Document:

Exhibit 10.1

 

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

 

COMMERCIAL OUTSOURCING SERVICES AGREEMENT

 

This Commercial Outsourcing Services Agreement (“Agreement”) is entered into as of August 25, 2011 (the “Effective Date”) by INTEGRATED COMMERCIALIZATION SOLUTIONS, INC., a California corporation (“ICS”) and PACIRA PHARMACEUTICALS, INC., a California corporation (the “Company”).

 

RECITALS

 

A.            Company is, among other things, in the business of manufacturing, selling and distributing pharmaceutical products, including those listed on Schedule A (“Products”);

 

B.            ICS is, among other things, in the business of providing commercialization services for pharmaceutical products;

 

C.            The Company desires to engage ICS as its agent to provide certain commercialization services related to Products pursuant to this Agreement; and

 

D.            ICS desires to provide such commercialization services to the Company as its agent pursuant to this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, the parties hereby agree as follows:

 

1.             Appointment As Exclusive Agent

 

The Company hereby appoints ICS as the exclusive provider of Services (as defined in Section 2) for Products sold to the Company’s customers (“Customers”) in the United States, Guam, Puerto Rico and the U.S. Territories during the Term (as defined in Section 4.1), as provided in this Agreement.

 

2.             Services To Be Performed

 

2.1           Services.  The Company hereby engages ICS to provide the following services with respect to Products (“Services”):

 

2.1.1        Customer Services as described in Exhibit B.

 

2.1.2        Warehousing and Inventory Program Services as described in Exhibit C.

 

2.1.3        Distribution Services as described in Exhibit D.

 

2.1.4                        Warehousing and Distribution of Sample Products as described in Exhibit E.

 

2.1.5                        Marketing Materials Fulfillment Services as described in Exhibit F.

 

2.1.6                        Contract Administration and Chargeback Processing as described in Exhibit G.

 

2.1.7                        Accounts Receivable Management and Cash Applications as described in Exhibit H.

 

2.1.8        Financial Management Services as described in Exhibit I.

 

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2.1.9        Information Technology Services as described in Exhibit J.

 

2.2           ADR Status.  Solely for the limited purpose of compliance with the pedigree requirements of the Prescription Drug Marketing Act and any similar state laws, ICS shall be considered an “Authorized Distributor of Record” for the Products and a third party logistics provider who does not take title to Product or have general responsibility to direct the Product’s sale or disposition.  The foregoing shall not be construed in a manner that results in ICS being considered a distributor or wholesaler for any other purpose or under any other law or regulation.

 

2.3           Taxes.  ICS will not be responsible for collection or payment of any Taxes on behalf of the Company.

 

2.4           Definitions.  Capitalized words used without definition in this Agreement will each have the meaning in Schedule C.  Capitalized words used without definition in this Agreement will each have the meaning in Schedule C.

 

3.             Compensation — Fees For Services

 

3.1           Compensation.  The Company will compensate ICS for Services in accordance with Schedule B.  ICS will provide monthly invoices for fees for Services to the Company, and will bill the Company for any pass through charges monthly or as ICS is billed.  The Company will notify ICS of any disputed charges in writing within 30 days of the date of the invoice covering such charges.  In the absence of any such notice of dispute, all invoices will be deemed to be correct and due in full within 30 days of the invoice date.  If the Company disputes a portion of an invoice, the Company shall pay the undisputed portion of the invoice within 30 days of the invoice date.  A late fee of [**]% per month (or any portion thereof) will be charged as of the due date on all amounts not paid within [**] days of the invoice date, except any amount disputed by the Company in good faith.  If any dispute is resolved in favor of ICS, the Company will pay the applicable late fee on such amount from the original due date.

 

3.2           Price Changes.  For all fees, excluding pass-through costs which are billed on a “cost plus” basis, ICS and the Company will negotiate annual adjustments to take effect on each anniversary of the date of this Agreement during the Term.  ICS and the Company will negotiate such adjustments in good faith, taking into account all relevant factors including changes in the consumer price index, documented material changes to ICS costs of providing Services that have occurred (or are reasonably likely to occur), quantities of services used and any resultant economies of scale to ICS, and any other relevant factors (but without double-counting any cost increases addressed by Section 3.3).  ICS and the Company will use commercially reasonable best efforts to agree upon any proposed adjustment at least one hundred twenty (120) days prior to its effective date

 

3.3           Cost Adjustment.  If ICS can reasonably demonstrate to the Company that the costs to ICS for providing Services have materially increased (or are reasonably likely to increase materially during the following twelve (12) month period of the Term) as a result of any changes in the Requirements of Law, including the adoption of any new Requirements of Law impacting Services, then ICS may increase the applicable component of the fees for such Services provided in Schedule B (“Cost Adjustment”).  ICS will notify the Company of any proposed Cost Adjustment at least one hundred twenty (120) days prior to its effective date.  All Cost Adjustments will be determined under generally accepted accounting principles (“GAAP”) and cost allocation methods applied on a consistent basis.  If the Company objects to any Cost Adjustment and the parties are unable in good faith to resolve such objection to the reasonable satisfaction of both parties, then either party may terminate this Agreement upon ninety (90)

 

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days’ prior written notice to the other party.

 

3.4           Program Ready Date.  If the Company requests that ICS delay the launch of Services more than thirty-five (35) days beyond the agreed-upon date on the signatory page (the “Program Launch Date”) for any reason other than ICS’ failure to be in compliance with its obligations under this Agreement, the Company will pay ICS the Stand-Ready Fee and any associated expenses as specified in Schedule B, including reasonable out-of-pocket costs and other expenses.  The Company will give ICS at least one week’s written notice of changes to the Program Launch Date.  Program ready fees will continue until the Program Launch Date.  After the Program Launch Date, the Company will pay applicable monthly program fees.  For the first month during which Services are provided, ICS will prorate any difference between program ready fees and applicable monthly program fees.

 

4.             Term And Termination

 

4.1           Initial Term.  This Agreement will be effective as of the Effective Date and will continue for three (3) years (the “Term”) unless sooner terminated in accordance with Section 4.  The Term may be extended upon written mutual agreement of the parties, such extension to be negotiated in good faith six (6) months prior to the expiration of the Term.

 

4.2           Termination For Breach.

 

4.2.1        If a party fails to pay any amount due to the other party under this Agreement, such unpaid amount shall bear interest at the rate of [**] percent ([**]%) per month from the date due until paid.  If such amount becomes more than [**] days past due, the other party may provide notice to the non-paying party specifying the amount due and notifying the non-paying party that the other party may terminate this Agreement if the non-paying party fails to pay the amount due within ten days of the date of the notice.  If the non-paying party fails to pay the amount due within 10 days of the date of the notice, the other party may terminate this Agreement immediately and, in such event, shall provide written notice thereof to the non-paying party; provided that if such breach occurs more than three times during any 12-month period, the non-breaching party may terminate this Agreement upon five days’ written notice without any opportunity for cure.

 

4.2.2        Time and timely performance, consistent with the mutually agreed SOPs, are of the essence of this Agreement.  If a party fails to perform any obligation under this Agreement (other than payment of money), the other party may provide notice to the breaching party describing the breach in detail and notifying the breaching party that the other party may terminate this Agreement if the breaching party’s failure to perform is not cured within ten (10) business days of the date of the notice.  If the breaching party’s failure to perform is not cured and, if necessary, a corrective action plan implemented, within ten business days of the date of the notice, then the other party may terminate this Agreement immediately and, in such event, shall provide written notice thereof to the breaching party; provided that such cure right may not be exercised more than once during any 12-month period for any given breach.

 

4.3           Termination For Specific Events.  Either party may immediately terminate this Agreement upon written notice to the other party upon the other party’s:  (a) filing an application for or consenting to appointment of a trustee, receiver or custodian of its assets; (b) having an order for relief entered in Bankruptcy Code proceedings; (c) making a general assignment for the benefit of creditors; (d) having a trustee, receiver, or custodian of its assets appointed unless proceedings and the person appointed are dismissed within 30 days; (e) dissolving its existence under applicable state law; (f) insolvency within the meaning of Uniform Commercial Code Section 1-201 or failing generally to pay its debts as they become due within the meaning

 

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of Bankruptcy Code Section 303(h)(1), as amended; or (g) certification in writing of its inability to pay its debts as they become due (and either party may periodically require the other to certify its ability to pay its debts as they become due) (each, a “Bankruptcy Event”).  Each party agrees to provide immediate notice to the other party upon a Bankruptcy Event.  The Company may terminate this Agreement as to any Product without cause, effective upon written notice, if the Company ceases marketing or divests the Product, or if any regulatory action suspends or materially restricts the marketing of the Product, provided that the Company will be obligated to pay the Monthly Management Fee for the month in which notice of termination is provided and the following month.

 

4.4           Expenses.  Within 30 days of expiration or earlier termination of this Agreement for any reason, the Company will (a) pay ICS any amount owed; (b) return to ICS all hardware, software and other equipment, or pay to ICS the replacement cost of items not returned, other than consumables or Product-specific items; and (c) pay non-recoverable expenses for telecommunication, facsimile, postage, shipping and other services incurred by ICS up to the effective date of termination.  Upon expiration or termination of this Agreement, ICS agrees to reasonably cooperate to transition the Services to Company’s successor vendor with fees to be mutually agreed upon.

 

4.5           Survival.  Accrued payment obligations, and any provision if its context shows that the parties intended it to survive, will survive expiration or termination of this Agreement for a period of two (2) years, confidentiality obligations will survive for a period of three years, and indemnity obligations will survive until the expiration of any applicable statute of limitations; in each case, except as expressly provided, expiration or termination will not affect any obligations arising prior to the expiration or termination date.  Recordkeeping and documentation requirements will survive this Agreement for the period required by law or regulation.

 

5.             Recalls; Other FDA Issues

 

5.1           Recalls.  If the Company conducts a recall, market withdrawal or field correction of any Products (“Recall”), the Company will conduct the Recall or designate a third party to do so and be responsible for all Recall expenses.  ICS will comply with the Company’s reasonable requests in the Recall.  If the Recall was not due primarily to ICS’s negligence, the Company will pay or reimburse ICS’s Recall expenses (including reasonable attorneys’ fees) for those services requested by Company in writing.  If the Recall was due primarily to ICS’s negligence, ICS will pay or reimburse the Company’s reasonable documented out-of-pocket Recall expenses (including reasonable attorneys’ fees).  Each party will use its best efforts to minimize Recall expenses.  The Company will notify ICS of any proposed Recall as soon as possible and, in any event, will do so within forty-eight (48) hours of initiating a Recall.  If both Parties’ acts or omissions contributed to Recall, Recall expenses will be borne by each Party in proportion to its fault.

 

5.2           Government Notices; Adverse Events Notification.  Each party will provide the other with a copy of any correspondence or notices it receives from the FDA, DEA or any counterpart state agency specifically relating to Services or relating to a material violation of any kind that is related to the Company or the Product, whether such violation resulted from an act or omission by the Company or by ICS, no later than three (3) business days following such receipt.  In addition, ICS will provide the Company with any notice relating to Products promptly upon its receipt.  Each party will also provide the other with concurrent copies of any responses to any such correspondence or notices (e.g., such as an FDA 483 notice, warning letters, untitled regulatory letters and establishment inspection reports).  Where reasonably possible, ICS will give prior notice to the Company of any scheduled FDA or DEA inspections of ICS’s

 

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facilities specifically relating to any Products, and, if reasonably possible, will afford the Company the opportunity to be present at such inspection and to review and contribute to any written response, to the extent permitted by law.  ICS shall warm transfer any calls from a customer to Company at 1-855-EXPAREL if the customer reports information that relates, refers or pertains to:  (i) an adverse or unexpected event in humans relating to the Products; (ii) a technical or other complaint relating to the Products; or (iii) any report of any other problem involving the Products (e.g., contamination, discoloration, improper labeling, adulteration, et cetera).

 

6.             Legal Compliance

 

6.1           General.  During the Term, each party will comply with all Requirements of Law.  ICS will comply with Requirements of Law related to storage, handling and distribution of Products.  The Company will comply with Requirements of Law related to importation, manufacture, distribution, labeling, storage, sale and handling of Products.

 

6.2           Other.  The Company hereby represents and warrants to ICS that, during the Term (a) no Products delivered by or on behalf of the Company to or on the order of ICS will be, at the time of shipment or delivery, adulterated, misbranded or otherwise prohibited within the meaning of the Act or within the meaning of any applicable state or local law, (b) all Products will be, at the time of shipment and delivery to ICS, merchandise that may be introduced and delivered into interstate commerce under the provisions of Sections 404 or 405 of the Act, (c) all Products will be the subject of a duly approved NDA or ANDA and may be legally transported or sold under Requirements of Law, (d) all Products will have been approved by each applicable Governmental Authority for commercial sale and shipment within the United States and (e) the Company either (i) owns or holds the duly approved Biologics License Application, as such term is used in the Public Health Service Act, Title 21, United States Code, as amended, or the duly approved NDA or ANDA , for each of the Products, or (ii) is otherwise considered the “manufacturer” of all Products within the meaning of any applicable federal, state or local law relating to pedigrees.

 

7.             Representations And Warranties

 

7.1           By the Company.  The Company represents and warrants to ICS that:  (a) it has authority to enter into and perform this Agreement without restriction and this Agreement is a valid and binding obligation of the Company, (b) execution, delivery and performance of this Agreement by the Company has been duly authorized by all necessary corporate actions, (c) the Company has and will maintain, in full force and effect, all licenses and permits required under applicable law for the Company to sell and distribute Products under this Agreement, (d) as of the Program Launch Date, there is no proceeding or investigation pending or threatened that questions validity of this Agreement, marketing authorizations related to Products or actions pursuant to this Agreement, (e) Products, or any part thereof, have not been materially adversely affected in any way as a result of any legislative or regulatory change, revocation of the right to manufacture, distribute, handle, store, sell or market them or the Company’s breach of this Agreement, and (f) no approvals, consents, orders or authorizations of or designation, registration, declaration or filing with any Governmental authority (within the United States) are required for Company’s performance of its obligations under this Agreement, other than any approvals already obtained.

 

7.2           By ICS.  ICS represents and warrants to the Company that: (a) it has authority to enter into and perform this Agreement without restriction and this Agreement is a valid and binding obligation of ICS, (b) execution, delivery and performance of this Agreement by ICS has

 

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been duly authorized by all necessary corporate actions, (c) ICS has and will maintain in full force and effect, all licenses and permits required under applicable law for ICS to perform the Services under this Agreement, (d) there is no proceeding or investigation pending or threatened that questions validity of this Agreement, ICS’s licenses to warehouse and distribute pharmaceuticals, or any actions pursuant to this Agreement, (e) Products have not been materially adversely affected while in ICS’s possession as a result of any revocation of its licenses or ICS’s breach of this Agreement, (f) ICS shall handle and store Product in a clean and orderly location, in conformity with Product specifications, and in a manner that maintains the proper rotation and quality of Product, (g) ICS shall comply with Company criteria in shipping and storing Product that requires special handling, and (h) no approval of or filing with any Governmental Authority (within the United States) is required to perform Services, other than any approvals already obtained.  ICS will permit Company to conduct audits and inspections under normal working hours as not to disrupt ICS workflow and business operations, and shall permit Company to conduct a physical inspection of ICS storage facilities within ten (10) business days of a written request by Company for such inspection and shall reasonably cooperate to assist Company with such inspection, if requested.  Inspections and audits will require reasonable advanced written notice and will be reasonable in time and scope (limited to validating compliance with terms and conditions of this Agreement, including all Exhibits and Schedules hereto).

 

7.3           Notice of Changes.  The Company and ICS will give prompt written notice to the other if it becomes aware during the Term of any action or development that would cause any warranty in this Section 7 to become untrue.

 

8.             Trademarks/Data

 

Neither party may use the other party’s name, trademarks, service marks, logos, other similar marks, other intellectual property, or other data or information in any manner without its prior written approval, except to satisfy its obligations under this Agreement.  ICS shall not alter, modify, replace or reproduce any Product labeling, packaging or advertising.  Data and information that belong to the Company will be any data and information related to Products (including sales information), except “ICS Data.”  ICS Data is data and information that is not specific to Products or the Company and was developed by ICS relating to its processes, reports and services provided to the Company under this Agreement.  ICS Data, including information and data relating to any of ICS’s customers and their profiles, belongs to ICS.

 

9.             Confidentiality

 

9.1           Existing Agreement.  The parties have previously executed a written Confidentiality Agreement (“Confidentiality Agreement”), attached as Schedule D.  The parties will abide by its provisions during the Term and for at least five (5) years thereafter, regardless of any shorter term in the Confidentiality Agreement.  Information disclosed under this Agreement and the terms and conditions of this Agreement (including all attachments) shall be deemed “Confidential Information” under the Confidentiality Agreement.

 

9.2           Termination.  Upon expiration or termination of this Agreement for any reason each party will promptly: (a) return to the other party all documents and other material containing Confidential Information (as defined in the Confidentiality Agreement), including copies, other than those which a party is reasonably required to maintain for legal, tax or valid business purposes; or (b) certify to the other party that it has destroyed all such documentation and other materials.

 

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10.          Remedies

 

10.1         Generally.  Rights and remedies under this Agreement are cumulative and in addition to any other available rights or remedies under any agreement, at law or in equity.  In the event of termination pursuant to Section 4.2.2, the terminating party shall not have any further liability to the other party except for obligations accrued as of the date of termination and continuing compliance with any provisions of this Agreement which by their terms survive termination.

 

10.2         Equitable Relief.  If either party violates or threatens to violate Recall, Legal Compliance, Trademark/Data infringement, Confidentiality or other provisions of this Agreement, the other party may suffer irreparable harm and its remedies at law may be inadequate.  Accordingly, the other party may seek equitable relief.

 

10.3         Breach by the Company.  The Company acknowledges the difficulty (if not the impossibility) of ascertaining the amount of damages that would be suffered by ICS if (i) the Company terminates this Agreement without cause or (ii) ICS terminates this Agreement following a breach by the Company.  In such event, as compensation, as its sole remedy, and not as a penalty, the early termination fee (the “ETF”) payable to ICS shall be equal to twenty percent (20%) of the aggregate amount of all fees and other sums that, in absence of such breach, would have been paid by the Company to ICS under this Agreement, [**], with such fees and other sums to be based on the average monthly amount paid or owed by the Company to ICS during the six months preceding such breach (or such shorter time as the Agreement has been in effect).  The ETF is in addition to any other claims or amounts owed by Company to ICS under this Agreement, including Fees for Services performed and costs incurred prior to the effective date of termination and indemnification obligations under this Agreement and the Continuing Guaranty and Indemnification Agreement referenced in Section 13 below (the “Continuing Guaranty”).

 

10.4        LIMITATIONS.  EXCEPT FOR EACH PARTY’S OBLIGATIONS OF CONFIDENTIALITY UNDER SECTION 9, ETF UNDER SECTION 10.3, INDEMNIFICATION UNDER SECTIONS 11.1 AND 11.2, AND INTELLECTUAL PROPERTY UNDER SECTION 12:

 

(A)          NO PARTY WILL BE LIABLE TO ANY OTHER PARTY FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, SPECIAL OR OTHER SIMILAR DAMAGES ARISING OUT OF OR IN CONNECTION WITH A BREACH OF THIS AGREEMENT;

 

(B)          ANY LOSS DUE TO DAMAGE OR LOSS OF PRODUCTS WILL BE BASED UPON THE COMPANY’S COST OF MANUFACTURING OR ACQUIRING PRODUCTS, NOT ITS SELLING COST; AND

 

(C)          COMPANY UNDERSTANDS AND AGREES THAT IT HOLDS TITLE AND RISK OF LOSS FOR THE PRODUCTS AT THE ICS FACILITY UNDER THIS AGREEMENT.  AS A SERVICE PROVIDER, ICS DOES NOT ACCEPT LIABILITY FOR DAMAGE OR LOSS TO THE PRODUCT WHILE IN THE ICS FACILITY, EXCEPT FOR LIABILITY FOR THIRD PARTY CLAIMS SUBJECT TO INDEMNIFICATION UNDER SECTION 11.2 BELOW.  NOTWITHSTANDING THE FOREGOING, ICS AGREES THAT IF DAMAGE OR LOSS TO PRODUCTS IS CAUSED BY:  (1) A BREACH OF THIS AGREEMENT BY ICS, ICS SHALL BE LIABLE FOR SUCH LOSS UP TO A MAXIMUM AMOUNT EQUAL TO THE ETF (AS DEFINED UNDER SECTION 10.3(C) ABOVE); OR (2) ICS’S GROSSLY NEGLIGENT OR WILLFUL ACT OR OMISSION, THEN NO LIMITATION OF LIABILITY SHALL APPLY, EXCEPT FOR THE LIMITATIONS OF SECTIONS 10.4(A) AND (B) ABOVE.  COMPANY IS RESPONSIBLE FOR ENSURING THAT IT HAS APPROPRIATE INSURANCE IN PLACE TO PROTECT ITSELF FROM POTENTIAL DAMAGE OR LOSS TO ITS PRODUCTS.  THE

 

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INSURANCE REQUIRED UNDER SECTION 13 BELOW IS A MINIMUM ONLY, AND ICS DOES NOT REPRESENT OR WARRANT THAT THESE COVERAGES ARE SUFFICIENT FOR COMPANY’S NEEDS.

