed 
  
 Please return a signed copy of the contract with your formal Purchase Order to Cobra Biomanufacturing. 
  
 [************* 
  
 ************* 
  
 *************

  
 ************* 
  
 ************* 
  
 ************* 
  
 *************] 
  
 When timing is critical a faxed version is acceptable, but an original must be signed and returned within fourteen days. Upon receipt Cobra will notify the client of acceptance within 72 hours. 
  

					
	Confidential Document	 	10	  	June 28, 2005

 

 
  

 Auxilium Pharmaceuticals, Inc. 
 40 Valley Stream Parkway 
 Malvern, PA 19401 
 USA 
  
 June 28, 2005 
  
 Contract
O630 
  
 Process Development and cGMP Manufacture of Phase III
CTM 
  

			
	Total for Cobra Work Program:	  	$3,315,000

  
 Terms of Payment

  
 The following payment terms will apply
upon signing of Proposal O630 by both Cobra and Auxilium: 
  
 Purchase orders for
each Stage of this proposal shall be issued by Auxilium upon approval to commence the work outlined in the corresponding stage. Upon Auxilium approval to initiate a Stage and receipt of the corresponding Purchase Order from Auxilium, Cobra shall
issue an invoice for [*************] of the total Stage cost, in the case of Stage I and II, [***********] of the total Stage cost, in the case of Stages III, IV and V. The remaining balance of each Stage’s total cost shall be
invoiced appropriately by Cobra on a monthly basis against work completed. However, the final [******] of each Stage’s total cost shall not be invoiced and become due until the delivery by Cobra and acceptance by Auxilium of Technical
Report and/or the Certificate of Analysis by Auxilium’s QA Department for the respective Stage. 
  

									
	 For Auxilium Pharmaceuticals, Inc.
	 	 	 	 For Cobra Biologics Ltd.

				
	Accepted by:	 	 Gerri Henwood
	 	 	 	 David R. Thatcher, Chief Executive

					
	 Title:
	 	 CEO
	 	 	 	 Signature:
	 	 /s/ David R. Thatcher

					
	 Signature:
	 	 /s/ Gerri Henwood
	 	 	 	 Date:
	 	 July 27, 2005

					
	 Date:
	 	 July 27, 2005
	 	 	 	 	 	 

  

					
	Confidential Document	 	11	  	June 28, 2005

 

 
  

 Down Payment Invoice Scheme: 
  
 Upon signing of this proposal by both parties, Auxilium to issue Purchase
Order for Stages I and II of the program. 
  
 [*************]

  
 [*************] 
  
 Cobra to invoice Auxilium for [*************] of total Stage cost.

  
 Stages I and II Down Payment= [$*************]

  
 Upon approval by Auxilium to commence subsequent Stages,
Auxilium to issue Purchase Order for approved Stage and Cobra to invoice [***] of total Stage cost. 
  

			
	Stage III = $[******]	  	Down Payment= [$*************]
	Stage IV = $[******]	  	Down Payment= [$*************]
	Stage V = $[******]	  	Down Payment= [$*************]

  

					
	Confidential Document	 	12	  	June 28, 2005

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