Document:

Exhibit 10.16

 

PUBLIC HEALTH SERVICE

 

COOPERATIVE RESEARCH AND DEVELOPMENT AGREEMENT

 

This Agreement is based on the model Cooperative Research and
Development Agreement (“CRADA”) adopted by the U.S. Public Health Service (“PHS”)
Technology Transfer Policy Board for use by components of the National
Institutes of Health (“NIH”), the Centers for Disease Control and Prevention (“CDC”),
and the Food and Drug Administration (“FDA”), which are agencies of the PHS
within the Department of Health and Human Services (“HHS”).

 

This Cover Page identifies the Parties to this CRADA:

 

The U.S. Department of Health and Human
Services, as represented by

 

National Center for Toxicological Research

 

an Institute, Center, or Division
(hereinafter referred to as the “FDA”) of the

 

Food and Drug Administration

 

 

and,

 

BG Medicine, Inc.

 

hereinafter referred to as the “Collaborator”,

 

having offices at 610 N Lincoln Street,
Waltham, MA 02451

created and operating under the laws of
Delaware.

 

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Article 1.                    Introduction

 

This CRADA between FDA and Collaborator will be effective when signed
by the Parties, which are identified on both the Cover Page and the Signature
Page (page 16). The official contacts for the Parties are identified on the
Contacts Information Page (page 17). Publicly available information regarding
this CRADA appears on the Summary Page (page 18). The research and development
activities that will be undertaken by FDA and Collaborator in the course of
this CRADA are detailed in the Research Plan, attached as Appendix A. The
staffing, funding, and materials contributions of the Parties are set forth in
Appendix B. Any changes to the model CRADA are set forth in Appendix C.

 

Article 2.                    Definitions

 

The terms listed in this Article will carry the meanings indicated
throughout the CRADA. To the extent a definition of a term as provided in this
Article is inconsistent with a corresponding definition in the applicable
sections of either the United States Code (U.S.C.) or the Code of Federal
Regulations (C.F.R.), the definition in the U.S.C. or C.F.R. will control.

 

2.1                            “Affiliate” means any corporation or other
business entity controlled by, controlling, or under common control with
Collaborator at any time during the term of the CRADA. For this purpose, “control”
means direct or indirect beneficial ownership of at least fifty percent (50%)
of the voting stock or at least fifty percent (50%) interest in the income of
the corporation or other business entity.

 

2.2                            “Background Invention” means an Invention
conceived and first actually reduced to practice before the Effective Date.

 

2.3                            “Collaborator Materials” means all tangible
materials not first produced in the performance of this CRADA that are owned or
controlled by Collaborator and used in the performance of the Research Plan.

 

2.4                            “Confidential Information” means
confidential scientific, business, or financial information provided that the
information does not include:

 

(a)                                 information
that is publicly known or that is available from public sources;

 

(b)                                information
that has been made available by its owner to others without a confidentiality
obligation;

 

(c)                                 information
that is already known by the receiving Party, or information that is
independently created or compiled by the receiving Party without reference to
or use of the provided information; or

 

(d)                                information
that relates to potential hazards or cautionary warnings associated with the
production, handling, or use of the subject matter of the Research Plan.

 

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2.5                                “Cooperative Research and Development Agreement” or
“CRADA” means this Agreement, entered
into pursuant to the Federal Technology Transfer Act of 1986, as amended(15
U.S.C. §§ 3710a et
seq.), and Executive Order 12591 of
April 10, 1987.

 

2.6                                “CRADA Data” means all recorded information
first produced in the performance of the Research Plan.

 

2.7                                “CRADA Materials” means all tangible
materials first produced in the performance of the Research Plan other than
CRADA Data.

 

2.8                                “CRADA Subject Invention” means any
Invention of either or both Parties, conceived or first actually reduced to
practice in the performance of the Research Plan.

 

2.9                                “Effective Date” means the date of the last
signature of the Parties executing this Agreement.

 

2.10                          “Government” means the Government of the
United States of America.

 

2.11                          “FDA Materials” means all tangible
materials not first produced in the performance of this CRADA that are owned or
controlled by FDA and used in the performance of the Research Plan.

 

2.12                          “Invention” means any invention or
discovery that is or may be patentable or otherwise protected under Title 35 of
the United States Code, or any novel variety of plant which is or may be
protectable under the Plant Variety Protection Act, 7 U.S.C. §§ 2321 et seq.

 

2.13                          “Patent Application” means an application
for patent protection for a CRADA Subject Invention with the United States
Patent and Trademark Office (“U.S.P.T.O.”) or the corresponding patent-issuing
authority of another nation.

 

2.14                          “Patent” means any issued United States
patent, any international counterpart(s), and any corresponding grant(s) by a
non-U.S. government in place of a patent.

 

2.15                          “Principal Investigator(s)” or “PI(s)” means the person(s) designated by the Parties who
will be responsible for the scientific and technical conduct of the Research
Plan.

 

2.16                          “Research Plan” means the statement in
Appendix A of the respective research and development commitments of the
Parties.

 

Article
3.                    Cooperative
Research and Development

 

3.1                                Performance of Research and Development. The
research and development activities to be carried out under this CRADA will be
performed solely by the Parties identified on the Cover Page unless
specifically stated elsewhere in this Agreement. The PIs will be responsible
for the scientific and technical conduct of this project on behalf of their

 

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employers. Any Collaborator employees who will work at FDA facilities
will be required to sign a Guest Researcher or Special Volunteer Agreement
appropriately modified in view of the terms of this CRADA.

 

3.2                                Research Plan. The Parties recognize that
the Research Plan describes the collaborative research and development
activities they will undertake and that interim research goals set forth in the
Research Plan are good faith guidelines. Should events occur that require
modification of these goals, then by mutual agreement the Parties can modify
them through an amendment, according to Paragraph 13.6.

 

3.3                                Use and Disposition of Collaborator Materials and FDA
Materials. The Parties agree to use Collaborator Materials and FDA
Materials only in accordance with the Research Plan, not to transfer these
materials to third parties except in accordance with the Research Plan or as
approved by the owning or providing Party, and, upon expiration or termination
of the CRADA, to dispose of these materials as directed by the owning or
providing Party.

 

3.4                                Third-Party Rights in Collaborator’s CRADA Subject Inventions.
If Collaborator has received (or will receive) support of any kind
from a third party in exchange for rights in any of Collaborator’s CRADA
Subject Inventions, Collaborator agrees to ensure that its obligations to the
third party are both consistent with Articles 6 through 8 and subordinate to
Article 7 of this CRADA.

 

3.5                                Disclosures to FDA. Prior to execution of
this CRADA, Collaborator agrees to disclose to FDA all instances in which
outstanding royalties are due under a PHS license agreement, and in which
Collaborator had a PHS license terminated in accordance with 37 C.F.R. §
404.10. These disclosures will be treated as Confidential Information upon
request by Collaborator in accordance with Paragraphs 2.4, 8.3, and 8.4.

 

Article 4.                    Reports

 

4.1                                Interim Research and Development Reports. The
PIs should exchange information regularly, in writing. This exchange may be
accomplished through meeting minutes, annual reports, detailed correspondence,
and circulation of draft manuscripts.

 

4.2                                Final Research and Development Reports. The
Parties will exchange final reports of their results within four (4) months
after the expiration or termination of this CRADA. These reports will set forth
the technical progress made; any publications arising from the research; and
the existence of invention disclosures of potential CRADA Subject Inventions
and/or any corresponding Patent Applications.

 

4.3                                Fiscal Reports. If Collaborator has agreed
to provide funding to FDA under this CRADA and upon the request of Collaborator,
then concurrent with the exchange of final research and development reports
according to Paragraph 4.2, FDA will submit to Collaborator a statement of all
costs incurred by FDA for the CRADA. If the CRADA

 

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has been terminated, FDA will specify any costs incurred before the
date of termination for which FDA has not received funds from Collaborator, as
well as for all reasonable termination costs including the cost of returning
Collaborator property or removal of abandoned Collaborator property, for which
Collaborator will be responsible.