 

11.          Indemnification

 

11.1         By the Company.  The Company will defend, indemnify and hold harmless ICS and its Related Parties from and against all claims, liabilities, losses, damages, costs and expenses, including reasonable attorneys’ fees (collectively, “Claims”) brought by third parties or the Company’s employees caused by or arising from any (a) act or omission of the Company or its Related Parties in breach of this Agreement or violation of applicable law or regulation, (b) failure of the Company to perform its obligations or to comply with Requirements of Law, (c) breach of any warranty made by the Company in this Agreement (d) claims of patent, trademark, copyright or other infringement related to Products, (e) the Company’s storage, handling, use, non-use, demonstration, consumption, ingestion, digestion, manufacture, production and assembly of Products and their transportation to ICS, or (f) Taxes imposed against ICS or its Related Parties; provided, however, the Company will have no obligations under this Section 11.1 for any Claims to the extent caused by any negligent act or omission of ICS or its Related Parties.

 

11.2         By ICS.  ICS will defend, indemnify and hold harmless the Company and its Related Parties from and against all Claims brought by third parties or ICS’s employees against the Company or its Related Parties caused by or arising from any (a) act or omission of ICS or its Related Parties in breach of this Agreement or in violation of applicable law or regulation, (b) failure of ICS to perform its obligations or to comply with Requirements of Law, (c) breach of any warranty made by ICS in this Agreement, (d) the storage, handling, and assembly of Products and their transportation by ICS in violation of the terms of this Agreement or mutually agreed upon SOP’s, or (e) making by ICS of representations or warranties with respect to Products to the extent not expressly authorized by the Company in writing; provided, however, that ICS will have no obligations under this Section 11.2 for any Claims to the extent caused by any negligent act or omission of the Company or its Related Parties.

 

11.3         Procedures.  The obligations and liabilities of the parties with respect to Claims subject to indemnification under this Section 11 (“Indemnified Claims”) will be subject to the following terms and conditions:

 

11.3.1      The party claiming a right to indemnification hereunder (“Indemnified Person”) will give prompt written notice to the indemnifying party (“Indemnifying Person”) of any Indemnified Claim, stating its nature, basis and amount, to the extent known.  Each such notice will be accompanied by copies of all relevant documentation, including any summons, complaint or other pleading that may have been served or any written demand or other document.

 

11.3.2      With respect to any Indemnified Claim: (a) the Indemnifying Person will defend or settle the Indemnified Claim, subject to provisions of this subsection, (b) the Indemnified Person will, at the Indemnifying Person’s sole cost and expense, cooperate in the defense by providing access to witnesses and evidence available to it, (c) the Indemnified Person will have the right to participate in any defense at its own cost and expense to the extent that, in its judgment, the Indemnified Person may otherwise be prejudiced thereby, (d) the Indemnified Person will not settle, offer to settle or admit liability in any Indemnified Claim without the written consent of an officer of the Indemnifying Person, and (e) the Indemnifying Person will not settle, offer to settle or admit liability as to any Indemnified Claim in which it controls the defense if such settlement, offer or admission contains any admission of fault or

 

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guilt on the part of the Indemnified Person, or would impose any liability or other restriction or encumbrance on the Indemnified Person, without the written consent of an officer of the Indemnified Person.

 

11.3.3      Each party will cooperate with, and comply with all reasonable requests of, each other party and act in a reasonable and good faith manner to minimize the scope of any Indemnified Claim.

 

12.          Intellectual Property

 

All concepts, inventions, ideas, patent rights, data, trademarks, and copyrights that are related to Products will remain exclusive property of the Company, except those not specific to Products and that relate to the general processes, reports and services developed by ICS and provided to the Company.  Any concepts, inventions, ideas, patent rights, data, trademarks, and copyrights that are developed by ICS that are not specific to Products or that relate to the processes, reports and services developed by ICS will remain the exclusive property of ICS.

 

13.          Insurance

 

13.1         By the Company.  During the Term, the Company will maintain: (a) casualty and theft or loss insurance in amounts sufficient to protect all Products and other materials consigned to ICS, and (b) products liability and commercial general liability insurance having a limit of not less than [**] dollars ($[**]) per occurrence, Combined Single Limit (Bodily Injury and Property Damage), pursuant to one or more insurance policies with reputable insurance carriers having a Best’s Rating of A VII or otherwise as reasonably approved by ICS.  If the required insurance is underwritten on a “claims made” basis, the insurance must include a provision for an extended reporting period (“ERP”) of not less than twenty-four months; the Company further agrees to purchase the ERP if continuous claims made insurance, with a retroactive date not later than the date of this Agreement, is not continually maintained or is otherwise unavailable.  The Company will designate ICS and its Related Parties as “additional insureds” under each such insurance policy.  The Company will obtain a broad form vendor’s endorsement for products liability for ICS and its Related Parties.  Once the Products have been FDA approved, the Company will provide to ICS, upon request, a certificate of insurance indicating that such obligations have been satisfied.  As a condition precedent to the effectiveness of this Agreement, the Company will execute the form of Continuing Guaranty and Indemnification Agreement attached as Exhibit A.

 

13.2         By ICS.  During the Term, ICS will maintain the following insurance:

 

13.2.1      Workers’ Compensation.  Workers’ compensation statutory coverage as required by law in states where Services are performed;

 

13.2.2      Employer’s Liability.  Employer’s liability insurance with a limit of $[**] for bodily injury by accident per person, $[**] for bodily injury by accident, all persons and $[**] bodily injury by disease policy limit;

 

13.2.3      General Liability.  Commercial general liability insurance, including personal injury blanket contractual liability and broad form property damage, with a $[**] combined single limit;

 

13.2.4      Umbrella Liability.  Umbrella liability insurance in the amount of $[**] per occurrence and aggregate;

 

13.2.5      Property Insurance.  Property insurance covering the business property of

 

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ICS and others while at any unnamed location in the amount of $[**]; and

 

13.2.6      Other.  ICS will not be obligated to insure Products against any loss or damage to Products arising from the shipment or storage of Products at the ICS Facility, other than for its obligations under Section 10.4 above.

 

13.3         Self-Insurance.  The insurance required by Section 13 may be made up through a combination of self-insured retention and traditional insurance.

 

13.4         Source of Recovery.  Except to the extent that ICS is liable for Product damage or loss under Section 10.4(c) above, the Company agrees to look for recovery in respect of any such loss or damage solely to the casualty and theft or loss insurance provided by the Company in accordance with Section 13.1 of this Agreement.

 

13.5         Notice and Proof of Insurance.  Throughout the Term, ICS will (a) provide prompt written notice to the Company in the event ICS becomes aware or is notified that the insurance described in Section 13.2 will be materially adversely modified or cancelled and (b) provide the Company with proof of such insurance.

 

14.          Notices

 

Notices will be in writing and will be delivered personally (which will include delivery by courier or reputable overnight delivery service) or sent by certified mail, postage and fee prepaid, return receipt requested, to the address on the signature page.  Items delivered personally will be deemed delivered on the date of actual delivery.  Items sent by certified mail will be deemed delivered on the date the return receipt is signed.  A party may change its contact information by a written notice delivered in accordance with this Section 14.

 

15.          Governing Law

 

This Agreement and the rights and obligations of the parties under this Agreement will be construed and interpreted under the internal laws of the State of Delaware, excluding its conflict and choice of law principles.  The successful party in any legal action arising out of this Agreement, including enforcing its rights in a bankruptcy proceeding, may recover all costs, including reasonable attorneys’ fees.

 

16.          Severability

 

If any court determines a provision of this Agreement is invalid, such holding will not affect the validity of other provisions and they will remain in effect.

 

17.          Complete Agreement; Amendments; Counterparts; Waivers; Signatures.

 

This Agreement and its schedules and exhibits, including the Confidentiality Agreement and Continuing Guaranty, contain the entire agreement between the parties and supersede any prior oral and written representations by the parties that relate to the subject matter of this Agreement.  This Agreement may not be amended, supplemented or waived in any respect without written agreement of both parties, signed by their respective authorized representatives.  This Agreement may be executed in one or more counterparts, which will together constitute but one agreement and each of which will be an original.  A party’s failure to insist, in one or more instances, upon performance of any provision of this Agreement will not be construed as a waiver of its right and the other party’s obligations will continue in full force.  Either party’s consent to any act by the other party on any occasion will not be deemed consent on any other occasion.  Facsimile transmissions bearing a party’s signature will for all purposes be deemed

 

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an original.

 

18.          Force Majeure

 

If the performance of any part of this Agreement by any party will be affected for any length of time by fire or other casualty, government restrictions, war, terrorism, riots, strikes or labor disputes, lock out, transportation delays, electronic disruptions, internet, telecommunication or electrical system failures or interruptions, and acts of God, or any other cause which is beyond control of a party (financial inability excepted), such party will not be responsible for delay or failure of performance of this Agreement for such length of time, provided, however, (a) the affected party will cooperate with and comply with all reasonable requests of the non-affected party to facilitate Services to the extent possible, and (b) the obligation of one party to pay amounts due to any other party will not be subject to the provisions of this Section.  If ICS is affected by any event of force majeure, it shall promptly notify the Company of the occurrence and, if known, the duration thereof.  If the event is expected to or does prevent ICS’ performance hereunder for ten days or more, Company shall have the right to terminate this Agreement without further liability, except payment for Services performed through the date of termination and costs for any transition services.

 

19.          Interpretation

 

Each party to this Agreement (i) has participated in the preparation of this Agreement, (ii) has read and understands this Agreement, and (iii) has been represented by counsel of its own choice in the negotiation and preparation of this Agreement.  Each party represents that this Agreement is executed voluntarily and should not be construed against a party solely because it drafted all or a portion of this Agreement.  Headings of the various Sections are not part of the context of this Agreement, and are only labels to assist in locating those Sections, and will be ignored in construing this Agreement.  When this Agreement requires approval of one or more parties, such approval may not be unreasonably withheld or delayed.  Words, regardless of the number and gender specifically used, will be construed to include any other number, singular or plural, and any gender, masculine, feminine, or neuter, as the context requires.  “And” includes “or.”  “Or” is disjunctive but not necessarily exclusive.  “Including” means “including but not limited to.”

 

20.          Successors

 

Neither party may assign this Agreement (including pursuant to a merger or change in voting control) or any of its rights or obligations without prior written consent of the other party, which consent will not be unreasonably withheld or delayed. Upon such consent, this Agreement will be binding upon the successor party.

 

21.          Relationship Of The Parties

 

Neither party has any ownership interest in the other and their relationship, as established by this Agreement, is that of agent and master within the confines of the terms of this Agreement.  Other than such limited agency, this Agreement does not create any partnership, joint venture or similar business relationship between the parties.  Notwithstanding the limited agency created hereunder, each party will remain fully responsible for its actions and the actions of its Related Parties not specifically related to this Agreement.

 

22.          Letter of Intent

 

Pursuant to Section 17 of this Agreement, the parties’ Letter of Intent dated February 7, 2011, is superseded by this Agreement, provided that,Company shall pay $[**] on

 

11

 

December 1, 2011, in full satisfaction of all amounts due under the Letter of Intent, which represents [**]% of the implementation fee set forth in Schedule B.

 

 

SIGNATURE PAGE FOLLOWS

 

12

 

IN WITNESS WHEREOF, the parties have had a duly authorized officer, partner or principal execute this Commercial Outsourcing Services Agreement as of the Effective Date.

 

 

	
PACIRA   PHARMACEUTICALS, INC., COMPANY:
    	
INTEGRATED COMMERCIALIZATION   SOLUTIONS, INC.
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ James S. Scibetta 
    	
 
    	
By:
    	
/s/ Doug Cook
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name:
    	
James S. Scibetta
    	
 
    	
Name:
    	
Doug Cook
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:
    	
CFO
    	
 
    	
Title:
    	
VP, General Manager
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Address:
    	
5 Sylvan Way
    	
 
    	
Address:
    	
Attn: Executive Vice President and
    
	
 
    	
Parsippany, NJ 07054
    	
 
    	
 
    	
General Manager
    
	
 
    	
 
    	
 
    	
 
    	
3101 Gaylord Parkway
    
	
 
    	
8/30/11
    	
 
    	
 
    	
Frisco, TX 75034
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
with a copy to:

 

AmerisourceBergen Specialty Group, Inc.

Attn: Group Counsel, 1N-E186
   3101 Gaylord Parkway
   Frisco, TX 75034
    
	
 
    	
 
    	
 
    	
 
    
	
Program Launch Date:  December 1, 2011
    	
 
    	
 
    	
 
    

 

13

 

LIST OF SCHEDULES AND EXHIBITS

 

	
 
    	
Schedules:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Schedule   A
    	
Description   of Products
    
	
 
    	
Schedule   B
    	
Summary   of Fees
    
	
 
    	
Schedule   C
    	
Additional   Definitions
    
	
 
    	
Schedule   D
    	
Copy   of Executed Confidentiality Agreement
    
	
 
    	
 
    	
 
    
	
 
    	
Exhibits:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Exhibit A
    	
Continuing   Guaranty and Indemnification Agreement
    
	
 
    	
Exhibit B
    	
Customer   Services
    
	
 
    	
Exhibit C
    	
Warehousing   and Inventory Program Services
    
	
 
    	
Exhibit D
    	
Distribution   Services
    
	
 
    	
Exhibit E
    	
Warehousing   and Distribution of Sample Products
    
	
 
    	
Exhibit F
    	
Marketing   Materials Fulfillment Services
    
	
 
    	
Exhibit G
    	
Contract   Administration and Chargeback Processing
    
	
 
    	
Exhibit H
    	
Accounts   Receivable Management and Cash Applications
    
	
 
    	
Exhibit I
    	
Financial   Management Services
    
	
 
    	
Exhibit J
    	
IT   Services
    

 

14

 

SCHEDULE A

 

DESCRIPTION OF PRODUCTS

 

	
Description
    	
 
    	
NDC   Number
    

 

EXPARELTM is an extended-release liposome injection of bupivacaine, an amide-type local anesthetic/analgesic, indicated for single-dose local administration into the surgical wound to produce postsurgical analgesia.

 

[**]

 

 

Samples

 

Non- sampled product

 

 

Free Goods

 

Yes — selective basis

 

15

 

SCHEDULE B

SUMMARY OF FEES

 

	
Fee
    	
 
    	
Amount
    	
 
    	
Description
    
	
3PL Services
    	
 
    	
 
    	
 
    	
 
    
	
Development and Implementation
    	
 
    	
$[**]
    	
 
    	
· [**]
    
	
Stand-Ready Fee
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Monthly Management Fee
    	
 
    	
 
    	
 
    	
 
    
	
Customer Service
    	
 
    	
$[**]/month
    	
 
    	
· [**]
    
	
Warehouse & Distribution
    	
 
    	
 
    	
 
    	
 
    
	
Returns Management
    	
 
    	
 
    	
 
    	
 
    
	
Finance
    	
 
    	
 
    	
 
    	
 
    
	
Information Technology & Reporting
    	
 
    	
 
    	
 
    	
 
    
	
Chargeback Management
    	
 
    	
 
    	
 
    	
 
    
	
Sample Management
    	
 
    	
 
    	
 
    	
 
    
	
Marketing Material Management
    	
 
    	
 
    	
 
    	
 
    
	
Customer Service Fees
    	
 
    	
 
    	
 
    	
 
    
	
Order Processing Fee
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Customer Setup Fee
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Account Maintenance/License   Updates
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Allocation Fee
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Rush Order
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Emergency Order
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
International Order
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Warehouse &   Distribution Fees
    	
 
    	
 
    	
 
    	
 
    
	
Product Storage
    	
 
    	
$[**]
    	
 
    	
[**]
    

 

16

 

	
Fee
    	
 
    	
Amount
    	
 
    	
Description
    
	
Order Processing Fees (   refrigerated)
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Receiving Fee
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Shipping Fee
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Bulk Shipments
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Packing Supplies
    	
 
    	
[**]
    	
 
    	
[**]
    
	
Freight
    	
 
    	
[**]
    	
 
    	
[**]
    
	
Finance
    	
 
    	
 
    	
 
    	
 
    
	
Invoice Processing
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Credit Verification Reports —   Dun & Bradstreet
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Credit Verification Reports —   Experian
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Returns Management
    	
 
    	
 
    	
 
    	
 
    
	
RGA Initiation
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Return Processing
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Partial Return Processing
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Returns Storage
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Contract and Chargeback   Management
    	
 
    	
 
    	
 
    	
 
    
	
Chargeback Processing — Manual
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Chargeback Processing —   Electronic
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Membership Additions
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Contract Setup
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Contract Updates
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Information Technology   and Reporting
    	
 
    	
 
    	
 
    	
 
    
	
852/867: ABC, CAH, MCK
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Custom Reports
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Custom Development
    	
 
    	
$[**]
    	
 
    	
[**]
    

 

17

 

	
Fee
    	
 
    	
Amount
    	
 
    	
Description
    
	
Services
    	
 
    	
 
    	
 
    	
 
    
	
Additional Fees
    	
 
    	
 
    	
 
    	
 
    
	
Product Destruction
    	
 
    	
[**]
    	
 
    	
[**]
    
	
Telecom
    	
 
    	
[**]
    	
 
    	
[**]
    
	
FedEx/UPS/Postage Expenses
    	
 
    	
[**]
    	
 
    	
[**]
    
	
Pre-Approved Assessorial Labor Charge - Warehouse
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Pre-Approved Assessorial Labor Charge — Office Staff
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Pre-Approved Assessorial Labor Charge — QC,
    	
 
    	
$[**]
    	
 
    	
[**]
    
	
Management ICS Travel
    	
 
    	
[**]
    	
 
    	
[**]
    

 

18

 

SCHEDULE C

 

ADDITIONAL DEFINITIONS

 

“Act” means the Federal Food, Drug and Cosmetic Act, Title 21, United States Code, as amended, and the regulations promulgated thereunder.

 

“ANDA” means an Abbreviated New Drug Application as defined in and contemplated by the Act.

 

“Customer” is defined in Agreement Section 1.

 

“DEA” means the United States Drug Enforcement Administration.

 

“FDA” means the United States Food and Drug Administration.

 

“Governmental Authority” means any nation, government, state or other political subdivision, or any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

 

“ICS Facility” means the facility located at 420 International Blvd. Suite#500, Brooks, KY 40109 or 5360 Capital Court #102, Reno, NV 89502.

 

“NDA” means a New Drug Application as defined in and contemplated by the Act.

 

“Person” means any corporation, natural person, the Company, entity, firm, joint venture, partnership, trust, unincorporated organization, or Government Authority.

 

“Products” is defined in Agreement Recital A.

 

“Related Parties” means the subsidiaries, parents, affiliated companies, officers, directors, employees, independent contractors, representatives, shareholders, trustees and agents of any Person.

 

“Requirements of Law” means any law (including consumer law), treaty, rule or regulation or a final and binding determination of a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

 

“Services” is defined in Agreement Section 2.1.

 

“Taxes” means any and all liabilities, losses, expenses, and costs of any kind whatsoever that are, or are in the nature of taxes, fees, assessments, or other governmental charges, including interest, penalties, fines and additions to tax imposed by any federal, state or local government or taxing authority in the United States on or with respect to: (a) the Agreement or any related agreements or any future amendment, supplement, waiver, or consent requested by the Company or any required by the Agreement with respect to the execution, delivery or performance of any thereof, or the issuance, acquisition or subsequent transfer thereof, (b) the return, acquisition, transfer of title, storage, removal, replacement, substitution, purchase, acceptance, possession, rejection, ownership, delivery, non-delivery, use, operation, sale, abandonment, redelivery or other disposition of any interest in Products or any part thereof,

 

19

 

(c) the receipts or earnings arising from any interest in Products or any part thereof, (d) any payment made pursuant to this Agreement or to any Products, or (e) otherwise as a result of or by reason of the transactions contemplated by this Agreement, excluding, however, taxes imposed upon ICS that are based upon or measured by gross or net income and any franchise Taxes of ICS or any personal property taxes for Products or equipment owned by ICS.

 

“Term” is defined in Agreement Section 4.1.