 

Article 5.                    Staffing,
Financial, and Materials Obligations

 

5.1                                FDA and Collaborator Contributions. The
contributions of any staff, funds, materials, and equipment by the Parties are
set forth in Appendix B. The Federal Technology Transfer Act of 1986, 15 U.S.C.
§ 3710a(d)(1) prohibits FDA from providing funds to Collaborator for any
research and development activities under this CRADA.

 

5.2                                FDA Staffing. No FDA employees will devote
100% of their effort or time to the research and development activities under
this CRADA. FDA will not use funds provided by Collaborator under this CRADA
for FDA personnel to pay the salary of any permanent FDA employee. Although
personnel hired by FDA using CRADA funds will focus principally on CRADA
research and development activities, Collaborator acknowledges that these
personnel may nonetheless make contributions to other research and development
activities, and the activities will be outside the scope of this CRADA.

 

5.3                                Collaborator Funding. Collaborator
acknowledges that Government funds received by Collaborator from an agency of
the Department of Health and Human Services may not be used to fund FDA under
this CRADA. If Collaborator has agreed to provide funds to FDA then the payment
schedule appears in Appendix B and Collaborator will make payments according to
that schedule. If Collaborator fails to make any scheduled payment, FDA will
not be obligated to perform any of the research and development activities
specified herein or to take any other action required by this CRADA until the
funds are received. FDA will use these funds exclusively for the purposes of
this CRADA. Each Party will maintain separate and distinct current accounts,
records, and other evidence supporting its financial obligations under this
CRADA and, upon written request, will provide the other Party a Fiscal Report
according to Paragraph 4.3, which delineates all payments made and all
obligated expenses, along with the Final Research Report described in Paragraph
4.2.

 

5.4                                Capital Equipment. Collaborator’s
commitment, if any, to provide FDA with capital equipment to enable the
research and development activities under the Research Plan appears in Appendix
B. If Collaborator transfers to FDA the capital equipment or provides funds for
FDA to purchase it, then FDA will own the equipment. If Collaborator loans
capital equipment to FDA for use during the CRADA, Collaborator will be
responsible for paying all costs and fees associated with the transport,
installation, maintenance, repair, removal, or disposal of the equipment, and
FDA will not be liable for any damage to the equipment.

 

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Article
6.                    Intellectual
Property

 

6.1                                Ownership of CRADA Subject Inventions, CRADA Data, and
CRADA Materials. Subject to the Government license described in
Paragraph 7.5, the sharing requirements of Paragraph 8.1, and the regulatory
filing requirements of Paragraph 8.2, the producing Party will retain sole
ownership of and title to all CRADA Subject Inventions, all copies of CRADA
Data, and all CRADA Materials produced solely by its employee(s). The Parties
will own jointly all CRADA Subject Inventions invented jointly and all copies of
CRADA Data and all CRADA Materials developed jointly.

 

6.2                                Reporting. The Parties will promptly report
to each other in writing each CRADA Subject Invention reported by their
respective personnel, and any Patent Applications filed thereon, resulting from
the research and development activities conducted under this CRADA. Each Party
will report all CRADA Subject Inventions to the other Party in sufficient
detail to determine inventorship, which will be determined in accordance with
U.S. patent law. These reports will be treated as Confidential Information in
accordance with Article 8. Formal reports will be made by and to the Patenting
and Licensing Offices identified on the Contacts Information Page herein.

 

6.3                                Filing of Patent Applications. Each Party
will make timely decisions regarding the filing of Patent Applications on the
CRADA Subject Inventions made solely by its employee(s), and will notify the
other Party in advance of filing. Collaborator will have the first opportunity
to file a Patent Application on joint CRADA Subject Inventions and will notify
PHS of its decision within sixty (60) days of an Invention being reported or at
least thirty (30) days before any patent filing deadline, whichever occurs
sooner. If Collaborator fails to notify PHS of its decision within that time
period or notifies PHS of its decision not to file a Patent Application, then
PHS has the right to file a Patent Application on the joint CRADA Subject
Invention. Neither Party will be obligated to file a Patent Application. Collaborator
will place the following statement in any Patent Application it files on a
CRADA Subject Invention: “This invention was created in the performance of a
Cooperative Research and Development Agreement with the Food and Drug
Administration, an Agency of the Department of Health and Human Services. The
Government of the United States has certain rights in this invention.” If
either Party files a Patent Application on a joint CRADA Subject Invention,
then the filing Party will include a statement within the Patent Application
that clearly identifies the Parties and states that the joint CRADA Subject
Invention was made under this CRADA.

 

6.4                                Patent Expenses. Unless agreed otherwise,
the Party filing a Patent Application will pay all preparation and filing
expenses, prosecution fees, issuance fees, post issuance fees, patent
maintenance fees, annuities, interference expenses, and attorneys’ fees for
that Patent Application and any resulting Patent(s). If a license to any CRADA
Subject Invention is granted to Collaborator, then Collaborator will be
responsible for all expenses and fees, past and future, in connection with the
preparation, filing,.prosecution, and maintenance of any Patent Applications
and Patents claiming exclusively-licensed CRADA Subject Inventions and will be
responsible for a pro-rated share, divided equally among all licensees, of
those expenses and fees for non-exclusively licensed CRADA

 

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Subject Inventions. Collaborator may waive its exclusive option rights
at any time, and incur no subsequent financial obligation for those Patent
Application(s) or Patent(s)

 

6.5                                Prosecution of Patent Applications. The
Party filing a Patent Application will provide the non-filing Party with a copy
of any official communication relating to prosecution of the Patent Application
within thirty (30) days of transmission of the communication. Each Party will
also provide the other Party with the power to inspect and make copies of all
documents retained in the applicable Patent Application or Patent file. The
Parties agree to consult with each other regarding the prosecution of Patent
Applications directed to joint CRADA Subject Inventions. If Collaborator elects
to file and prosecute Patent Applications on joint CRADA Subject Inventions,
then Collaborator agrees to use the U.S.P.T.O. Customer Number Practice and/or
grant PHS a power(s) of attorney (or equivalent) necessary to assure PHS access
to its intellectual property rights in these Patent Applications. PHS and
Collaborator will cooperate with each other to obtain necessary signatures on
Patent Applications, assignments, or other documents.

 

Article
7.                    Licensing

 

7.1                                Background Inventions. Other than as
specifically stated in this Article 7, nothing in this CRADA will be construed
to grant any rights in one Party’s Background Invention(s) to the other Party,
except to the extent necessary for the Parties to conduct the research and
development activities described in the Research Plan.

 

7.2                                Collaborator’s License Option to CRADA Subject
Inventions. With respect to Government rights to any CRADA Subject
Invention made solely by an FDA employee(s) or made jointly by an FDA
employee(s) and a Collaborator employee(s) for which a Patent Application was
filed, PHS hereby grants to Collaborator an exclusive option to elect an
exclusive or nonexclusive commercialization license. The license will be
substantially in the form of the appropriate model PHS license agreement and
will fairly reflect the nature of the CRADA Subject Invention, the relative
contributions of the Parties to the CRADA Subject Invention and the CRADA, a
plan for the development and marketing of the CRADA Subject Invention, the
risks incurred by Collaborator, and the costs of subsequent research and
development needed to bring the CRADA Subject Invention to the marketplace. The
field of use of the license will not exceed the scope of the Research Plan.

 

7.3                                Exercise of Collaborator’s License Option. To
exercise the option of Paragraph 7.2 Collaborator must submit a written notice
to the PHS Patenting and Licensing Contact identified on the Contacts
Information Page (and provide a copy to the FDA Contact for CRADA Notices)
within three (3) months after either (i) Collaborator receives written notice
from PHS that the Patent Application has been filed or (ii) the date on which
Collaborator files the Patent Application. The written notice exercising this
option will include a completed “Application for License to Public Health
Service Inventions” and will initiate a negotiation period that expires nine
(9) months after the exercise of the option. If PHS has not responded in
writing to the last proposal by Collaborator within

 

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this nine (9) month period, the negotiation period will be extended to
expire one (1) month after PHS so responds, during which month Collaborator may
accept in writing the final license proposal of PHS. In the absence of
Collaborator’s exercise of the option, or upon election of a nonexclusive
license, PHS will be free to license the CRADA Subject Invention to others.
These time periods may be extended at the sole discretion of PHS upon good
cause shown in writing by Collaborator.

 

7.4                                Government License in FDA Sole CRADA Subject Inventions
and Joint CRADA Subject Inventions. Pursuant to 15 U.S.C. §
3710a(b)(1)(A), for CRADA Subject Inventions owned solely by FDA or jointly by
FDA and Collaborator, and licensed pursuant to the option of Paragraph 7.2,
Collaborator grants to the Government a nonexclusive, nontransferable,
irrevocable, paid-up license to practice the CRADA Subject Invention or have
the CRADA Subject Invention practiced throughout the world by or on behalf of
the Government. In the exercise of this license, the Government will not
publicly disclose trade secrets or commercial or financial information that is
privileged or confidential within the meaning of 5 U.S.C. § 552(b)(4) or which
would be considered privileged or confidential if it had been obtained from a
non-federal party.

 

7.5                                Government License in Collaborator Sole CRADA Subject
Inventions. Pursuant to 15 U.S.C. § 3710a(b)(2), for CRADA Subject
Inventions made solely by an employee of Collaborator, Collaborator grants to
the Government a nonexclusive, nontransferable, irrevocable, paid-up license to
practice the CRADA Subject Invention or have the CRADA Subject Invention
practiced throughout the world by or on behalf of the Government for research
or other Government purposes.

 

7.6                                Third Party License. Pursuant to 15 U.S.C.
§ 3710a(b)(1)(B), if PHS grants an exclusive license to a CRADA Subject
Invention made solely by an FDA employee or jointly with a Collaborator
employee, the Government will retain the right to require Collaborator to grant
to a responsible applicant a nonexclusive, partially exclusive, or exclusive
sublicense to use the CRADA Subject Invention in Collaborator’s licensed field
of use on terms that are reasonable under the circumstances; or, if
Collaborator fails to grant a license, to grant the license itself. The
exercise of these rights by the Government will only be in exceptional
circumstances and only if the Government determines (i) the action is necessary
to meet health or safety needs that are not reasonably satisfied by
Collaborator, (ii) the action is necessary to meet requirements for public use
specified by federal regulations, and such requirements are not reasonably
satisfied by Collaborator; or (iii) Collaborator has failed to comply with an
agreement containing provisions described in 15 U.S.C. § 3710a(c)(4)(B). The
determination made by the Government under this Paragraph is subject to
administrative appeal and judicial review under 35 U.S.C. § 203(2).

 

7.7                                Third-Party Rights In FDA Sole CRADA Subject
Inventions. For a CRADA Subject Invention conceived prior to the
Effective Date solely by an FDA employee that is first actually reduced to
practice after the Effective Date in the performance of the Research

 

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Plan, the option offered to Collaborator in Paragraph 7.2 may be
restricted if, before the Effective Date, PHS had filed a Patent Application
and has either offered or granted a license or has executed a license in the
CRADA Subject Invention to a third party. Collaborator nonetheless retains the
right to apply for a license to any such CRADA Subject Invention in accordance
with the terms and procedures of 35 U.S.C. § 209 and 37 C.F.R. Part 404.

 

7.8                                Joint CRADA Subject Inventions Not Exclusively
Licensed by Collaborator. If Collaborator does not acquire an
exclusive commercialization license in a joint CRADA Subject Invention in all
fields of use then, for those fields of use not exclusively licensed to
Collaborator, each Party will have the right to use the joint CRADA Subject Invention
and to license its use to others, and each Party will cooperate with the other,
as necessary, to fulfill international licensing requirements. The Parties may  agree to a joint licensing
approach for any remaining fields of use.

 

Article
8.                    Rights
of Access and Publication

 

8.1                                Right of Access to CRADA Data and CRADA Materials. FDA
and Collaborator agree to exchange all CRADA Data and to share all CRADA
Materials. If the CRADA is terminated, both Parties agree to provide CRADA
Materials in quantities needed to complete the Research Plan. Such provision
will occur before the termination date of the CRADA or sooner, if required by
the Research Plan.

 

8.2                                Use of CRADA Data and CRADA Materials. The
Parties will be free to utilize CRADA Data and CRADA Materials internally for
their own purposes, consistent with their obligations under this CRADA. The
Parties may share CRADA Data or CRADA Materials with their Affiliates, agents
or contractors provided the obligations of this Article 8.2 are simultaneously
conveyed.

 

(a)                                CRADA
Data.

 

Collaborator and FDA will use reasonable
efforts to keep CRADA Data confidential until published or until corresponding
Patent Applications are filed. To the extent permitted by law, each Party will
have the right to use any and all CRADA Data in and for any regulatory filing
by or on behalf of the Party.

 

(b)                               CRADA
Materials.

 

Collaborator and FDA will use reasonable
efforts to keep descriptions of CRADA Materials confidential until published or
until corresponding Patent Applications are filed. Collaborator acknowledges
that the basic research mission of PHS includes sharing with third parties for
further research those research resources made in whole or in part with NIH
funding. Consistent with this mission and the tenets articulated in

 

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“Sharing of Biomedical Research Resources: Principles and Guidelines
for Recipients of NIH Research Grants and Contracts”, December 1999, available
at http://ott.od.nih.gov/NewPages/RTguide_final.html, following
publication either Party may make available to third parties for further
research those CRADA Materials made jointly by both PHS and Collaborator. Notwithstanding the above, if those joint
CRADA Materials are the subject of a pending Patent Application
or a Patent, the Parties may agree to restrict distribution or freely
distribute them. Either Party may distribute those CRADA Materials made solely
by the other Party only upon written consent from that other Party or that
other Party’s designee.

 

8.3                                Confidential Information. Each Party agrees
to limit its disclosure of Confidential Information to the amount necessary to
carry out the Research Plan, and will place a confidentiality notice on all
such information. A Party orally disclosing Confidential Information to the
other Party will summarize the disclosure in writing and provide it to the
other Party within fifteen (15) days of the disclosure. Each Party receiving
Confidential Information agrees to use it only for the purposes described in
the Research Plan. Either Party may object to the designation of information as
Confidential Information by the other Party.

 

8.4                                Protection of Confidential Information. Confidential
Information will not be disclosed, copied, reproduced or otherwise made available
to any other person or entity without the consent of the owning or providing
Party except as required by a court or administrative body of competent
jurisdiction, or federal law or regulation. Each Party agrees to use reasonable
efforts to maintain the confidentiality of Confidential Information, which will
in no instance be less effort than the Party uses to protect its own
Confidential Information. Each Party agrees that a Party receiving Confidential
Information will not be liable for the disclosure of that portion of the
Confidential Information which, after notice to and consultation with the
disclosing Party, the receiving Party determines may not be lawfully withheld,
provided the disclosing Party has been given a reasonable opportunity to seek a
court order to enjoin disclosure.

 

8.5                                Protection of Human Subjects’ Information. The
research and development activities to be conducted under this CRADA are not
intended to involve human subjects or human tissues within the meaning of 45
C.F.R. Part 46 and 21 C.F.R. Part 50. Should it become necessary to utilize
human subjects or human tissues, or to provide a Party with access to
information about identifiable human subjects, the Parties agree to amend this
CRADA in accordance with Paragraph 13.6 to ensure that the research and
development activities conducted hereunder will conform to the appropriate
federal laws and regulations, including but not limited to all applicable FDA
regulations and HHS regulations relating to the protection of human subjects.

 

8.6                            Duration of Confidentiality Obligation. The
obligation to maintain the confidentiality of Confidential Information will
expire at the earlier of the date when the information is no longer
Confidential Information as defined in Paragraph 2.4 or three (3) years after
the

 

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expiration or termination date of this CRADA. Collaborator may request
an extension to this term when necessary to protect Confidential Information
relating to products not yet commercialized.

 

8.7                                Publication. The Parties are encouraged to
make publicly available the results of their research and development
activities. Before either Party submits a paper or abstract for publication or
otherwise intends to publicly disclose information about a CRADA Subject
Invention, CRADA Data or CRADA Materials, the other Party will have thirty (30)
days to review the proposed publication or disclosure to assure that
Confidential Information is protected. Either Party may request in writing that
the proposed publication or other disclosure be delayed for up to thirty (30)
additional days as necessary to file a Patent Application.