 

20

 

SCHEDULE D

COPY OF EXECUTED CONFIDENTIALITY AGREEMENT

 

Pacira Pharmaceuticals, Inc.
 10450 Science Center Drive
 San Diego, CA 92121
 Phone:  858-625-2424

 

MUTUAL CONFIDENTIALITY DISCLOSING AGREEMENT

 

Agreement dated November 4, 2010 (the “Effective Date”), between Pacira Pharmaceuticals, Inc., a California corporation (the “Company”) with offices at 10450 Science Center Drive, San Diego, California 92121, and Integrated Commercialization Solutions, Inc., a California corporation with offices at 3101 Gaylord Parkway, Frisco, Texas 75034 ( “ICS”).

 

1.             Background.  The Company and ICS (the “parties”) intend to engage in discussions and negotiations concerning the possible establishment of a business relationship between them or in furtherance of an existing business relationship between them.  In the course of such discussions and negotiations and in the course of any such business relationship, it is anticipated that each party will disclose or deliver to the other party and to the other party’s directors, officers, employees, authorized agents, attorneys, accountants, consultants and financial advisors) (collectively, “Representatives”) certain of its trade secrets or confidential or proprietary information for the purposes of enabling the other party to evaluate the feasibility of such business relationship and to perform its obligations and exercise its rights under any such business relationship that is agreed to between the parties (the “Purposes”).  The parties have entered into this Agreement in order to assure the confidentiality of such trade secrets and confidential or proprietary information in accordance with the terms of this Agreement.  As used in this Agreement, the party disclosing Proprietary Information (as defined below) is referred to as the “Disclosing Party”; the party receiving such Proprietary Information is referred to as the “Recipient.”

 

2.             Proprietary Information.  As used in this Agreement, the term “Proprietary Information” shall mean all trade secrets or confidential or proprietary information either (i) designated as such in writing (e-mail is sufficient) by the Disclosing Party, including, without limitation, by letter or by the use of an appropriate proprietary stamp or legend or otherwise identified as confidential, or (ii) or is of such a nature that a reasonable person would understand that such information is confidential, prior to or at the time any such trade secret or confidential or proprietary information is disclosed by the Disclosing Party to the Recipient.  Proprietary Information may be disclosed in any manner including in writing, orally, electronically, or visually.  The Company’s Proprietary Information shall include all information relating to the Company’s compounds, development work and materials, whether or not marked or otherwise identified as trade secrets or confidential or proprietary information.  ICS’s Proprietary Information shall include all information about processes, systems, strategic plans, business plans, operating data, customer information, pricing information, financial information and other information, whether or not marked or otherwise identified as trade secrets or confidential or proprietary information.  In addition, the term “Proprietary Information” shall be deemed to include:  (a) that portion of any notes, analyses, compilations, studies,

 

21

 

interpretations, memoranda or other documents prepared by the Recipient or its Representatives which contain, reflect or are based upon, in whole or in part, any Proprietary Information furnished to the Recipient or its Representatives pursuant hereto; and (b) the existence or status of, and any information concerning, the discussions between the parties concerning the possible establishment of a business relationship, including the fact that the parties hereto have entered into this Agreement and the terms and conditions thereof.

 

3.             Use and Disclosure of Proprietary Information.  The Recipient and its Representatives shall use the Proprietary Information only for the Purposes, and such Proprietary Information shall not be used for any other purpose without the prior written consent of the Disclosing Party.  The Recipient and its Representatives shall hold in confidence, and shall not disclose to any person, except as permitted hereunder, any Proprietary Information or exploit such Proprietary Information for its own benefit or the benefit of another without the prior written consent of the Disclosing Party.  Without limitation of the foregoing, the Recipient shall not cause or permit reverse engineering of any Proprietary Information or decompilation or disassembly of any drug products which are part of the Proprietary Information.  The Recipient shall disclose Proprietary Information received by it under this Agreement only to its Representatives (i) who have a need to know such Proprietary Information in the course of the performance of their duties in connection with the Purposes, (ii) who are informed of the confidential nature of the Proprietary Information and (iii) who are obligated to the Recipient to maintain Proprietary Information under terms and conditions at least as stringent as those under this Agreement.  The Recipient shall be responsible to the Disclosing Party for any disclosure or misuse of Proprietary Information that results from a failure to comply with terms of this Agreement by the Recipient and/or Recipient’s Representatives.  The Recipient shall promptly report to the Disclosing Party any actual or suspected violation of the terms of this Agreement and shall take all reasonable further steps requested by the Disclosing Party to prevent, control or remedy any such violation.

 

4.             Compelled Disclosure.  Notwithstanding anything contained in this Agreement to the contrary, if the Recipient or any of its Representatives is requested or required (by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) to disclose any Proprietary Information, the Recipient, to the extent legally permitted, shall promptly notify the Disclosing Party in writing of such request or requirement so that the Disclosing Party may seek an appropriate protective order or other appropriate remedy or waive compliance with the provisions of this Agreement.  The Recipient shall reasonably cooperate with the Disclosing Party (at the Disclosing Party’s sole cost and expense) to obtain such a protective order or other remedy.  If such order or other remedy is not obtained, or the Disclosing Party waives compliance with the provisions of this Agreement, the Recipient shall only disclose that portion of the Proprietary Information which it is advised by counsel that it is legally required to so disclose and shall obtain reliable assurance (at the Disclosing Party’s sole cost and expense) that confidential treatment will be accorded the Proprietary Information so disclosed.

 

5.             Limitation on Obligations.  The obligations of the Recipient specified in this Agreement shall not apply, and the Recipient shall have no further obligations, with respect to any Proprietary Information to the extent that such Proprietary Information:

 

(a)           is generally known to the public at the time of disclosure or becomes generally known without the Recipient or its Representatives violating this Agreement;

 

22

 

(b)           is in the Recipient’s possession at the time of disclosure otherwise than as a result of Recipient’s breach of any legal obligation;

 

(c)           becomes known to the Recipient through disclosure by sources other than the Disclosing Party without such sources violating any confidentiality obligations to the Disclosing Party; or

 

(d)           is independently developed by the Recipient without reference to or reliance upon the Disclosing Party’s Proprietary Information.

 

6.             Ownership of Proprietary Information.  The Recipient agrees that it shall not receive any right, title or interest in, or any license or right to use, the Disclosing Party’s Proprietary Information or any patent, copyright, trade secret, trademark or other intellectual property rights therein, by implication or otherwise.

 

7.             Return of Proprietary Information.  The Recipient shall, upon the written request of the Disclosing Party, promptly return to the Disclosing Party all Proprietary Information received by the Recipient or its Representatives from the Disclosing Party (and all copies and reproductions thereof).  In addition, the Recipient shall destroy:  (i) that portion of any notes, reports or other documents prepared by the Recipient which contain Proprietary Information of the Disclosing Party; and (ii) any Proprietary Information of the Disclosing Party (and all copies and reproductions thereof) which is in electronic form or cannot otherwise be returned to the Disclosing Party.  Alternatively, upon written request of the Disclosing Party, the Recipient shall promptly destroy (with written certification of destruction) all Proprietary Information received by the Recipient or its Representatives from the Disclosing Party (and all copies and reproduction thereof) and that portion of any notes, reports or other documents prepared by the Recipient which contain Proprietary Information of the Disclosing Party.  Notwithstanding the foregoing, the Recipient and its Representatives (i) may retain solely for compliance purposes one (1) copy of the Proprietary Information in order to comply with law or regulation and (ii) need not destroy electronic archives and backups made in the ordinary course of business where it would be commercially impracticable to do so.  Moreover, notwithstanding the return or destruction of the Proprietary Information, the Recipient and its Representatives will continue to be bound by their obligations of confidentiality and other obligations hereunder.

 

8.             No Representations and Warranties.  The parties acknowledge and agree that the Proprietary Information is being provided to each party “as is” and without any representation or warranty of any kind, either express or implied.  Each party understands and agrees that neither the Disclosing Party nor any of its Representatives makes any representation or warranty, express or implied, as to the accuracy or completeness of the Proprietary Information nor will any of them have any liability to the Recipient or its Representatives or any other person relating to or resulting from the use of the Proprietary Information or any errors therein or omissions therefrom.  Each party understands and agrees that the Disclosing Party is under no duty or obligation to provide the Recipient with access to any information, and nothing herein is intended to impose any such obligation on the Disclosing Party or any of its Representatives.

 

9.             Communications.  All questions and communications between the parties hereto with respect to the Purposes and/or the Proprietary Information will be submitted or directed only to the persons designated by the respective parties hereto.  The parties hereto agree that no other employees of the other party shall be contacted in connection with the Purposes or the Proprietary Information.

 

23

 

10.           Securities Laws.  The Recipient hereby acknowledges that it is aware, and that Recipient shall use its best efforts to advise its Representatives who are informed of the matters which are the subject of this Agreement, that the United States securities laws place certain restrictions on any person who has material, non-public information concerning the issuer with respect to purchasing or selling securities of such issuer or from communicating such information to any other person under circumstances in which it is reasonably foreseeable that such person is likely to purchase or sell such securities.

 

11.           Miscellaneous.

 

(a)           This Agreement supersedes all prior agreements, written or oral, between the parties relating to the subject matter of this Agreement.  This Agreement may not be modified, changed or discharged, in whole or in part, except by an agreement in writing signed by both parties.

 

(b)           This Agreement will be binding upon and inure to the benefit of the parties and their respective heirs, successors and assigns.  This Agreement may be assigned by either party to any affiliate.

 

(c)           This Agreement shall be construed and interpreted in accordance with the internal laws of the State of California, without giving effect to the principles of conflicts of law thereof.

 

(d)           The provisions of this Agreement are necessary for the protection of the business and goodwill of the parties and are considered by the parties to be reasonable for such purpose.  The parties hereto agree that money damages would not be a sufficient remedy for any breach or threatened breach of this Agreement by the Recipient or its Representatives, and the Disclosing Party shall be entitled to specific performance and injunctive relief and any other appropriate equitable remedies for any such breach.  The Recipient shall not and shall cause its Representatives not to oppose the granting of such equitable relief, and to waive any requirement for the securing or posting of any bond in connection with such remedy.  Such remedies shall not be deemed to be the exclusive remedies for a breach of this Agreement by the Disclosing Party or its Representatives but shall be in addition to all other remedies available at law or in equity.

 

(e)           This Agreement covers Proprietary Information that is disclosed by the Disclosing Party to the Recipient until the first anniversary of the Effective Date.  The Recipient’s confidentiality obligations imposed by this Agreement shall continue with respect to Proprietary Information until the third (3rd) anniversary of the Effective Date; provided, however, that the confidentiality obligations imposed by this Agreement with respect to the trade secrets and the DepoFoam manufacture included in the Company’s Proprietary Information shall continue in perpetuity.

 

(f)            For the convenience of the parties, this Agreement may be executed by facsimile and in counterparts, each of which shall be deemed to be an original, and both of which taken together, shall constitute one agreement binding on both parties.

 

[THIS SPACE INTENTIONALLY LEFT BLANK]

 

24

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first set forth above.

 

 

	
 
    	
PACIRA   PHARMACEUTICALS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   James S. Scibetta
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
James   S. Scibetta
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
CFO
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
INTEGRATED   COMMERCIALIZATION SOLUTIONS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Doug Cook
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Doug   Cook
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
General   Manager
    

 

 

[SIGNATURE PAGE TO CONFIDENTIALITY AGREEMENT]

 

25

 

 

EXHIBIT A

 

CONTINUING GUARANTY AND INDEMNIFICATION AGREEMENT

 

The undersigned does hereby guarantee to AmerisourceBergen Corporation and each of its subsidiary companies and their successors that any food, drugs, devices, cosmetics, or other merchandise (“Products”) now or hereafter shipped or delivered by or on behalf of the undersigned, its subsidiaries, divisions, affiliated companies and representatives (“Guarantors”) to or on the order of AmerisourceBergen Corporation or any of its subsidiaries will not be, at the time such shipment or delivery, adulterated, misbranded, or otherwise prohibited under applicable federal, state and local laws, including applicable provisions of the Federal Food, Drug and Cosmetic Act, 21 U.S.C.A. §301 et seq., (“FDCA”), and Sections 351 and 361 of the Federal Public Health Service Act, 42 U.S.C.A. §§ 262 and 264, and their implementing regulations (“Applicable Laws”), each as amended and in effect at the time of shipment or delivery of such Products; and such Products are not, at the time of such shipment or delivery, merchandise which may not otherwise be introduced or delivered for introduction into interstate commerce under Applicable Laws, including FDCA section 301 (21 U.S.C.A. §331); and such Products are merchandise which may be legally transported or sold under the provisions of any other applicable federal, state or local law; and Guarantors guarantee further that, in the case of food shipments, only those chemicals or sprays approved by federal, state or local authorities have been used, and any residue in excess of the amount allowed by any such authorities has been removed from such Products.

 

Guarantors hereby agree to defend, indemnify and hold AmerisourceBergen Corporation and each of its subsidiaries harmless against any and all claims, losses, damages, and liabilities whatsoever (and expenses connected therewith, including counsel fees), arising as a result of (a) any actual or asserted violation of Applicable Laws or by virtue of which Products made, sold, supplied, or delivered by or on behalf of Guarantors may be alleged or determined to be adulterated, misbranded or otherwise not in full compliance with or in contravention of Applicable Laws, (b) possession, distribution, sale and/or use of, or by reason of the seizure of, any Products of Guarantors, including any prosecution or action whatsoever by any governmental body or agency or by any private party, including claims of bodily injury, death or property damage, (c) any actual or asserted claim that Guarantors’ Products infringe any proprietary or intellectual property rights of any person, including infringement of any trademarks or service names, trade names, trade secrets, inventions, patents or violation of any copyright laws or any other applicable federal, state or local laws, and (d) any actual or asserted claim of negligence, willful misconduct or breach of contract by Guarantors.  Guarantors further agree to maintain primary and noncontributing Products Liability Insurance of not less than U.S. $[**] per occurrence, Combined Single Limit (Bodily Injury and Property Damage) including AmerisourceBergen Corporation and its subsidiary companies and their successors as Additional Insureds, including a Broad Form Vendors Endorsement.  If the required insurance is underwritten on a “claims made” basis, the insurance must include a provision for an extended reporting period (“ERP”) of not less than twenty-four months; Guarantors further agree to purchase the ERP if continuous claims made insurance, with a retroactive date not later than the date of this Agreement, is not continually maintained or is otherwise unavailable.  Guarantors will endeavor to provide at least 30 days’ prior written notice to the Additional Insureds in the event of cancellation or material reduction of coverage, and upon request promptly submit satisfactory evidence of such insurance.  All insurance coverage must be with a carrier and in a form acceptable to AmerisourceBergen Corporation, at its sole discretion, including any deductible or self-insurance risk retained by Guarantors.  In combination with significant excess liability insurance, any retained risk must be commercially reasonable, actuarially sound and acceptable to AmerisourceBergen Corporation, at its sole discretion.  Each Guarantor warrants that its assets are sufficient to cover any self-insurance liability it assumes under this Agreement.  Provisions in this Continuing Guaranty and Indemnification Agreement are in addition to, and not in lieu of, any terms set forth in any purchase orders accepted by Guarantors or any separate agreement entered into between AmerisourceBergen Corporation or any of its subsidiaries or their successors and Guarantors.  In the event of any conflict between the language of such other documents and the language set forth herein, the language herein shall be controlling.

 

 

	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    

 

26

 

	
 
    	
Date:
    	
 
    

Revised

6/2/05

 

27

 

EXHIBIT B

CUSTOMER SERVICES

 

ICS shall perform the following Services on and after the Program Launch Date during the Term of the Agreement:

 

1.             ICS, as agent of the Company, will develop, operate and maintain an Integrated Access Center (“Access Center”) to manage the comprehensive distribution Services related to Products described herein (“Customer Services”) for the Company.  ICS agrees to develop the Access Center and provide the Customer Services for the fees listed in Schedule B.

 

2.             The Access Center includes the following:

 

2.1                               A fully-integrated telecommunications and information system that will capture and manage key data from each Customer requesting information or specific services relating to Products;

 

2.2                               A toll-free Company-dedicated telephone and fax number solely for the Access Center, with all costs being the Company’s responsibility;

 

2.3                               The capability to handle queries about Products related to order processing and account management; and

 

2.4                               The capability to triage queries and forward to Company phones.

 

3.               ICS, as agent of the Company, will retain, train and manage appropriate staff personnel to operate the Access Center.  Responsibilities of Access Center personnel will be to:

 

3.1                               Receive orders via Electronic Data Interchange (“EDI”), facsimile, email, mail or telephone, and (b) be available from 8:00 a.m. to 5:00 p.m. (Central) to receive orders or triage calls to the Company as necessary;

 

3.2                               Receive EDI orders from the Company or its Customers.  Upon receipt, ICS will:

 

3.2.1                     Verify that product order file processed from customer and into ICS’ ERP system;

 

3.2.2                     Review EDI order processing error logs and communicate any non-processed orders and reasons to the Company or its Customers; and

 

3.2.3                     Take appropriate action based on direction from the Company to resolve any issues and re-enter orders or order files into the ERP for processing;

 

3.3                                 Generate and issue packing slips for the sale of Products sold under this Agreement;

 

28

 

3.4                               Manage the process of issuing Product return authorizations and Product destruction authorizations in accordance with the Company’s policies that have been provided to ICS, and coordinate shipment of Product for destruction;

 

3.5                               Set up customer accounts for Customers eligible to purchase from the Company according to parameters provided by the Company, and the Company will periodically supply ICS with its written criteria, as amended from time to time, for all Customer eligibility; and

 

3.6                               At the Company’s prior written request, verify that such Customers meet the Company’s eligibility criteria by:

 

3.6.1                     Credit verification using approved agencies and establishment of credit limits based on the Company’s guidance;

 

3.6.2                     Verification of licenses (including verification of DEA and state controlled substances, regulatory licenses and registrations when filling orders of controlled substances); and

 

3.6.3                     License verification using the NTIS database augmented by a copy of the Customer license if necessary; and

 

3.7                               Obtain Proofs of Deliveries (PODs) for the Company.

 

4.             Order allocations encompass any inbound orders to ICS that need to have original conditions reviewed and/or manipulated as opposed to allowing the order to flow freely through the order process system.  All allocated orders shall be filled in accordance with the Company’s written instructions.

 

5.             An order is defined as a shipment to a unique address that leaves the distribution center, regardless of the number of cartons or packages that constitute that shipment and/or the number of inbound requests for such order.

 

6.             The following services are not a part of Customer Services normally provided in the Access Center:

 

6.1          Product substitution relating to backorder management:

 

6.2          Stock allocation of Product to the Company’s Customer base:

 

6.3          Arranging for the re-distribution of Product within the Company’s Customer base; or

 

6.4           Any services not identified in paragraphs 1 through 3 of this Exhibit B.

 

29

 

EXHIBIT C

 

WAREHOUSING AND INVENTORY MANAGEMENT SERVICES

 

ICS shall perform the following Services on and after the Program Launch Date during the Term of the Agreement:

 

1.             ICS will warehouse and inventory Products at the ICS Facility.

 

2.             ICS will visually inspect each shipment of Product for external container or package damage or loss in transit (based upon records provided to ICS by the Company Product, or in accordance with the Statement of Work for the applicable product, if otherwise specified.

 

3.             ICS will promptly notify the Company upon ICS’s discovery of any damage or loss to Product.

 

4.             ICS will quarantine Product upon receipt and will release Product to salable inventory status within twenty-four (24) hours of written authorization from the Company.

 

5.             ICS will store all Product in compliance with current good manufacturing practice regulations and guidelines and other requirements of the FDA, the U.S. Drug Enforcement Administration (including maintaining required registrations, licenses and other authorizations, observing all DEA security standards and timely filing any necessary ARCOS reports and other DEA forms, including DEA form 222), all other applicable Requirements of Law and in accordance with the Company’s written instructions, if any.

 

6.             The Company will pay all costs, charges, expenses and import and export duties for delivery and transportation of Product to and from an ICS Facility; provided that ICS shall be responsible for the costs of any transfers of Product from one ICS Facility to another ICS Facility that are initiated by ICS and not requested by the Company.

 

30

 

EXHIBIT D

DISTRIBUTION SERVICES

 

ICS shall perform the following Services on and after the Program Launch Date during the Term of the Agreement:

 

1.             Distribution.  ICS shall provide the following distribution tasks:

 

1.1                                 ICS shall use its best efforts to ensure that Products will be packaged and distributed by trained personnel in client approved shipment containers.

 

1.2                                 ICS shall use its best efforts to ship Products within one (1) business day of receipt of orders by ICS unless otherwise specified under the terms of this Agreement.  Pacira will use drop ship through wholesaler Customers.  Should a customer need an emergency shipment for Saturday delivery ICS will follow shipping SOP and customer emergency shipment billing.