 

Article 9.                    Representations
and Warranties

 

9.1                                Representations of FDA. FDA hereby
represents to Collaborator that:

 

(a)                                  FDA
has the requisite power and authority to enter into this CRADA and to perform
according to its terms, and that FDA’s official signing this CRADA has
authority to do so.

 

(b)                                 To
the best of its knowledge and belief, neither FDA nor any of its personnel
involved in this CRADA is presently subject to debarment or suspension by any
agency of the Government which would directly affect its performance of the
CRADA. Should FDA or any of its personnel involved in this CRADA be debarred or
suspended during the term of this CRADA, FDA will notify Collaborator within
thirty (30) days of receipt of final notice.

 

9.2                               Representations and Warranties of Collaborator. Collaborator
hereby represents and warrants to FDA that:

 

(a)                                       Collaborator
has the requisite power and authority to enter into this CRADA and to perform
according to its terms, and that Collaborator’s official signing this CRADA has
authority to do so.

 

(b)                                 Neither
Collaborator nor any of its personnel involved in this CRADA, including
Affiliates, agents, and contractors are presently subject to debarment or suspension by
any agency of the Government. Should Collaborator or any of its personnel
involved in this CRADA be debarred or suspended during the term of this CRADA,
Collaborator will notify FDA within thirty (30) days of receipt of final
notice.

 

(c)                                  Subject
to Paragraph 12.3, and if and to the extent Collaborator has agreed to provide
funding under Appendix B, Collaborator is financially able to satisfy these
obligations in a timely manner.

 

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Article 10.             Expiration and
Termination

 

10.1                          Expiration. This CRADA will expire on the
last date of the term set forth on the Summary Page. In no case will the term
of this CRADA extend beyond the term indicated on the Summary Page unless it is
extended in writing in accordance with Paragraph 13.6.

 

10.2                     Termination by Mutual Consent. FDA and
Collaborator may terminate this CRADA at any time by mutual written consent.

 

10.3                     Unilateral Termination. Either FDA or Collaborator
may unilaterally terminate this CRADA at any time by providing written notice
at least sixty (60) days before the desired termination date. FDA may, at its
option, retain funds transferred to FDA before unilateral termination by
Collaborator for use in completing the Research Plan.

 

10.4                     Funding for FDA Personnel. If Collaborator
has agreed to provide funding for FDA personnel and this CRADA is mutually or
unilaterally terminated by Collaborator before its expiration, then
Collaborator agrees that funds for that purpose will be available to FDA for a
period of six (6) months after the termination date or until the expiration
date of the CRADA, whichever occurs sooner. If there are insufficient funds to
cover this expense, Collaborator agrees to pay the difference.

 

10.5                     New Commitments. Neither Party will incur
new expenses related to this CRADA after expiration, mutual termination, or a
notice of a unilateral termination and will, to the extent feasible, cancel all
outstanding commitments and contracts by the termination date. Collaborator
acknowledges that FDA will have the authority to retain and expend any funds
for up to one (1) year subsequent to the expiration or termination date to
cover any unpaid costs obligated during the term of the CRADA in undertaking
the research and development activities set forth in the Research PIan.

 

Article 11.             Disputes

 

11.1                      Settlement. Any dispute arising under this
CRADA which is not disposed of by agreement of the Principal Investigators will
be submitted jointly to the signatories of this CRADA. If the signatories, or
their designees, are unable to jointly resolve the dispute within thirty (30)
days after notification thereof, the Assistant Secretary for Health (or his/her
designee or successor) will propose a resolution. Nothing in this Paragraph
will prevent any Party from pursuing any additional administrative remedies
that may be available and, after exhaustion of such administrative remedies,
pursuing all available judicial remedies.

 

11.2                      Continuation of Work. Pending the
resolution of any dispute or claim pursuant to this Article 11, the Parties agree that
performance of all obligations will be pursued diligently.

 

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Article 12.             Liability

 

12.1                          NO WARRANTIES. EXCEPT AS SPECIFICALLY
STATED IN ARTICLE 9, THE PARTIES MAKE NO EXPRESS OR IMPLIED WARRANTY AS TO ANY
MATTER WHATSOEVER, INCLUDING THE CONDITIONS OF THE RESEARCH OR ANY INVENTION OR
MATERIAL, WHETHER TANGIBLE OR INTANGIBLE, MADE OR DEVELOPED UNDER OR OUTSIDE
THE SCOPE OF THIS CRADA, OR THE OWNERSHIP, MERCHANTABILITY, OR FITNESS FOR A
PARTICULAR PURPOSE OF THE RESEARCH OR ANY INVENTION OR MATERIAL, OR THAT A
TECHNOLOGY UTILIZED BY A PARTY IN THE PERFORMANCE OF THE RESEARCH PLAN DOES NOT
INFRINGE ANY THIRD-PARTY PATENT RIGHTS.

 

12.2                          Indemnification and Liability. Collaborator
agrees to hold the Government harmless and to indemnify the Government for all
liabilities, demands, damages, expenses and losses arising out of the use by
Collaborator for any purpose of the CRADA Data, CRADA Materials or CRADA
Subject Inventions produced in whole or part by FDA employees under this CRADA,
unless due to the negligence or willful misconduct of FDA, its employees, or
agents. The Government has no statutory authority to indemnify Collaborator.
Each Party otherwise will be liable for any claims or damages it incurs in
connection with this CRADA, except that FDA, as an agency of the Government,
assumes liability only to the extent provided under the Federal Tort Claims Act
, 28 U.S.C. Chapter 171.

 

12.3                          Force
Majeure. Neither Party will be liable for any unforeseeable
event beyond its reasonable control and not caused by its own fault or
negligence, which causes the Party to be unable to perform its obligations
under this CRADA, and which it has been unable to overcome by the exercise of
due diligence. If a force
majeure event occurs, the Party unable to perform will promptly
notify the other Party. It will use its best efforts to resume performance as
quickly as possible and will suspend performance only for such period of time
as is necessary as a result of the force majeure event.

 

Article
13.             Miscellaneous

 

13.1                          Governing
Law. The construction, validity, performance and effect of this CRADA will
be governed by U.S. federal law, as applied by the federal courts in the
District of Columbia. If any provision in this CRADA conflicts with or is
inconsistent with any U.S. federal law or regulation, then the U.S. federal law
or regulation will preempt that provision.

 

13.2                          Compliance with Law.
FDA and Collaborator agree that they will comply with, and advise their
contractors and agents to comply with, all applicable statutes, Executive
Orders, HHS regulations, and all FDA, CDC, and NIH policies relating to
research on human subjects (45 C.F.R. Part 46, 21 C.F.R. Parts 50 and 56) and
relating to the appropriate care and use of laboratory animals (7 U.S.C. §§
2131 et seq.;  9 C.F.R. Part 1, Subchapter A).
Additional information on these subjects is available from the HHS

 

13

 

Office for Human Research Protections or from the NIH Office of
Laboratory Animal Welfare. Collaborator agrees to ensure that employees,
contractors, and agents of Collaborator who might have access to a “select agent
or toxin” (as that term is defined in 42 C.F.R. §§ 73.4-73.5) transferred from
FDA is properly licensed to receive the “select agent or toxin”.

 

13.3                     Waivers. None of the provisions of this
CRADA will be considered waived by any Party unless a waiver is given in
writing to the other Party. The failure of a Party to insist upon strict
performance of any of the terms and conditions hereof, or failure or delay to
exercise any rights provided
herein or by law, will not be deemed a waiver of any rights of any Party.

 

13.4                     Headings. Titles and headings of the
articles and paragraphs of this CRADA are for convenient reference only, do not
form a part of this CRADA, and will in no way affect its interpretation.

 

13.5                     Severability. The illegality or invalidity
of any provisions of this CRADA will not impair, affect, or invalidate the
other provisions of this CRADA.

 

13.6                     Amendments. Minor modifications to the
Research Plan may be made by the mutual written consent of the Principal
Investigators. Substantial changes to the CRADA, extensions of the term, or any
changes to Appendix C will become effective only upon a written amendment
signed by the signatories to this CRADA or by their representatives duly
authorized to execute an amendment. A change will be considered substantial if
it directly expands the range of the potential CRADA Subject Inventions, alters
the scope or field of any license option governed by Article 7, or requires a
significant increase in the contribution of resources by either Party.