 

1.3                                 ICS shall ship Veterans Administration and other government orders direct or to the designated PPV (Preferred Pharmaceutical Vendor).

 

1.4                                 ICS shall distribute bulk shipments by a designated carrier using carrier bulk shipment terms.

 

1.5                                 ICS shall use its best efforts to ensure that Products are distributed on a FEFO (first expired/first out) basis unless otherwise directed by the Company in writing.

 

1.6                                 ICS shall deliver Products as a drop ship to end-user customers and billed to the designated wholesaler

 

1.7                                 ICS shall use its best efforts to ensure that non-EDI orders received by ICS during standard warehouse hours of shipping (currently M-F 8:00 a.m. to 3:00 p.m. Eastern, except holidays) and EDI orders received prior to the 3:00 p.m. Eastern cutoff time will be filled the same day.  ICS shall also use its best efforts to ensure that orders received after this agreed upon cut-off time will be processed no later than the next business day.  ICS shall use its best efforts to ensure that EDI orders arriving after the cutoff time will be processed within 24 hours of transmission to ICS.

 

1.8                                 At the Company’s request, ICS shall provide a “Rush Order” service for specific order or orders to be processed and shipped the same day; provided however, that such services are dependent on ICS’s ability to perform based upon order receipt time, ICS personnel, and transportation carrier availability.  Such orders shall be subject to the Company’s payment of the additional fees pursuant to Schedule B.

 

1.9                                 At the Company’s request, ICS shall provide “Emergency Order” services, defined as any order received outside of scheduled working hours (currently M-F 8:00 a.m. to 5:00 p.m. Eastern Time) requiring ICS staff to return to the ICS Facility to process the order within the same day.  Such Emergency Order services will be subject to additional fees pursuant to Schedule B.  ICS shall clearly identify any such orders to the Company at the time of the Company’s request.

 

2.             Inventory.  ICS will be responsible for the following inventory tasks:

 

31

 

2.1                                 ICS shall receive Products from the Company or a Company designee.

 

2.2                                 ICS shall ensure that any end of lot discrepancies evidenced by a difference in physical to book inventory as noted during Product distribution will trigger inventory counts and reconciliation by ICS to verify and determine, where possible, the cause for the discrepancy.

 

2.3                                 ICS shall provide the Company, at ICS’s expense, one (1) physical product inventory per calendar year and routine cycle counts.  ICS shall perform additional physical product inventories upon the Company’s request and for an additional labor charge.  Any such additional physical inventory requested by the Company will be scheduled based upon a written request from the Company and a mutually agreed upon inventory date.

 

2.4                                 ICS shall obtain any required packaging materials for distribution the cost of which shall be passed through to the Company pursuant to Schedule B.

 

2.5                                 ICS shall pay all labor costs for warehouse personnel providing the Services.

 

2.6                                 ICS shall provide tracking for all shipments as required by the Company;

 

2.7                                 ICS shall pay for all security costs for the ICS Facility and any other warehouse locations where Products may be stored in accordance with the terms of this Agreement.

 

2.8                                 ICS shall denote receipt of returns that include the proper RGA documentation within three (3) business days and process returns within seven business days of receipt at the ICS Facility.

 

2.9                                 ICS shall ship outdated/damaged Products to a site reasonably designated by the Company for disposal.  All transportation and destruction costs will be borne by the Company pursuant to Schedule B.

 

2.10                           ICS shall not responsible for maintaining inventory levels for Product fulfillment.

 

3.             Product Title.  The Company will at all times retain title to all of Products under this Agreement.

 

4.             Exclusions.  The following services will not be provided by ICS or included as Distribution Services under the terms of this Agreement:

 

4.1                                 Processing of Department of Transportation hazardous materials.

 

4.2                                 Re-stacking of inbound Products required at the ICS Facility.

 

4.3                                 Any other special labeling or packaging required for Products on or for shipments leaving the ICS Facility.

 

32

 

EXHIBIT E N/A

 

WAREHOUSING AND DISTRIBUTION OF SAMPLE PRODUCTS

 

ICS shall perform the following Services on and after the Effective Date during the Term of the Agreement.  The parties’ respective obligations are set forth below.

 

1.             Sample Products.  “Sample Products” shall mean [INSERT PRODUCT NAME], which is not intended to be sold and shall be re-labeled as such and is given to customers free of charge to promote sales.

 

2.             Storage and Shipment of Samples.  ICS will warehouse, inventory and distribute Samples and Free Goods consistent with standards for warehousing, inventory and distributing Services under Exhibit B.  ICS will distribute Samples by mail or common carrier.  ICS’s obligation to perform Services is conditioned on the Company’s performance of tasks as specified under Exhibit B.

 

3.             Re-Labeling of Sample Products.  ICS shall perform re-labeling services reasonably requested by Company and consistent with all Requirements of Law.  ICS shall ensure that each Sample Product distributed by ICS bears a label that includes one of the following statements:  “Sample,” “Not for sale,” or “Professional courtesy package.”  ICS shall include on the label of each Sample Product and on the outside container or packaging (if any) an identifying lot or control number that will permit the tracking of the distribution of each unit of Sample Product.  ICS shall not make any other changes to labeling without prior written direction of Company.

 

4.             Recipients.  For purposes of sending samples the Company will, from time to time, provide ICS with a current and accurate list of recipients authorized to receive Sample Products (“Recipients”), including additions, corrections, and deletions.  At a minimum, the list will include the name and ship-to address of each Recipient.  ICS will adhere to its standard operating procedures for distribution of Sample Products to Recipients, as well as all Requirements of Law, including without limitation the PDMA, pertaining to distribution of samples to Recipients.

 

4.1          Physician Recipients.  Prior to each delivery of Sample Product by ICS to a Physician Recipient, the Company will provide ICS with a completed sample request form in a form mutually agreed upon by the Parties, which shall be signed by the physician making the request (the “Sample Request Form”).  The Sample Request Form will contain the following information:

 

4.1.1  the applicable state license or authorization number (or DEA number where a controlled substance is requested) for the physician authorized to receive Samples Products;

 

4.1.2  the name, address, professional title and signature of the physician making the request;

 

4.1.3       the proprietary or established name and strength of the Sample Product requested;

 

4.1.4       the amount of Sample Product requested;

 

33

 

4.1.5       the date of the request;

 

4.1.6       the full names of the Company and ICS; and

 

4.1.7  any other information required by § 203.30 or other applicable law for the distribution of Sample Products to a physician.

 

4.2          Pharmacy or Hospital Recipients.  Prior to each delivery of Sample Product by ICS to pharmacy or hospital Recipient, the Company will provide ICS with a completed Sample Request Form, which is signed by the physician making the request.  The Sample Request Form shall contain all of the information listed in Section 4.1 above and shall also include the name and address of the pharmacy or hospital to which the Sample Product shall be delivered.

 

5.             Receipts for Sample Products.  Upon delivery of the Sample Product, ICS shall obtain a receipt that contains the following information:

 

5.1          Physician Recipient.  If the Recipient is a physician, the receipt will include at a minimum:  (i) the signature of the physician or the physician’s authorized designee acknowledging delivery of the Sample Product; (ii) the physician’s name, address, professional title; (iii) the proprietary or established name and strength of the Sample Product; (iv) the quantity of the Sample Product delivered; and (v) the date of delivery.

 

5.2          Pharmacy or Hospital Recipients.  If the Recipient is a Pharmacy or Hospital, the receipt will include at a minimum:  (i) the name and address of the licensed physician requesting the Sample Product; (ii) the name and address of the pharmacy or hospital designated to receive the Sample Product; (iii) the name, address, professional title and signature of the person acknowledging delivery of the Sample Product; (iv) the proprietary or established name and strength of the Sample Product; (v) the quantity of the Sample Product requested; and (vi) the date of delivery.

 

6.             Reconciliation of Sample Product Requests and Receipts; Losses.  ICS shall be responsible for reconciling sample requests, receipts and inventory of Sample Products as mutually agreed by the parties and consistent with all Requirements of Law.  ICS shall report all discrepancies, thefts and losses involving Sample Products to Company.  Company shall develop an appropriate definition for “Significant Loss,” and shall be responsible for determining whether any discrepancy, theft or loss constitutes a Significant Loss.  In the event that Company determines that a Significant Loss exists, Company shall notify the FDA of the loss consistent with PDMA requirements.

 

7.             Record Keeping Requirements.  The Company and ICS will create and maintain all applicable forms and records required by all Requirements of Law applicable to warehousing and distribution of Samples and Free Goods including PDMA, Rules and Controlled Substance Laws.  Prior to the distribution of any Samples or Free Goods, the Company and ICS will identify in a separate written procedure the specific forms and records each will maintain so that distribution of Samples and Free Goods will comply with all Requirements of Law.  The Company and ICS will permit the other, upon reasonable advance notice, to audit and inspect all such forms and records it creates or maintains in distributing Samples Products.  The Company and ICS will cooperate and assist with, and will provide the other with access to and copies of, such forms and records as may be useful in responding to, regulatory agency inspections or requests for such forms or records.

 

34

 

EXHIBIT F

 

MARKETING MATERIALS FULFILLMENT SERVICES

 

ICS will warehouse and manage distribution of Product and clinical and marketing materials that are sent to the Company’s authorized personnel (the “Company Representatives”) on and after the Program Launch Date during the Term as follows:

 

1.                                       The Company will develop and provide to ICS all materials for use in the Access Center.

 

2.                                       The Company will provide ICS with such bulk clinical and marketing materials in mutually agreeable packaging configuration shrink-wrapped packages designated as one “SKU” (Stock Keeping Unit).  Whenever possible, the Company will direct its other vendors to adopt specifications and coding systems that are currently being utilized in ICS’s Facility, with the SKU clearly marked with Product code to be used by ICS.

 

3.                                       ICS will charge the Company the fees in Schedule B for the storage of marketing materials.

 

4.                                       ICS will ship orders for marketing materials by ground unless otherwise specified in writing by the Company.

 

5.                                       Upon prior written approval from the Company, ICS will begin responding to requests for marketing materials, which requests will be directed to ICS by the Company Representatives by facsimile or electronic mail.  In addition, ICS will, upon written request of the Company, ship marketing materials to medical conventions, back to the Company or the Company’s Representatives, care givers and other healthcare providers, for fees in Schedule B.

 

6.                                       The Company will provide new product specifications as outlined in the “Product Set Up Sheets” to ICS at least five business days prior to product receipt at the warehouse.

 

7.                                       The Company will ensure that Product is configured in the minimum order quantity for shipment purposes.

 

8                                          Services not covered under the terms of this Agreement include:

 

8.1           Any marking required at ICS’s Facility for Product identification purposes; and

 

8.2           Processing or re-stocking marketing materials returned from trade shows.

 

8.3           Repackaging of marketing materials to meet ICS configuration requirements.

 

35

 

EXHIBIT G

 

CONTRACT ADMINISTRATION AND CHARGEBACKS PROCESSING

 

ICS is licensed to utilize BPI Contracts software developed by BPI Technologies Corporation to provide contract administration and chargeback processing services.  ICS shall perform the following Services on and after the Program Launch Date during the Term of the Agreement:

 

1.             Contract Administration.  ICS shall enter into the BPI Contracts application key demographic information, membership, and pricing arrangements, as provided by the Company, as negotiated between the Company and its key government and non-government contract accounts, including DOD and VA.  ICS shall assist the Company in managing information for such accounts, but shall have no liability for the timeliness, accuracy or reliability of the information provided by the Company under this Section.

 

2.             Chargeback Processing.  ICS will process debit memo submissions from wholesalers for wholesaler contract sales pricing reconciliation.

 

2.1              Reconciliation is based upon verification of the submitted wholesaler data against contract administration data.  Results of this verification are:

 

2.1.1            Reconciliation reporting; and

 

2.1.2            Credit Memo generation.

 

2.2     Submissions by wholesalers will be either paper or electronic (EDI).

 

2.2.1                                    Paper — Processing time for paper submissions will be five (5) business days.

 

2.2.2                                    EDI — Processing time for EDI submissions will be three (3) business days.

 

2.2.3                                    These times do not apply to new or newly acquired Products for a period of ninety (90) days.

 

3.             Rebates.  ICS will provide documentation for rebates to be paid by the Company on a quarterly basis.  ICS will also provide the Company with reports, in a format agreed upon by the parties, including pricing information for AMP and FAMP reports, and which otherwise allow the Company to monitor purchasing activity by its key accounts.

 

36

 

EXHIBIT H

 

ACCOUNTS RECEIVABLE MANAGEMENT AND CASH APPLICATIONS

 

ICS shall perform the following Services on and after the Program Launch Date during the Term of the Agreement:

 

1.             ICS will manage all accounts receivable transactions related to the Company managed distribution programs for Product.  The Company will establish a lock box at a financial institution of its choosing (the “Financial Institution”“).  Payments from Customers will be directed to the address of the lock box.  The Financial Institution will sweep the lock box daily and deposit payments into the Company’s operating account.  The Financial Institution will forward copies of all payment transactions to ICS for cash application purposes.  ICS and the Company will jointly determine the following:

 

1.1           Credit policy

 

1.2           Class of trade designations

 

1.3           Terms and conditions

 

1.4           License requirements

 

1.5           Dunning process for past due accounts

 

1.6           Reporting requirements

 

2.             ICS will provide comprehensive accounts receivable management services in conformance with ICS’s standard operating procedures, applicable Statements of Work, and the Company’s collection policies as they apply to:

 

2.1           Invoicing (prepare and mail Customer invoices)

 

2.2           Cash application

 

2.3           Reconciliation of daily lock box deposits

 

2.4           Credit hold/release processing

 

2.5           Change to Customer credit limits per the Company’s approval

 

Credit reports:

 

2.5.1.                          Experian

 

2.5.2                             D & B

 

2.6           Return authorization credits

 

2.7           Credit and re-bills

 

2.8           Reconciliation of accounts receivable to chargebacks

 

3.             ICS will adhere to state and federally mandated good credit and collection practices established jointly by ICS and the Company such as:

 

3.1           On-line details of calls

 

3.2           Call list of past due invoices

 

37

 

3.3           Past due reminder letters

 

3.4           Research and collection of unauthorized deductions

 

3.5           The Company approved write-offs

 

38

 

EXHIBIT I

 

FINANCIAL MANAGEMENT SERVICES

 

ICS shall perform the following Services on and after the Program Launch Date during the Term of the Agreement:

 

1.             ICS will provide monthly reconciliation of all financial transactions related to the Company managed distribution program for Product and provided with 3 business days of calendar month end as follows:

 

1.1           Month end close

 

1.2           Reconciliation of cash, cash discounts and accounts receivable

 

1.3           Inventory roll over

 

1.4           Reconciliation of inventory adjustments

 

1.5           Reconciliation of goods received

 

1.6           Reconciliation of sales and cost of goods sold

 

1.7           Reconciliation of returns and cost of goods returns

 

2.             ICS will provide on a monthly basis (or other agreed upon period), the following financial reports:

 

2.1                   Trial Balance

 

2.2                   Cash Application Summary

 

2.3                   Accounts Receivable Reports

 

2.4                   Inventory Reports

 

2.5                   Sales Reports

 

2.6                   Cash Discounts Report

 

39

 

EXHIBIT J

IT SERVICES

 

ICS shall perform the following Services on and after the Program Launch Date during the Term of the Agreement:

 

1.             Application Software.  ICS shall maintain a license to utilize ERP software developed by International Business Systems to provide Distribution and Financial Services to the Company.

 

2.             Access.  ICS shall ensure that access to the DataMart will be available to the Company Monday through Friday from 7:00 a.m. — 7:00 p.m. (Central) except for those holidays recognized by ICS (“Holidays”), a listing of which will be mutually agreed to by the Company and ICS.  ICS will contact the Company with reasonable notice of any non-availability of the DataMart due to routine or non-routine system maintenance undertaken by ICS, .  “DataMart” shall be defined as the repository of information available to ICS regarding Products and related standard reports, including but not limited to daily inventory reports and inventory adjustments.

 

3.             On-Call Support.   ICS shall maintain an on-call support line for answering Company questions, receiving requests for correction of errors and providing consulting services relative to the functionality and usage of the DataMart.  The support line will be available from 8:30 a.m. — 5:00 p.m. (Central) except for Holidays.

 

4.             Training.   ICS shall provide user documentation and training for DataMart through data dictionaries of DataMart; provided, however, that ICS shall have no obligation to provide Crystal Training and licenses to utilize crystal reports to the Company.

 

5.             Back-Ups.  ICS shall perform back-up of all the Company transactions at the end of each working day.  Such back-up will be performed at a scheduled time each day and will use an IBM utility product to copy all ICS’s the Company data on a media selected by ICS.

 

6.             Data Management and Reporting.  ICS shall provide the Company with standard reports as may be reasonably requested by the Company from time to time.  ICS has also developed a set of standard data file extracts that cover distribution and financial activity.  Frequency for report or data file creation is in part based on functional requirement but may be daily, weekly, monthly or on demand.  If customization is needed, the Company and ICS will jointly and reasonably determine the data elements and formats to be included in custom reports, as well as their frequency and data files.  Mutually agreed-upon standard reports and files are included in the pricing provided under this Agreement.  Additional charges will apply to special reports and data files created based upon hourly programming charges as listed in Schedule B for creation of specialized reports.  The Company will be responsible for hardware or software costs directly and for fees listed in Schedule B.

 

7.             Transfer Protocol.  ICS will make available to the Company data in the form of electronic files on a detail or summary basis that reflects the operational activity in the Company’s DataMart or CARS/IS environment.  The frequency of the data file availability may be event based, daily, weekly or monthly.  Certain timing restrictions apply based on type of data.  Conversely ICS will receive files from the Company for the purpose of file building, file maintenance or order processing.  The data may be delivered in one of four methods:  1) Cyclone Encrypted or PGP encrypted, 2) Secure Website, 3) E-mail (emergency only) or

 

40

 

4) Electronic Data Interchange:

 

8.             System Disaster Recovery.  ICS shall maintain in place disaster-relief plans consisting of disaster recovery procedures, telecommunications switch over during disaster or emergency period, and AS/400 System switch over during disaster or emergency period (collectively, “Disaster Plans”).  ICS will maintain the Disaster Plans during the Term.

 

41Exhibit 10.2

 

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

 

MASTER SERVICES AGREEMENT

 

This Master Services Agreement (this “Master Agreement”), with an Effective Date of August 30, 2011, will set forth the terms and conditions between Pacira Pharmaceuticals Inc. a California corporation,  5 Sylvan Way Parsippany, NJ 07054, (hereinafter “Pacira”), and Quintiles Commercial US, Inc., 10 Waterview Boulevard, Parsippany, NJ 07054 (hereinafter “Quintiles”).

 

Background:

 

A.                                   Pacira is in the business of developing, manufacturing and/or distributing pharmaceutical and/or biotechnology products (“Pacira Product(s)”).  Quintiles is in the business of providing sales, marketing, educational and alternative commercialization services for the pharmaceutical, healthcare and biotechnology industries.

 

B.                                     Pacira and Quintiles desire to enter into this Master Agreement to provide the terms and conditions upon which Pacira may engage Quintiles and its corporate Affiliates from time-to-time to provide contract sales, marketing, educational and alternative commercialization services for individual projects by executing individual Work Orders (as defined below) specifying the details of the services and the related terms and conditions.

 

Agreement:

 

1.0                               Definitions

 

1.1                                 “Affiliate” shall mean any corporation or business entity controlled by, controlling, or under common control with a party to this Master Agreement.  For this purpose, “control” shall mean direct or indirect beneficial ownership of at least fifty percent (50%) of the voting stock or income interest in such corporation or other business entity, or such other relationship as, in fact, constitutes actual control.

 

1.2                                 “Calendar Quarter”“ means the following periods: January 1 through March 31, April 1 through June 30, July 1st through September 30, and October 1 through December 31.

 

1.3                                 “FDA” shall mean the US Food and Drug Administration or successor agency performing similar functions.

 

1.4                                 “Fees” shall mean the fair market value compensation payable to Quintiles in return for Services.  Fees shall not include Pass-Through Expenses.

 

1.5                                 “Net Product Sales” shall mean the gross amounts billed by Pacira, its Affiliates, or Licensees in respect of sales of EXPAREL to unrelated parties, less the following deductions, to the extent each is applicable to the given sale: (a) trade, cash, or quantity discounts actually allowed and taken with respect to such sales; (b) taxes imposed upon and paid with respect to the sale, delivery, or use of the

 

 

product; and (c) amounts repaid or credited by reason of billing corrections, rejections, defects, recalls, or returns. Such amounts shall be determined in accordance with generally accepted accounting principles, consistently applied.

 

1.6                                 “Pass-Through Expenses” shall mean the reasonable and necessary out-of-pocket costs and expenses actually incurred without markup by Quintiles in providing Services, in accordance with a mutually agreed written budget or the express terms of a Work Order.

 

1.7                                 “Project” shall mean the complete task or set of tasks described in a specific Work Order.

 

1.8                                 “Services” shall mean the responsibilities, obligations and activities which are to be performed by Quintiles, as they are described in this Master Agreement and in specific Work Orders.

 

1.9                                 “Term” and “Project Term” shall have the meanings described in Section 11.1.

 

1.10                           “Work Order” shall have the meaning described in Section 2.2.

 

2.                                      Scope of Master Agreement; Services to be Provided; Work Orders; Project Teams.

 

2.1                                Scope of Master Agreement.  This Master Agreement allows the parties to contract for multiple Projects through the issuance of multiple Work Orders.  This Master Agreement covers the provision of professional sales and marketing services by Quintiles and Quintiles’s corporate Affiliates (see Section 12), including, but not limited to, recruitment of field personnel, full-time or flex-time sales force services, promotional education programs and other related commercialization services, when requested by Pacira and agreed to by Quintiles as set forth in the relevant Work Order.  Pacira shall, in its sole discretion, determine when and whether to offer projects to Quintiles and its corporate Affiliates, including the decision whether or not to enter into a specific Work Order.

 

2.2                                  Work Orders.  The specific details and tasks of each Project shall be separately negotiated and specified in writing on terms and in a form acceptable to the parties (each such writing, a “Work  Order”).   The first Work Order (#6508, attached hereto) is of even date hereof and subsequently issued Work Orders may follow the same basic template.  Any Services performed prior to the execution of the first Work Order that were not requested by Pacira in writing shall be performed at Quintiles’ financial risk.  Thereafter, no Services shall be performed prior to the execution of a Work Order covering such Services.  Each Work Order will include, as appropriate, identification of the Pacira Products to be involved in the Services, a schedule of Quintiles Responsibilities and Obligations, Pacira Responsibilities and Obligations and Fees and Pass-Through Expenses.  Each Work Order shall be subject to all of the terms and conditions of this Master Agreement, in addition to the specific details set forth in the Work Order.  To the extent any terms or provisions of a Work Order conflict with the terms and provisions of

 

 

this Master Agreement, the terms and provisions of this Master Agreement shall control, unless the Work Order expressly and specifically states an intent to supersede the Master Agreement on a specific matter (but then only with respect to the particular Work Order and with respect only to the matter so specified).  A change in a Work Order shall be evidenced by an amendment to the relevant Work Order duly executed by Pacira and Quintiles in form acceptable to both parties.

 

3.                                      Payment of Fees and Pass-Through Expenses.

 

3.1                                Pacira shall pay Quintiles the Fees and Pass-Through Expenses expressly described in each Work Order.  Unless otherwise agreed in a particular Work Order, Quintiles will use commercially reasonable efforts to invoice Pacira monthly in advance no later than the fifteenth day of each month for the estimated Fees and Pass-Through Expenses relating to the Project to be incurred during the following month.  Supporting documentation will be made available to Pacira upon request. Pacira shall make payment of all undisputed amounts within forty-five (45) days after the receipt of each monthly itemized invoice and (as applicable) any requested supporting documentation, after which time interest shall be due and payable on the unpaid balance at the rate of 1.5% per month.  If any portion of an invoice is disputed, Pacira shall pay the undisputed amounts within the aforementioned forty-five (45) days, and the parties shall use good faith efforts to reconcile the disputed amount for payment as soon as practicable.  Unpaid disputed amounts shall not be subject to interest.  At the end of each calendar month, Quintiles shall reconcile the advance payment made with the actual Daily Fees and Pass-Through Expenses incurred and shall issue a credit or debit as appropriate on the next month’s estimated invoice.

 

3.2                                 If the period of non-payment of an undisputed amount exceeds ten (10) days following the date on which the payment would have been due, Quintiles may, at its sole discretion and without prejudice to any other rights or remedies, provide  Pacira a ten (10) day written notice of intent to suspend Services in connection with a particular Project, and if the non-payment continues after the ten (10) day period, Quintiles may (i) declare Pacira in breach and cease the Services on that Project or (ii) exercise its right to give notice of a default in accordance with Section 11.3. Notwithstanding the foregoing, both parties shall continue to perform their obligations hereunder during the pendency of any dispute concerning the non-payment of disputed Fees and Pass Through Expenses.

 

3.3                                 Payments shall be by wire-transfer, automatic clearing house (ACH)  or by check as follows:

 

Postal Mail:

Quintiles Commercial US, Inc.

PO Box 601070

Charlotte, NC 28260-1070

 

Overnight Mail:

Quintiles Commercial US, Inc.

 

 

c/o Wachovia Bank

Lockbox #601070

1525 West WT Harris Blvd - 2C2

Charlotte, NC 28262

 

Electronic Payment:

Quintiles Commercial US, Inc.

Account Number:  2000016952739

ACH Payment ABA#:  053 101 626

Fedwire ABA#:  053 000 219

Wachovia Bank - Charlotte, NC

 

Quintiles Federal Employment ID Number is 22-3529314.

 

3.4                                 In the event that taxes or duties, of whatever nature, are required to be made or withheld on payments made pursuant to this Master Agreement or an applicable Work Order by any state, federal, provincial or foreign government, including, but not limited to, Value Added Tax, Pacira shall promptly pay said taxes and duties to the appropriate taxing authority without any deduction to any amount owed to Quintiles.  Pacira shall secure and deliver to Quintiles any official receipt for any such taxes paid.  Alternatively, Quintiles may invoice Pacira for the taxes, without a mark-up, as a pass-through expense, collect the taxes from Pacira, and pay the taxes due on the Services.  For the avoidance of doubt, the requirements of this provision shall not apply to any income, employment-related taxes, duties, or withholding and shall only apply to taxes directly applicable to the Services.

 

3.5                                 At least ten (10) business days prior to the first day of each Calendar Quarter, Quintiles shall provide Pacira with the forecasted budget estimate for such Calendar Quarter for each open Work Order (the “Quarterly Budget Forecast”).  The Quarterly Budget Forecast shall be substantially in the form of Attachment C to Work Order #6508.

 

4.                                      Confidentiality and Ownership of Information.

 

4.1                                 Each of the parties acknowledges that, in the course of performing its obligations hereunder, it may receive information from the other party which is proprietary to the disclosing party and which the disclosing party wishes to protect from public disclosure (“Confidential Information”).  Quintiles and Pacira agree to retain in confidence, during the Term of this Master Agreement and any Work Order, and any subsequent renewals thereof, and thereafter for a period of five (5) years (or, in the case of Confidential Information identified by the disclosing party as a trade secret, for as long as such Confidential Information remains a trade secret), all Confidential Information disclosed to it by or on behalf of the other party, and that it will not, without the written consent of such other party, use Confidential Information for any purpose other than the purposes indicated herein.  These restrictions shall not apply to Confidential Information which: (i) is or becomes public knowledge (through no fault of the receiving party); (ii) is made

 

 

lawfully available to the receiving party by an independent third party; (iii) is already in the receiving party’s possession at the time of receipt from the disclosing party (and such prior possession can be properly demonstrated by the receiving party); (iv) is independently developed by the receiving party and/or Affiliates (and such independent development can be properly demonstrated by the receiving party); or (v) is required by law, regulation, rule, act or order of any governmental authority or agency to be disclosed by the receiving party, provided, however, if reasonably possible, such receiving party gives the disclosing party sufficient advance written notice to permit it to seek a protective order or other similar order with respect to such Confidential Information and, thereafter, the receiving party discloses only the minimum Confidential Information required to be disclosed in order to comply.

 

4.2                                 Quintiles and Pacira shall limit disclosure of the other party’s Confidential Information to only those of their respective officers, representatives, agents and employees (collectively “Agents”) who are directly concerned with the performance of this Master Agreement and have a legitimate need to know such Confidential Information. Upon receipt of notice of termination by Pacira, Quintiles shall return all Pacira Confidential Information to Pacira.

 

4.3                                 All Pacira patents, trade secrets, copyrights, trade names, trademarks, service marks, proprietary materials or intellectual property and all improvements to any of the foregoing (collectively “Pacira Property”) used in connection with the Services provided pursuant to this Master Agreement or any Work Order shall remain the sole and exclusive property of Pacira, and Quintiles’s rights to use such Pacira Property shall be limited to those permitted by this Master Agreement or any Work Order.

 

4.4                                 Pacira acknowledges that Quintiles possesses certain inventions, processes, know-how, trade secrets, improvements, other intellectual properties and other assets, including but not limited to analytical methods, procedures and techniques, computer technical expertise and software, and business practices, including, but not limited to the Quintiles Sales Force Automation System (SFA) or Customer Relationship Management System (CRM) as applicable, the Quintiles Pharmaceutical Selling System, and the Quintiles Sample Accountability System which have been independently developed by Quintiles (collectively “Quintiles Property”).  Pacira and Quintiles agree that any Quintiles Property or improvements thereto which are used, improved, modified or developed by Quintiles under or during the term of this Master Agreement or any Work Order are the sole and exclusive property of Quintiles.  Pacira and Quintiles agree that any (i) data or (ii) systems licenses (including but not limited to SFA, CRM, and any other systems that may be licensed or independently developed by Quintiles for purposes of storing data on behalf of Pacira), shall, upon Pacira’s request, be provided, transferred, assigned, or licensed to Pacira (as applicable), or maintained by Quintiles for ongoing management by Quintiles on behalf of Pacira.  As to software licenses described in Section 4.4(ii) above, the term of such transferred, assigned or licensed licenses shall be limited to the applicable Project Term, unless otherwise agreed to by the parties in writing.

 

 

4.5                                 No party shall issue a press release or other formal public announcement (except for corporate presentations to respective board members or inter-company announcements) relating to this Master Agreement or the activities contemplated herein without the prior written approval of the other party.  Quintiles shall not unreasonably withhold its approval of any press release or other public announcement concerning information that is material to Pacira Pharmaceuticals or that is required by law.  For press releases required by law, if Quintiles fails to provide approval of such press release within three (3) business days (or sooner if required by law and Quintiles is notified of such shorter response time in writing) of receiving a draft, Pacira may deem such draft approved by Quintiles.

 

5.                                      Independent Contractor Relationship.

 

5.1                                 For the purposes of this Master Agreement and any Work Order, the parties hereto are independent contractors and nothing contained in this Master Agreement or any Work Order shall be construed to place them in the relationship of partners, principal and agent, employer and employee or joint venturers.  Neither party shall have the power or right to bind or obligate the other party, nor shall either party hold itself out as having such authority.

 

5.2                                 No provision of this Master Agreement or any Work Order shall be deemed to create or imply any contract of employment between Pacira and any employee of Quintiles. All persons performing Services shall be employees of Quintiles, or subcontractors engaged by Quintiles with prior written consent of Pacira, and shall not be entitled to any benefits applicable to employees of Pacira.

 

5.3                                 Quintiles will (i) maintain all necessary personnel and payroll records for Quintiles employees; (ii) compute wages and withhold applicable Federal, State and local taxes and Federal FICA payments for Quintiles employees; (iii) remit Quintiles employee withholdings to the proper governmental authorities and make employer contributions for Federal FICA and Federal and State unemployment insurance payments; (iv) pay net wages and fringe benefits, if any, directly to Quintiles employees; and (v) provide for employer’s liability and Workers’ Compensation insurance coverage.

 

5.4                                 Quintiles shall be responsible for management of all employer obligations in connection with Quintiles employees who perform the Services.  Quintiles employees shall remain exclusively under the direct authority and control of Quintiles and shall execute the acknowledgement form attached as Exhibit A to this Master Agreement.  No employees of Quintiles shall be entitled to any compensation, healthcare coverage or insurance, life insurance, disability benefits, pension or profit-sharing benefits, any other employee benefit or participation in any employee incentive compensation or stock option plan offered or provided by Pacira to Pacira employees.  Pacira may be involved in providing training, direction or equipment to a Quintiles employee only in the manner and to the

 

 

extent specifically described in a Work Order.  The employer obligations of Quintiles shall include: (i) human resource issues, including establishment of employee policies, and administration of health and benefits plans, 401K plan, and other employee benefit plans; (ii) work performance and work behavior issues, including probationary period, periodic and annual appraisals, employee discipline and termination; (iii) administration of systems for time-keeping, payroll and employee expense reimbursement; (iv) day to day management of employment issues in connection with performance of the Services.

 

5.5                                 Quintiles shall ensure that all Quintiles employees have executed appropriate confidentiality agreements requiring such employees to maintain the confidentiality of any Confidential Information they may receive while performing the Services.

 

6.                                      Regulatory Compliance.

 

6.1                                  In carrying out their responsibilities under this Master Agreement and each Work Order, Quintiles and Pacira agree to comply, to the extent applicable, with all laws, rules and regulations, including, but not limited to the Federal Equal Employment Opportunity Act, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Fair Labor Standards Act, the Immigration Reform and Control Act of 1986, the Food, Drug and Cosmetic Act, Section 1128B(b) of the Social Security Act (42 U.S.C. §1320a-7b), and the Prescription Drug Marketing Act, and with industry standards of practice, including those set forth in the PhRMA Code on Interactions with Healthcare Professionals.  Pacira shall be primarily responsible for compliance with the Physician Payment Sunshine Act,  Cal. Health & Safety Code s. 119400-119402, and any similar law or regulation of any other governmental unit and shall provide Quintiles with any applicable per physician spending limits arising therefrom.  To facilitate Pacira’s compliance with federal and state physician spend reporting requirements, Quintiles will provide its standard monthly excel file that includes all data required for federal and state reporting requirements as jointly determined by the Parties.

 

6.2                                 If Quintiles or its employees become aware of adverse drug experience reports involving the use of any Pacira Product, while performing any Services in connection with the Pacira Product, they shall immediately notify Pacira in accordance with Pacira procedures. Pacira shall deliver to Quintiles a written copy of such Pacira notification procedures.

 

6.3                                  Pacira shall be solely responsible for responding to any government or regulatory agency concerning use or marketing of Pacira Products, except where (i) such responsibility is expressly transferred to Quintiles in a Work Order; or (ii) to the extent any notice or reporting requirement is by law made directly applicable to Quintiles.  Reports made by Quintiles shall be charged to the customer on a time and materials basis.  Both Quintiles and Pacira shall provide the other with copies of all written reports, including all applicable documentation, made to any governmental or regulatory agency.  Both Quintiles and Pacira shall provide the other with a written summary of any oral or telephonic report made to any governmental or regulatory agency.  Quintiles shall

 

 

promptly notify Pacira of any information Quintiles receives regarding any threatened or pending action by a government or regulatory agency that may affect the Pacira Products, or of any communication received by Quintiles from a government or regulatory agency with Quintiles regarding a Pacira Product or the Services provided by Quintiles hereunder.  Each party shall notify the other of every instance of actual or suspected fraud or misconduct on the part of a Quintiles employee in connection with the Services provided to Pacira under a Work Order promptly after the initial discovery of any suspicious findings or possible evidence of such.  Quintiles shall, at the request of Pacira, cooperate with Pacira in order to respond, or in formulating a procedure for taking appropriate action.  In no event shall Quintiles respond to any agency without the prior consent of Pacira, unless compelled to do so by law.

 

7.                                      Reports and Project Administration

 

Quintiles will manage and administer each Project in accordance with the specifications and milestones contained in each Work Order.  Quintiles shall provide Pacira a periodic Project report, the content of which will be determined between Quintiles and Pacira leadership in the frequency and with content as more particularly described in each Work Order.  The Project report shall generally include: (i) headcount, turnover, status of recruitment; (ii) Project status and progress toward achieving objectives or milestones; (iii) financial accountability, and tracking expenses against budget.  All information transmitted by Quintiles pursuant to this Master Agreement will be sent by either telephone, email or certified mail in accordance with the provision of Section 16 of this Master Agreement.  Quintiles shall not transmit any such information by facsimile unless explicitly authorized by Pacira in writing.  Pacira hereby consents and authorizes Quintiles to send emails or certified mailings relating to the Services, or relating to potential future services, to any office of Pacira or Pacira’s affiliates in accordance with Section 16 of this Master Agreement.

 

8.                                      Return of Pacira Materials.

 

Within sixty (60) days after the completion of Services by Quintiles, or upon termination of the Master Agreement or any Work Order, Confidential Information, Pacira Property  and other data owned by Pacira, regardless of the method of storage or retrieval, shall at Pacira’s request either be delivered to Pacira in such form as is then currently in the possession of Quintiles, or disposed of, at the direction and written request of Pacira, unless such materials are otherwise required to be stored or maintained by Quintiles as a matter of law or regulation.  Pacira shall pay the costs associated with any of the above options.  Quintiles reserves the right to retain, at its own expense and subject to the confidentiality provisions herein, one copy of all materials provided in connection with performance of the Services, to be used to satisfy regulatory requirements or to resolve disputes regarding the Services.

 

 

9.                                      Indemnification and Liability Limits.

 

9.1                                 Quintiles shall indemnify, defend and hold harmless Pacira, its Affiliates and its and their respective directors, officers, employees and agents from and against any and all losses, claims, actions, damages, liabilities, penalties, costs and expenses (including reasonable attorneys’ fees and court costs) (collectively, “Losses”) incurred in connection with a third party claim or governmental action (collectively, “Third Party Claims”) resulting from any (i) breach by Quintiles, its employees, or subcontractors of its obligations hereunder; (ii) willful misconduct or negligent acts or omissions of Quintiles, its employees, or its subcontractors in the performance of Services pursuant to this Master Agreement or Work Order;  (iii) violation by Quintiles or its employees or subcontractors of any municipal, county, state or federal laws, rules or regulations applicable to Quintiles’ performance of Services pursuant to this Master Agreement or Work Order; (iv) the marketing, promotion, or sale of Pacira Products by Quintiles, its employees, or its subcontractors in a manner which violates this Master Agreement, any Work Order, or applicable law, except to the extent acting under the direction of Pacira; (v) representation or misrepresentation by Quintiles, its employees, or subcontractors relating to Pacira Products that is not consistent with the labeled claims or the product literature, except to the extent acting under the direction of Pacira; and (vi) the determination by any governmental authority that any Quintiles employees are employees of Pacira; all except to the extent such Losses are determined to have resulted from the action or inaction by Pacira, or by the negligence or willful misconduct of Pacira or its employees.

 

9.2                                 Pacira shall indemnify, defend and hold harmless Quintiles, its Affiliates and its and their respective directors, officers, employees and agents from and against any and all Losses incurred in connection with a Third Party Claim resulting from (i) the manufacture, storage, packaging, production, transportation, distribution, promotion (except to the extent such Losses are subject to the indemnity obligations of Quintiles set forth in Section 9.1(iv) or (v) above), sale, use or other disposition of the Products; (ii) breach by Pacira or its employees of its obligations hereunder; (iii) willful misconduct or negligent acts or omissions of Pacira or its employees; (iv) the conduct of the Services, but only to the extent such conduct is consistent with the instructions provided by Pacira; and (v) violation by Pacira or its employees of any municipal, county, state or federal laws, rules or regulations; all except to the extent such Losses are determined to have resulted from the action or inaction (unless such action or inaction was pursuant to instruction or direction by Pacira), negligence or willful misconduct of Quintiles or its employees.

 

9.3                                The party seeking indemnification hereunder (the “Indemnified Party”) shall:  (a) give the party obligated to indemnify (the “Indemnifying Party”) prompt written notice of any such claim or law suit (including a copy thereof); (b) Indemnified Party and its employees shall fully cooperate with Indemnifying Party and its legal representatives in the investigation and defense of any matter the subject of indemnification; and (c) Indemnified Party shall not unreasonably withhold its approval of the settlement of any such claim, liability, or action by Indemnifying Party covered by this Indemnification provision; provided, however, that Indemnified Party’s failure to comply with its obligations pursuant to Section 9.3 shall not constitute a breach of this Master Agreement nor relieve Indemnifying Party of its indemnification obligations pursuant to Section 9, except to the extent, if any, that Indemnifying Party’s defense of the affected claim,

 

 

action or proceeding actually was materially impaired thereby.

 

9.4                                 Neither Quintiles nor Pacira, nor their respective affiliates,  directors, officers, employees, subcontractors or agents shall have any liability (including without limitation, contract, negligence and tort liability)  for any loss of profits, opportunities or goodwill or any type of indirect or consequential damages in connection with this Master Agreement or any Work Order  or the Services performed by Quintiles.  In addition, in no event shall the collective, aggregate liability (including without limitation, contract, negligence and tort liability) of either Quintiles or Pacira, or their respective  affiliates, directors, officers, employees, subcontractors or agents, under this Master Agreement (excluding indemnity obligations for Third Party Claims arising under section 9.1 herein, and further excluding liability for a party’s gross negligence or willful misconduct) exceed the amount of fees actually received by Quintiles from Pacira under the applicable Work Order.