 

13.7                     Assignment. Neither this CRADA nor any
rights or obligations of any Party hereunder will be assigned or otherwise
transferred by either Party without the prior written consent of the other
Party.

 

13.8                     Notices. All notices pertaining to or
required by this CRADA will be in writing, signed by an authorized
representative of the notifying Party, and delivered by first class,
registered, or certified mail, or by an express/overnight commercial delivery
service, prepaid and properly addressed to the other Party at the address
designated on the Contacts Information Page, or to any other address designated
in writing by the other Party. Notices will be considered timely if received on
or before the established deadline date or sent on or before the deadline date
as verifiable by U.S. Postal Service postmark or dated receipt from a
commercial carrier. Notices regarding the exercise of license options will be
made pursuant to Paragraph 7.3. Either Party
may change its address by notice given to the other Party in the manner
set forth above.

 

14

 

13.9                     Independent Contractors. The relationship
of the Parties to this CRADA is that of independent contractors and not agents
of each other or joint venturers or partners. Each Party will maintain sole and
exclusive control over its personnel and operations.

 

13.10               Use of Name; Press Releases. By entering
into this CRADA, the Government does not directly or indirectly endorse any
product or service that is or will be provided, whether directly or indirectly
related to either this CRADA or to any patent or other intellectual-property
license or agreement that implements this CRADA by Collaborator, its
successors, assignees, or licensees. Collaborator will not in any way state or
imply that the Government or any of its organizational units or employees
endorses any product or service. Each Party agrees to provide proposed press
releases that reference or rely upon the work under this CRADA to the other
Party for review and comment at least seven (7) days prior to publication.
Either Party may disclose the Summary Page to the public without the approval
of the other Party.

 

13.11                    Reasonable Consent. Whenever a Party’s
consent or permission is required under this CRADA, its consent or permission
will not be unreasonably withheld.

 

13.12                    Export Controls. Collaborator agrees to
comply with U.S. export law and regulations. If Collaborator has a need to
transfer any CRADA Materials made in whole or in part by FDA, or FDA Materials,
or FDA’s Confidential Information, to a person located in a country other than
the United States, to an Affiliate organized under the laws of a country other
than the United States, or to an employee of Collaborator in the United States
who is not a citizen or permanent resident of the United States, Collaborator
will acquire any and all necessary export licenses and other appropriate
authorizations.

 

13.13                    Entire Agreement. This CRADA constitutes
the entire agreement between the Parties concerning the subject matter of this
CRADA and supersedes any prior understanding or written or oral agreement.

 

13.14                    Survivability. The provisions of Paragraphs
3.3, 3.4, 4.2, 4.3, 5.3, 5.4, 6.1-9.2, 10.3-10.5, 11.1, 12.1-12.3, 13.1-13.3,
13.10 and 13.14 will survive the expiration or early termination of this CRADA.

 

SIGNATURES BEGIN ON THE NEXT PAGE

 

15

 

SIGNATURE PAGE

 

ACCEPTED AND AGREED

BY
EXECUTING THIS AGREEMENT, EACH PARTY REPRESENTS THAT ALL STATEMENTS MADE HEREIN
ARE TRUE, COMPLETE, AND ACCURATE TO THE BEST OF ITS KNOWLEDGE. COLLABORATOR
ACKNOWLEDGES THAT IT MAY BE SUBJECT TO CRIMINAL, CIVIL, OR ADMINISTRATIVE PENALTIES FOR KNOWINGLY MAKING A FALSE, FICTITIOUS, OR
FRAUDULENT STATEMENT OR CLAIM.

 

 

	
  FOR FDA:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ William Slikker

  	
   

  	
  2/23/07

  	
   

  
	
  Signature

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  William Slikker, Jr., Ph.D.

  	
   

  	
   

  
	
  Director, National Center for Toxicological Research

  	
   

  	
   

  
	
  Food and Drug Administration

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  FOR COLLABORATOR:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Pieter Muntendam

  	
   

  	
  2/23/07

  	
   

  
	
  Signature

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Pieter Muntendam, M.D.

  	
   

  	
   

  
	
  President, BG Medicine

  	
   

  	
   

  
					

 

16

 

CONTACTS INFORMATION PAGE

 

	
   

  	
  CRADA Notices

  
	
   

  	
   

  
	
  For FDA:

  	
  For Collaborator:

  
	
   

  	
   

  
	
   

  	
   

  
	
  William Slikker Jr., Ph.D.

  	
  Pieter Muntendam, M.D.

  
	
  Director, National Center for 

  	
  President, BG Medicine, Inc.

  
	
  Toxicological Research

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Patenting and Licensing

  
	
   

  	
   

  
	
  For FDA:

  	
  For Collaborator (if separate from above):

  
	
   

  	
   

  
	
  Division Director, Division of 

  	
   

  
	
  Technology Development and Transfer 

  	
   

  
	
  NIH Office of Technology Transfer 

  	
   

  
	
  6011 Executive Boulevard, Suite 325 

  	
   

  
	
  Rockville, Maryland 20852-3804 

  	
   

  
	
  Tel: 301-496-7057

  	
   

  
	
  Fax: 301-402-0220

  	
   

  
	
   

  	
   

  
	
  Delivery of Materials Identified In
  Appendix B (if any)

  
	
   

  	
   

  
	
  For FDA:

  	
  For Collaborator:

  
	
   

  	
   

  
	
  Fred A. Beland, Ph.D.

  	
  Robert McBurney, Ph.D.

  
	
  Director, Systems Toxicology 

  	
  Senior Vice President and Chief Scientific Officer 

  
	
  National Center for

  	
  BG Medicine, Inc.

  
	
  Toxicological Research

  	
   

  

 

17

 

SUMMARY PAGE

 

EITHER PARTY MAY, WITHOUT FURTHER CONSULTATION OR PERMISSION,

RELEASE THIS SUMMARY PAGE TO THE PUBLIC.

 

TITLE OF CRADA: Systems Toxicology from
the 28-day Rat Study  for Prediction of Clinical Liver Toxicity Potential

 

 

	
  PHS [FDA] Component:

  	
  National Center for Toxicological Research

  
	
   

  	
   

  
	
  FDA Principal Investigator:

  	
  Fred A. Beland, Ph.D.

  
	
   

  	
   

  
	
  Collaborator:

  	
  BG Medicine Inc.

  
	
   

  	
   

  
	
  Collaborator Principal Investigator:

  	
  Robert McBurney, Ph.

  
	
   

  	
   

  
	
  TERM OF CRADA:

  	
  One (1) year from the Effective Date.

  

 

18

 

Systems Toxicology from the 28-Day Rat Study for

Prediction of Clinical Liver Toxicity Potential

 

A Joint Program of the

Division of Systems Toxicology,

National Center for Toxicological Research,

and

BG Medicine, Inc.

 

Program Research Plan

 

Candidate Biomarkers and Hepatic Effects in a 28-Day

Exposure Study in Rats of Drugs with

Known Human Liver Toxicity

 

19

 

Table of Contents

 

	
  Contents

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  CRADA
  Abstract

  	
   

  	
  21

  
	
   

  	
   

  	
   

  
	
  Research
  Plan

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
  Overall
  Goal of the Joint Research Program

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
  Partners
  Jointly Conducting the Research

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
  The
  Relevance of the Program for Human Healthcare

  	
   

  	
  23

  
	
   

  	
   

  	
   

  
	
  Research
  Plan

  	
   

  	
  25

  
	
   

  	
   

  	
   

  
	
  Expected
  Benefits of the Program

  	
   

  	
  26

  

 

20

 

CRADA Abstract

 

In
light of the enormous impact of drug toxicity on the pharmaceutical industry
and the greater public health, the FDA has included improved predictive
toxicology as one of the three core dimensions of its Critical Path Initiative.
The Critical Path also highlights the potential applications of genomics,
proteomics and metabolomics technologies – all of which can be integrated under
the umbrella of systems biology – to modernize the methods by which medical
products are evaluated in the context of safety and efficacy. A central thesis
to this Program is that the application of systems biology in the field of
predictive liver toxicology has the potential to yield revolutionary tools for
the evaluation of drug safety and toxicity.

 

Several
drivers that highlight the need for improved predictive liver toxicology tools
can be identified. Ideally, safety issues should be detected earlier than
current tools allow, in large
part to avoid costly clinical failures – and devastating market withdrawals –
that continue to scar the industry to the present day. Currently, there are no
reliable tools to distinguish true, progressive toxicology from transient
enzyme level changes; such tools could eliminate the all-to-common practice of
terminating otherwise viable drug candidates. Finally, liver toxicity itself
remains the single most widespread and expensive drug safety issue. One major
pharmaceutical company estimated that its clinical-stage failures over the last
decade due to liver toxicity have cost over $2 billion in the last decade. And
high profile market withdrawals due to live failure of drugs such as
troglitazone have far-reaching effects on industry, regulatory agencies and
public confidence.

 

In
performing the Program, NCTR and BGM seek to discover novel molecular
biomarkers predictive of liver toxicity in the standard rat animal model. Given
that the Program includes drugs of multiple chemical families that are
indicated for a variety of diseases, general signals predictive of tox effects
across drug classes may be discovered. The ideal biomarker set would provide
accurate and reproducible prediction, have the power to distinguish between
transient and progressive liver toxicity and also be detectable earlier than
current clinical chemistry measures. The utility of these biomarkers could
extend into the clinic and beyond, thus marking a step forward toward the
ultimate goal of eliminating late-stage clinical failures and market
withdrawals due to liver toxicity.

 

The
search for biomarkers will encompass evaluations of toxicity profiles data
generated through gene expression microarrays, and proteomic and metabolomic
analysis of biofluids. Each of these platforms provides a distinct, but
complementary view of the physiological status of the organism at that moment
in time. Gene expression analysis of target tissue transcripts can reflect
agent exposure and may provide direct correlations for evaluations of surrogate
markers in blood and urine. Proteomic and metabolomic analysis biomarker
patterns in available biofluids provide the basis for evaluations in
preclinical and clinical models. Detailed protein analysis contributes protein
and physiologic responses not available from gene expression data while the
metabolomic analysis of small metabolites can reflect target site toxicity and
changes to the overall health status of the individual.

 

Inasmuch
as this effort requires an array of core competencies and technology platforms,
the Program will leverage complementary capabilities from both NCTR and BG Medicine.
Both parties will make in-kind intellectual contributions central to the design
and execution of the research plan, and ultimately the data will enter the
public domain. In alignment with the Critical Path, the Program maps advances
in science to a huge area of unmet medical need, with tremendous potential
benefits to all stakeholders in the healthcare system.

 

21

 

APPENDIX
A

RESEARCH PLAN

 

Overall Goal of the Joint Research Program

 

The overall goal of the research program is to modernize the drug
discovery and development process, specifically to achieve a more scientific
understanding of the mechanisms of liver toxicity and to create new tools, such
as molecular biomarkers, that can be used in nonclinical studies to predict
potentially harmful effects of drugs in humans.

 

Partners Jointly Conducting the Research

 

FDA/NCTR

 

Principal Investigator: Fred A. Beland, Ph.D., Director, Biochemical
Toxicology

 

The Division of Systems Toxicology was established in September 2004 to
provide an umbrella to individuals who are using tools to assess patterns
associated with toxicity following acute and chronic administration. The
Division is comprised of six Centers of Excellence (Chemistry, Functional
Genomics, Hepatotoxicology, Metabolomics, Proteomics and Toxicoinformatics) and
an Immediate Office.

 

Systems toxicology provides an integrated and iterative assessment of
the toxicity of agents based on the holistic analysis of OMICs (genomics,
transcriptomic, proteomic and metabolomic) analyses and classic toxicology
endpoints. The Division’s mission is to provide state-of-the-art analyses of
preclinical and clinical response to regulated products at the analytical and
informatic level. One aspect of this approach is to develop and apply
metabolomic, proteomic and genomic analyses to develop an integrated network of
metabolite levels, proteins expressed, and gene expression changes as a
function of exposure. Since the goal is to apply new technologies to emerging
issues in toxicology, both potential toxicants and processes can be examined in
an iterative systems toxicology approach. Systems toxicology provides a step on
the critical path toward defining novel tools for safety assessment.

 

BG Medicine, Inc.

 

President: Pieter Muntendam, M.D.

 

BG Medicine was founded in 2001 to pioneer the commercial applications
of Systems Pharmacology/Toxicology, which is based on scientific advances in
the systems biology field. Its advanced proprietary platform enables novel
paths to new medicines through molecular fingerprinting of genes, proteins and
metabolites combined with powerful bioinformatics

 

22

 

integration to produce Systems Response Profiles. These profiles, which
combine multiple physiological compartments and often include thousands of
distinct analyte levels, have enabled unprecedented molecular characterization
of disease states and drug responses.

 

Systems Toxicology, as practiced by BG Medicine, offers a unique
approach to understanding toxicity including answering fundamental questions
about mechanism, inter-species applicability, subtle differences within a drug
class and the role of underlying disease, predisposition or concomitant
medications. Systems Toxicology can quickly answer the question whether the
toxic effect is intrinsic or extrinsic to the desired pharmacologic effect - a
question that has fundamental implications for the class of agents.

 

The Relevance of the Program for Human Healthcare

 

“Severe hepatotoxicity is one of the most common causes for
pharmaceutical product recalls, labeling changes and Dear Doctor Letters which
raises the question of how effective nonclinical and clinical testing is in
recognizing such toxicity. A primary purpose of nonclinical studies is to
discover target organ toxicity and from this information stop the development
of the compound or to utilize this information for monitoring possible
toxicities in human studies. The liver is a major target organ of early
screening efforts in the pharmaceutical industry and a major target organ in
the repeated dose, preclinical safety studies used to support clinical trials.
If a compound is hepatotoxic in animals, it is only after the toxicity is
assessed and an adequate safety margin is estimated that such a compound is
administered to humans. Despite these precautions, hepatotoxicity may be
identified in clinical trials and post-marketing periods. In some of these
instances hepatotoxicity may have been observed in nonclinical studies but not judged
significant, or in others, signals may have been inapparent.” From a document prepared by an FDA Working Group for
a public workshop on drug-induced hepatotoxicity that was held in February
2001.

 

Drug toxicity continues to be the number one risk factor for drug development
projects. Despite advances in the field of life sciences, our ability to avoid
and anticipate drug toxicity seems to be at the level where it was at the birth
of modem drug development. Because of the central role played by the liver in
metabolism, the liver is the most important site of drug-induced tissue injury.
For example, drug-induced elevations in liver enzymes, such as alanine
transaminase (ALT) and aspartate transaminase (AST), are routinely used as
surrogates for drug-induced liver injury. However, our understanding of the
multiple biochemical pathways responsible for changes in ALT and AST is
rudimentary and, often, incorrect decision are made about the likely
histopathological and liver function consequences of changes in these clinical
chemistry measures. This can lead to the premature suspension of the
development of promising, novel drug candidates targeted at diseases for which
no or inadequate pharmacological therapy is currently available. In other
cases, drug candidates are advanced through development to marketing approval,
based on acceptable changes in clinical chemistry measures thought sufficient
to indicate no potential for liver damage, only to be unexpectedly withdrawn
from the market upon the discovery of “idiosyncratic” liver toxicity.

 

23

 

What is urgently needed is better information about the biochemical
pathways contributing to the drug-induced responses of the liver under
conditions where traditional clinical chemistry measures used as surrogates for
liver injury are elevated in a transient or sustained fashion and to a moderate
or substantial degree. In addition, there is an urgent need for molecular
biomarkers that accurately reflect specific biochemical mechanisms in the
liver, and that can be measured in blood plasma/serum which can be used as more
reliable predictors of the consequences for liver function of continued
exposure to drugs.

 

A molecular systems approach to drug-induced liver function and injury
will provide the much-needed information and tools for the development of new
assays of liver function and injury that can be employed in the drug
development process and, ultimately, in medical practice.