 

9.5                                 Quintiles shall not be liable to Pacira for claims or losses arising out of the statements or representations of Quintiles employees with respect to Pacira Products to the extent the statements or representations conform to the written or printed statements or representations made to Quintiles and Quintiles employees by Pacira with respect to the Pacira Products.

 

9.6                                 In the event that a party (“Subject Party”) or any of its Affiliates, employees, agents or subcontractors is served with or becomes subject to any subpoena, order, judgment, complaint, proceeding, enforcement or other legal process (each, a “Legal Proceeding”) to which the other party is a party or subject, but Subject Party is not, which Legal Proceeding seeks from Subject Party disclosure of any documents or information related to the Services, then the other party shall bear and/or reimburse the Subject Party for all reasonable third party fees, costs and expenses (including reasonable attorneys’ fees) associated with such Legal Proceeding.  In the event of a Legal Proceeding involving both parties, each party shall bear its own costs, fees and expenses associated therewith.

 

10.                               Insurance.

 

Quintiles and Pacira shall each, at its own cost and expense, obtain and maintain in full force and effect, the following insurance during the Term (and any subsequent renewals thereof): (i) worker’s compensation insurance in accordance with the statutory requirements of each state in which the Services are to be performed; (ii) employer’s liability insurance with a minimum limit of [**] dollars ($[**]); (iii) comprehensive general liability insurance, including contractual liability, with a minimum limit of [**] dollars ($[**]), combined single limit per occurrence; (iv) comprehensive auto liability, covering bodily injury and property damage, for owned, hired or non-owned automobiles with a minimum limit of [**] dollars ($[**]), combined single limit per occurrence; (v) professional errors and omissions, with a minimum limit of [**] ($[**]), per occurrence; and (vi) products liability insurance covering the Product, with a minimum limit of [**] ($[**]), per occurrence (not required for Quintiles).  Each party shall provide the other party an original signed certificate of insurance evidencing all coverage herein required,

 

 

within thirty (30) days after the effective date of this Master Agreement.  Pacira must provide thirty (30) days prior written notice of cancellation or material change in insurance coverage.  The insurance obligations hereunder may be met by a program of self-insurance.

 

11.                               Term and Termination.

 

11.1                            This Master Agreement shall be effective as of the Effective Date and shall continue until terminated as hereinafter provided (the “Term”).  Each Work Order shall include a statement of the Project start date and the Project end date (the “Project Term”).

 

11.2                            Pacira may terminate this Master Agreement or any Work Order without cause at any time by providing sixty (60) days prior written notice to Quintiles.  Pacira may partially terminate a Work Order for Sales Force Services by providing Quintiles with a written list of the field territories to be eliminated within sixty (60) days prior to the effective date of such partial termination.  During such sixty (60) day notice period, Quintiles shall use commercially reasonable efforts to arrange for the Sales Force members under any terminated Work Order to be placed in an alternate position as of the date of project termination.  For avoidance of doubt, unless Pacira provides written instruction otherwise, Quintiles shall continue to fully perform its obligations under this Master Agreement or any Work Order that is terminated during the foregoing sixty (60) day notice period.

 

11.3                           Either party may terminate this Master Agreement by written notice at any time if the other party defaults in the performance of its material obligations under the Master Agreement. Either party may terminate a Work Order by written notice at any time if the other party defaults in the performance of its material obligations under the Work Order.  In the event of such default, the party declaring the default shall provide the defaulting party with written notice setting forth the nature of the default, and the defaulting party shall have thirty (30) days to cure the default.  Provided, however, that if the nature of the default is such that it cannot reasonably be cured within thirty (30) days, the defaulting party may cure such default by commencing in good faith to cure such default promptly after its receipt of such written notice and prosecuting the cure of such default to completion with diligence and continuity within a reasonable time thereafter. If the defaulting party fails to cure the default within the foregoing time periods, the other party may terminate the Master Agreement or Work Order, as the case may be, by written notice to the defaulting party, which notice shall be effective upon receipt.

 

11.4                          Either party may terminate this Master Agreement by written notice to the other party, effective upon receipt with no right to cure the default, if the other party files a petition for bankruptcy, reorganization or arrangement under any state statute, or makes an assignment for the benefit of creditors or takes advantage of any insolvency statute or similar statute, or if a receiver or trustee is appointed for the property and assets of the party and the receivership proceedings are not dismissed within sixty (60) days of such appointment.

 

 

11.5                          In the event this Master Agreement or a Work Order is terminated other than by Pacira for a breach as set forth in Section 11.3, Pacira shall (a) pay to Quintiles all Fees for Services rendered which are due and owing to Quintiles because of any completed performance of Quintiles’s obligations prior to the effective date of termination; (b) pay all Pass-Through Expenses actually incurred by Quintiles prior to the effective date of termination; and (c) pay any other costs which have been expressly identified in a Work Order as being due upon termination of such Work Order.

 

11.6                          Termination of this Master Agreement or any Work Order for whatever reason shall not affect the accrued rights of either Quintiles or Pacira arising under this Master Agreement or a Work Order, and all provisions which expressly or by implication survive the termination or expiration of the Master Agreement or a Work Order shall remain in full force and effect.

 

12.                               Relationship with Affiliates.

 

12.1                           Pacira agrees that Quintiles may on notice to Pacira utilize the Services of its corporate Affiliates to fulfill Quintiles’s obligations under this Master Agreement and any Work Order.  Any Quintiles Affiliate so utilized shall be (i) subject to all of the terms and conditions applicable to Quintiles under this Master Agreement and the Work Order applicable to such Project(s), including, but not limited to, provisions establishing the standards for performance, (ii) entitled to all rights and protections afforded Quintiles under this Master Agreement and the Work Order applicable to such Project(s), including, but not limited to, the indemnity and limitation of liability protections set forth herein; and (iii) pre-approved in writing by Pacira and specifically referenced in the applicable Work Order, provided that no such pre-approval shall be required to the extent that such Affiliates provide only legal, HR, finance, IT, and other ancillary support of the Services.  Any such Affiliate of Quintiles may execute a Work Order directly and, with respect to the corresponding Project, the rights and obligations of the parties shall be governed by all of the terms and conditions of this Master Agreement, to the same extent as if such Quintiles Affiliate was a party to this Master Agreement.

 

12.2                            Pacira and Quintiles acknowledge that certain Affiliates of Pacira may utilize the services of Quintiles (and its Affiliates) under this Master Agreement and under any Work Order.  In such event, (i) Pacira shall cause such Pacira Affiliate to acknowledge and be bound by all the terms and conditions of this Master Agreement and the specific Work Order, and (ii) Pacira shall remain responsible and obligated under this Master Agreement and the Work Order, as if Pacira was directly receiving the Services provided to such Pacira Affiliate.  Any such Affiliate of Pacira may execute a Work Order directly and, with respect to the corresponding Project, the rights and obligations of the parties shall be governed by all of the terms and conditions of this Master Agreement, to the same extent as if such Pacira Affiliate was a party to this Master Agreement.

 

13.                               Cooperation.

 

All data and information in Pacira’s possession or control necessary for Quintiles to

 

 

conduct Project assignments will be delivered by Pacira to Quintiles.  Quintiles shall not be liable to Pacira nor be deemed to have breached this Master Agreement or any Work Order as a result of errors, delays or other consequences directly arising from Pacira’s failure to provide documents, materials or information or to otherwise cooperate with Quintiles in order for Quintiles to timely and properly perform Quintiles’s obligations.

 

14.                               Force Majeure.

 

If the performance or observance of this Master Agreement or any obligation of this Master Agreement or any Work Order is prevented or delayed by reason of an act of God, civil commotion, storm, fire, riots, strikes, legal moratorium (other than FDA action), war or revolution, the party so affected shall, upon prompt notice of such cause being given to the other party, be excused from such performance or observance to the extent of such prevention or during the period of such delay, provided that the party so affected shall use its best efforts to avoid or remove the cause(s) of non-performance and observance with utmost dispatch.

 

15.                               Review of Work; Audit.

 

During the term of this Master Agreement, Quintiles will permit Pacira’s representative(s) (unless such representatives are competitors of Quintiles), at reasonable times and in a reasonable manner, and at Pacira’s expense, to (i) examine the work performed hereunder to determine that the Services are being conducted in accordance with the agreed terms, or (ii) audit the financial records related to Quintiles’s performance of the Services.  If the audit reveals that Pacira overpaid any amounts to Quintiles, Pacira shall, at its option, either receive a credit for such overpaid amounts or be reimbursed for such overpaid amounts within thirty (30) days of the audit.  If the audit reveals that Quintiles overcharged any amounts to Pacira by more than five percent (5%), then Quintiles shall reimburse Pacira for Pacira’s out-of-pocket expenses associated with conducting the audit within thirty (30) days after receiving the audit results.

 

16.                               Notices.

 

Any notice required or permitted to be given by either party shall be in writing.  All notices shall be to the parties and addresses listed below, and shall be sufficiently given (i) when received, if delivered personally or sent by facsimile transmission, or (ii) one business day after the date mailed or sent by an internationally recognized overnight delivery service.

 

	
If   to Quintiles:
    	
Quintiles   Commercial US, Inc.
    
	
 
    	
 
    
	
 
    	
10   Waterview Blvd.
    
	
 
    	
Parsippany,   NJ 07054
    
	
 
    	
Attention:   Joseph F. Chirillo, Sr. VP Commercialization
    
	
 
    	
Strategic and Risk-Based Business
    

 

 

	
With   a copy to:
    	
General   Counsel
    
	
 
    	
Quintiles   Commercial US, Inc.
    
	
 
    	
4820   Emperor Blvd.
    
	
 
    	
Durham,   NC 27709
    

 

	
If   to Pacira:
    	
Pacira   Pharmaceuticals
    
	
 
    	
5   Sylvan Way
    
	
 
    	
Parsippany,   NJ 07054
    
	
 
    	
Attention:   Taunia Markvicka, VP Commercial
    
	
 
    	
Development
    
			

 

	
With   a copy to:
    	
General   Counsel, Attention: Kristin Williams
    
	
 
    	
and
    
	
 
    	
Customer   Legal Dept
    
	
 
    	
Pacira   Pharmaceuticals
    
	
 
    	
5   Sylvan Way
    
	
 
    	
Parsippany,   NJ 07054
    

 

17.                               Assignment.

 

Except for Affiliates, as stated above in Section 12, neither party may assign any of its rights or obligations under this Master Agreement or any Work Order to any third party without the written consent of the other party, which consent shall not be unreasonably withheld; provided, however, that either party may assign this Master Agreement or any Work Order to a third party without the prior written consent of the other party in connection with a change of control transaction (whether by merger, consolidation, sale of equity interests, sale of all or substantially all assets, or otherwise) to an entity.

 

18.                               Arbitration.

 

Resolution of disputes concerning any aspect of the Services, this Master Agreement or any Work Order shall be accomplished by good faith negotiations between Pacira and Quintiles, to be commenced within thirty (30) days after notice.  If necessary, thereafter, resolution of such disputes shall be accomplished, at written request of either party to the other party, by binding arbitration, which shall not interfere with the timely rendering of Services.  Arbitration will be pursuant to the Rules of Conciliation and Arbitration of the American Arbitration Association, using a three-person panel of arbitrators, one (1) to be designated by Pacira, one (1) by Quintiles, and a third to be agreed upon by the other two (2) arbitrators.  If the two party-appointed arbitrators are unable to agree on a third arbitrator within thirty (30) days after the second arbitrator is appointed, the third arbitrator shall be selected by the American Arbitration Association.  Notwithstanding the foregoing, each Party shall be entitled to, in addition to all other remedies available under this Master Agreement, seek equitable relief, including injunction and specific

 

 

performance, in any court of competent jurisdiction.

 

19.                               Additional Warranties and Representations.

 

19.1                           Quintiles and Pacira warrant and represent to the other that they have the full right and authority to enter into this Master Agreement and that there is no impediment that would inhibit their ability to perform their respective obligations under this Master Agreement or any Work Order.

 

19.2                          Quintiles and Pacira agree to perform their obligations hereunder in a timely, professional and competent manner.

 

19.3                           Pacira warrants and represents that it possesses good title to, or the right to use, any and all trademarks of the Pacira Products, free and clear of any claims or encumbrances that would impede the performance by either party under the terms of this Master Agreement or any Work Order.  In addition, Pacira owns or controls the patents or appropriate licenses in connection with all Pacira Products to be involved in the Services, and has no knowledge of the existence of any claim or adverse rights which would restrict or prevent Pacira or Quintiles from performing the Services pursuant to this Master Agreement or a Work Order.

 

19.4                           Quintiles represents and warrants that it is not and has not been (i) excluded from participation in, or otherwise ineligible to participate in a “Federal Health Care Program” (as defined in 42 U.S.C. § 1320a-7b(f)) or in any other government payment program; (ii) listed on the General Services Administration’s List of Parties Excluded from Federal Procurement and Nonprocurement Programs; or (iii) debarred under the Generic Drug Enforcement Act of 1992 (the “GDE Act”) (21 U.S.C. § 335(a) and (b)).  Quintiles further represents and warrants that Quintiles does not and will not use in any capacity the services of any person excluded or debarred as set forth above.  Quintiles shall immediately notify Pacira of a breach of this provision.

 

 

20.                               General Provisions

 

20.1                           This Master Agreement shall be construed, governed, interpreted, and applied in accordance with the laws of the State of New Jersey, without giving effect to the principles of conflict of laws.

 

20.2                           The rights and obligations of Pacira and Quintiles under this Master Agreement and any Work Order, which by intent or meaning have validity beyond such termination (including, but not limited to, rights with respect to confidentiality, mutual indemnification and liability limitations) shall survive the termination of this Master Agreement or such Work Order.

 

20.3                           This Master Agreement contains the entire understandings of the parties with respect to the subject matter herein, and cancels all previous agreements (oral and written),

 

 

negotiations and discussions, dealing with the same subject matter.  The parties, from time to time during the term of this Master Agreement, may modify any of the provisions hereof only by an instrument in writing duly executed by the parties.

 

20.4                           References to any Schedule, Appendix, Attachment or Exhibit attached to this Master Agreement or any Work Order shall be deemed to incorporate the entire contents of the Schedule, Appendix, Attachment or Exhibit by reference, as if it were fully set forth in the Master Agreement or Work Order to which it is attached.

 

20.5                           No failure or delay on the part of a party in either exercising or enforcing any right under this Master Agreement or any Work Order will operate as a waiver of, or impair, any such right.  No single or partial exercise or enforcement of any such right will preclude any other or further exercise or enforcement thereof or the exercise or enforcement of any other right.  No waiver of any such right will have effect unless given in a signed writing.  No waiver of any such right will be deemed a waiver of any other right.

 

20.6                           If any part or parts of this Master Agreement or a Work Order are held to be illegal, void or ineffective, the remaining portions of the Master Agreement or Work Order shall remain in full force and effect.  If any of the terms or provisions are in conflict with any applicable statute or rule of law, then such term(s) or provision(s) shall be deemed inoperative to the extent that they may conflict therewith, and shall be deemed to be modified or conformed with such statute or rule of law.  In the event of any ambiguity respecting any term or terms hereof, the parties agree to construe and interpret such ambiguity in good faith in such a way as is appropriate to ensure its enforceability and viability.  Neither party shall assert against the other that the compensation arrangement provided in this Master Agreement or any Work Order is ground for voiding the Master Agreement or Work Order, or rendering the same unenforceable.

 

20.7                           The headings contained in this Master Agreement and any Work Order are used only as a matter of convenience, and in no way define, limit, construe or describe the scope or intent of any section of this Master Agreement or such Work Order.

 

21.                               Execution in Counterparts

 

21.1                           This Master Agreement may be executed in any number of counterparts, each of which when executed and delivered, shall constitute an original, but all of which together shall constitute one agreement binding on all parties, notwithstanding that all parties are not signatories to the same counterpart.

 

21.2                           Transmission by fax or by electronic mail in portable document format (pdf) of an executed counterpart of this Master Agreement shall be deemed to constitute due and sufficient delivery of such counterpart. The parties shall deliver to each other an original counterpart of this Master Agreement promptly after delivery by fax or electronic mail provided however, that failure by either party to so deliver an original counterpart shall not affect the sufficiency of a fax or electronic mail of such counterpart as provided in the

 

 

first sentence of this paragraph.

 

IN WITNESS WHEREOF, this Master Agreement has been executed by the parties hereto through their duly authorized officers on the date(s) set forth below.

 

 

	
QUINTILES   COMMERCIAL US, INC.
    	
 
    	
PACIRA 
    
	
PHARMACEUTICALS
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:   
    	
/s/   Daryl Gaugler
    	
 
    	
By:   
    	
/s/   David Stack
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name:
    	
Daryl   Gaugler
    	
 
    	
Name:   
    	
David   Stack
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:   
    	
Sr.   VP. Head of
    	
 
    	
Title:   
    	
CEO   and President
    
	
North   America Commercial Solutions
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
Date:
    	
August 30,   2011
    
						

 

 

Exhibit A to Master Service Agreement

 

Employee Acknowledgement Form

 

ACKNOWLEDGMENT OF STATUS

 

 

I hereby expressly acknowledge that I am not an employee of Pacira Pharmaceuticals Inc. (“Pacira”) or any of its affiliates, and that I am not subject to day-to-day direction, control or supervision of Pacira or any of its affiliates, or any agent, representative or employee of Pacira or its affiliates, in carrying out this work assignment.

 

I further acknowledge that I am an employee of Quintiles, and that I am subject to day-to-day direction, control and supervision of Quintiles, in carrying out this work assignment.  I understand that any problems or complaints that I may have regarding this work assignment must be directed to my supervisor at Quintiles, and not to Pacira or any of its affiliates, or any agent, representative or employee of Pacira or its affiliates.

 

I also acknowledge that I am not eligible to participate in any benefit plans of Pacira or any of its affiliates, including such things as medical benefits, life insurance benefits, pension benefits and stock options.  I further acknowledge that I am not eligible to participate in any such benefit plans even if it is later determined that my status was that of an employee of Pacira or any of its affiliates during the period of this work assignment.

 

I HEREBY EXPRESSLY WAIVE ANY CLAIM FOR PARTICIPATION IN ANY BENEFIT PLANS OF PACIRA OR ANY OF ITS AFFILIATES ATTRIBUTABLE TO THE PERIOD OF THIS WORK ASSIGNMENT.

 

 

	
 
    	
 
    
	
Print   Name
    	
 
    

 

 

	
 
    	
 
    
	
Signature
    	
 
    

 

 

	
 
    	
 
    
	
Date
    	
 
    

 

 

SALES FORCE WORK ORDER # 6508

 

This Sales Force Work Order is entered into between Pacira Pharmaceuticals and Quintiles Commercial US, Inc. (“Quintiles”), pursuant to the Master Services Agreement, having an Effective Date as of the date signed by Pacira (“Effective Date”) , between Pacira and Quintiles, and is subject to all the terms and conditions set forth therein, except as may be otherwise expressly provided herein.

 

A.                                    BRIEF DESCRIPTION OF SALES FORCE PROJECT:

 

Quintiles is providing an initial total of 63 Sales Representatives, 6 Regional Managers, and 1 Project Leader, with an optional plan for expansion targeted for the third Calendar Quarter in 2012 in support of EXPAREL a long-acting bupivacaine (anesthetic/ analgesic) product for postsurgical pain management. This sales team will be calling on hospitals and key pain specialists and surgeons as this analgesic is used for post-surgical pain control.  Subject to the termination provisions herein and in the Master Services Agreement, the number of Sales Representatives and Regional Managers may vary at Pacira’s discretion.

 

B.                                    PROJECT TEAMS:

 

	
Pacira
    	
contact:
    	
Taunia   Markvicka, VP Commercial Development
    
	
 
    	
address:
    	
Pacira   Pharmaceuticals
    
	
 
    	
 
    	
5   Sylvan Way
    
	
 
    	
 
    	
Parsippany   NJ 07054
    
	
 
    	
phone:
    	
973-254-3565
    
	
 
    	
 
    	
 
    
	
Quintiles Contact Person:
    	
Joseph   F. Chirillo Sr. VP of Commercialization
    
	
 
    	
 
    	
Strategic   and Risk-Based Business
    
	
 
    	
address:
    	
Quintiles   Commercial US, Inc.
    