 

General
Protocol and Timelines

 

The overall research plan is comprised of five (5) Study Units. A Study
Unit consists of a drug pair (one drug known to be associated with liver
toxicity, one known to be associated with mild or transient liver effects) and
a vehicle control group (see 5.2 below for list of study drugs). Both drugs in
the drug pair of a single Study Unit are from the same or similar drug class.
Each drug of a pair consists of 3 study arms (low dose, high dose and high dose
early sacrifice) with 16 rats per group. In addition to the two drugs, there is
one vehicle control group consisting of 16 rats per study unit. There are 112
rats in each Study Unit of this systems toxicology program. Plasma samples
obtained via tail bleeds will be collected for all animals at pre-dose, and at
days 1, 3, 7, 14 and 28. Urine samples will be collected at a pre-dose, and at
days 1-5, 14 and 28. Liver tissue will be collect at time points of sacrifice,
day 3 and day 28. Extensive measurements of urine, plasma and liver tissue will
be preformed employing a broad range of non -omic platforms for clinical
chemistries and histology and omic platforms for transcripts, proteins (mass
spectrometry) and metabolites (NNIR and mass spectrometry).

 

On the basis of the timeframes for analysis of the analytes on various
platforms and the importance of the results to the Critical Path Initiative,
the work plan for this systems toxicology study is divided into three discrete
sub-units. Two Study Units (two drug pairs) will be initiated in parallel,
followed by two additional study units staggered by five weeks and finally by
the last Study Unit staggered five weeks from the third and forth Units. The
timeframes for this portion of the study is approximately 15 weeks.

 

Once the samples are collected for each study unit, the broad range of
analytical measurements will be carried out by the NCTR team and BGM and its
partners. The primary focus of this phase of the program will be the analysis
of plasma and liver samples at days 3 and 28 and urine samples across all time
points.

 

Systems Toxicology data analysis will treat each Study Unit as a
separate study. This will enable the statistical and bioinformatics analysis of
the first Study Unit to proceed concurrent with the subsequent animal dosing
and sample and data collection from the remaining study units. Data

 

24

 

analysis, univariate/multivariate analysis and bioinformatics will be
completed individually for the changes observed within a drug as a function of
dose and between drug pairs. The combined bioinformatics expertise of BGM’s
correlation network analysis and NCTR’s ArrayTrack programs will ensure a
comprehensive analysis of these data.

 

Study Drugs

 

Drugs were selected in pairs from the same chemical class and
indication. Each pair has one drug known to cause progressive liver toxicity
and one drug known to cause mild or transient liver effects. Analysis of the
toxicity profiles of these pairs may therefore reveal biomarkers that
distinguish between transient and progressive liver effects. In addition, the
five pairs cover a range of drug classes from major markets and the analysis
could therefore yield liver toxicity biomarkers generally applicable across
drug classes with tremendous potential utility in the context of existing
development programs. As a proof of concept of the systems toxicology approach
to liver toxicity biomarker development using compound pairs within a compound
class that differ in their clinical evidence of hepatotoxicity, a pilot study
consisting of a single compound pair from the following list of agents will be
used. The five drug pairs are given below; drug names in bold are known to cause progressive liver
toxicity, those in italics are
known to cause mild or transient liver effects:

 

Pair 1: HIV Protease Inhibitors

 

ritonavir, saquinavir

 

Pair 2: Quinolone Antibiotics

 

trovafloxacin, moxifloxacin

 

Pair 3: Non-Steroidal Anti-Inflammatories 

 

bromfenac, diclofenac

 

Pair 4: Antileukotrienes

 

zafirlukast, montelukast

 

Pair 5: Thiazolidinediones

 

troglitazone, rosiglitazone

 

N.B.                         The drugs selected for the
study may change depending on availability of raw material and the input of
pharmaceutical sponsors.

 

25

 

Expected Benefits of the Program

 

We expect that there will be multiple benefits derived from the
performance of the Program. These benefits include, but are not limited to:

 

1.               Molecular biomarkers suitable for
supplementing or replacing traditionally inadequate clinical chemistry measures
of liver toxicity such as ALT and AST

 

2.               Biomarkers that are predictive of liver
toxicity earlier than current clinical chemistries

 

3.               Biomarkers that enable informed
development decisions by distinguishing between transient liver effects and
true progressive liver toxicity

 

a.               Enable advancement
of viable and promising candidates that would otherwise have been dropped upon
demonstrating transient effects

 

b.              Eliminate costly
late-stage failures of candidates that were allowed to advance based on
traditionally insensitive and ambiguous metrics

 

c.               Reverse the
highly-publicized downward trends in efficiency and output of the discovery and
development engine

 

4.               The potential to avoid market
withdrawals of drugs due to liver failure

 

a.               Increase public
confidence in regulatory agencies and industry

 

b.              Avoid social,
political and financial repercussions

 

5.               Set an example for revolutionary
contributions to the healthcare system by uniting advanced technologies and
core competencies from the FDA and industry

 

a.               Advancement of
science

 

b.              Improved profile for
all stakeholders

 

c.               Sets the stage for
future projects in other areas of unmet need

 

26

 

Appendix B

 

STAFFING, FUNDING AND MATERIALS/EQUIPMENT
CONTRIBUTIONS OF THE

PARTIES

 

NCTR-BG Medicine CRADA - Phase 1 Proof of
Concept Pilot Study

 

Staffing Contributions:

 

FDA
will provide scientific staff and other support necessary to conduct the
research and other activities described in the Research Plan. FDA’s scientific
staff will include FDA’s Principal Investigator and technical staff.

 

FDA
estimates that 1.45 person-years of effort per year will be required to
complete the CRADA research.

 

Collaborator
will provide scientific staff and other support necessary to conduct the
research and other activities described in the Research Plan. Collaborator’s
scientific staff will include Collaborator’s Principal Investigator or
technical staff.

 

Collaborator
estimates that 5.6 person-years of effort per year will be required to complete the CRADA
research.

 

Funding Contributions:

 

Collaborator
agrees to provide funds in the amount of $400,391.00 for FDA to use to acquire technical, statistical, and
administrative support for the research activities, as well as to pay for
supplies and travel expenses. Collaborator will provide funds in two equal
installments. The first installment will be due within thirty (30) days of the
Effective Date. The second payment will be upon completion of the animal
portion of the study. Collaborator agrees that FDA can allocate the funding
between the various categories in support of the CRADA research as FDA’s PI
sees fit.

 

CRADA PAYMENTS:

 

Collaborator
will make checks payable to the [Food and Drug Administration], will reference
the CRADA number and title on each check, and will send them via trackable mail
or courier to:

 

National
Center for Toxicological Research, ATTN: Finance Officer 

3900
NCTR Road

Jefferson,
Arkansas 72079

 

27

 

CRADA Travel Payments:

Travel arrangements for all Government staff will be made in accordance
with the Federal Travel Rules and Regulations, whether arranged by FDA and
funded using either appropriated funds or CRADA funds, or arranged and funded
directly by Collaborator.

 

Materials/Equipment Contributions:

 

FDA will utilize major equipment in the Division of Systems Toxicology,
Functional Genomics, Proteomics and Metabolomics Laboratories with an estimated
value of $3.3 M for use under this CRADA.

 

FDA will also provide use of its ArrayTrack software ($1.5M est.
development cost) and it’s IBM Storage Servers (estimated value of $1M) for use
under this CRADA

 

If FDA decides to provide additional FDA Materials for use under this
CRADA, those materials will be transferred under a cover letter that identifies
them and states that they are being provided under the terms of the CRADA.

 

Collaborator will utilize capital equipment from its Metabolomics,
Proteomics and IT laboratories with an estimated value of $8.7M, and supplies
with an estimated value at $440,000, for use under this CRADA.

 

28

 

APPENDIX C

 

MODIFICATIONS TO THE MODEL CRADA

 

Deletions are shown as strikethroughs and
additions are underlined

 

Article 1. Introduction

This CRADA between FDA and Collaborator will be effective when signed
by the Parties, which are identified on both the Cover Page and the Signature
Page (page 16). The official contacts for the Parties are identified on the
Contacts Information Page (page 17). Publicly available information regarding
this CRADA appears on the Summary Page (page 18). The research and development
activities that will be undertaken by FDA and Collaborator in the course of
this CRADA are detailed in the Research Plan, attached as Appendix A. The
staffing, funding, and materials contributions of the Parties are set forth in
Appendix B. Any changes to the model CRADA are set forth in Appendix C.

 

Add language to read:

 

Article 1. Introduction

This CRADA between FDA and Collaborator will be effective when signed
by the Parties, which are identified on both the Cover Page and the Signature
Page (page 16). The official contacts for the Parties are identified on the
Contacts Information Page (page 17). Publicly available information regarding this
CRADA appears on the Summary Page (page 18). The research and development
activities that will be undertaken by FDA and Collaborator in the course of
this CRADA are detailed in the Research Plan, attached as Appendix A. The
staffing, funding, and materials contributions of the Parties are set forth in
Appendix B. Any changes to the model CRADA are set forth in Appendix C. FDA
and Collaborator acknowledge that Collaborator will receive funding from
pharmaceutical manufacturers to support the performance of its obligations
under the Research Plan.

 

The pharmaceutical manufacturers may elect to have a representative of
their scientific staff participate in BG Medicine’s Scientific Advisory
Committee for this CRADA.

 

The pharmaceutical manufacturers listed below have agreed to provide
$350,000.00 each to Collaborator as a one-time payment for Phase I (Pilot
Study) of the Joint Research Program., This has been done under a “Participant
Agreement” between the Collaborator and each pharmaceutical manufacturer. These
funds will be used by Collaborator for staffing and material costs and for
Collaborator to meet its obligations to FDA under Appendix B of this agreement.

 

FDA will use the CRADA funding provided by Collaborator to acquire
technical, statistical, and administrative support for the research activities,
as well as to pay for supplies and travel expenses directly related to the
collaboration.

 

The pharmaceutical manufacturers listed below are not a party to this
agreement. The Food and

 

29

 

Drug Administration will not receive any funding from them.

 

Eisai Co., Ltd

4-6-10 Koishikawa Bunkyo-ku

Tokyo, 112-8088 

Japan

Dr. Shoji Asakura 

s-asakura@hhc.eisai.co.jp

+81 (29) 847-6471

 

Sankyo Co., Ltd

3-5-1 Honcho Nihonbashi

Tokyo, 103-8426

Japan

Sunao Manabe

Director of Medicinal Safety Research Laboratories

 

Orion Corporation 

Orionintie 1, 02200 

Espoo, Finland

Esa Heinonen

Vice President, Research and Development

Esa.Hein@orion.fi

+358 10 4261

 

Mitsubishi Chemical Corporation 

33-8 Shiba 5-chrome

Minato-ku

Tokyo, Japan

Dr. Sadayo Iijima

General Manager, Healthcare Planning 

Iijima.Sadayo@md.m-kagaku.co.jp 

+81 (3) 6414-3580

 

Johnson & Johnson

Spring House JNJPRD

Welsh & McKean Roads

Spring House, PA 19477-0776 

Michael Kelley

MKelley2@PRDUS.JNJ.COM 

(215) 628-5451

 

Pfizer Global Research and

Denise Robinson-Gravitt, PhD

Global Technology Development

50 Pequot Avenue MS6025 C4269

New London, CT 06320

 

30

 

Denise.robinson-gravatt@pfizer.com

(860)-732-0790

 

USB SA

Thomas Senderovitz, MD

Chemin du Foriest

B-1420 Braine-l’Alleud

Belgium

Thomas.senderovitz@ucb-group.com

+32 (0) 2 386 35 96

 

Article 8. Right of Access and Publication

Section 8.1: Right of Access to CRADA Data and CRADA Materials. FDA and
Collaborator agree to exchange all CRADA Data and to share all CRADA Materials.
If the CRADA is terminated, both Parties agree to provide CRADA Materials in
quantities needed to complete the Research Plan. Such provision will occur
before the termination date of the CRADA or sooner, if required by the Research
Plan.

 

Add language to read:

Section 8.1: Right of Access to CRADA Data and CRADA Materials. FDA and
Collaborator agree to exchange all CRADA Data and to share all CRADA Materials.
If the CRADA is terminated, both Parties agree to provide CRADA Materials in
quantities needed to complete the Research Plan. Such provision will occur
before the termination date of the CRADA or sooner, if required by the Research
Plan. FDA acknowledges and agrees that Collaborator may provide CRADA Data
to funding pharmaceutical manufacturers and that each funding pharmaceutical
manufacturer will be granted the right to use the CRADA Data for its internal
purposes provided that no manufacturer shall be permitted to publish any CRADA
Data or to use any CRADA Data in, or in support of, a patent application
directed to the composition or use of a biomarker useful in detecting or
predicting hepatotoxicity.

 

Section 8.2: Use of CRADA Data and CRADA Materials. The Parties will be
free to utilize CRADA Data and CRADA Materials internally for their own
purposes, consistent with their obligations under this CRADA. The Parties may
share CRADA Data or CRADA Materials with their Affiliates, agents or contractors
provided the obligations of this Article 8.2 are simultaneously conveyed.

 

Add language to read:

Section 8.2: Use of CRADA Data and CRADA Materials. The Parties will be
free to utilize CRADA Data and CRADA Materials internally for their own
purposes, consistent with their obligations under this CRADA. “The Parties may
share CRADA Data or CRADA Materials with their Affiliates, agents or
contractors, and that Collaborator may share the CRADA Data with funding
pharmaceutical manufacturers, provided that in each case the obligations
of this Article 8.2 are simultaneously conveyed.”

 

31Exhibit 4.1  

	NUMBER

  

    
	 	

 
	 	SHARES

  

    

	
THE ENSIGN GROUP, INC.

INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
 COMMON STOCK
 

	
THIS CERTIFIES that	
 	

 	
 	
CUSIP 29358P 10 1

SEE REVERSE SIDE FOR CERTAIN DEFINITIONS
 

is the owner of

FULLY PAID AND NON-ASSESSABLE SHARES OF THE COMMON STOCK, PAR VALUE $0.001 PER SHARE OF
  THE ENSIGN GROUP, INC. 

transferable only on the books of the Corporation by the holder hereof in person or by Attorney upon surrender of this Certificate properly endorsed. This Certificate is not
valid until countersigned by the Transfer Agent and registered by the Registrar.

        IN WITNESS WHEREOF, the said Corporation has caused this Certificate to be signed by the facsimile signatures of its duly authorized officers and its Corporate
seal to be hereunto affixed.

	DATED:

  

/s/ Gregory K. Stapley
 Secretary	 	THE ENSIGN GROUP, INC.

CORPORATE

SEAL

MAY 27,

1999

DELAWARE	 	  

  

/s/ Christopher R. Christensen
 President

COUNTERSIGNED
AND REGISTERED

            REGISTRAR AND TRANSFER COMPANY

            TRANSFER AGENT AND REGISTRAR 

BY

        The
following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or
regulations: 

	 	 	TEN COM	-as tenants in common	 	UNIF GIFT MIN ACT-	        Custodian        
	 	 	TEN ENT	-as tenants by the entireties	 	 	(Cust)                (Minor)
	 	 	JT TEN	-as joint tenants with right of survivorship and not as tenants in common	 	 	under Uniform Gifts to Minors Act

    
                        (State)

Additional
abbreviations may also be used though not in the above list. 

For Value Received,
                                         
        do hereby sell,
assign and transfer unto  

	PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE	 
	
	 
	  

  

    
	 

   

(PLEASE
PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE)

   

                                         
                                          
                                      Shares of the Common Stock represented by the within Certificate, and do hereby irrevocably constitute and appoint
                                         
                                          
                                      Attorney to transfer the
said Shares on the books of the within named Corporation with full power of substitution in the premises.  

Dated:
                                         
                   
  

	

 	
 	

X	
 	

    
	
 	

 
	

 	
 	

X	
 	

    
	
 	

 
	 	 	NOTICE:	 	THE SIGNATURE(S) TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME(S) AS WRITTEN UPON THE FACE OF THIS CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.	 	 

Signature(s) Guaranteed

	By:	    
	 
	 	THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM),
PURSUANT TO S.E.C. RULE 17Ad-15.

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