	
 
    	
 
    	
10   Waterview Blvd.
    
	
 
    	
 
    	
Parsippany,   NJ 07054
    
	
 
    	
phone:
    	
215-396-8344
    

 

Routine correspondence relevant to the operation of the sales force should be sent to the above-named contact persons.  All notices or similar communications in regard to the terms or a change of terms of this Work Order are to be sent to the parties named in the Master Services Agreement -  Section 16. Notices.

 

C.                                    PROJECT TERM AND KEY DATES:

 

	
Project   Start Date
    	
 
    	
Effective   Date
    
	
Project   Leader Start Date
    	
 
    	
ASAP   after Effective Date
    
	
Regional   Manager Start Date
    	
 
    	
[**]
    

 

 

	
Sales   Representative Start Date
    	
 
    	
[**]
    
	
Initial   Classroom Training Dates
    	
 
    	
[**]
    
	
Last   Sales Representative Field Day
    	
 
    	
[**]
    
	
Last   Regional Manager Day/Project End Date
    	
 
    	
[**]
    

 

“Project Term” shall mean the period of time beginning on the Project Start Date and ending on the Project End Date.   This Work Order shall renew automatically for successive one year terms, unless terminated by either party within sixty (60) days prior to the Project End Date.  Upon each such renewal, the Project End Date will be advanced one full year.  Any increases or reductions in Daily Fees and other fees due to Quintiles shall be mutually agreed to between Pacira and Quintiles.

 

D.                                    DEFINITIONS

 

1.                                       “Daily Fee” shall mean the applicable fee due Quintiles for each Day Worked.

 

2.                                       “Day Worked” shall mean a day of service during which a Sales Representative details Prescribers, or attends scheduled company training and/or specifically designated home study.  A “Day Worked” by a Regional Manager shall mean a day during which the Regional Manager performs duties and responsibilities described in the Work Order.  Days Worked shall not include days on leave, holidays, sick days or vacations.

 

3.                                       “Detail” shall mean an interactive face-to-face contact by a Sales Representative with a Prescriber or the Prescriber’s legally empowered designee, during which a promotional message involving the Product is given in accordance with the Promotional Program.  When used as a verb, “detail,” “details” and “detailed” shall mean to engage in a Detail as defined herein.

 

4.                                       “Prescriber” shall mean physicians and other health care professionals legally authorized to write prescriptions for pharmaceutical products.

 

5.                                       “Product” shall mean the Pacira pharmaceutical products specifically identified in the Work Order or any other product whose promotion and detailing is assigned to Quintiles by mutual agreement with Pacira.

 

6.                                       “Promotional Expense Budget” shall mean the funding and guidelines for use of such funding that are provided by Pacira for use by the Sales Force when detailing Product.

 

7.                                       “Promotional Material” shall mean the Product labeling and package inserts, sales aids and detailing materials, and other promotional support items provided by Pacira to Quintiles, for use in promotion of the Product.

 

 

8.             “Promotional Program” shall mean the marketing plan, strategy and promotional message for the Product, which will include use of the Promotional Material and the Promotional Expense Budget.

 

9.             “Qualified Candidate” shall mean a candidate for inclusion on the Sales Force that meets the Sales Force Qualifications set forth in Section E(3) of this Work Order.

 

10.           “Sales Force” shall mean the Sales Representatives, Regional Managers and Project Leader, individually and as a group, that have been assigned to deliver Details of the Product in accordance with the terms of this Work Order.

 

11.           “Sales Representative” shall mean a Quintiles employee who has been trained and equipped to detail Prescribers.

 

12.           “Target Prescriber” shall mean one of the specifically identified Prescribers within a Sales Representative’s territory to be detailed by the Sales Representative.

 

13.           “Territory” shall mean the United States and Puerto Rico.  In connection with an individual Sales Representative, the territory shall be the geographic area assigned to the individual Sales Representative.

 

E.             QUINTILES RIGHTS, RESPONSIBILITIES AND OBLIGATIONS

 

1.             Sales Force.  The Sales Force will initially be composed of the following Quintiles employees:

 

	
Number
    	
 
    	
Position Title
    
	
63
    	
 
    	
Sales   Representatives
    
	
6
    	
 
    	
Regional   Managers
    
	
1
    	
 
    	
Project   Leader
    

 

Pacira Pharmaceuticals may request that Quintiles provide additional Sales Force Personnel by submitting a written request in substantially the form attached hereto as Exhibit 1 (“Additional Personnel Request Form”).  As the total number of Sales Representatives increases for the Sales Force, additional Regional Managers may also be increased in order to maintain a mutually agreed upon number of Regional Managers.

 

2.             Recruitment.  Quintiles shall be responsible for recruitment and re-recruitment (replacement) of the Sales Representatives and Regional Managers in accordance with the Sales Force Qualifications described below.  Quintiles shall obtain all appropriate background checks and drug screens.  Quintiles shall provide an average of three Qualified Candidates per Sales Force position.  If Pacira elects to participate in the final selection of members of the Sales Force, Pacira shall approve or disapprove qualified candidates within five (5) business days after the Qualified Candidates are submitted to Pacira for final selection.  Absent such approval or disapproval from Pacira, Quintiles

 

 

shall select from the final Qualified Candidates.  If Pacira rejects three Qualified Candidates for a territory, Pacira shall reimburse Quintiles for any costs incurred in sourcing additional qualified candidates until the territory is filled.  For candidates that Pacira has identified to Quintiles, Quintiles agrees to credit the recruiting fee with respect to such candidates, and charge Pacira only for those costs incurred in connection with the actual employment of the candidate.

 

3.             Sales Force Qualifications. Quintiles will exercise its best commercial efforts to recruit from a diverse candidate base. A qualified candidate for Sales Representatives shall meet the following minimum qualifications: four-year college degree (B.A., B.S. or equivalent); minimum 2 years outside sales experience, 3 years pharmaceutical experience and at least 1 year of hospital experience.  A qualified candidate for Regional Manager  shall meet the following minimum qualifications: four-year college degree (B.A., B.S. or equivalent); minimum 2 years outside sales experience, minimum one year previous management experience and have hospital experience.  Pacira may provide a target list to Quintiles to support the recruitment. In such event, Quintiles shall use its best commercial efforts to identify qualified candidates from such list and recruit such qualified candidates.

 

4.             Position Descriptions and Duties.  Quintiles shall manage, supervise and evaluate the performance of the Project Leader, Regional Managers and Sales Representatives in accordance with the responsibilities and duties identified below.  All Sales Force employees shall demonstrate the following: work ethic and integrity; planning, organizing and territory management skills; strong interpersonal skills; excellent communication skills; critical thinking and analysis; problem solving; decisiveness; sound judgment; customer-focused selling skills; basic computer skills; ability to listen and learn.

 

Sales Representatives

·      Generate sales in line with assigned territory quota

·      Maintain and update current and prospective target physician profiles

·      Keep current with market knowledge and competitive products

·      Maintain a professional image for Pacira and Pacira Products

·      Participate in all training and sales meetings

·      Plan and organize territory to meet sales and call targets

·      Make sales presentations (details) — individual, one-on-one, in-services

·      Make complete, accurate and timely submission of all time-keeping, call activity, sample activity and expense reports

·      Compliance with Promotional Program, and proper use of Promotional Materials and Promotional Expense Budgets

·      Participate or coordinate Lunch & Learns, dinner programs, weekend events, as appropriate

 

 

·      Have appropriate interaction with co-promotional partners or counterparts

·      Ability to comply with credentialing requirements

 

Project Leader

·      Recruit, interview and select Sales Representatives (and subordinate managers)

·      Handle 180 day and annual performance review, personnel issues, discipline and termination of (Sales Representatives and) subordinate managers

·      Generate sales in line with project TRX goals

·      Acts as the primary link between the Pacira and Quintiles for all operational and HR needs

·      Prepare monthly reports to Pacira, as required by the terms of this Work Order.

·      Make regular field visits: to develop and motivate Sales Representatives for attainment of sales objectives; to assess and monitor field activity and work schedules; to monitor and manage field reporting by Sales Representatives, including call and sample reporting.

·      Assist with the planning and delivery of training, and periodic sales meetings

·      Review and approve expense reports; monitor compliance with expense policies.

·      Monitors compliance with Promotional Program, and proper use of Promotional Materials and Promotional Expense Budgets

·      Monitors compliance with PDMA and sample accountability procedures

·      Monitors time-keeping and attendance

 

Project Leaders, Regional Managers

·      Recruit, interview and select Sales Representatives and subordinate managers

·      Handle 180 day and annual performance review, personnel issues, discipline and termination of Sales Representatives and subordinate managers

·      Generate sales in line with project TRX goals

·      Regional Managers shall make regular field visits: to develop and motivate Sales Representatives for attainment of sales objectives; to assess and monitor field activity and work schedules; to monitor and manage field reporting by Sales Representatives, including call and sample reporting.

·      Communicate with Pacira field/regional managers on regular and timely basis

·      Assist with the planning and delivery of training, and periodic sales meetings

·      Review and approve expense reports; monitor compliance with expense policies.

·      Monitors compliance with Promotional Program, and proper use of Promotional Materials and Promotional Expense Budgets

·      Monitors time-keeping and attendance

 

5.             Sales Force Compensation; Benefits. Quintiles shall compensate the Sales Force employees with a combination of salary and variable incentive (bonus).  Bonuses and other incentives shall not be included in the Daily Fee.   Quintiles shall establish a target average salary and salary matrix, which recognizes greater experience and training, and

 

 

preferred selection criteria.  The terms and conditions of a variable incentive compensation plan (“Incentive Plan”) shall be mutually determined by Quintiles and Pacira, including eligibility criteria and performance targets.  The plan may also include incentive awards such as trips and prizes.  Quintiles shall administer the Incentive Plan, determine eligibility and pay the incentive compensation and awards, in accordance with the Incentive Plan. Sales Force employees shall be eligible to receive an auto allowance, and shall be entitled to participate in the Quintiles employee benefit plans for health and dental care, and 401k, all in accordance with company eligibility criteria.

 

6.             Pacira Training and Periodic Sales Meetings.  Quintiles shall facilitate the participation of the Sales Force in Pacira’s initial sales training, backfill training of replacements for Regional Managers and Sales Representatives and all follow-up training, including periodic sales meetings.  Pacira may request Quintiles’s participation in the delivery of training and Quintiles will provide such services on a time and materials basis as the parties may agree in a written amendment to this Work Order.  In all cases, Quintiles shall monitor and observe all Pacira training.  Quintiles may have Sales Force Members participate in the Quintiles LEAD(1) and LEAD(2) Leadership Education and Development Programs.

 

7.             Sales Force Development Training.  Quintiles shall provide the Sales Force with the following training.  For experienced managers, the training may need to be adapted or revised.

 

·    Manager Development Training Phase 1 (Home Study)

 

	
Home Study Modules
    
	
 
    
	
DDI   Targeted Selection
    
	
DDI   Certification
    
	
Taleo   Training
    
	
Fleet   Safety Training
    
	
PeopleSoft   Time and Labor
    
	
Concur
    
	
IDEALS   Overview
    
	
Pacira   Product / Disease State Backgrounders
    
	
Progressive   Discipline
    
	
Regulatory   Agency Searches & Inspection
    
	
Adverse   Drug Reaction Reporting
    
	
Benefits   Overview
    
	
PeopleSoft   Direct Access for Managers
    
	
Co-Employment
    
	
It’s   All About Respect
    
	
Culture   of Compliance
    
	
Global   Privacy Awareness
    
	
Professional   Skills
    
	
HIPAA
    

 

 

	
Business   Ethics
    
	
Conflict   of Interest
    

 

·    Manager Development Training Phase 2 (Classroom)

 

	
Classroom Modules
    
	
 
    
	
Quintiles   Overview
    
	
Pacira   Company Overview
    
	
Project   Lead Expectations and Project Metrics
    
	
The   Manager’s Role
    
	
Setting   Region / Team Expectations
    
	
Pacira   Product / Disease Review (Optional)
    
	
Pacira   Marketing Overview (Optional)
    
	
HR   Forum & Generations at Work
    
	
Benefits   Review (Optional)
    
	
IDEALS   Overview
    
	
Building   Trust
    
	
Motivating   Others
    
	
iCoach   including Role Plays
    
	
iCoach   certification
    
	
Field   Administration (including close out process)
    
	
Innsight   Field Contact Report and Coaching System
    
	
Train-the-Trainer   for launch meeting
    

 

·    Rep Initial Development Training (Home Study)

 

	
Home Study Modules
    
	
 
    
	
Fleet   Safety Training
    
	
PeopleSoft   Time and Labor
    
	
Concur-Expense   Field Employee Training
    
	
IDEALS   Overview
    
	
Pacira   Product / Disease State Backgrounders
    
	
 
    
	
Regulatory   Agency Searches & Inspection
    
	
Adverse   Drug Reaction Reporting
    
	
Benefits   Overview
    
	
PeopleSoft   HR Employee Direct Access
    
	
Sample   Accountability
    
	
It’s   All About Respect
    
	
Culture   of Compliance
    
	
Global   Privacy Awareness
    
	
Good   Promotional Practices
    
	
HIPAA
    
	
Business   Ethics at Quintiles
    

 

 

	
Conflict   of Interest Management
    
	
Professional   Skills
    

 

·    Rep Initial Development Training (Classroom)

 

	
Classroom Modules
    
	
 
    
	
Quintiles   Overview & Expectations
    
	
Pacira   Company Overview
    
	
Corporate   Compliance
    
	
Good   Promotional Practices
    
	
It’s   All About Respect
    
	
HIPAA
    
	
Field   Administration
    
	
Fleet   Administration
    
	
 
    
	
Sample   Accountability
    
	
PI &   Competition
    
	
Pacira   Product / Disease Review (Optional)
    
	
Pacira   Marketing Overview (Optional)
    
	
Adverse   Event (Pharmacovigilance)
    
	
SFA
    
	
IDEALS   Overview
    
	
Objection   Workshop
    
	
Clinical   Reprint
    
	
Role Plays- Vis Aid tour, practice sessions etc
    
	
Role-Play   Certification
    
	
Train-the-Trainer   for launch meeting
    

 

·    Quintiles Learning Management System (Learning Curve) Access

 

·    Custom Training Module Development

 

At the request of Pacira, Quintiles will customize existing therapeutic training materials or create new training materials for Pacira’s products and therapy areas.  These training modules may come from a variety of existing or market available resources, or be developed to Pacira’s specifications from scratch.  The cost of this customization or development will be conveyed to Pacira in a written estimate with work commencing upon the execution of a written amendment to this Work Order.

 

8.             Promotional Activities.  Quintiles shall be responsible for managing and monitoring the promotional activities of the Sales Force, in strict adherence to the Promotional Program and using only the Promotional Materials provided by Pacira and in accordance with all applicable laws, rules and regulations. Sales Representatives shall not be permitted to develop, create or use any other promotional material or literature in connection with the

 

 

promotion of the Product.  The Sales Representatives will be required to immediately cease the use of any Promotional Materials when instructed to do so by Pacira.  Quintiles shall monitor that Promotional Materials are not changed, (including, without limitation, by underlining or otherwise highlighting any text or graphics or adding any notes thereto) by the Sales Representatives.  Sales Representatives shall be required to limit their statements and claims regarding the Product, including as to efficacy and safety, to those which are consistent with the Product labels, package inserts and Promotional Materials.  The Sales Representatives shall not be permitted to add, delete or modify claims of the efficacy or safety in the promotion of the Product, nor shall the Sales Representatives be permitted to make any untrue or misleading statements or comments about the Products or any Pacira competitors or competitor products.

 

9.             Monthly Reporting.  Quintiles and Pacira will agree on a monthly project summary report, the content to be agreed upon by both parties.

 

10.           Reporting by Sales Representatives.  Sales Representatives shall be required to report all field activities and expenditures in a manner that is timely, accurate and honest, and in accordance with policies and procedures for the applicable reporting systems.  Quintiles Regional Managers shall routinely reinforce the importance of compliance with the reporting guidelines and policies (e.g. sample accountability, call reporting, promotional budget expenditures, travel expenses).  Newly hired Sales Representatives shall receive training on the reporting systems, guidelines and policies during the initial sales training program

 

11.           Management and Discipline of the Sales Force.  Quintiles shall be responsible to manage the Sales Force.  Quintiles has sole authority to remove employees from the Sales Force.  In conformance with Quintiles policy, Quintiles shall provide appropriate employee counseling and discipline, up to and including termination, to Sales Force members who violate employment rules and who are otherwise under performing their job responsibilities.  Quintiles will promptly follow-up on any reports made by Pacira of Sales Force member non-compliance and will apply such counseling or discipline as may be warranted in Quintiles’ sole judgment.

 

F.             PACIRA RIGHTS, RESPONSIBILITIES AND OBLIGATIONS

 

1.             Promotional Program and Promotional Materials.  Pacira shall be responsible for providing a Promotional Program, Promotional Materials and Promotional Expense Budget that (i) will not involve the counseling or promotion of a business arrangement that violates federal or state law; (ii) will be in compliance with the PhRMA Code on Interactions with Healthcare Providers and the Compliance Program Guidance for Pharmaceutical Manufacturers developed by the United States Department of Health and Human Services Office of the Inspector General; and (iii) shall not require or encourage the Sales Representatives to offer, pay, solicit or receive any remuneration from or to Prescribers to induce referrals or purchase of Pacira Product.  Pacira shall be responsible for providing written guidelines for proper use of the Pacira’s Promotional Expense Budget.

 

 

2.             Training and Periodic Sales Meetings.

Pacira shall be responsible for the following:

·      Programming, materials and facilities for initial Sales Force training. The initial training agenda shall include one day designated for Quintiles training regarding personnel management, compensation and benefits and field administration and 1 day of SFA training

·      Programming, materials and facilities for periodic sales meetings or product launch meetings as designated by Pacira.

 

3.             Sales Data.  Pacira shall be solely responsible for obtaining historic and ongoing sales data regarding Pacira Products.   Pacira shall be solely responsible to pay any applicable fee required by any third party, including, but not limited to, any per rep fee imposed by the American Medical Association or any third party charge from IMS Health, SDI, or other third party data provider for support and services.

 

4.             Productivity Reports.  Every month, Pacira shall provide Quintiles with the data Pacira receives from its third party logistics provider to produce productivity reports for the Sales Force in order to calculate bonuses, evaluate performance, and any other mutually agreed purposes, including but not limited to, (i) Actual purchases or DDD sales data by territory, region, and nation; and (ii) Early view by territory.   Pacira shall make all reasonable efforts to deliver to Quintiles the data with the same frequency and with the same speed as such are received and distributed by Pacira with regard to their own sales forces.

 

5.             Business Cards; Detail bags.  Quintiles shall supply the Sales Force with business cards, the content of which shall be subject to approval by Pacira, such approval not to be unreasonably withheld.  Quintiles shall supply the Sales Force with detail bags at Pacira’s expense

 

6.             Reimbursable Expenses.  Pacira shall be responsible to reimburse Quintiles for the following expenses in accordance with the expense budget agreed upon by the parties, when necessary and actually incurred by Quintiles in support of the Project:

·      Travel expenses in association with recruitment

·      Travel expenses in connection with all training and periodic sales meetings

·      Travel expenses in connection with field management and audits in the territories

·      Spends made pursuant to the Promotional Program

·      Costs arising from field representative licensure or reporting requirements.

 

7.             No Recruitment. Subject to Section G.2 below, through the Project End Date, and for one year thereafter, neither Pacira nor Quintiles shall attempt to actively recruit or solicit any personnel from the other Party without the prior written consent of such other Party; provided that, notwithstanding the foregoing, each Party shall be permitted to engage in general recruitment through advertisements or recruiting through head-hunters so long as the other Party’s employees and personnel are not specifically targeted.

 

 

G.            FEES AND PASS-THROUGH EXPENSES

 

1.             All relevant fees and pass-through expenses are set forth in more detail on Attachment B, attached hereto.  In the event of any inconsistency between this paragraph G and Attachment B, Attachment B shall govern.

 

2.             Daily Fees.  Pacira shall pay Quintiles a Daily Fee for each Day Worked by Sales Representatives and Regional Managers during the Project Term and thereafter if required for Project close-out.  The Daily Fees and total estimated Daily Fees during the Project Term are stated in the following table, and are also set forth on Attachment B:

 

	
 
    	
 
    	
Number
    	
 
    	
Daily Fee
    	
 
    	
Estimated Days
   Worked
    	
 
    	
Estimated Total
   Days Worked
    	
 
    	
Estimated Total
   Fees
    
	
Sales   Representatives
    	
 
    	
63
    	
 
    	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
Regional   Managers
    	
 
    	
6
    	
 
    	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
Project   Leaders
    	
 
    	
1
    	
 
    	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Estimated   Total Fees
    	
 
    	
 
    	
 
    	
[**]
    

 

3.             Pass-Through Expenses.  Pacira shall play Quintiles for Pass-Through expenses as incurred.  Estimated Pass-Through expenses are set forth on Attachment B.

 

4.             Incentive Plan Administration. Pacira shall pay Quintiles an amount equal to (i) the amount of all non-salary compensation earned by Sales Force members in accordance with the terms of the Incentive Plan or otherwise requested by Pacira; and (ii) an amount equal to [**]% of such compensation for Quintiles’s employer costs (payroll taxes, benefits), as further set forth on Attachment B.

 

5.             Training Fee.  For the Quintiles training services as described in Paragraph E(7) of this Work Order, Pacira shall pay Quintiles a fee of $ [**].  Further details regarding the training services and associated fees are set forth on Attachment B.  The training fees shall be invoiced by Quintiles immediately following the conclusion of the initial Sales Force training program.

 

6.             Promotional Fees.  A promotional budget is to be determined by Pacira, in its sole reasonable discretion.

 

7.             Recruiting/Backfill Recruiting Fees.  For every Sales Representative, Regional Manager or Project Leader placed onto the project by Quintiles initially or on backfill, Pacira shall pay Quintiles a Recruiting Fee of $[**], respectively, as further set forth on Attachment B.  No Recruiting Fee shall be due if Pacira identified such Sales Representative, Regional Manager, or Project Leader as a target to Quintiles.  During the Project Term, and notwithstanding the backfill actually required, Pacira shall only be responsible for Replacement Recruiting Fees for up to [**] percent ([**]%) of the initial personnel set

 

 

forth on the table in Section G.1 of this Work Order.  Replacement Recruiting Fees for any backfill exceeding [**]% of such initial personnel shall be waived by Quintiles.  Estimated Recruiting / Backfill Recruiting Fees are set forth on Attachment B

 

8.             SFA Fees.  Pacira shall pay the following fees in connection with SFA, as further set forth on Attachment B: (a) an immediate payment of $[**] for start-up and deployment; and (b) a monthly SFA services fee in the amount of $ [**] for computers, licenses and other items listed in Attachment C.  In the event that any equipment or IT hardware (including, without limitation, laptops and mobile devices) are purchased for the Project and the cost for such equipment and hardware invoiced to and paid by Pacira, such equipment and hardware shall, at Pacira’s option, become the property of Pacira; in the event any equipment and/or hardware is not paid in full as of the Project End Date, and Pacira wishes to retain such property, Pacira will be required to pay to Quintiles any amounts remaining on the equipment lease or the asset value, based upon straight-line depreciation of the equipment and/or hardware, as more fully described in Attachment D hereto.

 

9.             Dollars at Risk.  Once Net Product Sales as recognized by Pacira have reached $30 million, Pacira will pay Quintiles $[**] for each additional million in Net Product Sales (the “Risk Payment”), up until Net Product Sales have reached $[**], as follows:

 

	
Product Sales
    	
 
    	
Quintiles
   Payment
    	
 
    	
Cumulative
   Payment to
   Quintiles
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    	
 
    	
 
    

 

In addition, in the event that at any time during the Project Term the Pacira Products are subject to back order or stock out or are generally unavailable for distribution for any cause not attributable to Quintiles or a Force Majeure event (“Shortage”), Pacira shall provide Quintiles with notice of such Shortage.  If a Shortage shall occur, the length of time during which there is a Shortage shall be added onto the Project End Date solely for

 

 

purposes of calculating the Risk Payment set forth herein.  (By way of example, if there is a Shortage that lasts thirty (30) days, then the Project End Date shall be extended for a period of thirty (30) days solely for purposes of calculating the Risk Payment which may be due hereunder).

 

10.                                 Payment Schedule.  Quintiles shall invoice Pacira monthly for all Fees, Take-on Fees and Pass-Through Expenses, as further set forth on Attachment B.  At the end of each calendar month Quintiles shall provide Pacira a list of the billable Sales Force personnel and the total number of Days Worked multiplied by the respective Daily Fee rate.  Quintiles shall invoice Pacira in advance for all incentive compensation and related employer costs, and the incentive compensation shall be paid to the Quintiles Personnel by Quintiles only after Pacira pays to Quintiles the amount of the applicable incentive compensation invoices.

 

11.                                 Early Termination.  Pursuant to the terms of the Master Agreement, this Work Order may be terminated by Pacira by providing Quintiles with sixty (60) days’ prior written notice of its intent to terminate.  Throughout the notice period, the terms and conditions of this Work Order shall remain in full force and effect and Pacira will continue to be responsible for all Fees and Pass-through Expenses that are payable in accordance with Section 11.5 of the Master Services Agreement, as well as any non-cancelable obligations incurred in accordance with the terms of this Work Order, net of recoveries (e.g. cancellation fees) with respect to the canceled territories.  For avoidance of doubt, unless Pacira provides written instruction otherwise, Quintiles shall continue to fully perform its obligations under this Work Order during the foregoing sixty (60) day notice period.

 

12.                                 Changes in Scope; Additional Services.  All prices and costs contained in this Work Order are subject to mutually agreed revision as needed to reflect changes in the scope of services being provided by Quintiles.  Additional services will be provided at Quintiles’s normal and customary rates, subject to the prior written approval of Pacira.  No change or amendment to this Work Order shall be effective without the prior written approval of both Parties.

 

13.                                 Expense Allocation Chart.  The financial responsibility of Quintiles and Pacira for expenses and costs of Sales Force operation shall be allocated in accordance with the terms of this Work Order, which are summarized for illustrative purposes in the “Sales Force Expense Allocation” chart (Attachment A).

 

14.                                 Sales Force Roll Over.

 

a.               Pacira may hire any members of the Sales Force prior to or contemporaneously with the Project End Date by providing Quintiles sixty (60) days prior notice.  .

 

b.              End of Term.  In order to protect the integrity of future sales teams to which Quintiles field employees may be assigned, in the event Pacira does not hire members of the Sales Force as provided in Section G 14(a) above, for one year after the end of the Project Term, Pacira may not directly solicit or recruit

 

 

any Sales Force member who remains employed by Quintiles following the Project End Date to work for Pacira.  In the event Pacira breaches this obligation, , Pacira shall be liable to Quintiles in the amount $50,000 for each Sales Force member solicited or recruited. The restriction in this Section G 14(b) shall not apply to any solicitation directed at the general public in publications available to the general public.

 

H.                                    ADDITIONAL TERMS

 

1.                                       Steering Committee.  Pacira shall make all decisions with respect to the strategy and resources for the marketing and promotion of the Products.  However, other issues may arise under the terms of this Work Order or between the parties while operating under this Work Order which are appropriate for consultation between the parties to ensure maximum productivity of the Sales Force, including, but not limited to, the establishment of work rules or the response to greater than expected Sales Force turnover and other changing market conditions.  The parties shall, therefore, establish a Steering Committee, chaired by Pacira and consisting of up to three (3) members from each party.  The chairperson’s duties shall include site selection, logistics, agenda and facilitation; provided however, that a Quintiles Committee member may submit agenda items to the Chair and such items shall be included in the next regular meeting of the Steering Committee.  Each member of the Committee shall be an employee or member of the Board of Directors of the party that appointed such member.  Initial appointments shall be made within fourteen (14) days of the date of this Work Order.  A member of the Committee may be removed at any time, with or without cause, Work Order by the party that appointed such member.  The Committee shall meet each quarter, or otherwise at the call of the chairperson to review, coordinate, and discuss issues regarding the Promotional Program.  In addition, the Committee shall review and resolve issues pertaining to this Work Order.  The members of the Committee will use reasonable efforts to reach consensus on all decisions.

 

In Witness Whereof, Pacira and Quintiles have caused this Work Order # 6508 to be duly executed on their behalf by their authorized representatives and made effective as of Effective Date of Work Order appearing above.

 

 

Accepted and Agreed to by:

 

 

	
QUINTILES COMMERCIAL US, INC.
    	
 
    	
PACIRA PHARMACEUTICALS
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/   Daryl Gaugler
    	
 
    	
/s/   David Stack
    
	
By:   By: Daryl Gaugler
    	
 
    	
By:   David Stack
    
	
Title:   Title: Sr. VP of Commercialization
    	
 
    	
Title:   CEO and President
    
	
Date:
    	
 
    	
 
    	
Date:
    	
August 30,   2011
    
					

 

 

Attachment A to Sales Force Work Order

SALES FORCE EXPENSE ALLOCATION

 

DATE

 

Project # 6508

 

	
Category
    	
 
    	
Included in
   Daily Fee
    	
 
    	
Additional
   Fee Due
   Quintiles
    	
 
    	
Pass-
   Through
   Expenses
    	
 
    	
Pacira
   Direct
   Expenses
    
	
Salary,   including payroll taxes, for Sales Representatives, Regional Managers,   Project Leader
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Incentive   compensation (bonus) for Sales Representatives, including payroll taxes
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    
	
Benefits   package, including (401k), medical, dental, Rx, vacation, holidays
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Auto   Costs in territory, including monthly allowance, mileage reimbursement,   parking and tolls.
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Basic   Business Expenses in territory, including phone, paper supplies, postage and   voice mail.
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Business   Cards & Detail Bags
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    
	
Call   Reporting & Sample Accountability
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    
	
Computers   for Sales Representatives, including software, helpdesk support,   data/replication lines
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    
	
Computers   for DMs, RSMs, NSM, including software, helpdesk support, data/replication   lines
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    
	
IMS   Third Party Charges
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    
	
Infrastructure   support (operations, HR, finance, legal)
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Liability   Insurance: employment, workers comp, E & O, CGL, auto
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Initial   recruitment, includes drug screens, background and motor vehicle checks
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    
	
Backfill   recruitment, includes drug screens, background and motor vehicle checks
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    
	
Meetings:   Pacira national and regional meetings; product launches
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    
	
Promotional   Expense Budget (access money)
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    
	
Promotional   Program and Promotional Materials (sales aids)
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    
	
Promotional   marketing expenses, including sales data
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    
	
Training   program, materials and facilities; initial and follow-up
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    
	
Quintiles   core curriculum training program, materials and facilities
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    
	
Field   Sales Licensure or Reporting Expenses
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    	
 
    	
 
    
	
Travel   Expenses (air, hotel, meals, T&E)
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    
	
Licensing   and Credentialing
    	
 
    	
 
    	
 
    	
 
    	
 
    	
X
    	
 
    	
 
    

 

 

Attachment B to Sales Force Work Order

 

	
Full Time   Representatives
    	
 
    	
63
    	
 
    
	
District   Managers
    	
 
    	
6
    	
 
    
	
Project   Leader
    	
 
    	
1
    	
]
    

 

DIRECT COSTS (IN DAILY RATE)

 

	
COMPENSATION
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Representatives Compensation & Benefits
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Salary
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Benefits/Taxes
    	
 
    	
$
    	
[**]
    	
 
    
	
District Manager Compensation & Benefits
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Salary
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Benefits/Taxes
    	
 
    	
$
    	
[**]
    	
 
    
	
PL Compensation & Benefits
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Salary
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Benefits/Taxes
    	
 
    	
$
    	
[**]
    	
 
    
	
Project Coordinator Support
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
Systems and Services Manager
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
Total Compensation
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
EXPENSES
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Rep Field Expenses
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Auto Allowance
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Others
    	
 
    	
$
    	
[**]
    	
 
    
	
DM Field Expenses
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Auto Allowance
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Others
    	
 
    	
$
    	
[**]
    	
 
    
	
PL Field Expenses
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Auto Allowance
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Others
    	
 
    	
$
    	
[**]
    	
 
    
	
Total Expenses
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
Direct Costs Subtotal
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    

 

Assumptions:

 

	
$[**]
    	
annual   salary payroll taxes (FICA, SICA, etc.), medical/dental, life, 401(k),   W/C, EAP
    
	
 
    	
 
    
	
$[**]
    	
annual   salary includes additional months for startup/closeout payroll taxes (FICA,   SICA, etc.), medical/dental, life, 401(k), W/C, EAP
    
	
 
    	
 
    
	
$[**]
    	
annual   salary includes additional months for startup/closeout payroll taxes (FICA,   SICA, etc.), medical/dental, life, 401(k), W/C, EAP Project Coordinator   salary and employment costs SSM salary and employment costs
    
	
 
    	
 
    
	
 
    	
car   + gas + insurance + maintenance
    
	
 
    	
telephone, ISP,   supplies, postage, parking & tolls, voicemail, AMA license
    
	
 
    	
 
    
	
 
    	
car   + gas + insurance + maintenance
    
	
 
    	
telephone, ISP,   supplies, postage, parking & tolls, voicemail
    
	
 
    	
 
    
	
 
    	
car   + gas + insurance + maintenance
    
	
 
    	
telephone, ISP,   supplies, postage, parking & tolls, voicemail
    

 

ADDITIONAL COSTS (NOT IN DAILY RATE)

 

	
RECRUITING
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Initial Recruitment
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Rep
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
DM
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
PL
    	
 
    	
$
    	
[**]
    	
 
    
	
Total Recruitment Costs
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
BONUS
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Target Bonus
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
Rep
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
DM
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
PL
    	
 
    	
$
    	
[**]
    	
 
    
	
Total Bonus
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
TRAINING
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Manager Development Training Phase I - Homestudy
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
Manager Development Training Phase II - Classroom
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
Representative Initial Development Training   (Single Session)
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
SFA Training
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
Quintiles Learning System
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
Total Training Costs
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
SFA/IT
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Startup Costs
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
IT
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
SFA
    	
 
    	
$
    	
[**]
    	
 
    
	
Annual Costs
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
IT
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
SFA
    	
 
    	
$
    	
[**]
    	
 
    
	
Total SFA/IT Costs
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
SAMPLE ACCOUNTABILITY
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
SA Automated Model
    	
 
    	
 
    	
 
    	
$
    	
—
    	
 
    
	
Additional Costs Subtotal
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
SERVICE FEE
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
TOTAL PROJECT COSTS
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    

 

Assumptions:

 

	
$[**]   
    	
per   rep - includes drug screen and reference check
    
	
$[**]   
    	
per   DM - includes drug screen and reference check
    
	
$[**]   
    	
per   PL - includes drug screen and reference check
    
	
 
    	
 
    
	
[**]%
    	
bonus   potential + [**]% tax
    
	
[**]%
    	
bonus   potential + [**]% tax
    
	
[**]%
    	
bonus   potential +[**]% tax
    
	
 
    	
 
    
	
Targeted   Selection Certification, FastTrackSelect Recruiting Model, Field Sales   Administration
    
	
Training   Delivery, Materials
    
	
Training   Development, Training Delivery, Training Account Executive, Materials
    
	
Training   on SFA platform
    
	
Web   based training for home study and on going development
    
	
 
    
	
Extranet hardware, shipping, MS Office/Utilities   setup, set-up and implementation, helpdesk Veeva SFA implementation and setup
    
	
 
    
	
Computers, accessories, printers, shipping, MS   Office/Utilities licenses, system maintenance, helpdesk Veeva SFA license fee
    
	
 
    
	
Reconciliations, inventories, transaction   processing, data entry, reporting compliance
    

 

 

 

Attachment B (cont.) to Sales Force Work Order

Project #6508

 

COSTS TO BE CHARGED AS INCURRED

ESTIMATED BACKFILL RECRUITING

 

	
Backfill Recruiting
    	
 
    	
Rep
    	
 
    	
$
    	
[**]
    	
 
    
	
TRAVEL EXPENSES
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
T/E for recruiting travel
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
T/E to training (Single Session)
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
T/E to meetings
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
T/E to support sales
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
LICENSING & CREDENTIALS
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Licensing & Credentials
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
Total As Incurred Expenses
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Risk Metrics
    	
 
    	
 
    	
 
    	
$
    	
[**]
    	
 
    

 

[**] per rep backfill and[**]%turnover

 

Estimated travel costs for manager and sales rep recruiting

 

Estimated travel, lodging, and meals to classroom training, assumes single training session for entire team

 

Estimated POA meetings: 2two-day meetings

 

Estimated at 1 day per month per Rep @ $[**]per day, [**] days per month per Mgr @ $[**] per day, [**] days per month per PL @ $[**] per day

 

Estimate of $[**] per team member is being included as a pass-through due to a growing industry trend of requiring credentials in order to gain access to a facility.

 

 

Attachment C to Sales Force Work Order

Project #6508

 

Budgeted Project Costs

 

	
 
    	
 
    	
G1
    	
 
    	
G2
    	
 
    	
G3
    	
 
    	
G4
    	
 
    	
G5
    	
 
    	
G6
    	
 
    	
G7
    	
 
    	
G8
    	
 
    	
 
    
	
Section of Work Order
    	
 
    	
 
    	
 
    	
Estimated PT
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Promotional
    	
 
    	
Backfill/Recruiting
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Month
    	
 
    	
Budgeted Labor
    	
 
    	
Costs
    	
 
    	
P/T Bonus
    	
 
    	
Training
    	
 
    	
Funds
    	
 
    	
Estimate
    	
 
    	
IT/CRM
    	
 
    	
Risk
    	
 
    	
Total
    
	
Contract Yr 1
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Jun-11
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    
	
Jul-11
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    
	
Aug-11
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    
	
Sep-11
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Oct-11
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Nov-11
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Dec-11
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Jan-12
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    
	
Feb-12
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Mar-12
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Apr-12
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
May-12
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    
	
Jun-12
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Jul-12
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    
	
Aug-12
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Sep-12
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Oct-12
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Nov-12
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    
	
Dec-12
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    
	
Jan-13
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
-
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
 
    	
 
    	
-
    	
 
    	
 
    	
[**]
    	
 
    
	
Total Budget   contract
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
-
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
[**]
    	
 
    	
 
    	
 
    	
 
    	
 
    	
[**]
    	
 
    

 

 

Attachment D to Sales Force Work Order

Hardware Amortization

Project #6508

 

Pacira IT rollover costs

 

	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Book value per
    	
 
    	
Book value per
    	
 
    
	
 
    	
 
    	
Purchase
    	
 
    	
Monthly
    	
 
    	
unit after [**]
    	
 
    	
unit after [**]
    	
 
    
	
 
    	
 
    	
price per unit
    	
 
    	
amortization*
    	
 
    	
months
    	
 
    	
months
    	
 
    
	
Laptop, CD/DVD, Maintenance Plan
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    
	
Peripherals, AC adapters, printers, carry bag
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Add’l costs per unit to be incurred at time of   purchase
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Shipping Estimate (Pass-through)
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Total cost to purchase including shipping based   on:
    	
 
    	
$
    	
[**]
    	
 
    	
units
    	
 
    	
$
    	
[**]
    	
 
    	
$
    	
[**]
    	
 
    

 

*- Based on [**] month straight line depreciation

Does not include any server, help desk or infrastructure support costs.

 

 

EXHIBIT 1 to Sales Force Work Order

 

ADDITIONAL PERSONNEL REQUEST FORM

 

This Request for Additional Personnel is made pursuant to Master Services Agreement dated as of                between Pacira Pharmaceuticals and Quintiles Commercial US, Inc. (“Quintiles”), and Work Order #6508 Dated                     .

 

	
PART 1
    	
 
    
	
 
    	
 
    
	
Number   and Category of Personnel Requested:
    	
Additional   Fees Required For Each Added Personnel:
    
	
 
    	
 
    
	
o Sales   Representatives
    	
Recruiting   Fee — $
    
	
 
    	
Training   Fee — $
    
	
o Regional   Managers
    	
Estimated   Pass-Throughs — $
    
	
 
    	
Monthly   Incremental Fees : $ (SFA), $
    
	
o Other   (describe):            
    	
(Sample   Accountability), $ (Fleet)
    
	
 
    	
 
    
	
TERRITORY   LOCATION(S)
    	
 
    
	
 
    	
 
    
	
REQUESTED START DATE(S)
    	
 
    
	
 
    	
 
    
	
 
    	
Signature:
    
	
AUTHORIZED   PACIRA REPRESENTATIVE SUBMITTING REQUEST
    	
 
    
	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
Date:
    
	
 
    	
Phone:
    
	
 
    	
Fax:
    
	
 
    	
 
    
	
PART 2
    	
To Be Completed by Quintiles
    
	
 
    	
 
    
	
This   Additional Personnel Request Form was Received by Quintiles on the   following date:
    	
Request   is Accepted, and Recruitment shall begin immediately:
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
(sign   and date)
    
	
 
    	
Contact   Person:
    
	
 
    	
Phone:
    
			

 

 

	
 
    	
Request is Not Accepted (identify above   information which must be clarified or changed before Request may be accepted   by Quintiles):
    
	
 
    
	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
(sign   and date)
    
	
 
    	
Contact   Person:
    
	
 
    	
Phone:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00195-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00195-of-00352.parquet"}]]